Turkey’s construction firms apply for debt restructuring

As debt restructuring applications of capitalist groups are increasing day by day in Turkey, local media reported that Emay construction firm has recently applied to a bank for debt restructuring
Tuesday, 31 July 2018 22:19

Hakan Çağlar, the chairman of the executive board of Emay Construction in Turkey, talked to Bloomberg International on July 31 and he noted that they are negotiating for a debt restructuring with the banks. Çağlar added that their total debt by 2017 is 1,2 billion Turkish liras and that they want to extend the term of some part of this debt.

The increasing costs due to the rise in interest rate and exchange rate, and the decline in house sales created a need to debt restructuring, Çağlar said.

Due to the economic crisis in Turkey, the cost of housing construction has increased by 19.91 percent and that increase is expected to be reflected on house prices by September. The cost index of construction has reached up to the level of 151,21 by April with 23.04 percent annual increase in 2018 compared to 2017.

While Turkey’s capitalist investment groups have been undergoing a hard time to pay their debts to the banks due to the economic crisis, Turkey’s ruling AKP government has been supporting them through credit guarantee funds and debt restructuring regulations.