"Thanks to the bayram (holiday), the Turkish market seems to have turned the Dubai bend without a shock," Ali Bahçuvan, president of the Turkish Shareholders Association, or BORYAD, told the Anatolia news agency.
If the United Arab Emirates fails in calming investor sentiment, a "second shock wave" might come, Bahçuvan said, calling Turkey a "reference market" for emerging markets.
"The weight of foreign investors and interest-rate cuts make Turkey an example," he said. "The economy did not deteriorate despite a non-deal with the International Monetary Fund. All these help pull Turkey's risk premium down."
In an interview with Bloomberg in London during October, Finance Minister Mehmet Simsek said, "Going forward of course we hope that Turkey will be strong enough not to have to need, to tap into international financial institutions’ resources".
Turkey has tackled the effects of the global financial crisis without new lending from the IMF.
"We've gone through the worst and Turkey has been able to finance its deficit at historically low interest rates,” Simsek said. Spending plans for next year are “realistic” and financing “should not be an investor concern.”
In a note to investors on Tuesday, Timothy Ash, an emerging-markets economist at the Royal Bank of Scotland, said Turkish banks are not “particularly exposed to the $26 billion of Dubai World liabilities.”
Separately, the Financial Times reported that Britain’s banks were Dubai’s biggest foreign creditors. The report said Royal Bank of Scotland had the biggest exposure, of up to $2bn. HSBC, Standard Chartered and Lloyds Banking Group had exposure of about $1bn each, according to the paper.
Speaking to the Anatolia news agency, Bülent Erdogan, chief executive of Turkish construction giant Nurol, said three of the company’s ongoing projects had stopped six months ago due to problems with payments.
"We have six more ongoing projects in Abu Dhabi; we have seen no problem there,” he said. "[But] we also do not have any capital investments in Dubai."
Emin Sazak, chief of the Turkish-Qatari Business Council of the Foreign Economic Relations Board, said "If [Dubai World] says it will postpone payments to creditors, that would also mean delays in payments to constructors," he said, adding that only a few Turkish companies had planned to invest in Dubai, but pulled back due to the global credit crisis.
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