ECONOMY

Turkey’s bond issue up $100 mln

ISTANBUL – Turkey took advantage of the market’s appetite for its latest bond issue yesterday by adding another $100 million to the offer, defying doubts on whether it has fully overcome its economic crisis. While local demand for the 10-year, dollar-denominated bond paper saw the offering upped to $600 million from $500 million, foreign clients were less inclined to invest due to worries over Turkey’s debt risk and memories of fellow IMF client Argentina. «There’s some very good local demand in my opinion, which is largely driving Turkey’s return to the markets,» said Philip Poole at ING Barings. «Foreigners are clearly still concerned about the risks in Turkey and what happened in Argentina.» Standard & Poors said on Tuesday the meltdown in Argentina would leave US and European banks operating there with losses, and in some cases «significant» losses leading to big write-downs. Turkey launched the global issue on Tuesday via joint lead managers Credit Suisse First Boston and Goldman Sachs. The offer followed a $250 million addition in December to a five-year, $500 million bond. Turkish markets edged down on Tuesday with stocks on the main Istanbul National-100 shedding 2.35 percent and the lira falling to 1,376,000 to the dollar. Analysts say foreign borrowing will help Turkey lower the cost of servicing a foreign and domestic debt load of almost $200 billion, but it will also raise the stakes as Ankara works to implement a $19 billion IMF-backed crisis recovery pact. «In some ways what Turkey is doing now is dollarizing its debt, which by some measures (meaning its debt) is more onerous than Argentina’s,» Poole said. Moody’s credit rating agency had raised Turkey’s outlook to stable from negative on Tuesday but warned global factors and Turkish domestic politics could spring surprises. Turkey’s $19 billion IMF-backed economic program focuses on reducing the cost of servicing domestic debt of some 117,245 trillion lira (around $78 billion) and foreign debt of some $119 billion. While analysts say Turkish progress on legislating reforms that are crucial to that lending has been good, they worry whether Prime Minister Bulent Ecevit’s three-party coalition government has the will to implement them. Ecevit is currently on a visit to the United States and is due to meet President George Bush later in the day, when he may request the writeoff of some $5 billion of military debt. Turkey’s $600 million bond sale has a maturity date of January 22, 2012, pays 11.5 percent and has an issue price of 98.167. The spread will be 700 basis points over equivalent US treasury bonds. The IMF says it is ready to sign a new $10 billion, three-year standby accord with Turkey and the fund’s board of directors could meet as early as late January to approve the new loan deal. But the real revolution did not come until 1990 when D.D.C. Bradley, J.H. Burroughs, R.H. Friend and co-workers at Cambridge University (UK) demonstrated the first polymer light-emitting device. This opened up a whole new field of research with tremendous potential. There is a large variety of possible applications, and their commercial realization is being addressed by interdisciplinary teams of chemists, physicists and engineers in both industrial and university laboratories.