Position: Governor of Central Bank of Turkey
Incumbent: Erdem Basci
Date of Birth: Aug. 9, 1966
Term: April 2011 to April 2016.
– As deputy central bank governor for the last eight years, Basci has been at the heart of Turkey’s transformation from an economic basket case to a stable, fast-growing economy.
– The respected former academic, who has taught in Turkey and Britain, is the architect of the bank’s unorthodox and widely criticised strategy of countering a worryingly high current account deficit through a policy mix of lower interest rates and higher required reserve ratios.
– Basci, 45, is a contemporary of Economy Minister Ali Babacan. Both their fathers ran businesses in Ulus, the traditional heart of Turkey’s capital Ankara, and he served as an aide to the minister before joining the bank.
– Basci’s wife wears the Islamic headscarf, reason enough in 2006 for the country’s then-president, staunchly-secular Ahmet Necdet Sezer, to veto him as governor on ideological grounds.
– Having inherited record low inflation levels, with consumer price inflation standing at 4.26 percent in April, Basci is now running a Turkish economy that will show close to double-digit inflation for 2011, with a lira currency that has depreciated by around 20 percent.
– To contain inflationary pressures and help protect the lira, the central bank shifted to another controversial strategy in late October by using the overnight rate corridor to tighten liquidity, while leaving the policy rate, the one week repo rate, at a record low 5.75 percent. Bankers feel the new methods create uncertainty and would prefer the policy rate to be used as the main monetary tool.
– The economy is expected to have grown by 7 percent in 2011, slowing from 9 percent in 2010. But, due in large measure to the euro zone’s debt problems, there are concerns that Turkey could face a hard landing in 2012 at a time when the bank should be reining in inflation, making Basci’s job that much trickier.
via PROFILE-Turkey’s Central Bank Governor Erdem Basci | Reuters.