Turkey transfers its stakes in companies to Sovereign Wealth Fund

Ziraat Bank, Turkey

Turkey’s treasury shares in state-run lender Ziraat Bank, the stock market of Istanbul, Turkish Petroleum (TP), Petroleum Pipeline Corporation (BOTAS), the General Directorate of Post and Telegraph Organisation (PTT), information and communication services and satellite technologies company TURKSAT, have been transferred to the country’s sovereign wealth fund (SWF), according to Turkey’s Prime Ministry statement on Sunday.

Also, 6.88% of treasury shares in a major telecommunication company Turk Telekom plus Turkey’s official mining company Eti Maden and General Directorate of Tea Enterprises (CAYKUR), were all transferred to the country’s recently established SWF.

The official statement from the Turkish Prime Ministry noted Turkey’s sovereign wealth fund would operate these companies under the ‘Strategic Investment Plan’ to be approved by the Council of Ministers.

However, the fund has come under criticism and trended on Twitter yesterday with many people claiming that it was a usurpation of the country’s resources and that it was to be placed in the control of Turkey President Recep Tayyip Erdogan.

What does ‘wealth fund’ mean?

According to Professor Mustafa Durmus from Ankara’s Gazi University, the wealth fund can be considered as a ‘parallel budget’.

Speaking to Kom News, Durmus said, “the wealth fund is totally different from the country’s budget, it doesn’t have to be prepared and approved by parliament. It is a parallel budget that doesn’t have to be audited by the Turkish Court of Account. That is to say, the wealth fund has a special status and is almost uncontrollable and unquestionable.”