Turkey’s top 500 firms used 90 pct of profits to pay down debt in 2018: report

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Traders work at their desks on the floor of the Borsa Istanbul in Istanbul on May 22, 2018. Turkey's embattled currency, the lira, has hit new historic lows against the US dollar after Fitch ratings agency expressed concerns over the central bank's independence in the wake of comments by President Recep Tayyip Erdogan. / AFP PHOTO / OZAN KOSE

Turkey’s top 500 companies in 2018 spent nearly 90 percent of their profits to pay down their debts from previous years, according to a study published by the İstanbul Chamber of Industry (ISO), Deutsche Welle Turkish service reported on Tuesday.

The study of the top 500 companies, which account for 44.5 percent of Turkey’s exports, revealed that 67 percent of the financial resources of these companies is debt-driven.

With Turkey’s private sector holding some $220 billion in foreign debt, the Turkish lira’s 30 percent loss in value against the dollar in 2018 created more concern.

Experts told DW that paying that much debt is a blow to investments for these companies, adding that energy firms in particular are suffering from crushing debt.

İSO Chairman Erdal Bahçıvan said the situation was unsustainable for Turkish industrialists.

Among the top 500 companies, 119 declared losses on their 2018 balance sheets, amounting a 52.5 percent increase over the previous year in the number of firms in the red, according to the study.

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