Examination of external debt in Turkey after 2000 in terms of the sustainability of debt and over in debtedness

Savings and chronic budget deficits are the main problems in underdeveloped or developing countries. Although Turkey is one of these developing countries, there is both a lack of savings and chronic budget deficits. In general, financial resources are needed to close budget deficits and to realize investments that will contribute to economic growth. The financial resources needed are provided either by increasing tax rates or by borrowing. Governments generally prefer to resort to external borrowing rather than increasing their tax revenues because it provides them advantages. Since governments mainly resort to debt instruments instead of taxes, the level of indebtedness of countries is increasing day by day and it is starting to become risky. Therefore, the issue of multi-indebtedness and sustainability of debts is gaining importance today. The IMF and the World Bank evaluate whether a country is heavily indebted by looking at the Total External Debt Stock/GDP, Total External Debt Stock/Exports, Total External Debt Service/Exports, and finally, the Total External Debt Interest Service/Export ratios. If three of these four indicators exceed the specified threshold, the country is included in the category of high debtor country. Countries that fall into the category of highly indebted countries have problems in borrowing from international institutions/currency or cannot borrow. In addition, due to its low credibility, borrowing costs are higher compared to other countries. The study aims to examine the sustainability of Turkey's external debt between 2000-2022 in terms of multi-indebtedness indicators accepted by the IMF and the World Bank. In this study, which examines Turkey's external debt for the years 2000-2022 in terms of multiple debt criteria, it has been revealed that Turkey is a heavily moderately indebted country. In addition, thanks to the increase in export revenues in recent years, the opinion that foreign debt will be sustainable in Turkey is gaining weight. Therefore, savings should be increased and foreign borrowing should be reduced in order to ensure the sustainability of external debt. Keywords: External Debt, Sustainability of External Debt, Multiple Debt