Primary dealership system at public borrowing and Turkish case

Especially in developing countries, one of the most important problems is the finance of public deficits. In this regard, there are mainly two methods can be applied for countries. These methods are to closure of budget deficits with internal borrowing or external borrowing. When we consider about Turkish economy within the data for 2012, we will see that there are 408.3 billion TL of domestic debt, and there are 154.6 billion TL of external debt. Especially in countries like Turkey, which have bigger internal debt stock than external debt stock, public debt administrations become considerably important. The purpose of debt administration is to finance budget deficit with lowest possible cost and risk. At the financing of public debt, the most generally acknowledged method to minimize risk and cost of public debt administration is primary dealership system. The purpose of this study, is to analyze the general framework of primary dealership system?s importance on public debt management and Turkish case, which has been continuing since 2000, both in terms of Primary Dealers and Treasury. In the first part of this three-part-study, all aspects of the system are discussed and the topic are strengthened with the examples of various selected countries. In the second part, Turkish application of system have been examined, the development between 2000 and 2013 is analyzed and the final version is evaluated. Lastly in the third part, Turkish case of the system is reviewed in terms of the economic data on the system and its success in Turkish banking system and financing the public debt management is examined. Keywords: Primary Dealership System, Public Debt Management