TURKEY – Turkey says the individual pension system launched less than two years ago is growing faster than expected.
It said that a “level far higher than expected was reached in terms of the number of participants, the contributions and funds accumulated” for the Individual Pension System in 2004. The defined contribution system began on October 27 2003.
“As of December 31 2004, there were 334,557 individual pension contracts in the system and the funds directed to investment reached some $200m (€164m),” said Treasury undersecretary Ibrahim Halil Canakci in a report issued by Turkey’s Pension Monitoring Center.
“This fast-growing trend of the Individual Pension System proves that there is a possibility of achieving the target of a fund size about 5% of GDP in 10 years earlier than expected.”
Turkey plans to allow provident fund members to opt for the new system on a voluntary basis with their accrued rights this year. This would “ensure the momentum gained in 2004”.
And he said that 2005 would “a year of progress and development for the individual pension sector and life insurance activities”.
The report states that the schemes’ average annual return was 18.39%.