Abstract. Liberalization and globalization tendencies having had domination in the world since the beginning of 1980s have facilitated the developing countries’ access to external sources. So, serious increases have been seen in the countries’ foreign debts. There is a common consensus in both theoretical and empirical literature that one of the reasons which lead to increase in foreign debts is defence expenditures. Based on this point of view, this study mainly aims at analyzing the relationship between foreign debts and defence expenditures as specific to Turkey by considering data of 1980-2016 period. In this regard, Toda-Yamamoto and Dolado-Lütkepohl (TYDL) tests have been utilized. Analysis findings indicate that defence expenditures are the reasons of foreign debts in Turkey.

Keywords: security, defence expenditure, foreign debt, TYDL, Turkey.