CBRT Governor Erkan: We will support firms' access to finance for the development of export and investment potential

According to the statement made by the Turkish Exporters Assembly (TİM), Erkan attended the TİM Sectors Council meeting as part of her meetings with the real sector.

During the TİM Sectors Council meeting held at the TİM Foreign Trade Complex, mutual evaluations were conducted, and issues considered important for exporters were discussed in a broad scope.

CBRT Governor Erkan noted at the meeting the importance of price stability for stable and sustainable growth, stating that they are aware of both the challenges exporters face due to external demand and the strong aspects of the economy.

Erkan stated that central banks contribute to social welfare only when monetary policy focuses on price stability, adding, "This goal also requires closely following the real sector of the economy with a perspective of general balance and sustainability. In this context, the projections, trends, and opinions of our exporters regarding the economy are also of importance in our evaluations."

Speaking about Turkey's rising potential alongside the transformation the global economy is undergoing, Erkan used the expression, "Increasing predictability through price stability will be the strongest supporter of your realization of this potential."

Noting that the effect of the implemented policy spreads over time, while on the other hand, some positive results in the nature of leading indicators have begun to be obtained, Erkan said, "While there is a balancing in demand during the transition process before the disinflation period that will begin in the second half of 2024, we will continue to contribute to ensuring the continuity of production with correct policy designs."

"The level of monetary tightness required for the establishment of disinflation has been significantly approached"

CBRT Governor Erkan, referring to the November Monetary Policy Committee decision, emphasized that the level of monetary tightness required for the establishment of disinflation has been significantly approached.

Underlining that the time has come for the transition to the Turkish Lira, Erkan said, "We are seeing the most direct reflections of this in deposit developments. We acted quickly in the face of the credit flow that came to a standstill at the end of May and ensured the re-establishment of the market mechanism. While the waste and excess leading to inflation in individual loans are being eliminated, commercial loans continue to show continuity and contribute to production capacity."

Erkan explained practices such as increasing daily rediscount credit limits by 10 times, restructuring the Investment Commitment Advance Loan (YTAK) framework to allocate a limit of 300 billion liras over 3 years, and removing cost advantages and obstacles to access.

Noting that they are evaluating an additional update to rediscount limits within the framework of impact analyses, Erkan said, "We will continue to support firms' access to finance and financing conditions for the development of export and investment potential."

"IT WAS A VERY PRODUCTIVE MEETING FOR EXPORTERS"

TİM President Mustafa Gültepe stated that Hafize Gaye Erkan is closely interested in the problems of exporters as the CBRT Governor, and reminded that exporters have experienced difficulties in accessing finance for a long time.

Expressing that very important improvements have been made regarding exporters' access to finance since Erkan became the Central Bank Governor, Gültepe made the following evaluations:

"Eximbank's credit volume has been expanded. The daily volume of rediscount credits was increased 10 times to 3 billion liras. Last month, the discount rate on rediscount credits was fixed. There is an economic management in Ankara that prioritizes production and exports. We also view Central Bank Governor Hafize Gaye Erkan's visit to TİM as an indicator of the importance she attaches to exports and the exporter. We hosted her at the TİM Sectors Council Meeting. We made a general presentation regarding the current problems of the exporter and our demands, suggestions, and expectations in line with the 2028 target of 375 billion dollars in goods and 200 billion dollars in services exports. Afterwards, our colleagues from the Sectors Council explained their sector-specific demands and suggestions. It was a very productive meeting for us. With Hafize Gaye Erkan starting her duty as Central Bank Governor, a very positive climate has emerged where every issue is approached with consultation and common sense. I believe that this climate will also positively reflect on the growth of our exports."

News Source: 12punto