Mehmet Şimşek on public spending cuts: 'We are making an intense effort'

Treasury and Finance Minister Mehmet Şimşek made statements regarding the economic agenda.

Speaking to the Sabah newspaper, known for its proximity to the government, Şimşek stated that citizens expect public spending cuts and that they are making efforts in this regard.

Şimşek said, "Our citizens also expect public spending cuts. We are making an intense effort in this regard. In our ministry, we are closely scrutinizing overseas trips; are they necessary? Could one person go instead of many? We are showing sensitivity in these matters. The greatest saving is the channeling of resources into productive areas."

Treasury and Finance Minister Şimşek's statements are as follows:

"RISK PREMIUM WAS OVER 700 POINTS"

"With the policies we have implemented, investor confidence has increased, the risk premium has fallen, our reserves have strengthened, and exchange rate volatility has decreased. The CDS, which indicates our country's risk premium, was over 700 basis points in May; as of December 7, it fell to 336 basis points. While Turkey's risk premium fell by more than 300 basis points between May and December, the risk premium of emerging countries fell by an average of 55 basis points.

"THE BLEEDING IN THE TL HAS STOPPED"

Exchange rate volatility has decreased. The bleeding in the TL has stopped. The exchange rate volatility implied by 1-month options was at 57 percent in May. As of December 7, it fell to 9 percent. During this period, the average for emerging countries was at 11 percent.

"CREDIT RATING OUTLOOK IS IMPROVING"

Our credit rating outlook is improving. Standard & Poor's raised our rating outlook first to stable, then to positive. Fitch raised it from negative to stable.

GROWTH BALANCE

Rebalancing in growth has begun, and we are moving toward a more balanced composition.

CURRENT ACCOUNT STATEMENT

If we compare the 2nd and 3rd quarters of the year, the contribution of domestic demand to growth fell from 10.2 points to 8.5 points. The negative contribution of net external demand also fell from 6.3 points to 2.6 points. The current account deficit is decreasing. The annualized current account deficit showed an improvement of 8.6 billion dollars in September compared to May and stood at 51.7 billion dollars.

"THERE ARE OUTFLOWS FROM KKM"

There are outflows from Currency Protected Deposit (KKM) accounts. With the normalization of monetary policy, TL returns have started to increase. The KKM stock was 3.3 trillion TL on August 25. As of December 1, this amount fell to 2.7 trillion TL (a decrease of 654 billion TL).

"HIGHEST LEVEL IN RESERVES"

Our gross reserves are also increasing. Gross reserves have increased by 41.7 billion dollars since the end of May, reaching an all-time high of 140.1 billion dollars.

PERMISSION FOR TOGG

Institutions have planned vehicle requests. For example, requests come in saying, 'our vehicle is old, it needs to be replaced.' When giving approval, we say, 'you can only buy the domestic and national electric TOGG, which is cheap to use,' and secondly, we say you must sell the existing one. The existing one is likely more expensive, diesel or gasoline, and has high costs. We are sensitive about these matters."

News Source: 12punto