Mehmet Şimşek's investor tour in the US begins: 'Turkey is still an attractive country'

Treasury and Finance Minister Mehmet Şimşek, who arrived in the US for the G20, IMF, and World Bank Spring Meetings, made assessments regarding the Turkish economy at an event organized by the Atlantic Council.

Referring to the program they are implementing to stabilize the Turkish economy, Şimşek said, "The program is on track."

Şimşek emphasized that the primary goal of the ongoing macroeconomic stability and reform program is to ensure price stability and reduce inflation to single digits, noting that this is an ongoing process.

"INFLATION LIKELY TO REMAIN WITHIN THE CBRT'S TARGET BAND"

Stating that recent global fluctuations contain factors that could pull inflation both downward and upward, Şimşek explained that the decline in oil prices and tightening financial conditions could pull inflation down.

Minister Şimşek said, "As a result, it is likely that inflation will remain within the program's target band."

"EXPENDITURE DISCIPLINE WILL BE MAINTAINED"

Minister Şimşek noted that uncertainties in global trade could negatively affect growth and, consequently, exports; however, he expressed that tight financial conditions domestically could suppress demand and reduce imports, and that the current account deficit could remain below the target with the decline in oil prices.

Regarding growth, Şimşek stated that there are downside risks due to recent developments. Mentioning that they have entered a significant fiscal discipline process this year, Şimşek announced that expenditure discipline will be maintained.

"NO CRISIS SHOULD BE WASTED"

Touching upon their desire to accelerate structural transformation, Şimşek used the expression, "Our response to the uncertainty in global economic policies is to remain committed to our prudent, responsible, and sustainable macroeconomic policies."

Pointing out that structural transformation includes green transition investments that will reduce dependence on oil and natural gas imports, as well as preparation for digital infrastructure and artificial intelligence, Şimşek said, "As always, there is a lot of work to be done; no crisis should be wasted."

"TURKEY WILL BE IN A GOOD POSITION TO ATTRACT WESTERN INVESTMENTS"

In response to a question about developments in global trade, Şimşek replied, "The fragmentation of global trade would not be good for anyone, including us."

Şimşek explained that the fragmentation of global trade carries the risk of creating pressure on global growth, but there are some factors that make Turkey resilient.

Minister Şimşek stated that Turkey's growth is primarily based on domestic demand, namely investment and consumption.

Emphasizing that the country's trade is largely conducted according to rules, Şimşek said that free trade agreements signed with the European Union and neighboring countries secure approximately two-thirds of exports.

Stating that how Asian countries will respond to US tariffs creates uncertainty, Şimşek noted that if the same line continues after the 90-day delay in tariffs, the biggest risk for developing countries like Turkey would be indirect effects.

Stating that it is very rare for countries, including Asian countries, to destroy their production capacity, Şimşek expressed that Asia has a massive scale and the possibility of transferring this to the Turkish market is high.

Pointing out that this situation could also have some advantages, Şimşek noted the following:

"Turkey is one of the few countries that stands out in this field with its strong production culture and capacity. Especially in the context of relations with the West, we observe that Turkey's integration into global value chains is strengthening. In this direction, an increase in foreign direct investment may be seen, and it is also possible for some orders that cannot be supplied from Asia to shift to Turkey. This puts Turkey in a strategic position in terms of attracting investment and orders from the West. At the same time, some Asian firms may also tend to establish production or logistics bases in Turkey to meet regional needs."

"TURKEY IS STILL AN ATTRACTIVE COUNTRY"

Şimşek emphasized that Turkey is a large economy and has performed better than many emerging market countries in the last 20-25 years.

Drawing attention to infrastructure investments, Şimşek stated that Turkey is ahead of developing countries in terms of readiness for artificial intelligence and also possesses strong human capital.

Pointing out that if one looks at the big picture, it can be seen where Turkey is positioned and that the country has established strong connections with 54 free trade agreements, Şimşek assessed, "Therefore, it is understandable to have concerns. However, if we look from a long-term perspective, I can say that despite some problems that arise from time to time, Turkey is still an attractive country."

Also mentioning the progress made in the macroeconomic stability reform program they are implementing, Şimşek said that this would also help improve the investment environment.

MESSAGE OF COOPERATION WITH THE EU IN THE FIELD OF DEFENSE

Recalling the EU's plan for 800 billion euros in defense spending over the next 4 years, Şimşek drew attention to the fact that Turkey is among the few countries with the industrial capacity and capability to meet this strong need.

Touching upon relations with the World Bank, Şimşek recalled that the World Bank increased its commitments to Turkey from 17 billion dollars to 35 billion dollars within 3 years.

Noting that Turkey's priorities and the World Bank's focus align perfectly, Şimşek pointed to issues such as green transition, efficiency, and digital infrastructure.

Expressing that financing is important but that they also value the sharing of technical knowledge in relations with the World Bank, Şimşek said, "I can say that we have very good relations with the World Bank."

News Source: AA