Latest news with #MehmetŞimşek
Zawya
19-05-2025
- Business
- Zawya
Qatar-Turkey economic partnership yet to reach full potential: Turkish Minister
Doha, Qatar: In an exclusive interview with Al Sharq newspaper, which is also being published by The Peninsula newspaper, Turkish Minister of Treasury and Finance H E Mehmet Şimşek highlighted the strong political relations between Qatar and Türkiye. He emphasised that these ties are founded on shared values and deep mutual trust between President Erdoğan and Amir H H Sheikh Tamim bin Hamad Al Thani. However, he noted that the economic partnership between the two nations has yet to reach its full potential. Şimşek added that the Türkiye-Qatar High Strategic Committee, established in 2014, remains the cornerstone of our bilateral cooperation. At its 10th meeting in Ankara, we signed key agreements spanning trade, defence, transport, and media. To maximise impact, we should create sector-specific working groups in key areas like advanced manufacturing, agriculture, defence, finance, green energy, digital economy, logistics, and high-tech—enabling focused and results-driven cooperation. We're also strengthening key mechanisms like the Joint Economic and Financial Committee and Joint Economic Commission to diversify trade and investment flows. The recent Committee meeting in Istanbul laid out concrete steps in banking, tourism, and finance. The Trade and Economic Partnership Agreement (TEPA), signed in 2018, will be a key to removing barriers and deepening commercial ties, he underlined. Read the full interview below: 1. The political relations between Qatar and Turkey are held in high esteem. How can the cooperation in the financial, economic, trade, and investment sectors be raised to the same level as the political ties? Türkiye and Qatar enjoy excellent political ties, built on shared values and strong mutual trust between President Erdoğan and HH Emir Al Thani. Yet, our economic partnership still lags behind its true potential. The Türkiye-Qatar High Strategic Committee, established in 2014, remains the cornerstone of our bilateral cooperation. At its 10th meeting in Ankara, we signed key agreements spanning trade, defense, transport, and media. To maximize impact, we should create sector-specific working groups in key areas like advanced manufacturing, agriculture, defense, finance, green energy, digital economy, logistics, and high-tech—enabling focused and results-driven cooperation. We're also strengthening key mechanisms like the Joint Economic and Financial Committee and Joint Economic Commission to diversify trade and investment flows. The recent Committee meeting in Istanbul laid out concrete steps in banking, tourism, and finance. The Trade and Economic Partnership Agreement (TEPA), signed in 2018, will be a key to removing barriers and deepening commercial ties. In finance, Qatar's leading bank QNB has a strong footprint in Türkiye. We greatly value the ongoing currency swap agreement as a cornerstone of our financial cooperation. I would like to thank the Qatari authorities for their support. We see significant potential to expand Qatari involvement in Türkiye's banking sector, capital markets, infrastructure financing, and particularly in Islamic finance. Joint investments in third countries, especially in Africa, Central Asia, and the Middle East, present strategic opportunities to combine our strengths and achieve greater impact. The private sector must drive this transformation. Türkiye's large market, strategic location, robust manufacturing, modern infrastructure, and access to markets worth $30 trillion make it an ideal hub for Qatari businesses. In today's fragmented world, expanding bilateral and regional agreements and fast-tracking joint investments are key to unlocking the full potential of our strategic partnership, driven by innovation, sustainability, and private sector leadership. 2. Financial markets derive their strength from international cooperation and the prudent pursuit of opportunities. How can Qatar and Turkey enhance cooperation in the field of the digital economy through pioneering initiatives? Digital transformation is a key priority for Türkiye and we have made remarkable strides in building a robust digital economy. Our expanding fintech ecosystem, venture capital initiatives, and regulatory reforms reflect this commitment. Through initiatives like the 'Digital Türkiye', 'National Data Strategy' and 'National AI Strategy' we are accelerating innovation, strengthening digital infrastructure, and fostering data-driven growth. Today, the e-Government Gateway offers over 8,000 services to more than 67 million users. We have significantly expanded our digital infrastructure: broadband subscriptions rose from 6 million in 2008 to 96.4 million in 2024, household internet access grew from 25.4% to 96.4%, and fiber optic networks stretched from 117,000 km to 605,000 km. Qatar has also advanced significantly, leading in smart city technologies, AI-driven start-ups, and sustainable digital growth, supported by high quality digital infrastructure. In an era defined by digital innovation, Türkiye and Qatar are uniquely positioned to deepen their strategic partnership. By leveraging our complementary strengths, we can pioneer new models of cooperation in the digital economy. The Türkiye-Qatar Joint Economic and Financial Committee provides an ideal platform to explore these opportunities further. 3. Investors seek reassurance regarding the Turkish lira amid ongoing price fluctuations, waves of inflation and recession sweeping the world, and the constant adjustments in interest rates. How do you plan to address these concerns? Since the launch of our economic program, implied volatility in the Turkish lira has declined significantly, reflecting growing market confidence. The ongoing disinflation process, supported by structural reforms, will continue to anchor the lira's stability amid persistent global challenges such as trade tensions and geopolitical risks. Türkiye's ability to manage these challenges effectively is rooted in a transparent, rule-based economic framework focused on macroeconomic stability and structural transformation. The results are clear: more sustainable growth, fiscal discipline, a smaller current account deficit, stronger reserves, and reduced financial vulnerabilities. 4. How can both countries support start-ups and safeguard the investments of small business owners from the setbacks typical in the early stages? Türkiye's National Technology Initiative is advancing innovation and technological self-sufficiency across key sectors, from fintech to defense. With robust public-private collaboration, we've rolled out comprehensive digital economy roadmaps, scaled up R&D, expanded digital skills programs, and built a vibrant startup ecosystem. Flagship initiatives such as Turcorn 100, the Türkiye Tech Visa, and regulatory reforms enabling Venture Capital Investment Funds (VCIFs) have significantly accelerated startup growth. In 2024 alone, Türkiye attracted $1.1 billion in venture capital across 582 deals, ranking 11th in Europe and 3rd in MENA. Today, we proudly host 6 unicorns, 462 VCIFs, 39 venture capital funds, and 623 accredited angel investors. Türkiye also boasts one of Europe's leading gaming ecosystems, with 2 unicorns, 844 active gaming startups, and 12 specialized incubation centers. To strengthen early-stage innovation, we're eager to collaborate with Qatar, sharing experiences and co-developing tools to empower startups and safeguard small business investments. In SME financing, our Treasury-backed Credit Guarantee System has provided TRY 745.6 billion in guarantees, enabling TRY 886.5 billion in loans and supporting nearly 486,000 SMEs to date. In the field of innovation finance, the Tech-InvesTR Programme and the Türkiye Growth and Innovation Fund have successfully mobilized substantial capital. Building on this momentum, we have recently launched a new $50 million Fund of Funds, now open to international investors. We invite our Qatari partners to join us in this initiative and forge long-term collaboration in innovation, entrepreneurship, and high-value-added sectors. 5. What are the prospects for bilateral cooperation in supporting and revitalizing the Syrian economy and overcoming its challenges? Türkiye and Qatar share a common vision for promoting peace, stability, and development across the Middle East. Qatar is a standout nation in our region, not only for its remarkable economic progress but also for its mediation efforts in conflict zones and its significant humanitarian contributions. We firmly support Syria's territorial integrity and emphasize the importance of combatting terrorism in all its forms. Achieving lasting stability will require coordinated international support and sustained commitment on the ground. We are ready to lead joint efforts in rebuilding Syria's economy. Together, we can help restore institutions, improve governance, and restructure the financial and banking systems by sharing our experience. Turkish and Qatari companies can play a major role in key sectors such as healthcare, construction, infrastructure, energy, food, logistics, and power restoration. With Syria facing severe shortages in electricity and water, our companies are well placed to support essential service delivery—especially in industrial zones. We are seriously concerned about the wide-reaching sanctions that are crippling Syria's economy and harming civilians. These restrictions block essential goods, stall reconstruction, and deter much-needed investment. It's time to work together to lift sanctions that target the Syrian people, support Syria's reintegration into the global economy, and reestablish its engagement with international financial institutions. Joint action will be critical to rebuilding Syria's economy and securing a better future for its people. 6. What outcomes and future action plans emerged from your participation in the Spring meetings of the International Monetary Fund and the World Bank, the G20 ministerial meeting, and the International Development Banks? This year's Spring Meetings were particularly critical, taking place against a backdrop of rising trade tensions, subdued medium-term growth prospects, and elevated global debt levels. The IMF has revised its global growth forecast to 2.8% for 2025 and 3.0% for 2026, down from 3.3%. While a global recession is not expected, the outlook remains fragile. Financial markets have remained largely orderly, despite some volatility and a move toward safe-haven assets like gold. Looking ahead, reducing uncertainty and accelerating growth-oriented reforms will be essential. One of the most notable outcomes of this year's meetings was the strong participation of the United States, accompanied by a clear call for the IMF and the G20 to return to their core mandates. On the G20 front, three substantive sessions were held. First, a session on the global economy focused on the rise in trade tensions and the urgent need to preserve the G20's role as a platform for open and constructive dialogue, especially in an increasingly fragmented world. Second, discussions on the international financial architecture centered on the implementation of multilateral development bank (MDB) reforms. The G20 Presidency is now leading the development of a monitoring framework for the MDB Roadmap. There was strong consensus that enhanced coordination among MDBs could unlock substantial financing. Third, a dedicated session on Africa addressed key development challenges, with a focus on four critical constraints: weak institutions, infrastructure gaps, macroeconomic vulnerabilities, and high capital costs. In sum, these meetings highlighted both the risks we face and the importance of multilateral cooperation in responding to today's complex global challenge I had the opportunity to hold more than 60 meetings across Washington and New York. I joined investor conferences hosted by leading global investment banks, meeting with over 2,000 investors. These engagements were instrumental in presenting Türkiye's economic outlook and the compelling opportunities we offer. I also held direct meetings with CEOs of major global banks and the heads of key multilateral development institutions, including the World Bank, EBRD, AIIB, EIB, IFC, and IsDB. These high-level discussions not only reinforced existing partnerships but also opened new doors for strategic collaboration. We had in-depth sessions with credit rating agency executives, where we shared the latest progress under our economic program and our continued commitment to sound policy implementation. My meeting with the US Secretary of the Treasury was particularly productive and forward-looking, a clear sign of our mutual commitment to deepening economic ties. I also engaged with top US tech companies, reaffirming Türkiye's openness to innovation, digital transformation, and tech-driven growth. We had meaningful exchanges with prominent think tanks and civil society organizations. All in all, these meetings reaffirmed the strong international confidence in Türkiye's reform agenda and the vast potential we offer for long-term, sustainable investment. is said that Minister Mehmet Şimşek is "the Superman of the Economy." What is the secret formula for overcoming the financial setbacks faced by the Turkish lira and the Turkish economy? Our strategy is built on rule-based, transparent policies that align with international norms. Restoring economic credibility and ensuring predictability have been central to our efforts. I place great importance on teamwork and meritocracy. I'm fortunate to work with a highly capable and experienced team, all dedicated to delivering results. Despite heightened global uncertainty, Türkiye is better positioned than many to convert risks into lasting gains. Since June 2023, we've been firmly implementing a comprehensive macroeconomic stability and reform program focused on four core pillars: Lowering inflation permanently to single digits, Strengthening fiscal discipline, Reducing external vulnerabilities, Advancing structural transformation for higher productivity and growth. Progress So Far Inflation: Inflation has been falling for 11 consecutive months, and we expect this trend to continue. Recent market volatility may have temporarily affected expectations in the short term. The Turkish lira experienced a limited depreciation, but given weak domestic demand, we expect low exchange rate pass-through. Moreover, global oil prices have declined significantly, which could help offset exchange rate-driven pressures. Most importantly, the tightening in financial conditions is disinflationary. We believe inflation will remain within the target range. Fiscal outlook: We will never compromise on spending discipline. On the revenue side, performance depends on the level of economic activity. Therefore, recent market developments may lead to a slightly weaker budget balance compared to the projections in the Medium-Term Program (MTP). Our goal in pursuing fiscal consolidation is to support the Central Bank. By keeping expenditures under control, we aim to contribute to the disinflation process. External Balance: Our program aims not just to reduce the current account deficit, but to build a structurally surplus generating economy in the long run. Last year, excluding gold imports, we already posted a current account surplus, a clear sign that we're nearing the point where Türkiye can grow without external imbalances, even in a moderate growth. The transformation continues. We're pressing ahead with reforms to drive green and digital transformation, and a productivity- and technology-focused shift in industry. Encouragingly, recent market trends, especially falling oil prices, point to a current account deficit even smaller than our program forecast. Growth and Employment: We have achieved rebalancing in the economy, and employment remains strong. Last year alone, we created nearly 1 million new jobs. Recent market volatility may lead to a temporary slowdown in economic activity. However, through our program, we have reduced external vulnerabilities, increased resilience, strengthened macro-financial stability, and laid the ground for sustained high growth. 8. What structural advantages position Türkiye well amid rising global economic uncertainty? We live in a shock-prone world. Trade fragmentation, aging populations, high debt, climate change, and disruptive technologies are driving uncertainty and pushing global growth lower. As Epictetus said, 'It's not what happens to you, but how you react to it that matters.' Türkiye is responding with clear, credible, and forward-looking policies. Our economic program reinforces Türkiye's structural strengths while laying the foundation for lasting prosperity. Global protectionism is rising. Over the last 15 years, trade restrictions have steadily increased, driven largely by U.S.–China competition. China now produces over 30% of global manufacturing value-added and is the top trading partner for many economies. In this fragmented environment, Türkiye is more resilient than many peers for two reasons: First, our economy is less dependent on exports, with domestic demand as the primary growth driver. Merchandise exports account for around 20% of GDP. So, in a more inward-looking global order, Türkiye may be less affected, not immune, but less exposed than many others. Second, a large share of our trade is conducted with friendly and nearby countries. 62% of our exports go to countries with which we have free trade agreements. Our largest trading partner, the European Union, like us, supports a rules-based, multilateral trade system, which further shields us from external shocks. That said, indirect effects may still emerge. A key question is how China will respond to high tariffs. There is a risk of excess supply being redirected, at lower prices, to markets like ours. Another side effect is the decline in global investor risk appetite, which we are already experiencing. And of course, disruptions to global value chains remain a serious concern. However, one comparative advantage Türkiye holds is the relatively low tariffs imposed by the U.S., especially when compared to our Asian peers. Global debt is another major risk. Global total debt-to-GDP has surged to 328% globally. In contrast, Türkiye's ratio stands at 93%, well below the emerging market average of 245%, giving us fiscal flexibility in a high-interest environment. Demographic change is another critical global challenge. The share of people aged 65+ in the global population rose from 5% to 10% over more than 70 years. Now, the next jump, from 10% to 15%, is projected to take just 25 years. Türkiye, still has a window of opportunity of 15-20 years. Our working-age population is still growing. And by increasing women's labor force participation, we can better manage the risks of demographic transformation. Geopolitical tensions and conflicts are also rising, adding pressure on the global economy. This is reflected in soaring global defense spending, which has more than doubled in the past 25 years, reaching $2.7 trillion. This figure may very well double again over the next decade. As an example, the European Union is now relaxing fiscal rules to allocate up to €800 billion for defense over the next four years. Türkiye, as the second-largest land force in NATO and with a strong domestic defense industry, has high deterrent capacity. The surge in global defense spending presents a strategic opportunity for Türkiye. Twenty-five years ago, we were among the world's largest defense importers. In 2024, we became the 11th largest defense exporter globally. Today, over 80% of our defense products are locally designed and produced. More than 3,500 companies are actively engaged in R&D and production. This growing market offers Türkiye a unique chance to boost industrial value-added through greater global share. Technological transformation, particularly in generative AI and robotics, is another global game-changer. AI holds tremendous potential, especially in productivity gains. But even here, protectionist trends are rising, making equal access to advanced technologies more difficult. According to the IMF's AI Preparedness Index, Türkiye ranks above the emerging market average. However, we must narrow the gap with advanced economies. That's why we view digital transformation and AI adoption as top priorities. We will accelerate investments in areas such as: Expanding fiber infrastructure, 5G+, hyperscalers, national GPS systems, and nuclear energy Lastly, climate change remains the most pressing global challenge. Like the rest of the world, Türkiye is highly vulnerable to its effects. To mitigate this, we are investing in energy transition, and modern models for irrigation and agriculture. In 2024, 50% of our electricity came from renewable sources. Our goal is to raise this to above 70% in the coming years. In summary, the world is facing serious structural challenges. But Türkiye is in a relatively stronger position to navigate these difficulties. Our goal is to turn these advantages into lasting gains. 9. Are you planning to attend Qatar Economic Forum? Yes, I plan to attend. The Qatar Economic Forum is a key global platform for addressing today's economic challenges and fostering cross-border cooperation. For Türkiye, and for me, it's a strategic opportunity to highlight our reform agenda, attract investment, and deepen our strong economic partnership with Qatar to support sustainable growth © Dar Al Sharq Press, Printing and Distribution. All Rights Reserved. Provided by SyndiGate Media Inc. (
Qatar Tribune
05-05-2025
- Business
- Qatar Tribune
Turkey's inflation cools to below 38% to extend slide to 11 months
Agencies Turkey's annual inflation slowed for the 11th month in a row to the lowest in more than three years, easing to below 38% in April, according to official data on Monday. Consumer price rises slowed to 37.9%, down from 38.1% in March, figures from the Turkish Statistical Institute (TurkStat) showed. Market surveys projected an annual reading of around 38%. The April rate marks the lowest level since December 2021, when prices had risen 36.08%. The continued decline is positive, and the government expects inflation to keep falling, Treasury and Finance Minister Mehmet Şimşek said 'The fight against the high cost of living is the most important item on the agenda,' Şimşek told an interview with broadcaster TGRT Haber. 'We expect a normalization after July. By the end of the year, we foresee that annual inflation will fall below 30%.' Month-over-month, consumer prices grew 3%, compared to 2.46% in March, the TurkStat data showed. Surveys had estimated a 3.1% increase on the back of energy prices and foreign exchange pass-through. The annual rise was driven by a surge in education costs (79.2%), housing (74%), hotels and restaurants (41.8%) and health care spend (41.9%). The price growth in food and non-alcoholic beverages eased to 36.09% from 37.12%. Similarly, furnishings and household equipment costs moderated to 30.54% from 32.41%. Turkey's annual inflation exceeded 75% in May 2024, before starting to slow in June amid aggressive monetary tightening as part of the government's economic program. 'We continue to establish the disinflation process thanks to our steadfastly implemented economic program,' Vice President Cevdet Yılmaz wrote on the social media platform X. Recent weeks have seen Turkey's central bank reverse its easing cycle amid volatility after last month's arrest of Istanbul Mayor Ekrem Imamoğlu on corruption charges pending a trial, and uncertainty about U.S. tariffs. The arrest of Imamoğlu sent the Turkish lira and assets sharply lower. The currency later recovered some losses but still stood some 5% weaker compared to before the arrest. Economists have said that food prices and energy prices, as well as prices of items that are directly impacted by currency volatility, could impact April inflation due to the recent shake up in the market. The central bank began to gradually cut its benchmark interest rate in December and lowered it to 42.5% in early March. But it reversed the cycle last month with a surprise 350-basis-point rate hike to 46%, which boosted Turkish assets and signaled renewed commitment to tackling inflation. Although market volatility in mid-March caused some deterioration of inflation expectations, the government said the impact of the turmoil is temporary and limited and inflation will be in line with the central bank's target range. 'The (economic) program's aim has been to reduce inflation for nearly two years. Annual inflation has been trending downward for the past 11 months,' Şimşek said on Monday. 'Despite recent internal and external shocks, the continued decline is positive. What matters now is the next phase.' Şimşek said the government expects the downward momentum to continue and sees a high probability that inflation will remain within the target forecast range. The central bank's year-end inflation midpoint estimate currently stands at 24%, in a forecast range of 19% to 29%.'The impact of monetary policy has become clearly evident. This year, fiscal and revenue policies will create a more supportive effect,' he noted. 'We expect the disinflation process to persist in the second half of this year.' Yılmaz said the government would 'steadfastly continue' its fight against inflation 'through the program we have implemented with strong coordination.' 'In an increasingly uncertain global environment, we will enhance our relative performance with political stability and predictability. Our goal is to grow our economy in a stable manner and sustainably raise societal welfare levels,' he noted. Bürümcekçi Research & Consultancy said in a note that in the near term, monetary policy will be shaped by risks to financial stability rather than price stability. 'While we see a low probability that the central bank will return to rate cuts at its June meeting, we think that signals in this direction will only strengthen if the weighted average funding cost approaches 46.0% and substantial foreign-exchange reserve losses give way to steady reserve accumulation,' it said. A separate report from the statistical office showed that producer prices climbed 22.5% in April from a year ago. This was weaker than March's 23.5% increase and marked the lowest rate since October 2020. Prices of mining and quarrying climbed 29.59%, and manufacturing reported a 22.65% rise. Producer prices of electricity, gas, steam, and air conditioning grew 14.45% and advanced 58.14% for water supply. Month-over-month, producer prices moved up 2.76% after rising 1.88% in the prior month.
Shafaq News
25-03-2025
- Business
- Shafaq News
Turkiye takes global stage to tackle economic crisis
Shafaq News/ Recent developments in Turkiye's economy will be discussed on an international level, the Turkish Ministry of Treasury and Finance announced on Tuesday. Finance Minister Mehmet Şimşek and Central Bank Governor Fatih Karahan will discuss Turkiye's latest economic developments in a call at 13:00 GMT, hosted by Citigroup and Deutsche Bank, as part of efforts to reassure investors following recent political and economic turmoil, the ministry stated. Basın Duyurusu- 25 Mart 2025 — T.C. Hazine ve Maliye Bakanlığı (@HMBakanligi) March 25, 2025 What Happened? On Wednesday, Turkish police arrested Ekrem İmamoğlu, President Recep Tayyip Erdoğan's main rival. A court later ruled to hold him in pretrial detention on corruption-related charges. The decision sparked the country's largest protests in over a decade, with opposition figures and European leaders condemning it as 'politically motivated and undemocratic.' These developments shook financial markets, leading to sharp declines in the Turkish lira, stocks, and bonds. However, Istanbul's main stock index closed 3% higher on Monday, while the lira held steady against the dollar. To contain the crisis, the Ministry of Treasury and Finance, together with the Central Bank, the Banking Regulation and Supervision Agency, and the Capital Markets Board, held a series of meetings with key market players. Measures included raising the overnight lending rate by two percentage points to 46%, injecting approximately $14 billion in foreign currency to stabilize financial markets, and imposing a short-selling ban on the Istanbul Stock Exchange to curb volatility.
