Newsletters
Finance Minister Mehmet Simsek told investors in London that the country has largely completed its exit from currency-protected deposits, a key pillar of the government's economic stabilization program.
Speaking to real sector and financial sector investors during a two-day visit to London, Simsek said reserves have increased since early May, providing adequate reserve sufficiency while significantly reducing volatility in the Turkish lira.
"Reserve adequacy has been achieved with reserves showing an increase since the beginning of May, and volatility in the Turkish lira has significantly decreased," Simsek told the investors, according to information obtained by Türkiye's state-run Anadolu Agency.
The currency-protected deposit scheme, introduced in late 2021 during a severe lira crisis, guaranteed depositors against foreign exchange losses on lira deposits. The program helped stabilize the currency but created fiscal pressures and complicated monetary policy implementation.
During the meetings, which saw heavy participation, Simsek outlined developments in Türkiye's economic program and the country's structural transformation vision. He emphasized that the implemented economic program has proven its resilience against recent shocks.
"The downward trend in inflation continues, and inflation is expected to remain within the forecast range projected by the Central Bank at year-end," Simsek said. "The current account deficit has been brought to sustainable levels, the ratio of external debt to national income and gross external financing needs have decreased."
The minister stressed that discipline in public spending has been maintained, noting that "the disinflation process continues despite the possibility that revenue performance may be slightly below the target envisaged in the Medium-Term Program."
Simsek told investors that Türkiye's real sector maintains its resilient structure and that sectoral developments are being carefully monitored. He said active industrial policies and green and digital transformation initiatives will continue as part of the structural transformation framework.
The minister highlighted what he called the "Terrorist-Free Turkey" process, describing it as offering opportunities not only for security but also for regional integration and economic development.
"The Terrorist-Free Turkey process offers opportunities not only in terms of security but also regional integration and economic development," Simsek said. "The Eastern and Southeastern Anatolia regions have the potential to become Turkey's new growth engines."
Positioning Türkiye as an attractive destination for foreign direct investment, Simsek emphasized the country's economic fundamentals and regional advantages.
"Relative to per capita income, we are ahead of many countries with our high added value in the manufacturing industry," he said. "We are the main production base of our region in both manufacturing and services sectors. Our developed physical infrastructure, young and dynamic population, and strong regional integration capability make Turkey extremely attractive for foreign direct investment."
During his London visit, Simsek also met with executives of Turkish companies operating in the United Kingdom.
Türkiye has been implementing a comprehensive economic stabilization program since mid-2023, moving away from unorthodox monetary policies that had contributed to high inflation and currency volatility. The program includes monetary tightening, fiscal discipline measures, and structural reforms aimed at restoring investor confidence.
3 min read
