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President Recep Tayyip Erdogan reiterated his call to overhaul the global interest-based economic system on Friday, vowing to promote alternative models aligned with Islamic finance principles.
Speaking at the second Istanbul World Islamic Economy Summit held at the Istanbul Financial Center, Erdogan said the government would not back down from its efforts to transform the current financial order.
He emphasized that Türkiye would continue to oppose the interest-based model while also seeking to offer viable alternatives. "We won't step back from fighting to change the interest-based financial system. We will not just object; we will produce alternatives," Erdogan said during his keynote address.
The Turkish president highlighted the negative effects of interest rates on production, trade, and social life. He stated that he would continue to voice his aspiration for a non-interest economy with a stronger tone. "I have repeatedly drawn attention to the problems interest causes in economic and social spheres. I will keep expressing my longing for an interest-free economy louder than ever," he said.
Erdogan also criticized the current market share of participation banking—a sector based on Islamic finance principles—as insufficient, pointing out that despite several incentives, its share remains around 8.1% in Türkiye.
The summit address comes as Türkiye grapples with persistent inflation. Annual inflation stood at 37.86% in April 2025, according to the Turkish Statistical Institute, marking the 11th consecutive month of decline after it peaked at 75.5% in May 2024.
To combat rising prices, the Turkish central bank has aggressively raised its policy interest rate to 46% as of April 2025, following a limited rate-cut cycle that lasted for three months. The tight monetary stance reflects the government's efforts to restore price stability and bring inflation down to single-digit levels, a key objective of Türkiye's ongoing economic program.
Erdogan underlined that inflation remains the country’s top priority and said that recent improvements point to progress. "We have recorded visible improvements in inflation, which is our main priority. Our goal is clear: to bring inflation down to single-digit levels on a lasting basis," he said.
Erdogan reaffirmed his administration’s commitment to fully implementing its economic agenda. Referring to recently released growth data, he said that the figures confirm Türkiye is on the right track. "We are determined to carry out our economic program until we reach our targets. The growth figures released today have once again confirmed we are on the right path," he added.
The president also touched on Türkiye's fiscal response to recent natural disasters, noting that the government has allocated $75 billion over the past two years to address the aftermath of devastating earthquakes.
In a broader context, Erdogan warned of rising geopolitical risks and ongoing trade wars in the global economy. He said that Türkiye is navigating a challenging environment, marked by heightened uncertainty and sector-specific hardships, while also making progress toward domestic stability, particularly in the fight against terrorism.
"We are very close to eliminating a problem that has cost us $2 trillion over 40 years, aside from the human toll," Erdogan noted, adding that he believes Türkiye will ultimately reach its goal through careful and patient management.
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