Deputy President Yılmaz Meets with International Investors in the UK

Deputy President Cevdet Yılmaz, as part of his official visit to the United Kingdom, engaged with international investors and fund managers during an event held at the London Stock Exchange. Discussing developments in the Turkish economy and measures taken to strengthen it, Yılmaz highlighted Turkey’s commitment to supporting growth.

Addressing the global growth expectation of 3% in 2024, Yılmaz conveyed that Turkey has implemented policies and measures to actively support growth. He emphasized Turkey’s remarkable economic achievements, boasting 13 consecutive periods of growth over the last two decades, with an average annual growth rate of 5.4%. Yılmaz stated, “Turkey achieved a growth of 4.7% in the first nine months of 2023, and as envisaged in the Medium-Term Program (OVP), our annual growth expectation is 4.4%.”

Yılmaz pointed out the historic record in goods exports last year, surpassing the OVP target with $256 billion. He added, “Our service exports performed even better. We exceeded the $100 billion limit in service exports last year, achieving our goals. Despite demand challenges and geopolitical developments, we welcomed over 57 million tourists, generating approximately $54 billion in revenue.”

“Expecting Inflation to Drop to Single Digits by 2026”

Analyzing unemployment figures from the previous year, Yılmaz indicated an expectation that year-end unemployment would be below 10%, dropping to single digits. He noted that the budget deficit-to-GDP ratio, estimated at 6.4%, was surpassed, with the actual figure for the last year being 5.4%. Yılmaz highlighted the increase in the Central Bank’s reserves to $134 billion, stating, “International capital inflows accelerated with reduced exchange rate volatility, leading to improved financial conditions.”

Commenting on the positive impact of policies, Yılmaz mentioned the successful exit from currency-protected deposits, stating, “With our new policies and the favorable political environment, especially after the success in the Presidential and general elections, I believe we can leverage the increased capital inflow.”

Addressing the elimination of uncertainty following last year’s elections in Turkey, Yılmaz stated, “The fundamental aim of the OVP is to create a stable growth environment, reduce inflation to single digits in the medium term, and achieve a 4% growth in 2024, ensuring both internal and external balance.”

Yılmaz emphasized the positive effects of policies aimed at reducing inflation, stating, “With the continuation of our inflation-reducing policies, we expect it to decrease to 15% by 2025 and reach single digits by 2026.”

“Economic Program Working as Intended So Far”

Discussing the economic goals for the year, Yılmaz mentioned a target of $267 billion in export income and $60 billion in tourism revenues. He highlighted the reduced share of the budget deficit in GDP, aiming for 3% this year compared to last year’s 4.2%.

Yılmaz underscored the medium-term goal of reducing the deficit to 2%, emphasizing the detailed list of structural reforms in addition to monetary and fiscal policies. He stated, “We believe that structural reforms contribute tangible results in the medium term and create expectations in the short term. Successful structural reforms build more confidence for the future and have short-term effects.”

Touching upon the green and digital transformation and the 2053 targets, Yılmaz mentioned that ongoing simplification and tightening steps within the framework of the Central Bank’s monetary policy will strengthen financial stability and enhance the functionality of market mechanisms in coordination with fiscal policies.

“So Far, the Economic Program We Follow Is Working as Intended”

Yılmaz expressed confidence that policies focused on achieving lasting price stability would continue to be regulated to ensure economic stability while prioritizing the fight against inflation.

“Our goal is to increase the quality and diversity of investments to attract more investment,” said Yılmaz, noting that Turkey hosts around 80,000 international companies and has attracted $260 billion in foreign direct investment over the last 20 years. Addressing the increase in multinational companies’ activities, Yılmaz stated, “We are taking all necessary steps to create an environment where the investment climate will improve, predictability will increase, and investors’ expectations will be met at a higher level.”

Yılmaz highlighted that from 2002 to 2023, a total of $13.8 billion in international direct investment was made from the UK to Turkey, indicating the confidence British investors have in Turkey. He concluded by stating, “Turkey, located in the middle of three continents, has the potential to be a significant trade center. As one of the top 10 countries with the most advanced Free Trade Agreement networks, our goal is to attract more investment by increasing the quality and diversity of investments. Electromobility, green energy, chemistry, petrochemistry, information technology, high-quality production technologies, defense, and aviation are our prioritized sectors.”

Deputy President Yılmaz affirmed that the Presidency’s Investment Office is ready to provide all necessary support to investors.

source: prepared by Melisa Beğiç

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