Istanbul Chamber of Commerce (ITO) President Şekib Avdagiç called on banks to quickly lower lending rates in line with the Central Bank of the Republic of Türkiye’s 300-basis-point rate cut, saying cheaper financing is crucial for investment, production and employment.

ISTANBUL — August 31, 2026

Istanbul Chamber of Commerce (ITO) President Şekib Avdagiç said banks should rapidly reflect the 300-basis-point interest rate cut by the Central Bank of the Republic of Türkiye (CBRT) in their lending rates.

Evaluating Türkiye’s second-quarter economic growth figures, Avdagiç said the economy expanded 2.3% year-on-year, adding that ITO evaluates not only the pace of growth but also which sectors are driving it.

Industrial Recovery Offers Hope

Avdagiç said the breakdown of the second-quarter figures presented a more encouraging picture compared with the previous quarter.

He noted that the industrial sector, which contracted 0.8% in the first quarter, returned to growth with a 2.4% expansion in the second quarter.

“The recovery in industry is the most valuable aspect of these figures in terms of the quality of growth,” Avdagiç said.

Foreign Trade Outlook Improves

Avdagiç also pointed to a more favorable picture in foreign trade compared with the previous quarter.

He noted that exports of goods and services, which had declined sharply by 12.7% in the first quarter, contracted by a more moderate 3.4% in the second quarter.

Meanwhile, imports fell 6.4%, resulting in a more positive contribution from net external demand.

Avdagiç also highlighted the 13.3% increase in agricultural output, saying he considered the performance highly valuable. Quarterly economic growth accelerated from 0.1% to 1.1%, he added.

“This trajectory is positive, but it is important to maintain it. This is where financing costs come into play,” Avdagiç said.

Investment Appetite Remains Weak

Avdagiç noted that the construction sector contracted 1.9% in the second quarter and that there had also been a significant slowdown in investment appetite.

Investment increased by only 0.6% during the quarter, he said.

According to Avdagiç, the recovery in industry and the narrowing of the decline in exports are encouraging developments. However, he stressed that the recovery can only become permanent if investment activity regains momentum.

“This picture clearly demonstrates the pressure that costs are placing on the real sector,” Avdagiç said.

Call for Faster Lending Rate Cuts

Avdagiç said banks should quickly implement their announced plans to reduce lending rates in line with the CBRT’s 300-basis-point rate cut.

He emphasized that easier access to financing for investments focused on production and exports would be one of the most critical steps in turning today’s growth figures into tomorrow’s employment and sustainable production capacity.

“Our expectation is that this reduction will be rapidly reflected in commercial loans and applied broadly across the entire banking sector,” Avdagiç said.

He also called for the gap between exchange-rate movements and inflation to return to more reasonable levels, arguing that this would further support the real sector and economic activity.

Source: Patronlar Dünyası/ Prepared by: İlayda Gök