LONDON
Turkish Vice President Cevdet Yilmaz met Tuesday with international investors and fund managers at the London Stock Exchange in the British capital.
During his address at the event, which was organized by Globalturk Capital, he spoke about developments in the Turkish economy and the steps taken to strengthen it.
Pointing to economic growth forecasts of 3% in 2024, Yilmaz noted that Türkiye has resolutely implemented policies and measures that support growth.
“Türkiye grew by 4.7% in the first nine months of 2023, and we expect our yearly growth rate to be around 4.4% as we envisioned in our medium term program (MTP),” he said, reminding that over the past 20 years, Türkiye has shown “remarkable economic growth” with an average annual rate of 5.4%.
He said that goods exports broke the historic record with $256 billion last year and exceeded the country’s MTP projections.
“Our services exports reached the level of $100 billion last year, and our targets have been achieved. Tourism revenues especially are quite satisfactory. Despite all these demand problems globally and geopolitical developments, we exceeded 57 million tourists last year, and our tourism revenue was around $54 billion.”
‘We aim to reach single-digit inflation again in 2026’
Taking into consideration last year’s unemployment figures, Yilmaz pointed out that the year-end unemployment expectation will be below 10%, in single digits, and said that while the budget deficit to national income ratio was projected as 6.4%, it was realized at 5.4% last year.
Noting that the Central Bank’s reserves have reached $134 billion, he said international capital inflow accelerated with the decrease in the volatility in the exchange rate and financial conditions improved.
“Our policies, especially our updated policies, have strengthened the stability of our currency and reduced the volatility in our foreign exchange markets,” he said.
Yilmaz said he believes that with the country’s new policies and political environment, Türkiye can benefit from the increased capital inflow, especially with the success achieved after the presidential and general elections last May.
Explaining how political stability has been assured with the success gained after the elections, Yilmaz said “the main objective of the MTP is very clear: to foster a stable growth environment, reduce inflation to single digits in the medium term and ensure both a domestic and external balance. While aiming for 4% growth in 2024, we are expecting a notable decrease in annual inflation around mid-2024.”
Yilmaz said that “2025 will see a continuation of these disinflationary policies. We are expecting around 15% (inflation) next year, and the year after that, in 2026, we aim to reach single digits again,” he said, adding that policies have started to show some results.
‘Economic program we are following so far is working as intended’
Saying that Türkiye aims to increase its exports to $267 billion and tourism revenues to $60 billion this year, he said they expect a decrease of more than one percentage point in the ratio of the current account deficit to national income, which was around 4.2% last year.
Pointing out that Türkiye’s aim in the medium term is around 2%, he highlighted that this is part of the program with regard to the current account deficit through a combination of tight monetary policy, fiscal discipline and structural reforms.
“Apart from monetary and fiscal policies, we also have a detailed list of structural reforms and we have prepared the calendar for them with a close monitoring structure,” said Yilmaz.
“We believe that structural reforms contribute to our program with the concrete results in the medium term as well as the contribution to expectations in the short term. If you achieve structural reforms, they generate a more confident environment for the future of the country and they generate short-term effects,” he added.
Touching on the green and digital transformation as well as the country’s 2053 target, the vice president noted that “simplification and tightening steps” implemented by the central bank as part of monetary policy will continue and strengthen financial stability and increase the functionality of the market mechanisms in coordination with the country’s fiscal policies.
“The economic program we are following so far is working as intended,” said Yilmaz, noting that economic policies will continue to be calibrated by prioritizing disinflation “so that we will achieve permanent price stability.”
‘Our goal is to increase quality, diversity of investments’
Noting that there are almost 80,000 international companies operating in Türkiye, Yilmaz said that the country has attracted around $260 billion in foreign direct investments over the last two decades.
“We take all necessary steps to establish an environment in which the investment climate has improved, predictability for investors will increase and investors’ expectations will be met at a higher level,” he noted.
Reminding that from 2002 to 2023, a total of $13.8 billion in foreign or international direct investment was attracted from the UK to Türkiye, Yilmaz said this is a “clear indication” of the confidence their British counterparts have in the growth and potential of Türkiye’s economy.
He said Türkiye is strategically positioned at the crossroads of the three continents and serves as a central hub for significant trade, energy and other economic activities, adding the country is also listed among the top 10 economies having the largest networks of free trade agreements.
“Our goal is to increase the quality and diversity of the investments and attract more value added investments to Türkiye. Thus, e-mobility, green energy, life sciences, chemicals, petrochemicals, ICT machinery and high quality manufacturing technologies, defense and aviation are among the priority sectors we support,” said Yilmaz.
He added that the Investment Office of the Presidency is ready to provide all kinds of support to investors.
