Turkey enters reform implementation era for economy with price stability top priority



Turkey has concluded intense preparations for its reform agenda in the fields of economics and law, in which one of the main goals this year in the economy will be to achieve price stability and maintain a holistic fight against inflation, President Recep Tayyip Erdoğan said Friday.

Erdoğan was addressing a Foreign Economic Relations Board (DEIK) meeting, where he underlined the importance of keeping the interest rate levels low while maintaining the fight against inflation.

He stressed that thanks to steps already taken, the Turkish lira has gained 12% against the dollar and 10% against the euro. In recent months, over $15 billion of portfolio inflows to Turkey were seen, the president added. After reaching a low of 8.5832 on Nov. 6, the lira rallied nearly 15% against the dollar following the Central Bank of the Republic of Turkey (CBRT)’s raising its key interest rate late December. It currently stands about 7.40 against the U.S. currency.

Erdoğan also underlined the importance of four main areas: investment, employment, production and exports.

“If these four titles are missing, there is nothing for us to brag about. The main thing is to lower inflation by lowering interest rates,” he said, noting that reforms regarding this will soon be shared with the public and that the steps are set to be taken quickly in line with the reform agenda.

“We are also speeding up structural measures in combating the current account deficit. In 2020, total budget expenditures reached TL 1.2 trillion ($160 billion), remaining below our program target,” Erdoğan said.

The president said the central government’s year-end budget balance posted nearly TL 173 billion, easily beating the target of TL 239 billion.

He also reiterated that the reforms Turkey has carried out for the past 18 years have distinguished “our country from others in these difficult days of the pandemic.”

Turkey is set to emerge as a strong, durable and competitive player in the post-pandemic period, Erdoğan stressed.

Erdoğan said that Turkey needs a new leap in trade diplomacy by advertising Turkish companies and products to the world in a better way.

“Turkish companies have created a difference from their competitors with their reliability during the pandemic period. Surely, this situation has been triggered by the efforts to form a new alternative to the Asian-based production model throughout the world. Despite the decline in global trade, Turkey has achieved positive growth in the economy,” he said.

Erdoğan also noted that Turkey had an export figure of $169.5 billion in 2020.

“Last year, 18,123 Turkish companies became exporters for the first time. Our steps to facilitate exports function much more effectively compared to equivalents in the world,” he said.



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