Minister of Finance and Finance Mehmet Şimşek stated that they aim to ensure price stability, strengthen fiscal discipline and reduce the current account deficit with the deflation program and said, “There is serious progress in this area. We are in the second phase of the program, progress is very significant.” he said.
Şimşek delivered a speech titled “Economy's Frontline: Trade Conflicts and New Global Competition” at the TRT 2025 World Forum program held in Istanbul. Stating that global uncertainty has never been felt with such intensity, Şimşek said that despite this, market perception remains positive as the global economy remains resilient. Speaking about the fact that the growth rate of the global economy has been lower in recent years compared to previous periods, Şimşek explained that there are many challenges they face globally, the main of which are “protectionism in global trade”, “high global debt”, “aging of the population”, “possible devastating consequences of artificial intelligence”, “impact of climate change” and “geopolitical tensions”. Şimşek stated that protectionism in global trade has now become the new normal and stated that although there are occasional temporary tensions, such as between China and the United States, the long-term trend appears to be unchanged. Noting that 20 years ago, China's share in global production was less than 9%, today it has increased to more than 30%, Şimşek said: “If the same trend continues, this share could even increase to 45%. Who lost market share? The West in general. America's share in global production decreased from 22% to 11%. The European Union lost about 10 points. So did Japan. This is the real reason for protectionism.” he said. “PROTECTIONISM IS PERMANENT” Minister Şimşek pointed out that China has become the number one trading partner of more countries in the world over the past 20-25 years and said production is increasingly shifting to Asia, especially China. Stating that while real wages remain stagnant in developed countries, increases continue in developing economies, Şimşek stated that this imbalance has become the main source of political and social backlash against globalization and the managed trade system. Emphasizing that the loss of manufacturing does not only mean the loss of low value-added jobs, Şimşek said that this loss also eliminates the service sectors associated with it. For this reason, he stated that protectionism now appears to have become a permanent trend. “Türkiye IS RELATIVELY LESS” Minister of Finance and Finance Şimşek stated that Türkiye is relatively less fragile in this process and continued: “Because 62% of our exports go to countries with which we have free trade agreements. More than 80% go to our neighboring geographical regions, to neighboring and friendly regions such as Central Asia, the Middle East and North Africa. This partly protects us. Trade in services remains untouched affected by protectionism. We can turn this situation into an opportunity while we are working on new free trade agreements with the Gulf.” Şimşek spoke about the contributions of the Development Road Project, which will provide uninterrupted transportation services from Türkiye to every country in Europe by road and rail from FAV Port in Iraq to London, and gave examples of corridors extending to Europe and China via Turkey. “OUR LOW DEBT IS AN ADVANTAGE” Minister Şimşek said Türkiye is strong in services exports and said this year's services trade surplus will be around $65 billion, and that although there is a deficit in goods trade, it is strong in tourism, contracts, medical tourism, education and creative industries. Stating that the global debt-to-GDP ratio has increased significantly over the past 25 years, reaching 324%, Şimşek said, “In Türkiye, the ratio is 89%. This is an important advantage and allows us to create more space for infrastructure, education and health spending. Countries with high debt burdens do not have the same opportunities. We use this space for structural reforms, investments to increase productivity, intelligence artificial and green transition.” he said. Explaining Türkiye's work and investments in areas such as artificial intelligence, 5G, defense industry and renewable energy, Şimşek said: “We are accelerating the renewable energy transition. Turkey is in the top 10 in terms of production potential for solar, wind and geothermal energy equipment. We have high potential to become an important player in green technology.” he said. “Compared with developing countries, Türkiye's PERFORMANCE IS SUPERIOR” Referring to the deflation program they are currently implementing, Finance and Finance Minister Şimşek said, “Our goal is to ensure price stability, strengthen fiscal discipline and reduce the current account deficit. There has been serious progress in this area. Structural transformation is a key factor for sustainability. We are in the second phase of the program, progress is significant. We aim to reduce inflation to single digits.” again.” he said. Expressing that the share of high- and medium-tech products in exports has increased, Şimşek said: “Türkiye is on its way to becoming a regional direct investment center again. Direct investment has increased about 20 times over the past 20-25 years. We aim to return to investment grade with a newly increased credit score. The average real growth rate over the past 20 years is 5.4%. This reflects the economic performance during the period of our President Mr. Recep Tayyip Erdoğan Compared with developing countries, especially China and “Excluding India, Türkiye's growth performance is clearly superior.”
