Achieving price stability is priority, says Mehmet Şimşek

WASHINGTON

The government’s priority is to achieve price stability, Finance Minister Mehmet Şimşek has said, adding that this takes some time.

Speaking at an event organized by the International Institute of Finance, Şimşek said that their second priority is to restore fiscal discipline.

“Another priority is to lower the current account deficit and achieve a more sustainable external balance… Most importantly to implement structural reforms,” the minister emphasized.

Türkiye has achieved reducing the current account deficit despite “a challenging geography in which the country is located” and their aim is to make it sustainable, which requires structural transformation, Şimşek said.

"Türkiye has achieved reducing the current account deficit despite a challenging geography in which the country is located and their aim is to make it sustainable, which requires structural transformation," Şimşek said.

“We want to help the Central Bank bring inflation down to single digits. We want to create fiscal space for reforms,” he added.

Şimşek pointed to the cost of reforms, noting that reforms such as digital, green and industrial transformation require resources.

Stating that they also want to create buffers against external and internal shocks, Şimşek said, “Next year will be a turning point. Fiscal policy will be more powerful in reducing inflation, there will be a significant negative fiscal impulse.”

Responding to a question, the minister refrained from commenting on the hike in the minimum wage.

“The minimum wage is negotiated by the [labor] unions, employers and the government and it would not be appropriate for me to comment at this stage,” Şimşek said.

“I am sure that the unions, employers and the government will be sensitive to maintaining a certain level of [Türkiye’s] competitiveness,” he added.