‘We’re on right track, but need to be patient’: Şimşek

ANKARA

Treasury and Finance Minister Mehmet Şimşek has called for patience as he seeks to “rebalance the economy and soften domestic demand.”

President Recep Tayyip Erdoğan has thrown his “support and commitment” behind the economic policies, Şimşek told the Financial Times in an interview.

“We’re on the right track. There is strong evidence confidence is returning. But we need to be patient, it’s still challenging,” the minister said.

Şimşek took the helm at the economy, while Hafize Gaye Erkan was appointed the Central Bank governor after the May elections. Since the change in the economic team, the Central Bank has raised the interest rate by 2,150 bps.

“We have already taken dramatic measures,” Şimşek said, adding that policies would focus on cooling inflation, rebuilding the country’s foreign currency reserves and reducing its current account deficit.

Higher exports and investment would be key to sustaining growth and Türkiye would need to become less reliant on consumer spending, he said.

Financial conditions are already tighter than what the Central Bank policy rate alone suggested because of other steps to tighten policy, while inflation would remain in a transitional phase until the middle of next year, according to the minister.

Şimşek also said building more constructive relations with Western countries and Gulf neighbors would help boost the economy.

“Türkiye is in the process of pulling out of a geopolitical recession,” he added.