Türkiye sees unprecedented growth in foreign investors' interest: Finance minister

ANKARA

Türkiye has seen a massive increase in foreign investors’ interest recently, as the country’s resilient growth despite tight monetary and fiscal policies created what is described as “the most intense investment climate since 2013,” the country’s treasury and finance minister said.

Mehmet Simsek, speaking during a live broadcast on a local network, said he recently met around 800 investors in hubs like London, New York, and Hong Kong over a week and a half.

Simsek stated that, while the global economy grew 3.3% last year, Türkiye’s trading partners in the EU and the Middle East saw a limited economic recovery.

He noted that global oil prices are likely to fall below $60 per barrel if geopolitical uncertainties continue in Iran. However, “once these are resolved, energy prices will most likely return to a downward trend,” he said, adding that this development would contribute to Türkiye reaching its current account deficit and disinflation goals.

Simsek underlined that foreign investors are attracted to Türkiye’s strategic position as a strong NATO member, as well as its sector appeal in areas like defense, noting that investors view Türkiye as a normalized market and focus on technical macroeconomic issues and the disinflation outlook, instead of questioning political ownership.

The minister stated that Türkiye’s fiscal discipline showed a stark contrast with that of peer nations, as its public debt-to-gross domestic product (GDP) ratio fell below 25%, while similar developing countries struggled with an average ratio of 74% instead.

Meanwhile, Türkiye’s household debt stood at only 10% of GDP, and its budget deficit was reduced to 2.9% of GDP last year, well below the 6.3% average of developing countries, despite massive public spending to rebuild infrastructure and services in the earthquake-stricken region in the country’s southeast and early retirement (EYT) costs.

Simsek stated that Ankara’s economic program is entering its third phase, shifting from risk management to generating non-interest surpluses. This shift is expected to enable access to cheaper financial resources from the private sector in 2026.

He mentioned that Türkiye’s current account, excluding gold, which is largely imported due to portfolio preferences, ran a surplus in 2024.

Simsek is expecting a near-zero current account deficit of 0.3% in 2025, excluding gold, and 1.6% including gold, which he calls “highly manageable.”

Meanwhile, Türkiye’s gross reserves more than doubled from $98 billion to more than $200 billion, and net reserves are hovering around $80 billion.

Simsek stated that the $143 billion foreign exchange rate protected deposit (KKM) stocks from mid-2023 have mostly been eliminated.

The minister is expected to visit Japan in early March to meet with leading business representatives and attract direct real-sector investments as Ankara maintains its focus on combating inflation.

*Writing by Emir Yildirim in Istanbul