A veteran Turkish journalist, Mr Sedat Ergin (resume at the end of this article) attended Simsek’s NYC meeting. This translation is an excerpt from the column he writes for Daily Hurriyet..
When you go up to the 43rd floor of the building of Goldman Sachs, one of the world’s leading investment banks, located in the financial center of southern New York, you suddenly see the view of Manhattan island covered with skyscrapers in all its impressiveness.
The presentation made by the Minister of Treasury and Finance Mehmet Şimşek is the main topic of the conversations at the dinner. Şimşek had met with the managers of the world’s leading investor funds at the same center in the morning.
It is clearly felt that the new policies that started to be followed in the economy after Şimşek took over the post of Minister of Treasury and Finance at the beginning of last June and Hafize Gaye Erkan became the head of the Central Bank, created a positive atmosphere in Wall Street.
Of course, the fact that Şimşek previously worked at another well-known investment bank, Merrill Lynch, is another factor behind the trust placed in him in these circles.
Especially as Turkey moves towards the local elections expected to be held at the end of next March, the question that everyone around here is most curious about is whether there will be a deviation or relaxation in these policies that were put into effect with Şimşek under election pressure.
RELIANCE ON RULES AND PREDICTABILITY MESSAGES
The message that the Minister of Treasury and Finance shared with the Turkish public from New York is the same message he gave to his domestic and foreign interlocutors here. He emphasizes on every occasion that President Recep Tayyip Erdoğan’s support for the policies they have implemented to control inflation is “full”.
A significant part of Şimşek’s presentation includes the goals of the medium-term program, which have already been announced to the public, such as the fight against inflation, tight monetary policy and financial discipline.
While assuming his post as minister at the beginning of June, he said: “Transparency, consistency, predictability and compliance with international norms will be our basic principles in the coming period. Turkey has no choice but to return to a rational basis. The message “A rule-based, predictable Turkish economy will be the key to achieving the long-awaited prosperity” constitutes the main parameters of Şimşek’s view.
Then, in the much-discussed issue of interest rates – orthodox policies based on rules – must be the guiding line.
However, in order for the announced three-year plan to be successful and, within this framework, to reduce inflation to a single-digit rate again in 2026, a number of other complementary tools and policies are undoubtedly needed.
TURKEY STİLL NEEDS FOREIGN FUNDING
If we approach it in terms of external resources, it is understood that the 51 billion dollars committed by the United Arab Emirates and the 35 billion dollars that the World Bank is working on have a significant place in Şimşek’s strategy. Although it is important that these are made, it is still necessary to first monitor and see that these commitments are honored. Additionally, it should not be overlooked that the implementation will extend over a very long period of time.
In any case, for the success of Turkey’s economic program, in addition to these commitments, it is essential to diversify the needed foreign fund inflow by turning to other sources and to encourage direct foreign capital investments. It is a fact that foreign capital inflow from the West has remained very limited in recent years.
There is a critical topic that needs to be underlined at this point. The importance of principles such as reliance on rules and predictability, which Şimşek also emphasizes, is also valid for foreign capital inflow. Establishing the rule of law in Turkey is an indispensable issue in order to ensure predictability in the field of finance.
In this context, strengthening the legal basis and overcoming the existing problems in the judiciary will strengthen the credibility of the messages given by Şimşek.
FOREIGN POLICY MUST BE REALIGNED
Another critical element is that the success of the economic program being followed must also receive strong support from the nurturing of a positive atmosphere in Turkey’s relations with the Western world.
In the face of serious problems that Turkey’s relations with both the USA and the European Union are experiencing today, creating an environment of friendliness on both coasts of the Atlantic is essential for the external support of the economic program.
Therefore, there is a need for an adjustment in Turkey’s foreign policy that will enable this goal to be achieved.
WHO IS SEDAT ERGIN?
Sedat Ergin (born in Istanbul in 1957) is a leading Turkish journalist.
After graduating from Robert College High School in Istanbul and receiving a B.A. degree in international relations from Faculty of Political Sciences of Ankara University, Ergin has been active in journalism since 1975 when he began to work for Turkish News Agency as a general assignment reporter. He served as diplomatic reporter at daily Cumhuriyet’s Ankara office from 1979 to 1987.
In 1987, he joined Hürriyet and was assigned to Washington D.C. where he was stationed for almost six years. He was appointed Ankara Bureau Chief for Hürriyet in 1993. He served in this capacity for twelve years during which he focused on internal and external Turkish developments.
In March 2005, he was appointed as the editor-in-chief of Milliyet. He held this position until October 2009 when he returned to Hürriyet as a senior columnist.
In August 2014 he was appointed as the editor-in-chief of Hürriyet. He left this position in March 2017 and returned to writing his regular column.
He was a regular political commentator on NTV and CNN-Turk news channels for many years.
Ergin was awarded the prestigious Sedat Simavi Journalism Prize twice (1997 and 2003), as well as the press freedom awards of the Turkish Journalists’ Association (2010) and Deutsche Welle (2016).
Follow our English language YouTube videos @ REAL TURKEY: https://www.youtube.com/channel/UCKpFJB4GFiNkhmpVZQ_d9Rg
And content at Twitter: @AtillaEng
Facebook: https://www.facebook.com/realturkeychannel