Minister of Treasury and Finance Mehmet Şimşek, “Medium Term Programn (OVP) ownership is very strong, our President (Recep Tayyip Erdoğan) is fully behind this program. This program of ours will gain more and more popularity both abroad and domestically. “We are getting results, and we believe we will get them,” he said.
Şimşek, organized in collaboration with the International Finance Institute (IIF) and the Banks Association of Turkey (TBB), at the Istanbul Financial Center Ziraat Bank Headquarters Auditorium. “Türkiye Sustainable Finance ForumHe spoke at.
Pointing out that sustainability is now the main theme all over the world, Şimşek said that sustainable finance stands out as the most important component of this issue.
Şimşek pointed out that sustainable finance will be a growing field in the coming period and stated that the world‘s sustainability gap is 4 trillion dollars according to some people within the framework of the UN Sustainable Development Goals.
“SUSTAINABLE FINANCE IS A VERY CRITICAL AREA”
Emphasizing that private sector resources must be mobilized in this field, Şimşek continued his words as follows:
“So the resources of multilateral banks and the public are insufficient here. Therefore, sustainable finance is a very critical field and this field will grow rapidly within the entire financial sector. As of today, sustainable finance resources, managed financial resources, are approximately 3 trillion dollars globally. Regulatory institutions, The owners of the resources have an approach that will highlight sustainable investments here, and they take sustainability as a basis. This is a growing area that comes to the fore in funding from places such as the Development Bank and the World Bank. In a research that ranks countries according to their green product potential, China is ranked number one and Turkey is ranked 6th. “For us, sustainable finance, green transformation and sustainability are a critical area. This is not a luxury, it is a necessity.”
“IT IS NECESSARY FOR US TO ENSURE GREEN TRANSFORMATION”
Minister Şimşek touched upon the improvement in the current account deficit if Turkey achieves a green transformation and reminded that Turkey has a serious current account deficit except for energy.
Şimşek said, “It is a necessity, a mandatory need for us to focus on this area, to have more access to sustainable finance opportunities and to achieve green transformation through this. When you look at the fund accumulation related to sustainability in the last 10 years, it has increased from approximately 600-700 billion dollars to around 3 trillion dollars. In the coming period, “In this period, asset accumulation in this direction will accelerate and grow much faster. If you look at where these resources come from and where they are mainly kept and managed: Europe.” he said.
Providing information about Turkey’s commercial closeness with Europe, Şimşek continued as follows:
“The fact that Europe is at the forefront and hosts these funds with 84 percent is a great advantage and a reference for us. This area is an issue we need to focus on in the coming period. When you look at the bond issuances of countries in recent years, you see that there is a green weight and cumulatively “If you look at it, 54 states have issued bonds worth approximately 547 billion dollars so far, but 80 percent of this is in the field of green transformation. Turkey is not much different from this.”
Şimşek said that Turkey has had an important journey in the field of sustainable green finance since 2014, but what it will do in the coming period is more important.
“AS TREASURY, WE MADE TURKEY’S FIRST GREEN BONDS ISSUANCE”
Pointing out the importance of what they will do in this field from now on, Şimşek said, “Last year, as the Treasury, we made Turkey’s first green bond issue, a successful issue. We will continue this. Because the need for resources in this field is great, we see this resource as valuable. Not only as the Treasury, but also in our companies.” “This is an untouched and growing area for our banks, and we believe that they will definitely play an active role in this area.”
“OUR GOAL IS TO REACH NET-ZERO TARGET BY 2053”
Minister of Treasury and Finance Şimşek pointed out that one of Turkey’s most important priorities is sustainability and said, “Our goal is to reach the net zero target by 2053. This is an important journey that will increase Turkey’s competitiveness. It will reduce Turkey’s current account deficit, create quality employment and “It is a process that will enable growth. That’s why we stand behind this process, this process is very valuable to us.” he said.
Stating that Turkey is 72nd among 166 countries in the Sustainable Development Report, Şimşek stated that this is not a desired ranking and that it is necessary to run much faster.
Şimşek said, “A Climate Law and climate regulation are currently on the agenda in the coming period. I believe that this will be completed quickly, this is important.” he said.
“THERE IS A GREAT IMPROVEMENT IN ACCESS TO FINANCE BY OUR BANKS AND THE REAL SECTOR”
In his speech, Minister Şimşek also gave information about the MTP and its outputs.
Stating that the heart of this model is the elimination of imbalances, Şimşek said, “In other words, it includes many components such as reducing inflation, reducing the current account deficit to a sustainable point, and reducing the budget deficit to more reasonable levels. Imbalances in growth are eliminated, that is, the composition of growth improves. The contribution of net exports with the contribution of domestic demand.” “It is in a balancing act. This will bring disinflation, a lower sustainable current account deficit, and reserve accumulation.” He made a statement.
Noting that the current account deficit has narrowed and that the 12-month current account deficit, which was 60 billion dollars in May last year, decreased to around 32 billion dollars as of February, Şimşek made the following evaluations:
“I believe that the ratio of national income to national income will drop to 2.5 percent this year. 2.5 percent will, on the one hand, reduce the ratio of foreign debt to national income, and on the other hand, it will allow us to accumulate reserves. There is a great improvement in the access to finance of our banks and the real sector. The important thing is that our banks are now able to obtain long-term subordinated capital facilities from global markets. Since the beginning of the year, we have reached approximately 4 billion dollars of subordinated capital. This shows that the program is working in all its dimensions. There is a dramatic increase in our gross reserves, especially in the last month. “There is an increase.”
“OUR PRESIDENT IS FULLY BEHIND THE PROGRAM”
Reminding that the elections are over, Şimşek concluded his words as follows:
“The ownership of the OVP is very strong, our President is fully behind this program. This program of ours will gain more and more popularity both abroad and domestically. It will be a program in which belief and trust will increase as we get results. And we are getting results, and we believe that we will get them. Our program is working. , exchange rate volatility decreased, international credit rating agencies started to increase our country’s credit rating. They all said, ‘We plan to increase it in the next period.’ “If we implement this program decisively and patiently, Turkey’s credit rating will increase, macro-financial imbalances will be eliminated and we will achieve sustainable high growth.”