For a while now, certain figures have been criticizing Turkey’s economic administration for the policies it has implemented regarding the reduction in imports. Furthermore, there are even those who accuse Turkey of becoming withdrawn within itself and express that these are archaic policies from the ‘70s. As all this was being said and done, last Tuesday the country’s Finance and Treasury Minister Berat Albayrak gave a speech at the 63rd General Assembly meeting of the Banks Association of Turkey and said: “We need to provide financial support to the investments that will substitute imported products.
What did Turkey’s FinMin say and mean?
Albayrak’s discourse at the general assembly meeting regarding imports was loud and clear. “Importing will get harder. The precautions taken that render these imports more arduous are not temporary. Don’t think that everything will go back to the way it was when the pandemic ends in two or three months.”
These statements are of vital importance, because as Albayrak said, this matter is of strategical significance for Turkey. Turkey jettisoning the problems that are the cause of its widening foreign trade deficit like the facilitating of imports and money policies that at some point rendered the Turkish lira more valuable than it actually was will serve to promote an independent economy.
In this sense, those who hide behind clichés and cordial words like “market ally,” saying that Turkey is withdrawing and closing its gates to the outside world is something that certainly does not correspond with Turkey’s policies.
Turkey is obligated to locally produce everything that is in its power to do so. As such, what we need to do is to use our resources to fund domestic production in a fertile environment and under the appropriate conditions. And it is here that banks have a vital role.
Suggestions for our banks
In his assembly speech, minister Albayrak, who has a firm grasp on bank activities which signal loan recalls and is aware of the pressure that these banks put on companies that are calculating collateral valuations, issued a caveat to banks once more. His criticisms toward banks’ loan policies hit the nail on the head too.
Indeed, banks in Turkey have offered disproportionate collateral regardless of the project. Instead of them offering short-term and high-interest loans, from the very beginning they need to adopt an approach that will render projects feasible which is also significant in terms of effectively utilizing resources.
Particularly the fact that Albayrak was forced to warn banks “not to give loans to those who don’t need it just to meet your active ratio” and not to provide loans that will be used for speculative transactions was sufficient to reveal the inner workings of banks in Turkey.
Financial security under control
For some time now Turkey has been implementing policies that give weight to economic and financial security. And so it has begun to reap the fruits of these efforts. Furthermore, the zeitgeist of the current period, in which the world economy is going through an evolution, necessitates this. Hence, the only criticism that can brought upon Turkey’s policies and regulations that were made according to the spirit of the times is why these said policies were enacted so very late.
Trying to cheapen the fact that Turkey is dropping its money and financial policies that have turned it into an import “haven”, thus putting domestic production at a disadvantage with statements like “policies of the ‘70s” will be remembered as nothing more than a desperate attempt to oppose just for the sake of doing so.