The French bank BNP Paribas was the latest in the row to back Türkiye’s economic policies drive in its recently published report citing that normalization in policies along with easing in risk premiums have restored confidence among investors and rating agencies.

“Official foreign exchange reserves consolidated over the summer, the Turkish lira is much more stable and risk premiums have eased,” the bank said.

“Economic growth remains resilient despite the slowdown in domestic credit, and the budget deficit is much lower than expected given pre-election promises,” it noted.

Following elections, President Recep Tayyip Erdoğan named a new economic team of technocrats with Wall Street experience and broad support among foreign investors to embrace more conventional economic policies, including monetary tightening.

Since June, the Central Bank of the Republic of Türkiye (CBRT) hiked rates by a combined 2,150 basis points to rein in inflation and vowed to deliver further tightening if needed. The central bank is due to announce its latest decision on the interest rates during its meeting scheduled for next week.

Consumer prices rose 61.5% over 12 months ending in September, official data suggested while officials foresee the easing and outcomes of implemented policies during the next year.

Treasury and Finance Minister Mehmet Şimşek, Photo: AA

“However, inflation has accelerated once again and the current account deficit has just about stabilized,” BNP Paribas further said, adding that, “Rebalancing in growth and de-dollarization have not yet been achieved, but it is more likely now that these will be seen in 2024.”

“Monetary policy comes into play with a delay, the effect of the measures we have taken today shows itself months later, and it will take time for us to get the results,” Treasury and Finance Minister Mehmet Şimşek noted in a recent interview.

However, the officials have acknowledged the return of foreign investors’ interest in Türkiye and are actively engaged in meetings domestically and overseas.

Şimşek, along with CBRT Governor Hafize Gaye Erkan, attended recently held World Bank-IMF annual meetings held in Marrakech, while the minister was set to meet investors in the French capital, Paris on Thursday as well.

Attending the investment conference in Istanbul on Thursday Vice President Cevdet Yılmaz highlighted the country’s strategic location between three continents, noting Türkiye has attracted a large amount of foreign direct investment (FDI) in the last 20 years.

“Türkiye has attracted $260 billion of direct international capital in the last 20 years,” he said.

“I would like to state that as of today, around 80,000 international companies operate in our country,” he further noted, adding, “I can easily state that the interest of multinational companies in Türkiye will increase day by day in line with their strategies of positioning in nearby regions, regionalization and product diversification.”