Treasury and Finance Minister Nureddin Nebati on Monday said the government was working on new steps to further strengthen the country’s financial infrastructure, which he said would eventually help boost financial stability.
"We are working intensively together with all our related institutions for the development of financial architecture and infrastructure," Nebati told the 2nd Future of Finance Summit, organized by Turkuvaz Media Group’s broadcaster A Para.
"We will unveil the new steps we will take in this context with the public in the near future. These new steps will also contribute to financial stability," Nebati said, citing a scheme that protected the value of the Turkish lira deposits.
Ankara introduced the scheme, which sought to compensate for losses incurred against foreign currencies, to prop up the lira in December.
Nebati said the implementation of the scheme had helped stabilize high volatility in the exchange rate, as he stressed that the government would be developing new financial business models to ensure the expansion of the entrepreneurial ecosystem in Türkiye in the coming period.
The minister also said touted the government’s new economic program, which he said had contributed to the country’s economy.
Dubbed Türkiye Economy Model, the program was unveiled last year and prioritizes low-interest rates to boost exports, production and investments, aiming to lower inflation and flip the country’s chronic current account deficits to a surplus.
In line with the model, Türkiye’s central bank cut its policy rate by 350 basis points to 10.5% in the last three months, surprising markets after inflation surged to a fresh 24-year high in September.
The central bank had embarked on a rate-cutting cycle more than a year ago as it lowered its one-week repo rate by 500 basis points to 14%, where it had left it steady in the first seven months of this year.
"We are explaining our model. They are listening to us, they are watching us, they are curious about us. They were questioning, now they’re looking at ‘how did it happen.’ The Türkiye Economy Model is on the world's agenda as a model," Nebati said.
He stressed that government policies helped the economy maintain growth in the last eight quarters.
The Turkish economy expanded by a better-than-expected 7.6% year-over-year in the second quarter on strong domestic demand and exports. The rate made Türkiye the second-fastest growing economy in the G-20.
The country’s GDP had expanded by 7.5% annually in the second quarter. Last year, the economy bounced back strongly from the COVID-19 pandemic and grew by 11.4%, its highest rate in a decade.
Nebati emphasized that the financial sector, which he said has been strengthened by the structural reforms they have implemented and the proactive steps they have taken, has come to the fore as one of the most important resilience elements of the economy in the challenging period that the world has been going through in recent years.
The minister said the government has been doing its part in this period when the search for a new and more inclusive financial architecture is gaining momentum all over the world.
"We are working intensively with all our relevant institutions to develop financial architecture and infrastructure. I would like to express that we will share the new steps we will take in this context with the public in the near future," Nebati noted.