Dimes Square
Welcome back! Today, we’re traveling across the pond to witness the cabinet live out their New York Minute dreams: This week, the Turkish economy finally got its big showbiz break as the presidential investment office seemingly decided a Times Square billboard would be the cure to our economic woes.
While we remain skeptical of New Yorkers’ burning desire to invest in Turkey – or even its location on a map – we do know recap readers want the hot econ details on this week’s busy itinerary.
In this week’s edition:
Welcome to New York (Taylor’s Version)
Report card: More credit rating upgrades on the horizon
Inflation check: Macroprudential measure to squeeze liquidity
FDI cash flow monitor
This week’s stat round-up
Welcome to New York (Taylor’s Version)
As politicians from around the globe entered a New York State of Mind for the United Nations (UN) General Assembly, our economy dream team partook in a series of investor meetings scheduled for their time in the Big Apple – mostly as part of the 15th Türkiye Investment Conference held by the Türkiye-US Business Council (TAİK).
However, disclaimer: As confirmed by financial executives who spoke to Turkey recap, there has been slim to no official communication about the content of the meetings. So, let’s look at what each cabinet member has been up to and then get into some commentary.
Pres. Erdoğan spoke at a TAİK-hosted dinner and later at the opening roundtable event, where he reiterated the presidency’s goal of raising Turkey’s share in the global FDI market from one to 1.5 percent. TAİK said the roundtable hosted “senior representatives from 25 Fortune 100 American companies, alongside executives from leading Turkish companies investing in the US.”
Finance Min. Şimşek worked overtime as he attended three closed-door investors’ meetings hosted by Citibank, shook some hands at a rather chic TAİK event, boasted about how the account deficit was no longer a liability at an Anatolian Businessmen Association (ASKON) event, reassured Goldman Sachs’ guests that Turkey’s fiscal tightness was here to stay and wrapped up his meetings by telling Moody’s and S&P officials about his public finance hopes and dreams.
Energy Min. Bayraktar told investors at a roundtable meeting that Turkey promised investors “wide investment opportunities for the [global] energy transition”.
Trade Min. Bolat told US Chamber of Commerce Pres. Suzanne Clark about investment opportunities in Turkey and said he aims to increase the US-Turkey trade volume to $100b.
Looks like the cabinet was undoubtedly in an Empire State of Mind during their week in New York, but what to make of it all?
Glass half full: TAİK Board Chairman Murat Özyeğin told columnist Vahap Munyar that investor energy toward Turkey is similar to the vibes of 2005-2007 when a significant $87b was invested in the country.
Glass half empty: Economists told DW that the New York promotions’ target audience was “not useful to the country” and the message about development was “inconsistent with the reality of Turkey”.
Report card: Going hard for these good grades
While Turkey’s top officials trotted around town in an attempt to convince investors that we were, in fact, worthy of their cash, the country remained on the minds of major financial and credit rating institutions. Here is our global report card for the week.
↑ S&P Senior Director Frank Gill foreshadowed a potential credit rating upgrade for Turkey in November, praising the improvement in net reserves and the account deficit but noting that S&P will continue to watch the Central Bank’s interest rate policy.
↑ Fitch upgraded six banks’ Diversified Payment Rights (DPRs) ratings, holding their outlook as “stable”.
↑ The European Bank for Reconstruction and Development (EBRD) noted improvements in the economy in a routine note, holding its growth forecast for Turkey at 2.8 percent in 2024 while lowering it on a regional scale.
↓The Organisation for Economic Co-operation and Development (OECD) brought our GPA down and lowered its growth forecast for Turkey from 3.4 percent to 3.2 percent for 2024.
Inflation ✔️
While the country’s financial executives shrank the market gold circulation by filling jewelry boxes at the wedding of banking regulator BDDK’s deputy chairman, the financial administration took macroprudential steps to lower lira liquidity.
Required reserve ratios for banks were increased from 12 to 15 percent for short-term lira deposits and from eight to 10 percent for long-term lira deposits. Required reserve ratios for foreign currency deposits were lowered from eight to five percent.
Referring to a recent analysis, the Central Bank pointed to lira inflation as the cause of increased debit and credit card use over the past four years.
Clearly, increased card use couldn’t help us, as the gap has widened between minimum wage and the hunger line as estimated by the United Confederation of Unions of Public Servants (BİRLEŞİK KAMU-İŞ): The hunger line, defined as the monthly cost of healthy nutrition for a four-person family, is now almost 4,000 liras higher than minimum wage, at 21,000 liras.
Household expenditure is not expected to drop any time soon, either, as experts warn a proposed regulation for electric bills hints at electricity price hikes in October.
🤑 FDI: Cash flow monitor
24hrs: Şimşek’s estimated duration of his stay in Germany ahead of New York, where he met with investors and executives of major corporations.
Over $10.6b: Presidential Investment Office Chairman Ahmet Burak Dağlıoğlu’s estimate for FDI in Turkey this year.
25 yrs: Qatar Sheikh Mansoor’s claimed experience in investment as he told CNBC-e that his country is looking to expand investment in Turkey.
🧮 Buy the numbers: This week’s stat round-up
1.5 pct: The drop in households’ inflation forecast for September 2025, according to the Central Bank’s September survey.
$25m: The planned size of a start-up investment fund under the İstanbul Chamber of Industry.
2026: The expiration date for Turkey’s existing natural gas contract with Iran, which state-run gas company BOTAŞ is looking to renew for long-term supply.
46th: Turkey’s place in Allianz’s global ranking of countries’ personal wealth.
10 pct: The portion of recycled technological waste in Turkey, according to a waste management expert.
🔮 Fortune TLer
“The ministers wanted to have closed-door meetings to be able to give as sincere responses as possible. There was a really large number of meetings being held, and it was quite busy. Their goal was not to attract large crowds but to attract the right people. They wanted a few dozen participants to attend and to be able to ask their questions directly if they wanted to. For example, at the roundtable led by the president, there were Fortune 100 representatives. Not all of them were CEOs – some were senior directors – but they all got a chance at the mic and asked questions. That wasn’t possible at the previous, larger meetings. So, I was told it was more effective in that sense.
The other difference from last year is, of course, that we hadn’t received all these credit rating upgrades. So Mr. Şimşek was trying more to explain what they, as the administration, were going to be doing. There was also talk about him leaving after the local elections [of March 2024.] And he would tell them that the president was behind the [midterm economy] program and that things wouldn’t change. But this year, he just showed audiences tables [of goals] and told them, ‘This is how it was last year, how it is this year.’ So he had more convincing material to work with. He was bolder, telling audiences, ‘You’ll see when we are back in September 2025 that these goals will be actualized. If they’re not, you can ask us about it.’
[Chairman of the Foreign Economic Relations Board] Nail Olpak told me, ‘It’s not like we are walking away with $50m in the bag. But there are positive signals.’”
– Vahap Munyar, senior economics reporter, said about the Ankara cabinet’s closed-door meetings in New York this week
⚡Speed reads
Turkey seen likely to start discussing rate cuts in November (Bloomberg)
Turkey shelves plans to tax gains from stocks and crypto market (Bloomberg)
Turkey cracks down on hybrid car imports as it seeks Chinese investment (Reuters)
Vestel inks contract with ‘aviation giant’ to produce plane screens (Ekonomim)
Turkey plans 10-year dollar bond to push back looming debt maturities (FT)
🗓️ Week ahead
Oct 3 September CPI, PPI (TÜİK)
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Gonca Tokyol, Editor-at-large @goncatokyol
Ingrid Woudwijk, KMD president @deingrid
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Emily Johnson, Deputy editor @emilyjohnson
Damla Uğantaş, Tr Türkçe editor @damlaugantas
Azra Ceylan, Economy reporter @azraceylani