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Turkey and EU Revive Talks on Visa-Liberalization as Economy Grows By 4.5%

CIP Turkey
IMI Official Partner

In a testament to its resilience, the Turkish economy is expected to achieve a robust growth rate of 4.5% in 2023, according to Treasury and Finance Minister Mehmet Şimşek. Speaking at a gathering of the Turkish Banking Association in Istanbul, Şimşek highlighted the positive impact of recent measures on monetary and fiscal policies, coupled with reduced political uncertainty following elections.

Şimşek assured listeners that the government’s policies would align with international norms, emphasizing a commitment to shaping monetary, fiscal, and credit policies to meet targets. Furthermore, he pledged to continue the trajectory of simplifying and tightening monetary policy to ensure stability and sustained economic growth.

The minister emphasized the government’s short-term priority of establishing financial stability and enhancing predictability, setting the stage for a more secure economic environment. He called on banks to actively contribute to efforts to improve the current account balance and the disinflation process, emphasizing the importance of supporting the real sector over a focus on consumer loans.

Addressing the need for a more balanced economy, Şimşek expressed a commitment to deepening financial markets and creating a more stable economic foundation. He urged a shift from the era of banks primarily focusing on consumer loans, stressing the importance of supporting the real sector’s uninterrupted access to financing.

Despite acknowledging potential risks posed by strong domestic demand through the current account deficit and inflation, Şimşek remained optimistic about the future. The Turkish economy demonstrated resilience by achieving 4% growth in the first quarter of 2023 compared to the same period last year. The growth rate accelerated from the final quarter of 2022, signaling positive momentum.

As the government focuses on fostering financial stability, increasing predictability, and supporting the real sector, the Turkish economy’s growth in the face of global challenges underscores its adaptability and potential for continued success. The expansion in the first quarter of 2023 reflects a positive trajectory, with the government poised to take further steps toward economic development and resilience.

Visa Agreement With EU Can Add Another Layer To Economic Growth

Turkey and the EU have revived talks regarding a new visa agreement, a matter that could significantly enhance economic relations between the two economic powerhouses. 

Turkish Interior Minister Ali Yerlikaya met with EU Commissioner for Home Affairs Ylva Johansson to discuss several issues during the second Türkiye-EU High-Level Dialogue on Migration and Security in Brussels.

Among the topics was the pending visa waiver issue that has been debated for the past few years. The EU mapped out a set of 72 criteria that Turkey has to meet in order to qualify. Turkey has met 66 as of November 23, and according to sources covering the meeting, it is actively working on meeting the requirements for the last six.

Unhindered travel to the EU can add another layer to Turkey’s growing economy, both through political standing and the ease of doing business with the Union. 

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