Minister Şimşek's message on inflation: Our top priority is to combat the cost of living.

22.05.2025 21:11

Speaking at the 'Financial Literacy Day Program' organized by the Capital Markets Board, Minister of Treasury and Finance Mehmet Şimşek stated, "With the program we have implemented, inflation will continue to decrease in 2025. We believe in this. The decline will continue because our top priority is to combat the cost of living."

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Minister of Treasury and Finance Mehmet Şimşek spoke at the Financial Literacy Day Program organized by the Capital Markets Board (CMB).

"WHEN FINANCIAL LITERACY IS LOW, INDIVIDUALS ARE VULNERABLE TO EXPLOITATION"

Minister Şimşek stated, "Standard & Poor's has conducted a study on global financial literacy. According to the data there, 33 out of every 100 people worldwide are financially literate, while in Turkey, this number is only 24. In other words, according to this study, which was conducted in 2022, the ratio of financially literate individuals to the total population in Turkey is 24 percent. Therefore, we have a bit of a gap compared to the world average. Unfortunately, the low level of financial literacy can have severe consequences both on an individual and societal scale. Because when financial literacy is low, individuals are vulnerable to exploitation and manipulation," he said.

"INFLATION WILL CONTINUE TO FALL IN 2025"

Noting that last year's inflation forecasts matched the data, Minister Şimşek said, "In our country, we stated that inflation would start to decrease from the second half of the year, referring to last year, and that in countries implementing disinflation programs, the local currency generally appreciates in the early stages of the program, which is an observation. If you look at 2024, you will see that our observations have generally held true, meaning they have materialized. Indeed, since the second half of last year, inflation has started to decrease rapidly. That is, inflation, which reached around 75 percent in the middle of the year, ended the year at around 44 percent. The current account deficit fell to below 1 percent of national income, at 0.8 percent. At the beginning of the program, if we go back to May 2023, the current account deficit was around 5.5 percent. Indeed, since the second half of last year, despite the guidance in the first quarter, we have started to see that our citizens, domestic firms, and companies have preferred to use Turkish lira. With the program we implemented, inflation will continue to fall in 2025. We believe in this. The decline will continue; because our top priority is to fight against the cost of living. Reducing inflation to increase our citizens' purchasing power is our top priority. We will continue our efforts in this regard," he stated.

"WE HAVE PAID NEARLY 1 TRILLION DOLLARS FOR OIL AND NATURAL GAS IMPORTS"

Emphasizing that the current account deficit will be low in 2025, Şimşek said, "The markets where we sell goods; that is, due to the slow growth of the global economy, external demand is weak. However, we anticipate the current account to national income ratio to be around 1.5 percent at this stage. Of course, looking ahead, we are accelerating the green transformation. Turkey is increasingly meeting its needs from renewable energy. Why is this important? If you look from 2003 to the present, Turkey has paid nearly 1 trillion dollars for oil and natural gas imports. It's not a small amount. Since the early 2000s, Turkey has transferred 1 trillion dollars abroad to purchase oil, natural gas, and their derivatives. Now, with the green transformation and local and renewable energy opportunities, we are changing this picture. As of April, 53 percent of Turkey's total electricity generation was obtained from renewable sources. If you look at the entire year of 2024, this rate is 48 percent. This means that in the future, Turkey's oil and natural gas import bill will decrease. What does this mean? It means that the foreign trade deficit will decrease, and the current account deficit will decrease. If you set aside gold imports in 2024, Turkey actually had a current account surplus. With a reasonable level of moderate growth, excluding gold imports, Turkey had a surplus. This surplus continues at the moment," he evaluated.

"TURKEY'S FINANCIAL LITERACY RATE WILL INCREASE"

Emphasizing that financial literacy education is a necessity at every age, Minister Şimşek spoke about collaborations with various institutions, stating, "Therefore, not only with the Ministry of National Education, not only in our universities, but also protocols are being signed with many public institutions and organizations or civil society organizations, programs are being conducted, and efforts are ongoing. Earlier, some figures were provided. It was stated that 'over 1 million individuals have been certified through this financial literacy platform.' This is an important figure, truly a significant achievement in just one year. The efforts in this direction will increase Turkey's financial literacy rate. 41 percent of these participants are women, and 42 percent are young people. This is truly very meaningful and inclusive," he said.