ITO President Avdagic: Monetary tightening should not slow down production lines

Istanbul Chamber of Commerce (ITO) President Şekib Avdagiç stated that they predicted that exchange rates would return to equilibrium in a short time after a transition period and said, “The deterioration in pricing behavior in this transition period needs to be eliminated quickly. The producer knows at what price he will replace the product he sells today, tomorrow or at what exchange rate he will procure the raw material to be purchased 3 months later; It is of great importance in terms of breaking the inflation expectations and preventing the expectation inflation”.

Avdagic made statements regarding the developments in the economy and the business world at the ITO Assembly meeting held in July with the participation of Minister of Commerce Ömer Bolat.

Avdagiç said that the new economy management closely followed the global economic realities and wrote a new development story in accordance with the rules of the economy. Avdagic said, “The main theme of the new development story can be summarized as interest rate hikes and the search for a new balance.” Avdagic noted that they attach importance to the Central Bank’s announcement that it will simplify macroprudential measures in this context.

“We see that the commercial loans of private banks are shrinking on an annual basis”

Şekib Avdagiç said, “As of the last week of June, we see that commercial loans of private banks contracted on an annual basis. With the arrangements to be made, the rapid removal of the obstacles to the private sector’s access to financing under favorable conditions will also pave the way for the economy to reach its potential growth level again.”

Stating that the ITO community knows the Minister of Commerce Ömer Bolat closely, Avdagiç continued: “Mr. Bolat, with two important and strong ties, our Chamber and our community are the roof. under is located. Minister Çavuşoğlu was both a lecturer at our Istanbul Commerce University and a member of the ITO Economic Advisory Board. Above all, he has a vast acquis as an action man who does not let go of his pen. As the President of the Istanbul Chamber of Commerce, the leading institution of the Turkish business world, I see it as a great chance to walk the path with our Minister and a great opportunity to remove the obstacles in front of trade.”

“Credit mechanism is one of the basic building blocks of economic stability”

Pointing out that monetary tightening should not slow down production lines, ITO President Avdagic said, “Therefore, the policy rate level should be supported by a series of measures aimed at production and trade. We demand that the Central Bank’s decisions be supported by a ‘predictable, easy-to-understand and coordinated policy set’, thus paving the way for the real sector. First and foremost, we would like to emphasize that a well-functioning credit mechanism; It is indispensable for production, employment and exports. A well-functioning credit mechanism is one of the basic building blocks of economic stability. The deterioration in the credit mechanism does not only affect the businesses in need of financing, but also disrupts the entire functioning of the market with the domino effect.

Sharing his views on the NATO Summit held in Lithuania, Avdagic said that Turkey has taken important steps towards getting those who are entitled, by using the cards in its hand correctly to defend its own interests.

“We find it very important that visa liberalization is included in the conditions that must be met”

Reminding that President Recep Tayyip Erdoğan, who made a reservation for Sweden’s NATO membership, announced the conditions for removing it, Avdagic said:

“Two of them are directly related to the business world. Updating the Customs Union Agreement and visa liberalization within the scope of full membership to the EU. From this podium, we constantly said that the Customs Union Agreement that we signed with the EU in 1995 should be updated. Almost 30 years have passed since this agreement, which put us in serious trouble in foreign trade. That’s why we were asking both our government and EU countries to update it. Mr. President has taken the right step in this direction. Secondly, as you know, we are experiencing the visa problem, which has now turned into an obstacle for our businessmen and trade, to our bones. Therefore, we consider it very important that visa liberalization is included in the conditions that must be met. The fact that Sweden understands that it should respect Turkey’s sensitivities and takes steps to convince us in this direction is an indicator of Turkey’s effectiveness. We see that the Government is managing a very successful process in this regard, and as the business world, we appreciate that it uses the cards we have in favor of our country.”