ITO Chairman Avdagiç: Policy needs updates on several points

Şekib Avdagiç, chairman of the Istanbul Chamber of Commerce (ITO), said the economic management team has delivered a successful framework and risk management, but that the war-driven conditions and expectations of the business community call for updates to a policy that so far has been finance- and reserve-focused. His remarks, delivered to journalists, stressed the need for targeted adjustments rather than a wholesale reversal.

Avdagiç noted improvements in foreign exchange reserves and external funding access achieved over the past three years, underscoring that these gains should not be ignored. At the same time, he warned that the regional conflict has altered domestic and external balances, creating a case for reviewing parts of the economic program with a comprehensive lens rather than viewing monetary decisions solely through a simple “rate up or hold” frame.

Pointing to the correlation between the exchange rate and inflation, Avdagiç recalled that a roughly 3% rise in the currency in the first quarter coincided with a cumulative 10% increase in inflation. He highlighted the strategic importance of reaching the $410 billion goods and services export target for 2026 and argued that import-to-export ratios must not slip below critical thresholds, implying coordinated adjustments to currency policy, export regime and import regulations where needed.

On incentives, Avdagiç recommended broadening the base of support measures which he said tend to focus disproportionately on the largest firms, and suggested channeling a greater share of packages such as investment advance credits to mid-sized companies (OBIs). He also emphasized Turkey’s progress in renewable energy and domestic production capacity in areas like solar panels and wind turbine components as factors that have mitigated worst-case energy scenarios.

Market observers interpret Avdagiç’s intervention as a call for policy makers to preserve prior gains while enhancing resilience to external shocks via targeted, fast-moving reforms. While immediate market disruption is not the most likely outcome, exchange-rate movements, export performance and inflation trends will remain the key variables shaping investor expectations in the coming quarters. Policy adjustments focused on export incentives, import rules and currency management could be prioritized to support both stability and growth.