Ankara sees opportunity in tariff turmoil, says Şimşek

ISTANBUL

Türkiye has a chance to outperform other emerging markets hit by U.S. President Donald Trump’s tariffs “once the dust settles” thanks to manageable U.S. trade exposure and lower oil prices, Finance Minister Mehmet Şimşek told the Financial Times.

The collapse in oil prices would narrow the current account deficit of energy-importing Turkey and thus help rebuild international reserves, he said.

On U.S. tariffs, Şimşek argued Türkiye’s $1.3 trillion economy was relatively insulated as 80 percent of its trade is with countries with which it has a free trade agreement, such as its customs union with the EU, or with “friendly neighbors” in the Middle East, Central Asia and North Africa.

Washington placed a 10 percent tariff on Turkish exports to the U.S.

“All of this is relatively constructive,” Şimşek said.

“When the dust settles, we hope and believe Türkiye could positively decouple in investors’ eyes from more troubled emerging economies in Asia and elsewhere,” he added.

“There was a large but brief impact from domestic political-driven turbulence. Now [the turbulence] is tariff-driven,” Şimşek said.

“In relative terms, our vulnerability is not so bad. We may have to live with softer growth. But what is, is: you have to live with external shocks such as these [U.S. tariffs],” he said.

Şimşek conceded that a slowing Turkish economy would mean lower tax revenues, and this “could lead to wider budget deficit” than forecast.

“We will maintain spending discipline regardless,” he said. “Big picture, we can live with this.”