Şimşek’s Program: Promised Stability—But Where Are the Results?

When Mehmet Şimşek was brought back to lead Turkey’s economic policy in June 2023, it was marketed as a return to reason. After the unconventional and irrational decisions of the 2021–23 period, his reappointment was heralded as a pivot back to orthodoxy. Financial markets at home and abroad responded with enthusiasm.

What Turkey needed, however, wasn’t just technical fixes. It was a coherent, long-term economic transformation plan. Turkey’s economic fragility isn’t new. It has simply worsened under the same ruling party, the AKP, in power for 23 years. Inflation was around 8% in the 2010s. Today, it stands at 35%.

Framing Şimşek as a savior and the face of “rationality” was always a flawed narrative. The excitement surrounding his return, especially in financial circles, was misplaced.

Weak Results, Waning Confidence

In the first quarter of 2025, annual GDP growth was just 2%, down from 5.1% in 2023 and 3.2% in 2024. Inflation is 35%, very close to the same level nearly two years after Şimşek took office. The primary goal, disinflation, remains unmet.

Inflation is not just a technical metric. It's a social phenomenon. In Turkey, people are used to living under high inflation. That doesn’t make it acceptable, but it has built a certain resilience. While Europeans panicked at 7–8%, many in Turkey would cheer for single-digit inflation. A drop to 9% would feel like victory.

Şimşek’s so-called “program” has failed to capitalize on this societal readiness. It has not delivered even the minimum breakthrough needed to inspire hope.

Proponents call this “stabilization.” But what’s being stabilized? Not household purchasing power. Not the real economy.

Turkey’s official unemployment rate is 8.6%, but the broader underutilized labor rate is 32.2%, reflecting widespread hidden joblessness. Manufacturing is stagnant.

As for public finances, the concern is the growing burden of interest payments, which now exceed principal repayments on public debt.

Şimşek’s direction continues to appeal to carry trade, stock market, and bond investors, not those seeking real structural change. Does Turkey really need short-term inflows, or a bold, long-term strategy to rebuild industry and expand employment?

The Misfit Between Man and Mandate

Şimşek’s background is firmly rooted in finance. But Turkey’s needs today lie in rebuilding its productive base, creating decent jobs, and strengthening public institutions.

There is a clear mismatch between his credentials and the country’s structural challenges. His background is ill-suited to an economy where industrial capacity is weak, households are indebted, and costs are rising.

The neoliberal economic model Şimşek represents has systematically eroded the purchasing power of the masses and entrenched inequality. Extreme financialization, a hallmark of this model, has prioritized short-term speculative gains over real production and labor rights. Under Şimşek’s stewardship, the conditions of waged labor have worsened, with rising costs and stagnant incomes pushing workers into deeper insecurity.

In the first quarter of 2025, construction’s value added rose 7.3%, while agriculture shrank by 2% and industry by 1.8%. This is not a growth story Turkey needs. It’s structural distortion.

Despite all this, Turkey has not attracted significant foreign direct investment. Even short-term inflows have fallen short of expectations. What remains are rate hikes and aimless public finance policy with no roadmap for long-term reform.

Politics and Accountability

No finance minister or central bank can offset a political crisis as deep as Turkey’s. But Şimşek is not an outside expert. He is a cabinet member, a political actor, and shares responsibility for his government’s direction.

That includes economic decisions, but also political repression, institutional decay, and the erosion of the rule of law. These forces directly shape economic confidence, mainly when it comes to foreign direct investments.

While Şimşek may claim technocratic legitimacy, his role demands political accountability. His program is inseparable from the regime under which it operates.

What exactly has Şimşek’s program achieved?

If the goal was to lower inflation, it hasn’t. If it was to restore investor confidence, that too is elusive. There’s been no productivity revival, no wave of sustainable investment, no improvement in income distribution. The cost of living crisis continues.

The government didn’t bring Şimşek back for real reform. It brought him back to buy time, to offer a façade of control while avoiding a socially beneficial institutional change.

Turkey doesn’t need a symbolic technocrat. It needs a genuine economic strategy grounded in justice, production, and institutional renewal.

Turkey's problems are political, structural, and decades in the making.

Until those are addressed, no program, no matter how “rational” it seems, will succeed.