Türkiye Sets Sight on Top-5 Global Rank in Participation Finance

(MENAFN) Türkiye has set its sights on breaking into the world's top five nations in participation finance, Treasury and Finance Minister Mehmet Simsek announced, pointing to the country's demonstrated resilience in the face of mounting global economic pressures.

Addressing attendees at Anadolu's Participation Finance Summit held at the Istanbul Financial Center, Simsek noted that Türkiye already holds a top-10 position globally in the sector — and that the government, under President Recep Tayyip Erdogan's leadership, is actively working to climb higher.

The global participation finance industry is on a steep growth trajectory, with total assets projected to approach $10 trillion by 2030, nearly doubling from roughly $6 trillion recorded in 2024. Simsek characterized the sector as inherently stable and well-positioned to absorb surging worldwide demand, adding that the Treasury and Finance Ministry remains committed to nurturing and expanding the domestic participation finance ecosystem.

The minister pointed to two decades of measurable progress within Türkiye's banking landscape. Participation banks' share of total deposits climbed from 3% to 11%, while their share of overall banking assets grew from 2.4% to 10%. Loan penetration similarly advanced, rising from 4% to 8% over the same period. He further noted that participation finance institutions are outpacing conventional banks across key metrics — including return on equity, capital adequacy, and asset quality.

Simsek also called on industry stakeholders to broaden their conception of participation finance beyond traditional banking, advocating for deeper integration of fund management and insurance into the sector's framework. He stressed the strategic importance of positioning the Istanbul Financial Center as a globally recognized hub for participation finance.

Hormuz Tensions and Energy Exposure
Turning to global energy markets, Simsek said Türkiye has deliberately diversified its oil and natural gas supply chains to guard against disruption, adding that the country maintains virtually no exposure to the Strait of Hormuz — a critical chokepoint currently at the center of regional tensions.

While acknowledging that oil price volatility could weigh on Türkiye's Medium-Term Program, the minister expressed confidence that corrective measures are in place to keep the fiscal roadmap intact.

Simsek painted a picture of an economy in solid standing: the budget deficit-to-national income ratio held at 2.9% last year, while public debt remained near 24% of national income — a figure considerably lower than most comparable economies. The Central Bank of the Republic of Türkiye has also bolstered its defenses, expanding gross reserves from $100 billion to $166 billion, now covering more than five months of imports — a substantial cushion against external shocks.

Rounding out the positive indicators, Simsek revealed that the total market capitalization of companies listed on Borsa Istanbul has surged from $425 billion to $516 billion, reflecting growing investor confidence in Türkiye's financial markets.

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