Economy
EBRD allocates $2.55B to 42 projects in Türkiye in 2025 to date
The investments of the European Bank for Reconstruction and Development (EBRD) in Türkiye have reached 2.2 billion euros ($2.55 billion) in 2025 so far, the bank’s top executive said on Thursday, pointing to their strong performance in the country and expectations to lift this figure further by the end of the year.
“These investments were made across 42 different projects in areas including corporations, small and medium enterprises (SMEs), partnerships with financial institutions, energy, infrastructure and innovation,” said Greg Guyett, first vice president of the EBRD.
“By the end of the year, I think we will reach the investment volume of 2.6 billion euros in 2024 and even surpass this level,” he added.
Speaking to Anadolu Agency (AA) during his first official visit to Türkiye, taking place this week, he answered questions regarding EBRD’s investments and activities in the country.
Guyett mentioned that his visit to Türkiye was very productive and expressed significant confidence in the activities of EBRD’s clients in Türkiye, especially in the innovation economy.
“I was very impressed by our clients’ commitment to energy transition and their efforts in the creation of the energy system of the future,” he added.
Guyett pointed out that there are numerous opportunities in Türkiye for the EBRD to fulfill its mission in clean energy, the energy system of the future, supporting the development of the private sector and mobilizing the private sector.
Stating that they continue to show a very strong performance in Türkiye this year as well, Guyett shared key figures on investments while also announcing that they decided to make Istanbul one of their regional hubs.
Istanbul as a regional hub
“In this context, we are also increasing our employment here. I had the chance to spend time with the team here, and I was very pleased to see that there are very talented employees here,” he noted.
He also mentioned that, as a result of geopolitical developments, data distribution and data localization have increased, and Türkiye will continue to be a center.
Expressing that they exceeded the amount they committed for the reconstruction of the earthquake zone, reaching 1.6 billion euros, he further said: “We are very pleased to support displaced people in the region, contribute to housing opportunities and support enterprises, especially SMEs, and we will continue to do so.”
Guyett also emphasized that they are working on a series of initiatives to sustain support and investments in the earthquake region and noted that some areas particularly need more investment.
Expressing strong optimism about long-term opportunities in Türkiye, the EBRD official suggested that Türkiye has a young, growing, well-educated population and favorable demographics.
Furthermore, he mentioned that they expect Türkiye’s economic policies to continue curbing inflation.
“We have seen inflation slow down and like many business people, we certainly want the government to reduce inflation further,” said Guyett.
“We have confidence that the policies implemented by the government will continue to reduce inflation. However, inflation remains a concern for our customers and, of course, for us.”
Global trends
Guyett also noted that trends in global trade will continue to change, and mentioned that trade balances between Asia and Europe are affected by this change.
Explaining that the changing trade trends worldwide will truly benefit Tükiye, Guyett continued: “We see more trade in the Asia-Europe corridor. I think Türkiye is well-positioned as a gateway to Western Europe and a strong central hub in its region.”
“Therefore, combined with the deep intellectual capital and educated population in Türkiye, I am very optimistic that these elements will create long-term opportunities for the country.”
He also pointed out that Türkiye and its surrounding region will become even more important due to its central role in developing future energy and industrial systems.
“This region is also very important for critical minerals. There are some natural advantages of this region of the world. Türkiye and these regions will continue to benefit from these advantages,” he said.
At the same time, he conveyed expectations that the future period will be more technology-focused, including data localization.
“At this point, I think Türkiye is well-positioned thanks to the plans put forward by the government, especially in the energy sector. Considering how educated and open to technology Türkiye’s workforce is, we will also see that this opportunity will continue.”
The EBRD’s investments in Türkiye in 2024 increased by 4% compared to the previous year, reaching 2.6 billion euros, marking the highest annual investment on record. The bank had invested 2.5 billion euros in 2023 and 1.6 billion euros in 2022.
Annual inflation in the U.K. accelerated in July in line with analysts’ expectations, official data showed Wednesday, driven primarily by higher household energy bills.
The consumer price index (CPI) rose 2.9% in the 12 months to July, up from 2.6% in June, the Office for National Statistics (ONS) said in a statement.
The rise was spurred by a 13% hike in the price cap on household energy bills that took effect last month, a consequence of the ongoing U.S.-Iran war.
The ONS called it “the largest rise in gas prices for almost four years.”
Britain’s new prime minister, Andy Burnham, has pledged to ease cost-of-living pressures, unveiling measures such as a tax cut on household electricity prices and a cap on bus fares.
“Iran-war inflation continues to impact prices here at home, but Britain’s economy is resilient,” Treasury chief John Healey said in response to the latest figures.
“There is more to do to restore hope and build a stronger economy where prosperity is shared more fairly across Britain,” he added.
Analysts expect inflation to rise toward the end of the year as higher energy costs feed through to bills further, with little sign of a deal to end the Middle East war.
The Bank of England held its benchmark interest rate at 3.75% last month despite inflation remaining far above its 2% target.
“A renewed spike in inflation has been expected as the war in the Middle East continues to navigate a clunky cease-fire,” said Jonathan Raymond, investment manager at Quilter Cheviot.
“Things remain far from normal in the Strait of Hormuz and look unlikely to be resolved any time soon, meaning pressure is likely to remain on prices for the remainder of the year at least,” he added.
The United Arab Emirates (UAE) has reportedly halted all trade exchanges and financial transactions with Iran “until further notice,” according to a report shared by the state-run WAM news agency, citing the Foreign Ministry’s strategic communications director.
No further details were revealed as yet.
The agency, however, said that the head of strategic communications at the Foreign Ministry, Afra al-Hameli, rejected all allegations regarding the status of the economic relationship between the UAE and Iran.
Al Hameli also reiterated the UAE’s steadfast commitment to dialogue, cooperation, and regional integration as essential means of advancing peace, stability, and prosperity in the region.
He underscored that, in light of regional escalations “that undermine regional and international peace and security, all trade, commercial exchanges, and financial transactions with Iran have been halted until further notice,” the statement shared by the WAM read.
The announcement came after the UAE Defense Ministry said it detected two Iranian ballistic missiles that targeted maritime navigation, an Anadolu Agency (AA) report said.
Tensions in the Middle East have heightened after the U.S. and Israel launched joint strikes on Iran in late February. In response, Tehran retaliated with strikes in regional countries hosting U.S. assets, including the UAE.
In mid-June, Iran and the U.S. signed a memorandum of understanding (MoU) under Pakistani mediation aimed at ending their war and reaching a lasting peace agreement.
Talks, however, have since broken down amid ongoing disputes over the memorandum’s terms and navigation through the Hormuz Strait, a critical route for global energy exports.
A year after taking out a loan in Buenos Aires, Andrea is overwhelmed by shame because she can no longer pay it back.
And she is not alone.
Debt delinquency among Argentine families has tripled in a year, reaching its highest level in two decades under President Javier Milei, a radical free-market champion whose draconian austerity measures have curbed inflation but left many struggling to make ends meet.
Some 5.8 million people are more than 90 days behind on their debt payments, according to the Central Bank of Argentina.
Stagnant incomes, coupled with a cost of living crisis – due in part to Milei slashing subsidies for transportation, gas, medicine and other essentials – have nudged household finances to the brink.
Andrea, a 32-year-old mother who declined to give her surname because she felt ashamed of her predicament, tried to reinvent herself by starting a catering business after the stationery shop where she worked shut down.
But the purchase of a new oven landed her in hot water.
“I fell behind on payments, and in a couple of months the debt became too big to repay. It went from one million pesos (about $670) to five million (about $3,360),” she said.
No ‘gun to their head’
In total, some 21 million people, out of Argentina’s population of 46 million, have some type of debt, according to the Central Bank.
Milei has rejected any responsibility for the situation.
“Did they have a gun to their head to make them do it (take out a loan)?” he asked curtly in a recent interview.
The president of Buenos Aires’ Banco Provincia, Juan Cuattromo, rejects the notion that Argentines are themselves to blame for getting in over their heads.
He told Agence France-Presse (AFP) debt delinquency was “not a consequence of individual decisions” but the result of “a macroeconomic context that has worsened incomes, employment and economic activity.”
Interest rates of 1,000%
Personal loans and credit cards account for more than 70% of unpaid loans, according to a report by the Center for Argentine Political Economy.
“I go to bed and wake up thinking about how I’m going to pay,” Claudia Debaste told AFP, referring to her credit card bill.
Debaste, a 40-year-old single mother who works a low-pay office job, ran up a large bill on utilities, transportation, groceries and medicine.
She fell behind on her payments four months ago and is now seeking to reschedule her debt.
Milei has been hailed for his success in fighting high inflation, Argentina’s perennial bugbear, but slower price increases are a double-edged sword for people living on credit, as it means their loans retain their value over time.
Longer repayments – coupled with higher bills and stagnant wages – have created the perfect storm for many families.
The debt crisis coincides with the rise of easy access to credit from digital wallets such as Mercado Pago, the digital payment arm of e-commerce giant Mercado Libre.
Fintech companies have drawn in adolescents as young as 13, telling them they no longer need to be adults to gain access to “instant cash.”
But eye-watering interest rates soon land them in a debt spiral.
Gabriel Solano, leader of the Workers’ Party, filed a criminal complaint last week against Marcos Galperin, CEO of Mercado Libre, for usury.
“The total effective financial cost (of a loan from Mercado Pago) stands at 1,375%,” Solano wrote on the social media platform X.
Teenage debtors
The offer of credit, with few conditions attached, has also sucked in workers from the gig economy, with the platforms for which they work sometimes acting as their lenders.
Their rates start at 260% annually, quadruple those of banks, with the payments deducted from the workers’ earnings.
Those who don’t pay risk having their account on the platform blocked, effectively putting them out of business.
“It’s like being fired,” Leandro Hidalgo, a delivery driver and union representative, told AFP, accusing the platforms of “financial slavery.”
Canadian Prime Minister Mark Carney spoke with U.S. President Donald Trump on Tuesday as Ottawa sought to head off a new round of American tariffs on Canadian goods just hours before a midnight deadline.
Trump signed orders for the steep 50% duties last month, with the White House alleging “discriminatory treatment” by Canada against U.S. alcohol, automobile and dairy products.
The tariffs are set to take effect Wednesday, covering products such as wine, hockey sticks and cement.
Efforts to avoid the tariffs are going down to the wire.
Carney spoke by phone with Trump on Monday afternoon about the trade negotiations, a spokesperson for the Canadian leader told AFP.
On Monday, Carney said that talks to avert the duties were at an “intense and delicate” stage.
Overall, Trump’s incoming tariffs target around 5.5% of Canada’s exports to the United States, worth about $20 billion, Oxford Economics estimates.
While this only poses a “modest” negative risk to Canada’s economy, Oxford Economics said in a recent report that the duties would “affect central Canada’s manufacturing sector much more severely.”
Canadian negotiators have been in Washington to push for a deal to avoid the new tariffs and also secure relief on Trump’s sector-specific duties – which have battered Canada’s auto, steel, lumber and aluminum industries.
Ottawa has reportedly offered concessions such as pressuring provinces to put U.S. alcohol and wine back on their shelves, Canadian media said. But it remains unclear if a deal is imminent.
The U.S. Trade Representative’s office did not respond to queries on the matter.
“It’s not unusual for a trade negotiation to go right up to the deadline,” former U.S. commerce official Christopher Padilla told AFP.
He expects that the Trump administration threatened new tariffs to try and win early concessions from Canada as the countries negotiate over renewing the U.S.-Mexico-Canada free trade agreement (USMCA).
But even if officials reached a pact that was acceptable to both sides on the trade front, this might be rejected by Trump, who could seek to penalize Canada over other political concerns, he said.
This could include issues like Canada’s efforts to deepen economic ties with European countries or China.
“The relationship with Canada has been challenging from the beginning,” Padilla said.
He warned that Trump also has “a history of lashing out against allies when he is frustrated on other fronts,” such as when he is not getting what he wants from parties like Iran, China or Russia.
Oxford Economics anticipates that manufacturers who stand to be most impacted include those in the cement, paper, printing, wood, clothing and electronics equipment sectors.
With the U.S. Supreme Court striking down many of Trump’s global tariffs earlier this year, the president had tapped an untested legal provision for the new duties targeting Canada.
These duties will not apply to energy, potash or goods already facing sector-specific tariffs, but they are set to hit products covered by the USMCA.
Trump’s trade envoy Jamieson Greer said the tariffs aimed to “hold Canada accountable” for its retaliation against the United States.
Provinces have taken U.S. alcohol products off their shelves, he said, and “given better market access to dairy products from the European Union” among other actions, Greer said in July.
Türkiye is on the verge of getting a new homegrown passenger car brand, as the industrial group HABAŞ edges closer to revealing its first models, with acclaimed designer Frank Stephenson at the helm of the design process.
HABAŞ, which acquired Japanese automaker Honda’s former manufacturing plant in the northwestern Gebze district, is expected to introduce its first passenger car by the end of the year, according to Turkish business daily Ekonomim on Tuesday.
The project would make HABAŞ Türkiye’s second passenger car brand backed by 100% domestic capital after electric vehicle maker Togg.
The group would initially develop two models, a sedan and a crossover, with plans to offer three powertrain options: gasoline, hybrid and plug-in hybrid.
The company has not yet confirmed later-stage plans for fully electric models.
Project led by Ferrari, McLaren designer
The project involves Stephenson, the U.S.-born designer known for his work with major automotive brands including BMW, Ferrari and McLaren.
Stephenson’s official website says he is working on the design of a new Turkish automotive brand, without naming the company, Ekonomim said.
His team’s work is reportedly expected to cover the entire design process, from establishing the brand’s design language and 3D modeling to surface development, clay modeling and engineering support.
The project description also points to plans spanning sedan, crossover, SUV and light commercial vehicle segments.
Stephenson’s ties to Türkiye
Stephenson also has a personal connection to Türkiye. Born in Morocco in 1959, he spent part of his childhood in Istanbul after his family moved to the city because of his father’s work.
He lived in Türkiye between the ages of 11 and 16, attended school and learned Turkish before moving to Madrid with his family.
He later built a career as one of the automotive industry’s best-known designers.
Over $1 billion investment planned
The project forms part of a broader investment plan estimated at around 1 billion euros ($1.16 billion) for commercial and passenger vehicle production, according to previous statements by HABAŞ officials.
The former Honda plant in Gebze is expected to serve as the production base for the passenger cars, with HABAŞ reportedly targeting annual production capacity of 75,000 vehicles.
Former Honda plant becomes foundation
HABAŞ’s ambitions are built around Honda’s former Turkish production facility.
The Japanese carmaker produced Civic Sedan models at the Gebze plant for 24 years before ending production in Türkiye in 2021. HABAŞ subsequently acquired the facility.
The company also purchased equipment from Honda’s former plant in the U.K. after its closure and brought some of that equipment to Türkiye.
HABAŞ has traditionally operated in industrial and metals-related businesses. The group is involved in sectors including industrial and medical gases, iron and steel, energy production, heavy machinery, automotive, banking and seaport operations. In automotive, it is producing buses, midibuses, tow trucks and heavy cargo trucks.
The group appears to be relying on the involvement of Stephenson, whose portfolio includes high-profile sports and premium cars, which will add international design credentials to the project in Türkiye’s competitive passenger car market.
The bigger challenge will come after the unveiling: moving from design and prototypes to mass production and establishing a sustainable presence in the domestic market.
Türkiye’s home prices continued to rise in nominal terms in July but fell further behind inflation, marking an eighth consecutive month of declines in real terms, official data showed Tuesday.
The residential property price index rose 1.5% month-over-month in July and increased 25% from a year earlier in nominal terms, the Central Bank of the Republic of Türkiye (CBRT) said.
Adjusted for inflation, however, home prices fell 5.1% year-over-year. Annual consumer price index (CPI) stood at 31.75% in July.
Among Türkiye’s top three cities, price growth accelerated more strongly in Istanbul than in capital Ankara and western Izmir during the month.
Home prices rose 2.7% month-over-month in Istanbul, compared with 2.2% in Ankara and 0.5% in Izmir.
On a regional basis, the largest annual increase in the residential property price index was recorded in the Bingöl, Elazığ, Malatya, Tunceli, Van, Bitlis, Hakkari and Muş region, at 35.5%.
The smallest annual increase was seen in Balıkesir and Çanakkale, at 16.4%.
Rents also drop in real terms
The CBRT’s new tenant rent index, which tracks newly signed lease contracts, also showed a decline in real terms.
The index rose 1.9% month-over-month in July and 28.4% year-over-year in nominal terms, but declined 2.6% in real terms.
Regional rental trends diverged from the housing market. The Eastern Black Sea region recorded the strongest annual increase, with rents rising 35%, ahead of Istanbul, Ankara and Izmir.
In Istanbul, annual rent growth reached 32.4%, exceeding July’s 31.75% inflation rate and resulting in a real increase.
Annual rent increases were 28.6% in Ankara and 26.3% in Izmir.
The strongest regional increase was recorded in Artvin, Giresun, Gümüşhane, Ordu, Rize and Trabzon, where the new tenant rent index rose 35% year-over-year.
The lowest increase was again recorded in Balıkesir and Çanakkale, at 18.8%.
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