A new omnibus bill has been prepared oncovering in issues at the Ministry of Treasury and Finance that are included in the scheduled economic reform package previously announced by President Recep Tayyip Erdogan.
The ‘mini’ economy package, which won’t be very comprehensive, is said to include some technical regulations to be implemented by June 30,2021. The legislative proposal is expected to be submitted to the Parliament soon. Among the scheduled topics in the reform package, are spending discipline in the public sector and financing the employment. One of the steps to be taken that will be included in the law proposal is to merge the Medium-Term Program (OVP) and the Medium-Term Financial Program (OVMP) in order to simplify the budget preparation process.
SHOCKS POSING A RISK TO BE EVALUATED
Also scheduled in the package forand expected to be implemented by June 30 at , 2021, the latest, is the establishment of the Price Stability Committee which will be tasked with be established monitoring inflation dynamics, evaluating shocks posing a risk to the disinflation process, and determining and manage necessary measures. Under the coordination of the Ministry of Treasury and Finance, the committee will consist of the Trade, Agriculture and Forestry, Energy and Natural Resources ministries and the Presidency of Strategy and Budget, as well as the Central Bank.
LOAN UNDER KGF GUARANTEE
Micro- and small sized firms which face liquidity difficulties will be able to access a TRY 100,000 loan with the Credit Guarantee Fund (KFG) for each additional employee it adds. The maximum limit of the loan will be TRY 500,000. The loan will have a two-year maturity and a payment grace period for the first 6 months. Companies which will create additional employment will have an opportunity to use loans with low financing costs.
One of the first steps to be taken will see Financial Stability and Development Committee restructured as the Financial Stability Committee (FIK) after reviewing its duties and responsibilities. Under the Ministry of Treasury and Finance’s coordination, the FIK will determine, monitor and manage systemic risks and focus on increasing savings and deepen financial markets by focusing on supervising financial stability. The Committee will meet on a regular basis every month and release quarterly reports.