A closing-bell ceremony was organized at Borsa İstanbul with the participation of H.E. President Recep Tayyip Erdoğan to commemorate the signing of the Memorandum of Understanding for Strategic Cooperation between Borsa İstanbul and the Islamic Development Bank.

In the speech he delivered at the closing-bell ceremony organized on the occasion of the signing of the Memorandum of Understanding (MoU) for Strategic Cooperation between Borsa İstanbul and the Islamic Bank for Development (IDB), H.E. President Recep Tayyip Erdoğan expressed his best wishes for the cooperation to be beneficial for both parties.

Stating that Borsa İstanbul is the roof of the Turkish capital markets institutions, Erdoğan went on to say that with an experience in excess of 30 years, Borsa İstanbul has gained international prestige in its field.

Erdoğan emphasized that Borsa İstanbul strengthened its position thanks to the recent critical and successful steps it has taken while the IDB has been carrying out studies aimed at improving the commercial activities among Islamic states and facilitating finance for more than 40 years. Erdoğan said that he believes the cooperation between the two institutions will lead to beneficial and efficient results for both parties.

Erdoğan congratulated the parties for their efforts during the process of the preparation for the MoU, adding:

"The free circulation of labor and capital globally provides the basis for the current commercial system and consequently, international relations. Within this framework, as the needs are numerous and resources are limited, the need for alternative finance becomes more and more important. Interest based banking system faces a significant dead end. The balance, which was lost during the 2008 global crisis, has still not been regained, and the near future does not look positive in this respect.  Personally, I have never been positive about interest, so let me tell you that I am not surprised with this crisis. We have to shift toward a financial system that is based on making money by making an effort, by using information, and by trading rather than making money out of money”.

President Erdoğan added, "I have nothing to say against the independence, autonomy of the Central Bank of the Republic of Turkey, but I cannot let the nation’s rights, entitlements, and resources be wasted through high interest rates”.

Underlining that the Central Bank of the Republic of Turkey is independent, Erdoğan went on to say, “All right, let them be independent, but I am a politician. Can I officially intervene with their business? No. However, if this is what they are doing, then I will stand up and criticize them because I am the one that the public complains about; not the bureaucrat leading the Bank. So, I will warn them and they must find solutions, produce remedy. It’s not fair when I am the one who gets the complaints when others enjoy themselves”.

Erdoğan also warned the banking sector as follows: “Please get the interest rates to a reasonable level. You see, we are talking about employment. If we want growth, we need employment. But now, the unemployment rate is higher than 11%. Should this country be in such a situation? If we do not want such a situation, then what is it that we need? It is investment, production, employment, and competition”.

Erdoğan emphasized the importance of smoothing access for entrepreneurs to facilities, adding, “But the banking system has got used to making money out of money; so what do they do? They do not provide the required credit support. And when they do, they apply very high interest rates and fail to make the leading step”.

In his speech at the ceremony, Deputy Prime Minister H.E. Nurettin Canikli expressed his best wishes for a beneficial cooperation.

Canikli said that the depreciation of the Turkish Lira against the US Dollar is not attributable to the dynamics of Turkey only, but is rather a result of the global factors, which is experienced in all markets. Canikli added, “In spite of these facts, we have recently come across some foretellers of a crisis in Turkey. The crisis that they have been expecting, and calling for in the last decade has not come, and it will not occur during this last fluctuation”.

Canikli pointed out to the fact that it is extremely important to develop Islamic financial products and to increase the traded value in Turkey, the other Islamic countries, and the world as a whole, emphasizing that the main reason of the recent fluctuations in the global markets is the inclusion of interest as a variable in the model.

Deputy Prime Minister Canikli indicated that the expectations for an interest rate increase strengthen due to the positive growth figures from the USA. Canikli said that the US Dollar has appreciated against all currencies, and added, “The result of the US elections has led the US Dollar to appreciate against all currencies. Particularly the President-elect’s statement of yesterday to the effect that the free trade agreement negotiations with Europe will be suspended is the basic reason for the fluctuation in all markets, especially the European markets”.

Borsa İstanbul Chairman of the Board and Executive Committee Himmet Karadağ said that the strategic cooperation agreement between Borsa İstanbul and the Islamic Development Bank was developed under the leadership of President Erdoğan, and will accelerate Borsa İstanbul’s growth. Karadağ noted that they are making maximum effort to reach the 2023 Istanbul Financial Center vision, and went on to say, “Within this framework, I believe that strategic cooperation with the leading institutions of the global financial sector is very important and we are taking steps towards this purpose. Istanbul is the historical center of international trade, a city of the companions of prophets, and a bridge between the East and the West”.

Karadağ underlined the fact that Borsa İstanbul’s ongoing strategic partnership with Nasdaq and the European Bank for Reconstruction and Development (EBRD) is crowned with the historic cooperation with the Islamic Bank for Development, adding, “This cooperation will ensure that a wide variety of Islamic financial products that is becoming with Istanbul are traded in Turkey and the international capital markets”.

Karadağ emphasized that the International Interest-Free Financial Consultancy Board that will shortly be established in close cooperation with Borsa İstanbul will highly contribute to the standardization of Islamic financial products.

Dr. Bandar Hajjar, President of the Islamic Development Bank, said that their cooperation with Borsa İstanbul will help to develop Islamic financial products and investment alternatives. Hajjar added, “Once these targets are achieved, Borsa İstanbul will become a preferred investment center for financial investments. This cooperation will act as a resource mobilization tool for financing the infrastructure development of the member countries and help the IDB to realize its basic purpose”.

Hajjar said that they appreciate Turkey’s efforts in the area of Islamic finance and Turkey offers a strong example about the ways of making up for the financing deficit of IDB-member countries.

Following the speeches, an MoU was signed between Borsa İstanbul and the Islamic Development Bank. At the closing-bell ceremony, Borsa İstanbul’s bell was rung by President Erdoğan, Deputy Prime Minister Canikli and Borsa İstanbul Chairman of the Board and Executive Committee Himmet Karadağ. At the end of the program, Canikli and Karadağ presented a calligraphic work to President Erdoğan.