The Treasury and Finance Ministry is planning to carry out a total debt service of 3 trillion 241.9 billion Turkish liras next year, including 1 trillion 373.2 billion liras of principal and 1 trillion 868.7 billion liras of interest. The “Treasury Financing Program,” encompassing the developments of 2024 and forecasts for 2025, has been published on the Treasury and Finance Ministry’s website. According to the 2025 Treasury Financing Program prepared based on the Medium-Term Program and central government budget projections, the average term of domestic borrowing, which was 65.1 months last year, decreased to 48.6 months in the January-October period of this year. The average cost of fixed-rate Turkish lira-denominated domestic borrowing, which was 20.6 percent, also stood at 36 percent during the same period.

In order to expand the investor base and diversify borrowing instruments, lease certificate issuances, first carried out in 2012, continued in 2024 as well. Within this framework, a total of 69.7 billion Turkish lira worth of Turkish lira-denominated lease certificates were issued in the domestic market during this period. The issuance of gold bonds and gold-based lease certificates, first conducted in October 2017, was also continued this year. With these actions, capital markets were strengthened through issuances directed at banks and investment funds. Against the total redemption of 126.4 tons of gold bonds and gold-based lease certificates in 2024, a total of 131.8 tons of gold-denominated securities were issued, including 48.5 tons of gold bonds and 83.3 tons of gold-based lease certificates.

During the January-October period of this year, domestic borrowing in euros amounted to 1.2 billion euros in response to a 2.9 billion euro principal repayment, while domestic borrowing in dollars of 1.6 billion was conducted in response to a 1.6 billion dollar principal repayment. By the time the summer season approached, 70 percent of the annual financing needs had been met. In 2024, global economic prospects, monetary policy decisions of advanced country central banks, and geopolitical developments continued to closely influence global markets.

Due to enhancements in the country’s credit ratings and improvements in risk premiums in 2024, the year’s bond issuances and exchange operations saw high participation rates, resulting in positive developments. Throughout 2024, a total of 10.5 billion dollars worth of bond issuances were conducted in international capital markets. Excluding the liability management section of the last bond issuance, approximately 8.6 billion dollars of this was obtained as cash financing. Looking forward, the potential for a financing transaction via conventional bonds or the sukuk market will be assessed in the remaining part of the year within the framework of favorable market conditions.

Title: Treasury’s 2025 Financing Program Unveiled

Content: The Treasury and Finance Ministry aims to realize a total debt service of 3 trillion 241.9 billion liras next year, split into 2 trillion 385 billion liras of domestic debt and 856.9 billion liras of external debt. Aiming for a majority of the 2 trillion 229 billion lira domestic debt service to come from market payments, with 156 billion liras from non-competitive sales to public institutions.

It is expected for the cash-based interest-free balance to be negative 62.9 billion liras, which will be filled by privatization revenues, sales revenues, fund transfers, debt repayments, and cash/bank usage. In 2025, it is planned to obtain financing worth 11 billion dollars through bond and lease certificate issuances from international capital markets. These plans include aiming for a total of 2 trillion 845.5 billion liras worth of domestic debt issuance for 2025.