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Japan’s R&I Joins Global Trend with Turkish Credit Upgrade

R&I Japan

In a significant move for Turkey’s international financial standing, the Japanese credit rating agency Rating and Investment Information (R&I) has upgraded Turkey’s foreign currency issuer rating from BB- to BB. This marks the first time in eight years that the Japanese agency has raised Turkey’s notch, citing a “stable” outlook as the nation doubles down on macroeconomic discipline.

The Road to BB: Why Japan Changed Its Stance

R&I’s decision reflects a growing international consensus on Turkey’s recent policy shift. The agency highlighted several key pillars that drove the upgrade:

  • Policy Credibility: The government’s focus on fighting inflation through disciplined fiscal policies and the Central Bank’s commitment to a tight monetary stance.

  • External Resilience: A narrowing current account deficit and a strategic strengthening of foreign exchange reserves—both in quantity and quality.

  • Banking Stability: A robust financial sector with a low non-performing loan (NPL) ratio of 2.5% and a healthy credit-to-deposit ratio settling around 80%.

Growth vs. Discipline: 2026 Projections

While the Central Bank’s high-interest-rate environment has led to a controlled slowdown in domestic demand, R&I noted that Turkey is sustaining growth. Following the 5% growth rates of 2022-2023, the government now forecasts:

  • 2025: 3.3% Growth

  • 2026: 3.8% Growth

The agency also pointed out that the budget deficit-to-GDP ratio fell to approximately 2.9% in 2025, while the public debt stock remains exceptionally low compared to global peers at 23.6%.

Minister Şimşek: “The Results of Our Program Are Visible”

Responding to the upgrade on February 27, 2026, Treasury and Finance Minister Mehmet Şimşek stated that the increase is a direct result of the “macroeconomic stability-oriented policies” implemented since late 2023. This Japanese upgrade follows similar positive moves from agencies like Fitch and S&P earlier this year, signaling a broad re-entry of Turkish assets into global investment portfolios.

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