Türkiye’s National Green Finance Strategy and Action Plan (2026-2029): A Binding Timetable for the Green Transformation of the Financial System
I. Introduction: The Legal Framework of the Circular and the Plan
Presidential Circular No. 2026/8 (the “Circular”), published in the Official Gazette dated 4 July 2026 and numbered 33300, announced that the “National Green Finance Strategy and Action Plan (2026-2029)” (the “NGFS Action Plan”) will be published on the official website of the Ministry of Treasury and Finance. It also required all public institutions and organizations to diligently fulfil their duties and responsibilities in this respect and to provide all support and assistance needed during the implementation process.
Although the Circular, by its legal nature and content, is not a regulatory act directly imposing obligations on natural and legal persons but rather an instruction and coordination instrument addressed to the administration, the NGFS Action Plan to which it refers sets out a dated legislative and regulatory timetable specifying, for each of the 45 actions, the responsible institution, the related institutions, the target year and the performance indicators.
In this respect, the NGFS Action Plan serves as a roadmap for the secondary legislation that will directly affect the financial and real sectors over the next four years.
The NGFS Action Plan cites as its basis the Green Deal Action Plan (2021), the Climate Council Final Declaration (2022), the Twelfth Development Plan (2024-2028), the Strategic Plan of the Ministry of Treasury and Finance (2024-2028), the Medium-Term Programmes (2025-2027 and 2026-2028) and, finally, the Climate Law No. 7552 of 2 July 2025.
The link between Article 8 of the Climate Law and the Plan is particularly significant. In parallel with Articles 9, 10 and 11 of the Paris Agreement, the Law defines climate finance, technology development and transfer, and capacity building as the “means of implementation” of the fight against climate change. It also places the promotion of green and sustainable capital market instruments, bank loans and other financial instruments on a statutory footing.
Published on the first anniversary of the Law’s adoption, the NGFS Action Plan is the first comprehensive implementation document of this legal framework on the financial system side.
The international context also features in the rationale of the NGFS Action Plan. According to the World Bank’s 2023 Türkiye Country Climate and Development Report, Türkiye’s “Resilient Net Zero Pathway” scenario requires approximately USD 68 billion in additional investment over the 2022-2030 period, roughly half of which is expected to be met by the private sector.
Under the New Collective Quantified Goal (NCQG) concluded at COP29 in Baku, it was decided to mobilize a total of USD 1.3 trillion in climate finance by 2035, including at least USD 300 billion annually from public resources. The “Baku to Belém Roadmap to 1.3T” published at COP30 sets out the implementation steps towards this target.
The NGFS Action Plan explicitly embraces the objective of enabling Türkiye to benefit more effectively from this global financing architecture.
II. The Architecture of the Plan: Three Objectives, Eleven Targets, Forty-Five Actions
The NGFS Action Plan consists of 11 targets and 45 actions under three objectives:
- Objective 1: Establishing the Infrastructure Required for a Transparent and Measurable Green Finance Ecosystem
- Objective 2: Strengthening Institutional Capacity and Human Resources in the Field of Green Finance
- Objective 3: Establishing Market Mechanisms for the Development of Green Finance
Objective 1 is devoted to the regulatory framework and infrastructure, including sectoral regulatory frameworks, verification and assurance systems, data collection and management infrastructure, common reporting standards and the prevention of the misuse of green finance.
Objective 2 focuses on human resources and institutional capacity, while Objective 3 addresses the expansion of products and instruments, the launch of the Türkiye Emissions Trading System and incentive mechanisms.
The timetable distribution of the actions reveals the Plan’s center of gravity. 2026 is designed as the year in which the regulatory foundation will be laid; 2027-2028 is the implementation and expansion period, while 2029 is the measurement, stress-testing and reporting phase.
A significant portion of the training and awareness actions are, moreover, defined as “continuous”.
III. 2026 Commitments: The Nearest-Term Regulations
The actions envisaged under the NGFS Action Plan for completion by the end of 2026 constitute the nearest-term and most concrete expectations for the financial and real sectors.
Türkiye Green Taxonomy Regulation: Foremost among these is the publication of the Türkiye Green Taxonomy Regulation under Action 1.1.1, for which the responsible body is the Climate Change Directorate of the Ministry of Environment, Urbanization and Climate Change (ÇŞİDB).
As the classification system determining which economic activities qualify as “green” or “sustainable”, the Taxonomy is a precondition for many other actions under the NGFS Action Plan. The alignment, by 2028, of the criteria in the Green Asset Ratio Communiqué of the Banking Regulation and Supervision Agency (BDDK) with the Taxonomy under Action 1.1.2 is likewise tied to it.
Türkiye Emissions Trading System: The second critical commitment is the completion of the secondary legislation of the Türkiye Emissions Trading System (the “ETS”) and its entry into operation under Action 3.2.1.
Rendering the ETS, whose legal framework was established by the Climate Law, operational within 2026 means that carbon pricing and the associated compliance costs will take concrete shape for the industrial and energy sectors.
Other actions on the 2026 timetable include:
- Legislative amendments to encourage insurance companies to invest in green assets, under the responsibility of the Insurance and Private Pension Regulation and Supervision Agency (SEDDK), Action 1.1.3
- A Sectoral Sustainability Guide for the payment institutions sector, under the responsibility of the Türkiye Payment and Electronic Money Institutions Association (TÖDEB), Action 1.1.4
- A common reporting template to be issued by the Public Oversight, Accounting and Auditing Standards Authority (KGK) to align financial reporting and sustainability reporting, Action 1.4.1
- The publication of Sustainability Assurance Audit Standard 5000, Action 1.2.2
- The completion by the Capital Markets Board (SPK) of the Guide on Green, Sustainable and Social Capital Market Instruments and the Guide on Sustainability-Linked Capital Market Instruments, Action 3.1.6
- Increasing the share of sustainability-themed funds in the portfolios of state contribution funds and Automatic Enrolment System (OKS) standard funds, Action 3.1.3
- A feasibility study on arrangements providing flexibility for foreign currency loan utilization in investment areas to be designated for the green transformation, under the responsibility of the Ministry of Treasury and Finance (HMB) and the Central Bank of the Republic of Türkiye (TCMB), Action 3.3.1
The last of these is worth monitoring separately with regard to the Decree No. 32 regime. The debate on introducing a green-investment-based exemption category into the foreign currency income requirement may point to a structural novelty in Turkish foreign exchange legislation.
IV. Key Obligations and Expectations for Financial Sector Actors
Banking: Expanding the scope of the Green Asset Ratio by aligning it with the Taxonomy by 2028, and the calculation of financed emissions, meaning loan portfolio emissions, by banks and their integration into risk management processes by 2029 under Action 1.2.4, are structural transformation items for the banking sector.
The establishment of the BDDK’s climate and environmental risk-linked stress-testing infrastructure by 2027 under Action 2.3.1, and the launch under the Financial Stability Committee of Climate and Nature Risk Stress Tests for the financial sectors by 2029, with results reported to the HMB every six months under Action 2.3.3, will directly affect supervisory practice.
Capital markets: The SPK regulation on environmental, social and governance (ESG) rating activities, planned for 2028 under Action 1.2.5, will bring a hitherto unregulated field under a licensing and oversight regime.
The review, through periodic assessment reports, of portfolio management companies’ practices under the Responsible Stewardship Principles Guide by 2027 under Action 1.1.6, and the authorization of audit firms to conduct assurance audits under the Türkiye Sustainability Reporting Standards (TSRS) by 2028 under Action 1.2.3, complete the reporting-assurance chain.
Insurance: A national risk management guide covering climate change and nature risks, together with the requirement for all licensed insurance companies to establish internal procedures consistent with it by 2027 under Action 2.3.2, will shape the sector’s agenda.
Further actions include an insurance or guarantee mechanism for emission reduction commitments in 2026 under Action 3.3.3, and a feasibility study on the systematic issuance of catastrophe bonds, or CAT bonds, for climate-linked risks in 2029 under Action 3.1.8.
Combating greenwashing: The NGFS Action Plan addresses the prevention of the misuse of green finance as a standalone target under Target 1.5. It tasks the BDDK, the SEDDK and the SPK with preparing, by 2028, sector-specific guides setting out green product definitions, green practices and methods of avoiding greenwashing under Action 1.5.1.
This adds a parallel layer, on the financial regulation front, to the greenwashing oversight framework established in the field of consumer law through the amendments to the Regulation on Commercial Advertising and Unfair Commercial Practices that entered into force in July 2026.
A two-track compliance obligation should therefore be expected in the marketing of financial products as “green”, under both consumer legislation and sectoral regulatory guides.
Public finance and public procurement: The completion, by 2027, of the legislative arrangements and the guide on green budgeting under Actions 1.1.7 and 1.1.8 is noteworthy.
The assessment of a review of the Public Procurement Law with a view to supporting practices promoting the green transformation in public procurement under Action 1.1.9 is also significant.
The latter places on the official agenda the debate on systematically incorporating environmental criteria into the “most economically advantageous tender” and technical specification regime of Law No. 4734. The action is, however, worded at the level of “assessing a review”, reflecting a double layer of caution.
V. Assessment: A Strong Timetable, Cautious Commitments
The NGFS Action Plan is a significant institutionalization step in that it ties, for the first time, the fragmented regulatory initiatives in the field of green finance in Türkiye to a single timetable and responsibility matrix.
That said, three points stand out.
The first is the weakness of the tax incentive dimension. Although Objective 3 is titled “strengthening incentive mechanisms”, the instruments envisaged are limited to prioritization in publicly subsidized loans, support for green patent application fees and R&D financing support.
Direct tax instruments, such as withholding tax advantages for green bonds and similar instruments, or special deduction or exemption regimes for green investments, are absent.
The lack of a bridge between the NGFS Action Plan and existing tax policy tools, including the incentive architecture introduced by Law No. 7582, makes the “incentive” leg the weakest link of the Plan.
The second is the soft formulation of a portion of the commitments. A considerable number of the forty-five actions are framed in terms of process rather than outcome, using expressions such as “conducting a feasibility study”, “assessing” and “carrying out studies”.
Likewise, some of the performance indicators, including the number of trainings, number of participants and publication of reports, are activity-oriented rather than output-oriented. This may make it difficult to measure the Plan’s success at the end of 2029.
The third is the uncertainty surrounding the monitoring and evaluation mechanism. There is no detailed arrangement for a standalone monitoring and evaluation structure that would track and report on the implementation of the actions and intervene in the event of delays.
Beyond the general support obligation the Circular imposes on public institutions, it remains unclear at what intervals and in what format implementation will be reported to the public.
Whether the annual activity report practice adopted under the Green Deal Action Plan is also envisaged for this Plan remains to be seen.
VI. Conclusion
As a document that fills in the financial system leg of the legal framework established by the Climate Law and rebuilds the financial architecture on the path towards the 2053 Net Zero Emission Target, the National Green Finance Strategy and Action Plan (2026-2029) will largely shape the regulatory agenda of the next four years.
The Türkiye Green Taxonomy Regulation and the ETS secondary legislation expected within 2026 require compliance preparations to be initiated now, by real sector businesses as much as by financial institutions.
Whether separate arrangements will follow in the coming period with respect to the Plan’s tax incentive dimension remains a matter to be monitored.