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2.10 Research and Development Activities
In keeping with the importance that the CBRT attaches to academic studies, working papers and research notes prepared by the CBRT staff continued to be posted on the CBRT website in 2017. 21 publications were added to the CBRT working papers series of peer‑reviewed research papers written by the CBRT staff‑members. In addition, another 15 new additions were made to the series of Research Notes that the CBRT publishes in order to contribute to discussions on economic issues in a timely fashion and to publicize the results of research about Turkish economy and monetary policy.
Central Bank Review, a peer-reviewed journal covering such topics as macroeconomic stability, financial stability, liquidity management, payment systems, and reserves management, was published by the CBRT 4 times in 2017.
Meanwhile, 7 articles that were written with contributions of the staff of the CBRT Research and Monetary Policy Department were published in journals that are listed in the Social Sciences Citation Index. The same department also held 5 seminars as part of the general series that it conducts for the CBRT personnel last year. During these seminars, presentations were given by participants from universities in Turkey and other countries, from international organizations, and from other countries’ central banks.
During the first half of 2017, a total of 6 research papers and studies were published by the Istanbul School of Central Banking (İMB). Of these publications, 2 were published by journals that are listed in the Social Sciences Citation Index, 1 was included in the CBRT Working Papers Series, and 3 appeared in various other national and international research publications.
In 2017, the İMB also conducted research seminars and a program of visit for academicians, research specialists, and central bank economists with the aim of contributing to the CBRT’s technical capacity, knowledge, communication, and bilateral cooperation in the areas of central banking, economics, and finance.
The Structural Economic Research Department of the CBRT, established and commenced operations on 28 June 2016, continued to engage in research on such topics as identifying the structural factors that restrain the effectiveness of the monetary policy, to formulate policy proposals within the framework of inter-agency cooperation, and to develop the corporate infrastructure.
This Department’s activities in 2017 may be summed up under five headings: (1) Work carried out within the scope of the Food and Agricultural Product Markets Monitoring and Evaluation Committee (2) In‑depth field studies exploring real economy along with sectoral and regional issues (3) Support for policymaking processes (4) Research (5) Coordination with academic circles.
The CBRT serves as the secretariat for the Food & Agricultural Product Markets Monitoring & Evaluation Committee. During 2017, this Committee convened 10 times in meetings that were chaired by Deputy Prime Minister Mehmet Şimşek. As a result of technical discussions concerning issues on the Committee’s agenda, a total of 17 decisions were put into effect with their publication in the Official Gazette.
Because the agencies and organizations that make up the Committee’s membership are represented at their most senior level of administration, the Committee is able to take a cooperative, solution-focused approach and formulate concrete policy measures in order to deal with the issues and problems they address. The benefits of the measures taken are expected to make themselves clearly felt in 2018.
In interactions with the real sector, face-to-face meetings are held with firms’ senior decision-makers. These meetings make it possible to obtain first-hand information from individual firms about sectoral, regional, and general activities and about their expectations on a variety of issues such as production & demand, investment, employment, borrowing conditions, prices, and costs.
Having previously been conducted in every two months in 2014‑2016, meetings with firms were conducted monthly last year. During 2017 a total of 1,581 firms were visited, of which 723 were manufacturers and 423 were wholesalers and retailers. Of these firms, 384 were based in Istanbul, 143 in Izmir, and 108 in Ankara. Seeking to maintain continuous communication with real sector firms on a more localized basis, a more dynamic structure was established in 2017 and Istanbul (Europe), Istanbul (Anatolia), Ankara, Izmir, and Adana Regional Offices were opened.
Such meetings play a major role in keeping track of real sector sentiments about how the economy is doing in a more timely fashion, in gaining a better understanding of the reasons behind firms’ economic decisions, and in making sounder economic forecasts. The data obtained through these meetings is compiled on a sectoral and regional basis so as to remove any firm‑specific information and then is regularly reported. It serves as substantial input for the determination of the monetary policy. In addition, corporate decision‑makers’ views about and expectations of monetary policy implementation were also reported to the CBRT Senior management without the identities of the firms. During 2017, efforts were made to improve the quality of the reports, to improve the sampling of current data taking the relative weights of economic activities at the sectoral and regional levels into account, and to enable sampling selection to be carried out by Regional Offices.
The direct transmission of the CBRT policies to companies and the provision of the better‑quality timely information to the MPC have strengthened the strategic role of the real sector studies in the CBRT ‑ Real Sector communication.
Besides analyzing such structural issues as Turkey’s economic growth, productivity, labor markets, foreign trade, balance of payments, public finance, saving/consumption, competition, human capital, research & development, and infrastructure as well as entrepreneurship, the digital economy, energy, education, and migration from the standpoints of financial stability and monetary policy, real-sector data was compiled on a sectoral and regional basis, consolidated and used effectively in the monetary policy decision-making process.
Detailed work was also carried out in order to provide access to new data sets and to support the policy-formulation process with the aims of identifying the structural factors that lead to inflation rigidity and persistence, of working jointly with other agencies and organizations that are involved, and of expanding the analytical capacities of the CBRT technical units.
An online system using image-processing technology was developed to control the quality of the intaglio printing on banknote substrates. This system is now being used on one of the CBRT Banknote Printing Plant’s intaglio printing machines.
A number of project-based R&D studies aimed at improving the plant’s processes were also completed last year.
One of the works that was completed in 2017 was initiated in 2016 and involved setting up an in-house ISO 14001 Environmental Management System, which provides an overall framework for ensuring that the plant is fulfilling its environmental responsibilities and statutorily-mandated obligations. In September 2017, the Turkish Standards Institution (TSE) was formally requested to verify the plant’s compliance with the standard. As a result of audits that the TSE conducted on 10-13 October, the plant was qualified for ISO 14001 Environmental Management System certification.
A large number of projects and infrastructure-related works were carried out in 2017 by the Information Technologies Department in line with the CBRT strategies. The infrastructure projects focused mainly on technology-renewal and capacity-expansion while the others were concerned with contributing to the CBRT’s ability to achieve its targets for the upcoming period by improving the services provided to bank units and by modernizing its software inventory.
Focusing on increasing the delivery speed and quality of information technology (IT) services being provided and on readying the Bank’s IT infrastructure for its digital transformation, important progress was made last year in the areas of:
Within the context of software-development processes, work was completed on the commission of new methods and tools for estimating project costs and for analyzing software quality.
In the context of the CBRT’s ongoing digital transformation process, work is continuing on projects concerned with the Bank’s use of big-data and business-analytics technologies and with installing the infrastructure needed for such use. Other projects in support of the CBRT’s digital transformation carried out last year included renewing the Bank’s main website and its EDDS and readying the infrastructure required for expanding the use of mobile technologies.
Important progress was also made in 2017 in the direction of renovating the CBRT’s infrastructure technologies in line with its digital transformation projects. In this context, the Bank’s communication networks, data-storage technologies, and user hardware systems were renewed, thereby increasing the CBRT’s capacity to cope with its steadily-expanding transaction volumes.
Archives Management System
After completion of the testing processes, the CBRT’s new web-based Archives Management System was made accessible to all authorized CBRT users as of the beginning of 2017.
Consisting of 13 main modules and 25 sub-modules, this system experienced heavy use in 2017 owing to the accessibility that it provides to information contained in CBRT’s physical and electronic archives no matter where the archives themselves may be located. Through this system, information may be:
As of end-2017, the CBRT Archives Management System contained 303,741 entries, of which 289,749 were located in the Bank’s archives, 13,821 in Department archives, and 171 in Division/Service-level archives.
All documents and files dating back to 1931, when the CBRT was founded, and which hitherto had been held in Department and Branch archives have been recorded in electronic format and are being kept in the corporate archives of the now fully operational CBRT Archive Management System.
Creation of Corporate Archives
All archival materials previously held by Departments and Branches either on their own premises and/or in the archives of the Izmit Branch have been relocated to the new CBRT Corporate Archives in Kahramankazan, about an hour’s drive north of Ankara. Under this project, about 300 thousand storage containers holding about 100 million documents were physically conserved; classified according to subject, date, and standard document code; labeled with barcodes and saved into the CBRT Archive Management System.
Since all documents in the corporate archives can be queried through the CBRT Archive Management System, users who are in need of particular documents can use the system to request access.
Use of Electronic Signatures and Registered Electronic Mail
Owing to the increasingly greater use of electronic signatures in the CBRT’s external correspondence, a set of instructions detailing how registered electronic mail is to be used was prepared and published.
The CBRT’s registered email address (merkezbankasi@hs02.kep.tr) was intensively used for the sending and receiving of all email messages and documents that bear electronic signatures. During 2017, 287 documents were received through this address and 830 were sent via the Bank’s registered email address.
Besides being now mandated by law, the use of the registered email system and of electronic signatures saves labor, reduces communication costs, ensures that correspondence takes place quickly and securely, and is a more eco‑friendly alternative.
CBRT’s New Electronic Data Delivery System
By allowing the national economy to be monitored closely, the CBRT Electronic Data Delivery System (EDDS) provides a vital public service. On 20 October 2017, a newly-designed EDDS was launched with enhanced functions and features.
When designing the new system, one goal was to ensure that existing services were not interrupted; another was to add new features that had been identified based on the findings of previously-conducted user-satisfaction surveys. These new features include:
Cash Management System
The use of more effective information flows in the cash management system and in the CBRT’s banknote deposit and payment operations with banks allowed for increased automation as well as reduced costs and risks. CBRT introduced the use of sealed containers for banks’ deposits of banknotes to the CBRT branches, relieved banknote deposit operations and decreased transaction times. And finally, under a new module introduced to the system in December 2017, information concerning banknote processing data started to be automatically sent to the banks. Hence, overall efficiency for CBRT and the banking sector has been improved.
Decentralized Cash Management System
The goal of CBRT’s Decentralized Cash Management System, per se the Notes‑Held‑to‑Order Scheme, is to set up in‑house cash vaults at premises of the Bank’s counterparties, namely banks and CITs and to delegate greater roles in cash‑handling, storage and distribution operations so as to increase the efficiency of banknote and coin circulation in Turkey.
With the aim of increasing the efficiency in cash cycle, reducing the costs and risks, and improving service quality by expanding the distribution network, in 2017 CBRT organized workshops for the mentioned counterparties in November and December during which developments related to this project were discussed and visits were conducted to potential cash vault facilities.
