Turkish economic growth jumps to 11.1 pct, hitting highest quarterly growth since 2011
ANKARA / ISTANBUL
Turkey’s gross domestic product grew at a blistering 11.1 percent in the third quarter, hitting its fastest expansion in six years, data from the Turkish Statistics Institute (TÜİK) showed on Dec. 11.
The growth rate is believed to have been encouraged by a series of government incentives and the low base effect after last year’s failed coup attempt. Following the coup attempt, which led to a 0.8 percent contraction in the third quarter, the government ramped up its stimulus measures including the use of its Credit Guarantee Fund and changes to tax regulation.
Performance in the third quarter pushed up cumulative GDP, reaching 827.2 billion Turkish Liras ($216 billion) in current prices, with GDP annualized at $844 billion, TÜİK data showed.
When the activities that constitute gross domestic product were analyzed, the total value added increased by 2.8 percent in the agricultural sector, 14.8 percent in the industry sector, 18.7 percent in the construction sector and 20.7 percent in the services compared with the same quarter of the previous year.
Final consumption expenditure by resident households grew 11.7 percent in the third quarter from a year earlier. Government spending on wages and purchases of goods and services rose 2.8 percent and gross fixed capital formation increased 12.4 percent in the third quarter of 2017 compared with the same quarter of the previous year in the linked volume index.
Exports of goods and services increased by 17.2 percent and imports of goods and services increased 14.5 percent in the third quarter from a year earlier.
Annual growth ‘may hit 7 percent’
Speaking to broadcaster TRT Haber, Şimşek said the Credit Guarantee Fund support was quite visible in the economic growth, as proved by the 15.3 percent expansion in machinery and equipment investments.
The Credit Guarantee Fund guarantees loans to small and medium-sized enterprises that could not otherwise get credit. It has backed some 221 billion liras ($57.39 billion) worth of loans so far, after its size was increased more than ten-fold to 250 billion liras in March.
“Turkey’s economy has grown at record high levels, with Turkey becoming the world’s fastest growing economy. The fourth quarter data also seems good and we expect to see a high growth level in that quarter to,” Elvan told private broadcaster A Haber.
New measures ‘underway’
“It will not be surprising for us if growth hits 7 percent in 2017,” Zeybekci said during a televised interview on BloombergHT.
“We will see a nearly 100 percent rebound in private sector investments in 2018 thanks to a series of new measures, which will be announced this month,” he added.