Türkiye targets 4.2 percent growth in 2027 as government unveils budget proposal
ISTANBUL
Türkiye expects economic growth to accelerate to 4.2 percent in 2027 from a projected 3.3 percent this year, supported by an improving global outlook and a recovery in external demand, Vice President Cevdet Yılmaz said on Oct. 16 with next year’s proposed budget in hand.
Presenting the government’s 2027 budget proposal at the presidential complex in Ankara, Yılmaz said stronger growth among Türkiye’s trading partners would create opportunities for exports and support balanced economic expansion.
The Turkish economy grew 3.7 percent in 2025, he said, adding that investment outpacing private consumption had strengthened production capacity and improved the composition of growth.
“In 2027, we expect our growth to rise to 4.2 percent, supported by the anticipated improvement in the global outlook and the recovery in external demand,” Yılmaz said.
The government aims to gradually accelerate growth to 5 percent by the end of its medium-term program through policies focused on productivity, technological transformation and innovation, he said.
Yılmaz said annual inflation, which fell below 30 percent in September, was expected to reach 28.4 percent by the end of this year before declining to 21 percent by the end of 2027.
“Price stability is the fundamental priority of our program,” he said.
Fiscal discipline and incomes policies will continue to support monetary policy, while supply-side measures, particularly in social housing and food, will reinforce disinflation.
Despite fluctuations stemming from energy and commodity prices, the underlying inflation trend continues to improve, Yılmaz said, reiterating the government’s medium-term goal of achieving lasting single-digit inflation.
He said the current account deficit was expected to fall below 2 percent of gross domestic product next year from a projected 2.6 percent in 2026.
Türkiye will continue policies to boost exports, strengthen energy supply security and reduce dependence on energy imports, he added.
The 2027 budget proposal projects expenditures of 27.28 trillion Turkish liras and revenues of 23.41 trillion liras ($551.2 billion), with national income expected to reach $2.24 trillion.
The figures imply a budget shortfall of $78.1 billion, equivalent to a projected 3.5 percent of GDP. Excluding earthquake-related expenditure, the deficit is forecast at 2.8 percent of GDP.
Yılmaz said the proposal would be submitted to parliament with President Recep Tayyip Erdoğan’s signature, calling it a budget of “resilience, prosperity and transformation.”
Interest expenditures are projected at $80.2 billion. The budget is expected to maintain a primary surplus next year.
For 2026, the government forecasts a deficit of 3.1 percent of GDP, below the initial 3.5 percent projection, despite spending pressures from higher energy and commodity prices.
Urban transformation funding will rise 176 percent to $5.57 billion in 2027, Yilmaz said, with disaster resilience remaining a priority alongside expanded social and rental housing provision.
Earthquake reconstruction spending over 2023-2026 totaled $109 billion at current prices, equivalent to $104 billion, he said, with 455,357 independent units completed and delivered.