AA Photo
Speaking at the Presidential Complex in Ankara, Yılmaz said Türkiye had made significant progress in fighting inflation.
“We have made significant progress in combating inflation. Inflation, which rose to 75.5 percent in May 2024, has entered a clear downward trend thanks to the policies we have implemented,” he said.
Yılmaz stated that inflation was expected to resume its decline in the final quarter of 2026 and reach 28.4 percent by year-end.
He also noted that the Central Bank estimated the direct and indirect impact of the war on inflation at around seven percentage points.
“We aim to reduce inflation, which we expect to reach 28.4 percent in 2026, to 21 percent in 2027, 13.5 percent in 2028 and 9 percent in 2029,” Yılmaz said.
Yılmaz also said that Türkiye’s 2026 economic growth forecast was revised down to 3.3 percent from 3.8 percent.
Under the new program, the government forecasts economic growth to accelerate to 4.2 percent in 2027, 4.6 percent in 2028 and 5 percent in 2029.
“By the end of 2028, we expect our national income to exceed $1.8 trillion for the first time and per capita income to surpass $20,000. We expect Türkiye to become the world’s 16th-largest economy and the 11th-largest in terms of purchasing power,” Yılmaz said.
He added that the government aims to raise national income above $2.2 trillion and increase goods and services exports to $450 billion by the end of the program period. According to Yılmaz, per capita income is expected to reach $25,000 by the end of the program.
Expected energy imports for 2026 were revised upward to $71 billion from $63 billion, while tourism revenue projections were lowered to $65 billion from $68 billion, Yılmaz said.
The forecast for the current account deficit-to-GDP ratio at the end of 2026 was revised upward to 2.6 percent from 1.3 percent.
The current account deficit-to-GDP ratio is projected at 1.9 percent for 2027, 1.8 percent for 2028 and 1.6 percent for 2029.
Yılmaz said the government aims to gradually reduce the budget deficit and expects the 2026 deficit to come in at 3.1 percent of GDP, below the previously forecast 3.5 percent.
He added that the government targets reducing the budget deficit-to-GDP ratio to 2.8 percent by the end of the program period.
Treasury and Finance Minister Mehmet Şimşek and Central Bank Governor Fatih Karahan also commented on the newly announced Medium-Term Program.
Şimşek said Türkiye faced serious shocks in 2023 and stressed the importance of reducing vulnerabilities stemming from the current account deficit.
“The improvement has been very substantial when gold is excluded,” he said.
Şimşek also rejected the notion that public-sector savings were being achieved through cuts to investments.
“The perception that public savings are being achieved by cutting investments is not correct,” he said.
He added that public expenditures would increase alongside planned appropriations and that there had been a significant rise in public-sector savings.
Karahan said they did not see any revision in the outlook that would justify pessimism regarding inflation.
“We are seeing positive inflation data in areas that affect monetary policy,” Karahan said.
The Medium-Term Program entered into force after being approved by President Recep Tayyip Erdoğan and published in the Official Gazette.
