Turkish economy expected to grow 3 percent next year

Turkish economy expected to grow 3 percent next year

Turkish economy expected to grow 3 percent next year

The Turkish economy is forecast to grow 3 percent next year after contracting 1.9 percent in 2019, the World Bank said in its twice-yearly Global Economic Prospects report released on June 4.

According to the bank, Turkey’s gross domestic product (GDP) growth will gather further momentum in 2021, and the economy will expand at 4 percent.

“The recovery is assumed to strengthen in 2020 through gradual improvement in domestic demand and continued strength in net exports, provided that fiscal and monetary policy avert further sharp falls in the [Turkish] lira and corporate debt restructurings help avoid serious damage to the financial system,” the bank added.

The country’s economy contracted by 2.6 percent year-on-year in the first quarter of 2019, the latest data from the Turkish Statistical Institute (TÜİK) showed on May 31.

Seasonally- and calendar-adjusted GDP, however, rose by 1.3 percent from the previous quarter.

Turkey’s GDP at current prices totaled 914.7 billion Turkish Liras (some $170.4 billion) from January to March

The Turkish economy grew 2.6 percent in 2018.

As laid out in Turkey’s new economic program announced last September, the economic growth target of the Turkish government is 2.3 percent this year, 3.5 percent next year and 5 percent by 2021.

Slower global growth

The World Bank slashed its growth estimate for the global economy for this year to 2.6 percent from its forecast for a 2.9-percent expansion in the January report.

“Global economic growth is forecast to ease to a weaker-than-expected 2.6 percent in 2019 before inching up to 2.7 percent in 2020,” it said.

“Growth in emerging market and developing economies is expected to stabilize next year as some countries move past periods of financial strain, but economic momentum remains weak.”

According to the bank, emerging and developing economic growth is constrained by sluggish investment, and risks are tilted to the downside.

“These risks include rising trade barriers, renewed financial stress and sharper-than-expected slowdowns in several major economies.”