Turkish economy growing in ‘balanced way’: Minister

Turkish economy growing in ‘balanced way’: Minister

Turkish economy growing in ‘balanced way’: Minister

Turkey’s exports, domestic consumption and factory activity are all rising at the same time, Treasury and Finance Minister Nureddin Nebati has said.

Speaking at a business forum organized by an association in the Mediterranean province of Antalya on March 19, he said that after closing last year with an annual gross domestic product (GDP) growth of 11 percent, Turkey will continue to be among the top-tier economies among the G20 countries.

“Our leading indicators are in a very good shape. Purchasing power parity is at a very good point. Electricity consumption is pretty well. The wheels are turning at factories. While exports are rising, consumption is following suit. We have been progressing in a balanced way,” he said.

Noting that Turkey’s 12-month rolling exports volume reached $231 billion, “We have reached this level by proving successfully to the near markets that we are providing a proper production base.”

He reiterated that year-end annual exports volume target is $250 billion, up from $225 billion last year.

Turkey’s foreign trade gap was down 7.5 percent to $46.1 billion in 2021, compared to the previous year, according to official figures released by the Turkish Statistical Institute (TÜİK). Last year, imports increased by 23.6 percent to $271.4 billion.

Turkish exports reached $20 billion last month, up 25.4 percent on an annual basis. However, the foreign trade volume soared 36.4 percent to $48.1 billion in the same period, while imports amounted to $28.2 billion due to the strong winter conditions and increasing global energy prices.

Nebati also said that the global rise in energy prices has been accelerating inflation in the country, but Ankara would continue working to lower it, adding that the Turkish Lira’s recent decline was within “acceptable” levels.

He said a government-backed scheme that protects lira deposits against depreciation of the currency had helped eliminate concerns over what he called “attacks” on the lira’s exchange rate.

“What we have seen in recent months is that the exchange rate is stable and moves forward within acceptable limits,” he said.

Inflation hit 54 percent in February and economists expect it to continue rising towards 70 percent in coming months, after Russia’s invasion of Ukraine sent commodity prices soaring.

The lira is down 11 percent against the dollar this year, mainly due to the economic fallout from Russia’s invasion of Ukraine. The currency had declined 44 percent last year.

The Turkish government’s new approach, dubbed as Turkey Economy Model, prioritizes a current account surplus, increasing exports, GDP growth and expansion in employment, while keeping interest rates low.

The Central Bank cut its policy rate by 500 basis points to 14 percent between September and December but has kept it unchanged at the last three meetings.

Turkey’s calendar-adjusted industrial production rose 7.6 percent in January compared to the same period last year, according to data released by the Turkish Statistical Institute (TÜİK) on March 11.