Turkey projects 9% GDP growth this year, 5% in 2022

ANKARA

Turkey’s economy is projected to expand 9% this year and grow a further 5% in 2022, according to the country’s medium-term economic program published in the Official Gazette late on Sunday.

The government is aiming for growth of 5.5% in 2023 and 2024, according to the three-year program, while the average gross domestic product (GDP) growth rate target is 5.3%.

Turkey’s GDP jumped 21.7% year-on-year in the second quarter of 2021, the highest annual growth rate since 1999, according to official data released last week.

Commenting on the program, Treasury and Finance Minister Lutfi Elvan said on Twitter: “We will further strengthen macroeconomic stability for durable growth led by the private sector.”

Turkey’s annual inflation, which climbed to 19.25% in August from 18.95% in July, is projected to hit 16.2% by the end of this year.

It is expected to fall to 9.8% by the end of 2022, according to the new economic program, while the year-end targets for 2023 and 2024 are 8% and 7.6%, respectively.

The current account deficit to GDP ratio is projected to be 2.2% next year, further narrowing to 1.5% in 2023 and 1% in 2024.

The GDP per capita is expected to surpass $11,000 by 2024, according to the program. The figure will be $9,947 in 2022, $10,703 in 2023, and $11,465 in 2024.

The government is aiming for the GDP to exceed $850 billion in 2022, before hitting $975 billion in 2023 and topping $1 trillion in 2024.

Turkey's GDP with current prices is projected to be around $801 billion this year, while it stood at $717 billion in 2020, according to the Turkish Statistical Institute.

The US dollar/Turkish lira exchange rate will be around 8.30 by the end of this year and increase to 9.27 in 2022, 9.77 in 2023, and 10.26 in 2024, according to the program.

The country’s exports target is $230.9 billion for 2022 and grows to $255 billion by 2024.

Turkey’s budget deficit, which has widened due to the impact of the coronavirus pandemic, is projected to increase in the coming few years.

It is expected to be 230 billion Turkish liras ($27.7 billion) this year, with a target of 278.4 billion liras ($30 billion) for 2022, 290.2 billion ($29.7 billion) in 2023, and 294 billion liras ($28.7 billion) in 2024.

The unemployment rate in Turkey, which stood at 10.6% in June, will hit 12.6% by the end of this year, according to the program’s estimates.

The government aims to bring it down to 12% next year, 11.4% in 2023, and 10.9% in 2024.​​​​​​​