EU raises forecast on Turkish economy

BRUSSELS - Anatolia News Agency

The European Commission increased its growth forecast for the Turkish economy from 3 percent to 3.3 percent for this year and from 4.1 percent to 4.6 percent for 2013.

The commission has described Turkey’s performance in reducing public debt stock in the past decade as an “impressive success story.” The European Commission released a spring economic forecast report, noting that Turkey’s gross domestic product (GDP) growth rate was forecast to ease to 3.3 percent in 2012, before accelerating to 4.6 percent in 2013.

“Annual GDP growth reached 9.2% in 2010 and was 8.5 percent in 2011 (helped by strong base effects), in spite of sluggish demand in Turkey’s chief export markets. The major factors behind this robust performance were the continued buoyancy of investment and a positive contribution from net trade in the second half of 2011,” it said.

 “Turkey’s fiscal consolidation in the past decade has been an impressive success story. In the wake of the 2001 financial crisis, the government managed to cut the public debt-to-GDP ratio from 75 percent to about 40 percent currently,” it said.

“While signs of improving external balances in recent months are clearly welcome, the prospective turnaround is still set to be comparatively modest, with the current-account deficit shrinking gradually from 10 percent of GDP in 2011 to 9.3 percent of GDP in 2012, and 8.7 percent of GDP in 2013,” it added.