Turkish economy grows 5.7 percent in first quarter

ANKARA

The Turkish economy grew by 5.7 percent in the first quarter of 2024 from a year ago, accelerating from the 4 percent of expansion in the final quarter of 2023, data from the Turkish Statistics Institute (TÜİK) have shown.

The quarterly growth of the Turkish economy quickened from 1 percent to 2.4 percent.

“Our economy is moving towards a more balanced and sustainable growth with the rational, predictable and rule-based policies we implement,” Finance Minister Mehmet Şimşek wrote on X, commenting on the growth data, adding that the annualized national income reached $1.16 trillion.

Indicators for the second quarter of the year point to a continued rebalancing in the economy, Şimşek said.

While the contribution of domestic demand to growth was 4.1 points, the contribution of net external demand turned positive after five quarters and it was 1.6 points in the first quarter of 2024, the minister added.

“Throughout 2024, we project balanced growth with a positive contribution from net external demand,” Şimşek said.

“Thanks to our program, the balanced growth composition, declining current account deficit, increased confidence, improved expectations and accelerated foreign resource inflows will contribute significantly to disinflation,” said the minister.

Final consumption of households increased by 7.3 percent in January-March from a year ago, slowing from the year-on-year increase of 9.3 percent in the final quarter of 2023, showed TÜİK data on May 31.

Household consumption accounted for 56.6 percent of GDP in the first quarter, down from 59.3 percent in the previous three-month period.

Exports rose 4 percent annually, while imports declined by 3.1 percent, according to TÜİK data.

Government final consumption grew 3.9 percent, accelerating from 1.7 percent, while gross fixed capital formation increased 10.3 percent in January-March 2024, declining slightly from 10.7 percent in October-December last year.

The construction sector grew 11 percent year-on-year in January-March, after expanding 10.8 percent in the previous quarter.

The pace of annual growth of the agriculture sector accelerated from 0.5 percent to 4.6 percent.

Industry expanded 4.9 percent with the key manufacturing sector growing 4.7 percent year-on-year in the first quarter of 2024, which compares favorably with the 1.9 percent growth in the previous quarter.

Services sector expanded 4.3 percent after growing 3 percent, while the annual expansion of the financial and insurance activities slowed from 7.4 percent to 2 percent.