Turkish growth beneficial for global economy, experts say
GLOBAL economists said that Turkish growth, which hit 5.1 percent in second quarter, was a positive development for the global economy, as Commerzbank Senior Emerging Markets Economist Tatha Ghose said Turkey regained confidence in the country’s investment environment.
FOLLOWING the announcement of Turkey’s growth data in the second quarter, which hit 5.1 percent, global economists evaluated the growth as a positive development. Commerzbank Senior Emerging Markets Economist Tatha Ghose said Turkey has regained confidence in the country’s investment environment. On the other hand, Rabobank Emerging Markets Exchange Strategist Piotr Matys stated that the country’s economy has quickly recovered from the negative economic impact of tumultuous political events of last year.
Commerzbank’s Ghose said Turkey could grow by 5.8 percent in 2017.
Speaking to Anadolu Agency (AA) regarding Turkey’s 5.1 percent growth in the second quarter, Ghose noted that the Turkish economy has geared up for the future and confidence in Turkey’s investment environment has been restored.
Underlining that tourism is an important factor in the success of the Turkish economy and that the sector is developing, Ghose stated that the number of tourists coming to Turkey has reached normal levels and that this is a significant development in terms of the current account deficit.
Ghose said the inflation outlook has not made much progress, asserting that this has not had a profound effect on the markets, while explaining that the outlook on Turkish assets has been largely regarded as positive.
Ghose went on to note that Turkey achieved broader-based development in the second quarter, adding that secondquarter growth was not achieved with public expenditures as these expenditures decreased in this period.
The economist stressed that Turkey’s economy could grow by 5.8 percent in 2017 and that the combination of the U.S. Federal Reserve’s (Fed) possible interest rate hike and other global high interest rates are negative factors for Turkey’s growth in 2018.
‘TURKEY’S GROWTH RATE IS VERY IMPRESSIVE’
Rabobank Emerging Markets Exchange Strategist Piotr Matys stated that the Turkish economy is rapidly recovering from the slowdown it experienced due to the July 15 coup attempt and terrorist attacks in the country, adding that Turkey’s growth rate is very impressive and its medium-term outlook is also encouraging.
Matys said financial incentives have contributed to growth but reiterated that growth without structural reforms may not be sustainable, stating that structural reforms will increase domestic savings, productivity and investments.
Emphasizing that strong growth must be continued with private consumption, investments and exports, Matys noted that capital inflows to Turkey could continue thanks to the signs of invigoration evident in the economy and the favorable, exogenous environment.
Emphasizing that the Turkish lira has recently showed resistance to the risks stemming from North Korea, Matys predicted that the dollar-lira exchange rate could drop down to 3.35 by the end of the year.