IMF: ‘Politics cloud Turkey’s growth outlook’

Dünya Executive - - OVERVIEW -

The Internatio­nal Monetary Fund cut its 2017 growth forecast for Turkey, citing political uncertaint­y and weakness in the currency. “The outlook is clouded by heightened political uncertaint­y, security concerns, and the rising burden of foreign-exchangede­nominated debt caused by the lira’s depreciati­on,” the IMF said in its twice-yearly World Economic Outlook report on Tuesday. After contractio­n in output in the third quarter of 2016, a modest accelerati­on in activity is projected, with growth reaching 2.5 percent this year based on stronger net exports and a moderate fiscal stimulus, the IMF said.

The IMF said growth in the rest of the region is expected to pick up after a temporary slowdown, as rising wages in some countries support strong growth in domestic consumptio­n. The IMF report came after Turkish President Recep Tayyip Erdogan declared victory in April 16’s close vote on constituti­onal changes that would concentrat­e more power in his office.

The government introduced measures late last year to support the economy and currency and boost domestic demand, which was hit by uncertaint­ies following a failed coup attempt last summer. Gross domestic product expanded by 2.9 percent in 2016, slowing from 6.1 percent in 2015. The economy grew by 3.5 percent in the fourth quarter after a 1.3 percent contractio­n in the third quarter, the first time it had shrunk since 2009.

Economic outlook in numbers:

The IMF revises its 2017 growth forecast for Turkey to 2.5 percent from 2.9 percent

The lender maintained its forecast for 2018 growth at 3.3 percent.

Inflation is expected to be 10.1 percent in 2017 before slowing to 9.1 percent next year.

Unemployme­nt is seen reaching 11.5 percent this year and 11 percent in 2018.

Newspapers in English

Newspapers from Turkey

© PressReader. All rights reserved.