Economic Trends/Outlook in Turkey

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Economic Overview

Turkey, a country of 74 million inhabitants, has an economy in transition, a relatively high degree of dependence on agriculture (11% of its territory is cultivated) and heavy industry (large mining sector and vast reserves of boron representing 60% of global reserves), and a tertiary sector in full expansion (hotel and catering business). After going through a serious economic and political crisis in 2001, Turkey has made a spectacular recovery thanks to a more favorable political climate but also to monetary, fiscal and structural reforms inspired by the World Bank and the IMF. Turkish economy is also based on manufacturing (country’s number one industrial activity). Since the 1980s, tourism has also been a significant source of income: Turkey is one of the ten most visited countries in the world. The financial crisis of course had an effect on the growth of Turkish economy; nevertheless the latter recovered relatively quickly and has grown by 3.5% in 2010. For 2011, the government foresees one point increase, thus bringing the growth rate to 4.3%. Indeed, the government has undertaken large economic reforms: adoption of a floating currency regime, giving total independence to the Central Bank, budgetary discipline and inflation control.

However, the Turkish economy remains vulnerable due to its high dependence on exports and foreign investment. With the current economic crisis, the unemployment rate has soared to around 15%. Turkey is also affected by its large informal sector.

Main Indicators 2009 2010 2011 2012 2013
GDP (billions USD) 614.47e 741.85e 797.61e 876.58e 943.43e
GDP (Constant Prices, Annual % Change) -4.7e 8.2e 4.6e 4.5e 4.1e
GDP per Capita (USD) 8,711e 10,399e 11,054e 12,012e 12,783e
General Government Balance (in % of GDP) -4.2 -3.5e -3.1e -2.9e -2.4e
General Government Gross Debt (in % of GDP) 45.5 41.7e 39.4e 37.6e 36.4e
Inflation Rate (%) 6.3 8.6e 5.7e 6.0e 5.4e
Unemployment Rate (% of the Labor Force) 14.0 11.9e 11.4e 11.0e 10.6e
Current Account (billions USD) -13.85e -28.35e -32.53e -33.46e -
Current Account (in % of GDP) -2.3e -4.0e -4.4e -4.3e -

Source: IMF - World Economic Outlook Database

Note: (e) Estimated Data


Main Sectors of Industry

Agriculture in Turkey, which contributes nearly 10% of the GDP and employs practically a third of the population, still suffers from low productivity because of its management system (small farms). Wheat is the main crop. The country is the third biggest exporter of tobacco in the world, the leading producer of hazelnuts (70% of world production). Mineral resources are abundant but under-exploited.

The manufacturing industry, the main industrial activity of the country, makes up nearly 30% of the GDP and commands almost 18% of the workforce, the textile and automobile sectors being the main activities. The Turkish government gives special priority to large infrastructure projects, particularly in the transport sector, which mostly function under the BOT model (build, operate, transfer).

The tertiary sector contributes slightly less than two-thirds to the GDP. Tourism represents 4% of the GDP with about 13 million tourists a year and almost 22milions in profits, thus making it one of the key sources of foreign currency for the country. 

Breakdown of Economic Activity By Sector Agriculture Industry Services
Employment By Sector (in % of Total Employment) 26.2 25.7 48.1
Value Added (in % of GDP) 9.3 25.8 64.9
Value Added (Annual % Change) 3.5 -8.4 -3.2

Source: World Bank - Last Available Data.

For more detailed background on Industries in Turkey, click here.

Indicator of Economic Freedom

Moderately free
World Rank:
Regional Rank:

Distribution of Economic freedom in the world
Source: 2011 Index of Economic freedom, Heritage Foundation


Country Risk

See the Country Risk Analysis Provided By Ducroire.


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