Turkey’s economic growth is high and well balanced: Turkish Deputy PM

Turkey’s economic growth is not only high but also well balanced, says Turkish Deputy Premier Mehmet Simsek

Simsek’s comments came after the Turkish Statistical Institute (TurkStat) announced that the economy expanded by five percent in the first quarter of 2017 compared with the same period in 2016.

“This increase in the short term is driven by measures that we took and by foreign conjuncture partially. I think, the most important point is that confidence is back in the market again. We will reinforce it through reforms. Hopefully, Turkey will follow a growth path of 5 percent and above again,” he said.

In a live interview broadcast with the private television channel NTV, Simsek said domestic demand and net exports contributed 2.8 points and 2.2 points to the first quarter’s growth rate, which was better than expectations.

He said the growth rate was not only higher but also well balanced.

Growth will accelerate in the second quarter when the leading indicators are considered, he said.

“The main point is sustainability [of economic growth]. Our investment campaign will be more influential. There is a strong recovery in employment which will continue.

“Increase in credit might not continue at this pace as it is related with credit guarantee fund partially. One of the most important issue is our crucial trade partner EU. There is a recovery in the eurozone and this will speed up this year with continuation of monetary easing and support of euro’s competitive situation,” Simsek said.

Inflation and exports

The deputy premier also said the country’s inflation, which stood at 11.72 percent in May, must come to single digits by the end of the year.

Simsek said the government’s investment incentives would be felt strongly in the coming months and employment recovery would continue.

“The data indicates that growth could exceed our target,” he added.

Additionally, Economy Minister Nihat Zeybekci said the net exports’ contribution to growth was 2.2 percent.

Turkish exports surged by 10 percent in the first five months compared with the same period last year and reached over $63.1 billion, according to Economy Ministry.

The country’s growth rate has surpassed that of the EU, OECD and G7 countries with its 5 percent growth rate, he said.

“Our expectation of the 2017 growth rate is accentuated by the first quarter data,” Zeybekci said.

“We will keep implementing a market-oriented exports and investment growth model in the coming period,” he added.

The lira had lost over 18 percent against the dollar last year, but it made gains after the country’s referendum in April.