Economic Growth in Turkey
Turkey's GDP growth from 2013 to 2022 was marked by volatility, influenced by political instability, monetary policy challenges, and currency fluctuations. The early years saw robust growth, but political upheavals and security concerns slowed the economy mid-decade. A sharp currency devaluation in 2018 prompted a further slowdown. That said, Turkey was one of the few large economies to avoid contraction in 2020 during the pandemic, and has notched rapid GDP growth in the two years since then.
Turkey's economy recorded an average growth rate of 5.3% in the decade to 2022, higher than the 2.5% average for Eastern Europe. In 2022, real GDP growth was 5.5%. For more GDP information, visit our dedicated page.
Turkey GDP Chart
Turkey GDP Data
|Economic Growth (GDP, ann. var. %)||3.0||0.8||1.9||11.4||5.5|
|GDP (USD bn)||776||760||719||814||905|
|GDP (EUR bn)||658||679||630||688||861|
|GDP (TRY bn)||3,761||4,318||5,049||7,256||15,012|
|Economic Growth (Nominal GDP, ann. var. %)||20.0||14.8||16.9||43.7||106.9|
GDP growth moderates in Q2
GDP growth ebbed to 3.8% year on year in the second quarter, from 3.9% in the first quarter. The reading came in above market expectations. Private consumption growth fell to 15.6% in Q2, marking the weakest expansion since Q3 2021 (Q1: +17.3% yoy). Public spending growth moderated to 5.3% in Q2 (Q1: +6.1% yoy). Meanwhile, fixed investment growth sped up to 5.1% in Q2, above the 3.7% increase in the prior quarter. Stronger construction activity following Q1’s devastating earthquakes spearheaded the improvement in investment. Exports of goods and services plunged at the steepest rate in over two years, contracting 9.0% in the second quarter as the economy faced a bleaker external backdrop (Q1: -2.6% yoy). Conversely, imports of goods and services growth picked up to 20.3% in Q2 (Q1: +14.2% yoy), marking the best reading since Q1 2020 and signaling resilient domestic demand. On a seasonally adjusted quarter-on-quarter basis, economic activity rebounded, increasing 3.5% in Q2, contrasting the previous quarter's 0.1% contraction. Q2's reading marked the best result since Q3 2021 and reflected the recovery from Q1’s earthquakes.
In H2, the economy is seen losing further steam. PMI data for July and August points to weaker industrial activity. Additionally, inflation reversed its downward trend in July, coming in at a four-month high, and is seen increasing further by year-end. Against this backdrop, the Central Bank hiked aggressively in August, which is set to weigh on overall activity during the remainder of the year. Additionally, muted activity around the globe will keep a lid on the external sector. Economic policy under Erdogan’s new Cabinet is a key factor to monitor. Analysts at the EIU commented on the outlook: “Real GDP growth may moderate in the remainder of the year as a result of policies adopted since the elections with a view to shoring up public finances and reducing the external deficit. Some taxes and public-sector prices have been increased, the Turkish lira has been allowed to weaken, inflation is being allowed to erode incomes, and interest rates have started to rise.”
How should you choose a forecaster if some are too optimistic while others are too pessimistic? FocusEconomics collects Turkish GDP projections for the next ten years from a panel of 43 analysts at the leading national, regional and global forecast institutions. These projections are then validated by our in-house team of economists and data analysts and averaged to provide one Consensus Forecast you can rely on for each indicator. By averaging all forecasts, upside and downside forecasting errors tend to cancel each other out, leading to the most reliable GDP forecast available for Turkish GDP.
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