EU raises Turkey's growth forecast

By Dilara Zengin and Bahattin Gonultas

ANKARA

The EU has increased its 2017 growth forecast for Turkey by more than two percentage points, according to the European Economic Forecast Autumn report published on Thursday.

Brussels’ latest set of economic forecasts project that the Turkish economy will grow 5.3 percent in 2017, up from the union's previous estimate of 3 percent in May.

The EU raised the country's economic growth forecast for 2018 from 3.3 percent to 4 percent.

The Turkish economy is also expected to grow 4.1 percent in 2019.

The increase follows the International Monetary Fund upping Turkey’s 2017 growth forecast 2.6 percentage points on Oct. 10, the World Bank raising its forecast 0.4 percentage points on Oct. 19 and the European Bank for Reconstruction and Development's [EBRD] lifting it by 2.6 percentage points on Nov. 7.

Turkey’s economy grew 5.2 percent in the first quarter of this year and 5.1 percent in the second quarter, compared with the same periods in 2016, according to the Turkish Statistical Institute (TurkStat).

"The government's fiscal stimulus this year -- supported by stronger exports, a significantly depreciated Turkish lira in comparison with last year and a strong boost from public finances and other policy incentives, intended to restore confidence in the Turkish economy," the bloc's economic report said.

The report noted growth of private consumption was expected to increase towards the end of this year and continue its expansion in 2018-19.