ISTANBUL
The International Monetary Fund forecast Turkey's economy to grow 3.4 percent in 2015, and 3.4 percent in 2016, according to a report released Friday.
The forecasts are somewhat lower than those of Turkish government's development plan, which projected four percent growth in 2015.
The report, "Global Prospects and Policy Challenges," was released ahead of the G20 meeting in Istanbul, which Turkey will chair. It warned that declining oil prices would not be enough to spur global growth in the coming two years.
"Global growth will receive a boost from lower oil prices, which reflect to an important extent higher supply. However, this boost is projected to be more than offset by negative factors, including the drag in investment associated with diminishing medium-term growth prospects. Accordingly, global growth in 2015-16 is revised down by a quarter percentage point to 3.5 and 3.7 percent, respectively," the report said.
In some emerging economies, lower oil prices might alleviate inflationary pressures and reduce vulnerabilities, the report continued.
"This would allow for monetary policy to be tightened more gradually or by less than otherwise required. The scope to do so will require credible macroeconomic policies and frameworks, which has proven essential in coping with volatile financial conditions in the past. Nonetheless, some economies (e.g., Turkey) that rely heavily on private external financing will need to proactively further adjust policies," the report said.
