When adjusted seasonally, the Turkish economy posted a 10.9 percent increase in real gross domestic product (GDP) growth in the first quarter of the year compared to a year ago, the second highest growth rate amongst the G-20 after China. Last year, however, the economy contracted by 12.8 percent in the corresponding period.
Market research company Euromonitor International attributed the 10.9 percent rise in Q1 GDP mostly to the base effect, in a report released on Monday. According to the study, quarter-on-quarter figures reveal that the economy slowed for the third consecutive quarter in the first three months of the year, thus illustrating that growth has been affected by the European debt crisis and lower public spending.
The report also highlighted a significant increase in domestic demand mainly due to lower interest rates. Accordingly, household spending rose by 9.9 percent year-on-year in constant terms.
However, the report stressed that Turkey remains vulnerable, as “the troubled debt-ridden EU could also dampen Turkey’s economic recovery, particularly given that the EU is Turkey’s main trading partner.” Exports to the EU-27 amounted to 38.2 percent of Turkish exports in 2009.
Euromonitor International predicted the Turkish economy will grow by 5.2 percent and 3.4 percent in 2010 and 2011, respectively.
