Finance Minister announces “New Economy Program” downgrading growth forecast

Treasury and Finance Minister Berat ALBAYRAK has announced the New Economic Program (YEP) which is normally (and traditionally referred to as Medium Term Program). The forecast is that Turkey will grow by 0.3 percent in 2020. In the previous presentation, the growth forecast was announced as 5 percent. Unemployment and inflation forecasts for 2021 also rose.

Minister ALBAYRAK stressed that the name of the new approach in the economy will be “New Normal” and said, “What do we mean by the new normal? The functioning of social economic life in the world has changed. Business patterns in the economy have been reshaped. In addition to the fact that services contact all areas of life in order for the economy to achieve the necessary harmony, it came across as a necessity. Our second goal will be to give the most accurate response to these imperatives and adapt to the new normal with the dissemination of models. Our third theme is the new economy; Export-oriented and inclusive development model.”

After his introductory speech, Minister ALBAYRAK began to list new economic forecasts for unemployment, growth and inflation.

Employment

The Minister stated that they forecasted unemployment to be 13.8 percent by the end of 2020. In the previous period, the unemployment forecast for the end of 2020 was 11.8 percent. Unemployment was expected to be 10.6 percent in 2021, and now the forecast has been updated to 12.9 percent.

Inflation

The forecast for inflation at the end of 2020 which was announced as 8 percentin the previous presentation rose to 10.5 percent. The 2021 forecast increased from 6 to 8 percent, the 2022 forecast from 4.9 percent to 6 percent, while the 2023 year-end forecast was announced as 4.9 percent.

Growth

The forecast for year-end 2020 growth, announced at 5 per cent in the second quarter, was revised to 0.3 per cent in today’s presentation. The year-end growth forecast for 2021 increased from 5 percent to 5.8 percent, while the year-end growth forecast for 2022 remained unchanged at 5 percent. The year-end growth forecast for 2023 was announced as 5 percent.

Rate forecast

The revisions to the dollar exchange rate on the national income account were as follows: 2020 … 6.91, 2021 … 7.68, 2022 … 7.88, 2023 … 8.02