Turkey: Businessmen expect 4 percent growth in 2012

Turkey’s gross domestic product (GDP) clinched 10.2 percent growth for the first half compared to the same period in 2010, recording the world’s fastest growth in the first half, followed by China. Representatives of Turkey’s leading conglomerates said on Sunday that they expect the Turkish economy to grow by “at least” 4 percent next year over 2011, objecting to an earlier growth estimate by the International Monetary Fund (IMF) which said the Turkish economy would grow by only 2.5 percent in 2012 compared to this year. Businessmen said the IMF estimate was “not a reliable analysis” for the country.

The IMF earlier predicted the Turkish economy, which recorded the fastest growth worldwide in the first half of this year, would grow by only 2.5 percent in 2012. Observers have criticized the fund for ignoring the country’s economic growth potential and releasing some “unrealistic” estimate figures. The Turkish business world joined the chorus.

Evaluating the IMF estimates for Today’s Zaman, Koç Holding CEO Mustafa Koç said Turkey would realize “a far better” economic growth performance than the IMF has predicted for next year. Underlining that 2.5 percent was very low considering the current rejuvenation in the markets, Koç said, “We expect the economy to expand by at around 4 to 5 percent in 2012 compared to this year.”

According to Eczacıbaşı Holding CEO Erdal Karamercan, next year’s economic growth “will not be lower than 4 percent,” compared to this year. “I do not find a lower estimate realistic,” he added. Kibar Holding Vice Chairman Ali Kibar joins Koç and Karamercan as he predicts next year’s growth to hover around 4 percent. Foreign Economic Relations Board (DEİK) Chairwoman Rona Yırcalı says she does not expect Turkey’s economic growth to be as weak as stipulated by the fund in 2012. “This is a very modest target even if we face some unprecedented developments in global markets,” she highlighted. She was joined by Hamdullah Eren from Eren Holding, who said: “Turkey continues its strong growth rate despite the fluctuations in the West, and it will not be a surprise when we see at least 4 percent growth next year.”

Turkey’s gross domestic product (GDP) clinched 8.8 percent growth in the April-June period of this year compared to the same months a year ago. The country was also the fastest growing economy in the first quarter of the year with 11.6 percent. The two quarters combined account for 10.2 percent growth for the first half compared to the same period in 2010, recording the world’s fastest growth in the first half, followed by China.

Following a 4.8 percent contraction in 2009, when global financial turbulence ravaged world economies, Turkey was able to bounce back faster than foreseen thanks to strict adherence to a disciplined monetary policy, timely measures taken by the Central Bank of Turkey and intensive investments from the private sector. Despite the bright picture, a widening current account deficit (CAD), which has become a serious structural problem for the country; however remains a reminder on the country’s agenda. Mainly affected by the country’s energy imports Turkey’s CAD has been increasing in the past few months, putting pressure on the government and the central bank.The authorities have earlier vowed to take further steps to reduce imports in a bid to tame the CAD.

09 October 2011
SOURCE: TODAYS ZAMAN