Turkey’s Economy Grows 3.7% in Q3 and 3.6% Over the Last Year

Turkey’s GDP grew 3.7% in the third quarter compared with the same period last year. Quarter-on-quarter growth reached 1.1%.

Looking at the combined period covering the first three quarters of this year and the last quarter of the previous year, GDP increased 3.6% compared with the previous yearly cycle.

The full-year growth forecast for the Turkish economy is 3.3%. The original projection was 4%, later revised down to 3.3%.

With growth so far, even if the last quarter expands by 2.3%, the annual target of 3.3% will still be met.
If Q4 growth is 3%, annual growth would reach 3.5%.
Should Q4 hit 3.5%, the yearly figure would climb slightly above 3.6%.

The downward revision of the growth target from 4% to 3.3% signaled an intention to cool down the economy. But the data shows either the slowdown has been abandoned or it is simply not succeeding. At this pace, the 2025 growth rate may approach the original 4% projection.

It’s worth recalling that the 2026 growth target is 3.8%.

 “Crying Yet Growing!” — Sector Performances Reveal a Mixed Picture

Official data shows nearly all sectors except agriculture expanded in Q3. Complaints from business circles, especially industrialists, do not reflect in the aggregated GDP figures.

The construction sector recorded a strong 13.9% annual growth in Q3 — a remarkable performance.

Industry grew 6.5%, a solid real increase once inflation is stripped out, contradicting the widespread pessimism in the field.

Trade, transportation, accommodation and food services also expanded 6.3%.

A Red Flag for Agriculture

Agriculture is the only major sector that shrank compared with last year, contracting a dramatic 12.7%.

This steep decline follows shrinking rates of 0.7% in Q1 and 5.5% in Q2. With Q3 showing 12.7%, agriculture is experiencing its worst third-quarter performance since 2017.

The causes cited — frost and drought — carry some truth, but the real concern is strategic: Is Turkey neglecting its agricultural foundation?

Unlike sectors such as industry or tourism, which can rebound quickly once conditions improve, agriculture does not recover easily.
Turkey risks “forgetting how to farm”, as more agricultural workers abandon the field out of frustration.

The danger is significant — and growing.

Labor Share Stagnates While Capital Share Rises

According to TÜİK, labor compensation accounted for 35% of national income, the same as Q3 last year.
However, compared with the previous quarter’s 38.4%, this figure represents a decline in real terms.

While labor’s share stagnates, capital’s share is increasing.
In Q3, capital income rose to 46.3%, up from 41.3% in the previous quarter and slightly above 46% last year.

Keywords

#Turkeyeconomy #GSYH #GDPgrowth #Q3results #agriculturedecline #constructiongrowth #industrygrowth #economicoutlook #laborshare #capitalshare