In 2011 Turkey celebrates the 88th Anniversary of the Turkish Republic that emerged from the Ottoman Empire. The Republic of Turkey with its democratic and secular political system, robust free market economy in Customs Union with the EU, social tradition of reconciling modernity with cultural identity is a generator of economic prosperity, dynamism and stability for its region and beyond.
Turkey had adopted a successful reform agenda in the aftermath of 2001 financial crisis. This comprehensive agenda aimed to ensure permanent macroeconomic stability and provide the economy with a flexible and productive structure by economic reforms and restructuring. In this process significant developments, aimed at the enhancement of the competitiveness in economy, were realized in the fields such as financial sector particularly banking sector, the independence of Central Bank, inflation targeting framework aiming price stability, tax, public finance, public financial management, labor market effectiveness, improvement of business climate, R&D, transportation, infrastructure of energy and ICT, agricultural subsidy, regulatory and supervisory agencies, public procurement system and privatization.
Turkey places a particular emphasis on structural reform efforts. Starting from the financial sector and with the accelerated privatization process, sweeping reforms including agriculture and social security, energy and telecommunication sectors have been successfully carried out. These are focused particularly on the reform of the public sector itself through measures in a number of topics ranging from public financial management to transparency and good governance.
Today Turkey is the 17th largest economy in the world with a GDP of about USD 730 billion. As a candidate country to European Union Turkey continues to strengthen its economic and financial system with sound policies as well as enhancing its role at regional and global level.
Recent Economic Developments in Turkey
By the end of 2008 the world has undergone the deepest financial turmoil and economic recession since the great depression of 1928. This global financial and economic crisis tested resiliency of Turkish economy in multiple dimensions. Sharp surge in global demand inevitably resulted in high decline in production and exports, which followed by decline in domestic demand due to elevated unemployment rates.
However, structural reforms and sound policies of recent years not only absorbed destructive effects of this global shock, but also helped Turkey to emerge as an stable economy with reliable financial structure, sustainable public budget, low real interest rates, one digit inflation and one of the highest growth rates in a global environment of failing financial systems, increasing public deficits, high unemployment. The pace of recovery in Turkish economy has outperformed projections of both government and international institutions. Annual growth rate of GDP in the first three quarters of 2010 was 8.9%, highest among OECD countries.
Major policy issues are enhancing flexibility of workforce through labor market and social security reforms. Main macroeconomic concerns are still high unemployment rate despite the recovery in economic activity and widening current account deficit.
Population: 73,722,988 (End of 2010)
Gross Domestic Product: 729 Billion USD (2010 projection)
Population growth rate: 1.59 % (2010)
Unemployment rate: 11.2 % (2010 Q4)
Economic growth rate: 8.2 % (2010 projection)
Annual inflation rate (CPI): 6.4 % (End of 2010)
Exports: 114 Billion US$ (2010)
Imports: 185 Billion US$ (2010)