Deputy PM Şimşek: Turkey can grow up to 4 pct in 2016

Published 26.08.2016 00:00

Deputy Prime Minister Mehmet Şimşek said Turkey's economy is likely to grow by 3.5- 4 percent in 2016, and downward risks related to it have increased. Pointing out that Turkey's borrowing dynamics are positive and there is enough space in the budget to back the economy, Şimşek said the Turkish economy has performed well despite negative developments, but he explained that it is hard to bring down the inflation rate, suggesting that government aims to drop the rate down to 5 percent.

In January, the government announced Turkey's Medium-Term Economic Plan (MEP), covering macroeconomic targets between 2016 and 2018, including growth and inflation. The government predicts that the national gross domestic product (GDP) will increase by 4.5 percent in 2016, and by 5 percent for 2017 and 2018. While introducing the MEP, Şimşek, deputy prime minister in charge of the economy, predicted that growth in 2016 will be mainly driven by domestic demand, but that a portion of that growth will also come from foreign demand, adding that the 5 percent targets for 2017 and 2018 will be achieved through investment and increased efficiency. The MEP also clarified the government's inflation target for the same period. Accordingly, Turkey plans to bring the annual inflation rate down over the next three years, from 8.81 percent in 2015, into the 5 to 7 percent range.

Şimşek underlined that the inflation rate is forecasted at 7.5 percent in 2016, 6 percent in 2017 and 5 percent in 2018. Reviewing the current developments in Tokyo, Deputy Prime Minister Şimşek said Turkish political parties are united against the Gülenist Terror Group (FETÖ) that perpetrated the coup attempt on July 15. He also added that the political environment in Turkey has become more suitable for reforms. Noting that Turkey will continue being anchored to the West, Şimşek said it had some disagreements with the U.S, but the two countries regained their good relations following Vice President Joe Biden's visit to Turkey. "The European Union is trying to repair its relations with Turkey. From now on, everyone can work for a solution in Syria," Şimşek said. "We are improving our relations with Russia." Şimşek on Asia tour to inform global investors of Turkey' investment environment Going on an Asian tour to meet with international investors, Şimşek posted a message on his Twitter account about his meeting in Tokyo, saying: "Our work in Tokyo started 10 hours ago. Our vigorous efforts to improve the perception of Turkey and draw investments will bear fruit."

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