IMF doubles 2017 economic growth forecast for Turkey

Published 10.10.2017 17:46
Updated 11.10.2017 09:54
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The International Monetary Fund (IMF) raised Turkey's growth forecast for 2017 by 2.6 percentage points to 5.1 percent.

The IMF published the October 2017 edition of the World Economic Outlook (WEO) Report under the title "Seeking Sustainable Growth." Turkey's growth expectancies for 2017 and 2018 were raised from 2.5 percent to 5.1 percent and from 3.3 percent to 3.5 percent, respectively.

The report, announced earlier this week before the "IMF-World Bank Annual Meetings," revised the global growth expectation to 3.6 percent for this year and 3.7 percent for next year, highlighting the cyclical recovery in the global economy. Growth estimates of the entity for 2017 and 2018 were set at 3.5 percent and 3.6 percent, respectively, in the WEO report updated in July.

According to the report, even though the short-term risks in the world economy are decreasing, many countries are likely to be exposed to downside risks in the middle term, while low inflation in developed countries, financial turmoil in emerging market economies, more tightening in global financial conditions than expected and conservative policies can be counted among the aforementioned risks.

2017 growth estimate in developed countries stands at 2.2 pct

In the IMF's October 2017 WEO report, growth estimates for the U.S., Japan and many European countries were revised upwards.

In the report, which showed recovery in consumption and investments in the U.S. after a weak first quarter, growth forecasts for the country were revised from 2.1 percent to 2.2 percent this year, and from 2.1 percent to 2.3 percent for the next year.

The institution which raised the eurozone's growth forecast for 2017 and 2018 by 0.2 percentage points to 2.1 percent and 1.9 percent respectively, also increased expectations for Germany, France, Italy and Spain. According to new projections, Germany will grow by 2 percent this year and 1.8 percent next year. These ratios indicate an increase of 0.2 points compared to the update made in July.

The IMF, which raised its growth estimates for France from 1.5 percent to 1.6 percent for 2017 and from 1.7 percent to 1.8 percent for 2018, also expects Italy to grow by 1.5 percent this year instead of 1.3 percent and 1.1 percent next year instead of 1 percent.

On the other hand, the IMF fixed this year's growth estimate for Spain, which came to the fore with Catalonia's independence attempts, at 3.1 percent, while revising the country's growth expectation for the next year from 2.4 percent to 2.5 percent.

In the report, the 2017 and 2018 projections for the United Kingdom remained unchanged at 1.7 and 1.5 percent, respectively. Expectations for Japan were revised up to 1.5 percent this year with an increase of 0.2 percentage points and to 0.7 percent for the next year with an increase of 0.1 percentage points.

While the biggest revision on the list of developed countries was made to Canada's growth forecasts, the country's growth estimate was raised from 2.5 percent to 3 percent this year and from 1.9 percent to 2.1 percent next year.

The general growth expectation for the developed countries group was raised to 2.2 percent for 2017 and to 2 percent for 2018 in the light of these revisions. The said numbers were announced as 2 percent and 1.9 percent, respectively, in the update count made three months ago.

Turkey's growth forecast revised up to 5.1 pct

The IMF's growth expectation for the emerging economies remained at 4.6 percent this year, while the forecast for the next year was raised from 4.8 percent to 4.9 percent.

Within this group, growth expectations for Turkey, Russia, Brazil and China were revised up, while projections for India and South Africa were downgraded.

Accordingly, Turkey's growth expectations for 2017 and 2018 were raised from 2.5 percent to 5.1 percent and from 3.3 percent to 3.5 percent, respectively. Growth forecasts for Russia rose from 1.4 percent to 1.8 percent this year, and from 1.4 percent to 1.6 percent for 2018.

IMF economists revised up China's growth forecasts for 2017 and 2018 by 0.1 percentage points to 6.8 percent and 6.5 percent, respectively. In addition, Brazil's growth estimate was revised up to 0.7 percent from 0.3 percent this year and to 1.5 percent from 1.3 percent next year.

Meanwhile, the IMF, which revised down its growth expectation for India from 6.5 percent to 7.2 percent this year, pulled down the country's forecast for 2018 from 7.7 percent to 7.4 percent. Growth forecasts for the South African economy were also downgraded to 0.7 percent from 1 percent this year and to 1.1 percent from 1.2 percent for next year.

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