The World Bank expects a moderate growth rate of around 4 to 5 percent in Turkey this year, World Bank Turkey Director Johannes Zutt said, emphasizing that the country had a very good year in 2017 with 7.4 percent growth.
Zutt recalled that the Turkish government introduced various financial incentives to encourage private sector investments after the Gülenist Terror Group (FETÖ) coup attempt on July 15, 2016. He said the private sector responded in a great way and Turkey achieved some high growth last year.
"Turkish companies need to work better in the innovation of products and services demanding higher prices and in the procurement of more embedded technology in these products and services," he said, emphasizing that the Turkish firms must be engaged in the more profitable side of the supply chain.
Zutt said that complex products with embedded technology will receive more demand in the world economy in the future. Turkish companies have yet to make huge progress in embedded technology products, which is a step for high growth.
The World Bank country director pointed out that the Turkish economy is closely related to the European economy and sensitive to interest rate hikes of the U.S. Federal Reserve (Fed). He underlined that Turkey needs to manage the stress stemming from these interest rate hikes and high oil prices and maintain relations with the EU.
"Most of Turkey's growth stems from the projects carried out with Europe," Zutt said.
With regard to World Bank's support for Turkey, he said that the bank is active in Turkey's energy sector. "We are supporting the Trans-Anatolian Natural Gas Pipeline Project (TANAP). We are working with the government to expand the Natural Gas Storage Facility in Lake Tuz. We are also working on energy transmission, distribution and the renewable energy sector," he added.