While the World Bank predicted the growth forecast for the Turkish economy as 2.7% at the beginning of the year, it increased it to 3.2% due to the resilient economy in the first quarter.
The World Bank has published the June issue of its Global Economic Prospects Report.
In the report, it was reported that the Turkish economy is expected to grow by 3.2% this year, 4.3% next year and 4.1% in 2025.
The World Bank predicted that the Turkish economy would grow by 2.7% in 2023 and by 4% in 2024, in its forecasts published in January.
Turkish economy remained resilient in the first quarter of 2023
Reminding that Turkiye was shaken by two major earthquakes at the beginning of February, the report stated that the direct loss of these earthquakes is estimated to be 4% of 2021 GDP, and the cost of rescue and rebuilding could be twice as high. Reconstruction efforts are expected to bolster investment, the bank’s report said.
Pointing out that the development of macroeconomic policies is uncertain on the backdrop of high inflation, the report stated that high current account deficit and low net foreign exchange reserves pose significant challenges as well as the depreciation in the exchange rate.
In the report, it was emphasized that despite all these headwinds, Turkiye continued to contribute significantly to the growth of the Europe and Central Asia region and its economy remained resilient in the first quarter of 2023.
“Sharp” slowdown in the global economy
Pointing out that global economic growth has slowed down sharply, the report stated that the risk of financial stress has increased in emerging market and developing economies due to rising global interest rates.
In the report, it was noted that the global economic growth, which was 3.1% in 2022, is expected to decline to 2.1% this year.
In the report, which stated that the world economy is expected to grow by 2.4% next year, it is reported that this rate is predicted to be 3% in 2025.
In its January forecasts, the World Bank had predicted that the global economy would grow by 1.7% this year and 2.7% next year.
- US economic growth expected to slow in 2024
Emphasizing that the growth in developed economies is expected to decline from 2.6% in 2022 to 0.7% this year, the report said that this rate is expected to remain weak with 1.2% in 2024 and to be 2.2% in 2025.
In the report, it was noted that the US economy, which is included in the group of developed countries, is expected to grow by 1.1% in 2023 and the growth is expected to decline to 0.8% in 2024 with the continued impact of the sharp increase in interest rates. In the report, it was stated that the US economy is expected to grow by 2.3% in 2025.
In its January forecasts, the World Bank had predicted that the US economy would grow by 0.5% in 2023 and 1.6% in 2024.
In the report, it was stated that the economic growth in the Euro Area is expected to decline from 3.5% in 2022 to 0.4% in 2023 with the lagged effect of the tightening in monetary policy and the increases in energy prices. It was noted that the Eurozone economy is expected to grow by 1.3% in 2024 and by 2.3% in 2025.
In the bank’s forecasts in January, the growth expectation for the Euro Zone economy was 0% for 2023 and 1.6% for 2024.
China’s 2023 growth forecast raised
In the report, it was stated that the growth in emerging market and developing country economies is expected to increase from 3.7% last year to 4% this year, and this rate is expected to be 3.9% in 2024 and 4% in 2025.
It was noted that the Chinese economy, which is in the group of emerging markets and developing countries, is expected to grow by 5.6% this year, 4.6 next year and 4.4% in 2025.
The World Bank predicted in January that the Chinese economy would grow by 4.3% in 2023 and 5% in 2024.
Source: Trthaber / Prepared by Irem Yildiz