If we are right about our GDP forecasts going into 2050, then it is conceivable that Turkey can become the second largest economy in Europe, excluding Russia.- Ahmet Akarli
A View from Turkey
Ahmet Akarli, co-head of New Markets Economic Research in our Global Investment Research Division, talks about the significant potential of Turkey as one of the Growth Markets.
Additional Insights on Turkey from Ahmet Akarli
- Turkey is a dynamic Growth Market with a population of nearly 80 million and a median age of 26 years. The country will benefit from a favorable dependency ratio by having enough young, working-age population to support its older population over the next decade and more. This demographic profile is expected to pay additional dividends by yielding fiscal balances to support robust economic growth for years to come.
- Historically Turkey has been a trading nation and part of the European state system. Its experimentation with capitalism throughout the past two centuries has resulted in a diversified economy and an accumulation of entrepreneurial talent in the economy. Small and medium sized enterprises have been the driving force of economic growth over the past 15 years.
- Throughout the 1990s Turkey was a very unstable economy with large trade imbalances, unsustainable fiscal deficits and low economic growth. Macrodynamic imbalances led to a number of crises in the country's economy during this time, which resulted in sweeping reforms that created a pathway for long-term economic growth.
- During the 2008-2009 global financial crisis Turkey's economy contracted by about 15% peak to trough, but afterwards the country's economy rebounded strongly, posting annualized growth rates of 12%—second only to China.
- While Turkey's economy continues to grow, over the coming quarters we expect it to slow down to about 3% annual GDP growth. This slower rate of growth is healthy and necessary for addressing the imbalances which have occurred in the economy over the past few years. To date the fiscal and monetary policy responses have been sensible to enable this rebalancing process.
- We estimate that by 2050, Turkey's economy could be the second largest in Europe, excluding Russia. See infographic: The Rise of Growth Markets.