Economists evaluated the growth data

Economists evaluated the growth data

While the Turkish economy grew by 3.9 percent in the third quarter of the year, in line with expectations, under the leadership of the finance and service sectors, economists say the 5 percent growth target can be achieved. cent for the whole year.

According to GDP data announced by the Turkish Statistical Institute (TUIK), the Turkish economy grew by 3.9 percent annually in the third quarter. Although the growth data for the second quarter of the year was revised from 7.6 percent to 7.7 percent, this figure remained at 7.5 percent for the first quarter.

The most important contribution to growth, which was announced in line with expectations, came from the financial and insurance sector with 21.6 percent. Growth, which was 18.2 percent in the services sector in the second quarter, remained strong even though it slowed to 6.9 percent in the third quarter. In the industrial sector, annual growth slowed down from 7.9 percent in the second quarter to 0.3 percent in the third quarter.

In this period, the contraction in the construction sector continued and reached 14.1 percent. The agricultural sector, which had a negative impact on growth in the second quarter, turned positive in the third quarter, contributing 0.1 points to growth. growing up; Inventories decreased 9.6 points, while net foreign demand increased 0.7 points.

When looking at the details of gross fixed capital formation, it was observed that investments continued to increase in the machinery and equipment branch in the third quarter. While construction investment contracted 19.9 percent in this period, investment in machinery and equipment, a proxy for private investment, rose 14.3 percent for the twelfth consecutive quarter.

IT IS POSSIBLE TO REACH THE GOAL OF 5%

Economist Haluk Bürümcekçi said that public and private consumption spending boosted growth in line with expectations, while net external demand made a limited contribution. Stating that the first signs of the last quarter of the growing year indicate that the loss of energy derived from external demand continues, Bürümcekçi said:

“Expectations seem to have strengthened that the acceleration of monetary tightening in developed countries, especially the US, could lead to a recession. In addition, since it has been observed that the macroprudential decisions of internal tightening have had a negative impact on companies’ access to credit, the possibility of accelerating the slowdown in economic activity has increased.

On the other hand, noting that economic activity lost momentum in the third quarter, the Central Bank cut the policy rate by 500 basis points to ensure that financial conditions were favorable, and made new decisions to limit commercial credit rates. . to close the gap between lending rates and the policy rate.

Consequently, if there is no interquarterly contraction of more than 0.5 percent in the October-December period, due to the 6.2 percent growth in the first three quarters compared to the same period of the previous year and the limited drop in the national income index since its all-time high, a growth rate of 5 percent in all of 2022. It seems possible to reach the goal.”

Economist Haluk Bürümcekçi

FOREIGN DEMAND AND EXPORT DOMESTIC DEMAND ON THE LEFT

Piri Reis University Vice Rectorate Prof. Dr. Erhan Aslanoğlu also stated that the growth data for the third quarter performed in accordance with expectations and there were no surprises.

Stating that Turkey is a dynamic country with its demographic and geographical characteristics, Aslanoğlu said that growth may exceed world averages for this reason.

Prof. Dr Erhan Aslanoglu

Aslanoğlu said: “Foreign demand and exports, which were the locomotive of growth from the beginning of the Kovid-19 epidemic until the first half of this year, seem to have given way to domestic demand. Although exports lost momentum and maintained some strength, the strengthening of imports seems to have curbed the impact of external demand on growth. I think there will be a similar trend in the last quarter and the first 6 months of next year.” he said.

Assessing that there will be a similar trend with policies supporting domestic demand in the first half of next year, Aslanoğlu said: “As a country with a savings gap in terms of sustainability, we need to establish the policy framework that will enable growth in the Foreign. ask.” he said.

‘WE CAN CLOSE THE YEAR WITH A 5 PERCENT GROWTH’

In the report published by VakıfBank Economic Research on the growth data for the third quarter, it was reported that the service sector, which has the highest share of national income with 57.12 percent, continued to be the biggest driver of growth with 4.7 points. , despite the fact that its contribution to growth decreased.

In the report, which noted that the largest contribution to the services sector came from tourism, the following was noted:

“While household consumption was the driver of growth in the third quarter, investment contributed negatively to growth despite high inflation and low interest rates. The recent decisions taken by public authorities to curb credit growth were effective in this situation.

Considering that the most important priority of economic management is growth, we believe that export pressures will reduce external demand and, consequently, we will enter a period of growth supported by internal demand.

In this context, an environment of internal demand will be generated that will offset the slowdown in external demand as a result of the recent relaxation of the decisions of the public authorities regarding credit restrictions and their support with fiscal policies through the spending channel. .

Based on the performance of the first three quarters, we maintain our expectation that the Turkish economy will end the year with a growth of around 5 percent, in case of a growth of around 2 percent in the last quarter, according to the preliminary report and industrial production data. (AA)

Source: Sozcu

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