Turkey’s economic outlook is showing signs of stabilization,with Vice President Cevdet Yılmaz signaling a continued decline in inflation during a speech in Ankara on November 26th. Addressing attendees at the Ankara Chamber of Industry’s 62nd Anniversary Awards Ceremony, Yılmaz outlined key economic indicators and strategic goals as the nation navigates a challenging global landscape [[number]].The positive assessment comes amid broader concerns about slowing worldwide growth and increasing geopolitical tensions.
Turkey’s inflation rate is trending downward, and November data is expected to reflect continued improvement, according to the country’s Vice President Cevdet Yılmaz. Speaking at the Ankara Chamber of Industry’s 62nd Anniversary Awards Ceremony, Yılmaz indicated that leading indicators suggest a positive trend for the current month’s inflation figures.
The positive outlook comes as the global economy faces headwinds, with growth lagging historical averages and world trade falling behind, Yılmaz noted. He highlighted increasing competition and what he termed an “economic cold war” alongside ongoing geopolitical conflicts.
Yılmaz emphasized the importance of closely monitoring the policies of major economic players like the United States, China, and the European Union. However, he pointed to Turkey’s strong economic performance over the past two decades, growing at an average of 5.4% annually, outpacing the global average of 3.5%. “We have grown 1.9 percentage points faster than the world every year. This is a significant achievement,” he stated.
Turkey’s economy is projected to grow around 3.3% this year, Yılmaz said, pushing the country’s economic size beyond the $1.5 trillion mark. This represents substantial growth from the $238 billion economy of 22-23 years ago. As of last year, Turkey ranked as the 17th largest economy globally in nominal dollar terms and the 12th largest based on purchasing power parity.
Assuming the International Monetary Fund’s (IMF) forecasts hold true, Turkey is expected to become the 16th largest economy in nominal dollar terms this year, and the 11th largest by purchasing power parity, Yılmaz added.
He also highlighted Turkey’s progress in income classification, noting its rise from the lower-middle-income group to the upper-middle-income group over the past quarter-century. Yılmaz stated that the country is poised to enter the high-income country category for the first time this year. “For the first time, we will take a step, albeit a small one, into the league of high-income countries. But this is a more challenging period… Simply increasing the numbers is not enough to stay in this league.”
“We will make Turkey permanent in this league”
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Yılmaz cautioned against relying on social media and unsubstantiated information when discussing the economy, stressing the need for analysis and data-driven assessments. “This is how we will become permanent in the league of high-income countries,” he said, adding that steps in areas such as the justice system, technology policy, urbanization, and disaster management will be crucial for sustaining this position.
Turkey’s public debt, as defined by the European Union, stands at around 24% of national income, significantly lower than the EU average of 82% and the 69% average for developing economies, Yılmaz pointed out. This low debt level will be a key advantage in implementing reforms, including the green and digital transitions.
Central Bank reserves reached $180.6 billion as of November 21st, Yılmaz noted, also highlighting the gold reserves held by the public. He stated that rising gold prices have increased both the Central Bank’s and citizens’ reserves, adding, “Ideally, these reserves would be further integrated into the system… This would give us additional strength.”
“We will close the year with inflation slightly above 30%”
Combating inflation remains a top priority, Yılmaz affirmed. He noted that inflation, which peaked at 75% in May, has since fallen to approximately 32.9%. He indicated that after a spike in September due to food prices, inflation has resumed its downward trajectory. “We anticipate that this month’s inflation will also be at a good level, based on leading indicators.” The goal is to close the year with inflation slightly above 30%, fall below 20% in 2025, and achieve single digits by 2027.
“We have come a long way”
Yılmaz stated that Turkey followed a correct strategy during the pandemic by maintaining agricultural and industrial production. Protecting the real sector was critical for economic resilience. He emphasized that short-term costs in the fight against inflation must be tolerated for long-term gains, and that levels below 30% will create a more favorable economic environment.
“We have switched to a new incentive system”
Yılmaz reminded attendees that Turkey will host COP31 next year, stressing the need for the private sector to prepare accordingly. He also noted that high-tech exports account for 13.3% of Ankara’s exports, exceeding the levels seen in many developed countries.
Regarding the new incentive system, Yılmaz explained that four priority areas have been identified for each province under the “Local Development Initiative.” For Ankara, these areas are medical enzyme and dye production, plant-based food supplements, electronic waste recycling, and medical product-packaging production, attracting investment proposals totaling 5.4 billion lira.
Yılmaz highlighted the upcoming launch of Turkey’s first hyperscale data storage project, a joint venture between Google Cloud and Turkcell, which will be established in Ankara with a $3 billion investment. He stated that the project will elevate the city’s digital economy infrastructure. Yılmaz, along with Ankara Chamber of Industry President Seyit Ardıç and TOBB President Rifat Hisarcıklıoğlu, presented awards to winning companies at the ceremony.
