Page 21 - TURKRptJun20

3.0​ ​Macro Economy
Main Macro Indicators
2015
2016
2017
2018
Q1
Q2
Q3
Q4
2019
Q1
Q2
GDP Growth (y/y)
6.1
3.2
7.5
2.8
-2.3
-1.6
1.0
6.0
0.9
-
-
GDP (per capita, $)
10,915
10,817
10,537
9,346
9,127
9,127
9,127
9,127
9,127
-
-
GDP (current, TRYbn)
2,339
2,609
3,111
3,724
922
1,023
1,146
1,190
4,280
-
-
GDP (current prices, $bn)
859
863
852
766
172
174
202
206
754
-
-
CPI (%, eop, Apr)
8.8
8.5
11.9
20.3
19.7
15.7
9.3
11.8
11.8
11.9
10.9
Lira-loans (%, y/y, May 15)
14.4
12.3
24.9
1.8
3.0
-0.5
4.0
13.9
13.9
19.1
32.5
Policy Rate (%, eop, active)
8.8
8.3
12.8
24.1
25.5
23.9
16.3
11.4
11.4
9.3
8.1
Population (mn)
78.7
79.8
80.8
82.0
83.2
83.2
83.2
83.2
83.2
-
-
Unemployment (%)
10.3
10.9
10.9
11.0
14.1
13.0
13.8
13.7
13.7
13.8
-
CA Balance ($bn)
-32.4
-31.5
-46.6
-28.3
-1.88
-1.29
5.92
-1.07
1.67
-7.64
-
CA Balance/GDP (%)
-3.8
-3.6
-5.5
-3.7
-1.1
-0.7
2.9
-0.5
0.2
-
-
Budget (TRYbn, Apr)
-23.5
-29.9
-47.8
-72.6
-36.16
-42.4
-7.2
-37.9
-123.7
-29.6
-43.2
Budget Balance/GDP (%)
-1.0
-1.1
-1.5
-1.9
-3.9
-4.1
-0.6
-3.2
-2.9
-
-
USD/TRY (eop)
2.92
3.53
3.79
5.29
5.56
5.79
5.65
5.95
5.95
6.61
6.81
source: imf, tuik, treasury, central bank
“With the incoming economic data likely to be less reliable than usual, we think that investors should focus more on the timely low-level activity data and the changing shape of infection curves to judge which EMs sit where in the crisis. Meanwhile, question marks over the data are unlikely to alter the thinking of central banks, most of which are likely to focus on keeping policy loose and providing liquidity,” Edward Glossop of Capital Economics said on May 11 in his emerging markets economic update note entitled “​Interpret incoming GDP & CPI data with a pinch of salt​”.
The European Commission (​EC​) ​said​ on May 6 that it anticipates Turkey's economy will contract by 5.4% in 2020.
Coronavirus concerns have resulted in financing costs and risk premia rising in Turkey, as in other emerging markets, and have caused a recent sell-off of Turkish assets, the EBRD ​said​ on May 13.
“With the non-performing loan ratio standing at a 10-year high of 5.3 per cent, the weakness of the lira and contractions in tourism, retail and export sectors are likely to put further stress on the already strained asset quality of banks, particularly in light of the large foreign-exchange-denominated debt overhang in the corporate sector,” it said.
“Meanwhile, government efforts to spur bank lending may lead to further asset quality deterioration down the road. Growth is likely to be heavily impacted by the coronavirus pandemic in 2020. We expect GDP to contract by 3.5 per cent in 2020, followed by a robust recovery to 6.0 per cent growth in 2021. There are significant risks surrounding this forecast, which is heavily dependent on the duration and extent of the social distancing measures,” the EBRD
21​ TURKEY Country Report​ June 2020 ​ ​www.intellinews.com