WIIW The Vienna Institute for International Economic Studies - Wiener Institut für Internationale Wirtschaftsvergleiche

TURKEY
Owing to both a 30% net rise in minimum wages and the current strong government spending, we expect GDP to expand by 3.2% in 2016. Given the ongoing tensions along the Turkish-Syrian border and with the decline in oil prices finally bottoming out, a recovery of (net) external demand is unlikely in 2016. As for 2017 and 2018, we expect GDP to grow by 3.1% and 3.0%, respectively, owing to the recovery of foreign demand following a steady depreciation process and positive but lower growth rates of consumer loans, ultimately leading to a firm policy stance being adopted by the Central Bank of the Republic of Turkey.