IMF Predicts Turkey's Economy Will Grow

The IMF predicts Turkey's economy will grow. The International Monetary Fund predicts 6 percent growth in 2021.

In the statement made by the International Monetary Fund (IMF), it was pointed out that the coronavirus (Covid-19) epidemic negatively affected health and economy in Turkey as in other countries. In the statement of the IMF, it was pointed out that policies focusing on monetary and credit expansion gave a strong impetus to the economy. However, the following statements were used, which stated that it made the economy more sensitive to internal and external risks by increasing the existing vulnerabilities: “The recent policy turn away from rapid money and credit growth is welcomed. If this transformation continues and if the temporary outbreak-focused additional support is combined with a reliable plan for medium-term fiscal consolidation as well as the financial sector and structural reforms, the buffers can be rebuilt more quickly. Structural reforms should focus on mitigating the risks posed by the long-term negative effects of the pandemic and include targeted measures to support the most vulnerable, promote labor market flexibility, and facilitate the reduction of corporate debt.”   Policy Intervention Generated Recovery In the statement made by the IMF, it was stated that Turkey started 2020 with pre-existing vulnerabilities, and it was noted that the first policy intervention implemented in combating the epidemic sharply recovered the country's economy. In the IMF's statement, it was stated that starting from late 2020, tightening monetary policy, relaxation of temporary regulatory measures and the apparent slowdown in state-owned bank lending helped limit pressure on the Turkish lira and rebuild trust. In the IMF statement, where the outlook on the Turkey’s economy was also discussed, the following statements were used: “The economy is expected to continue to grow positively in 2021.” The IMF stated that the Turkey’s economy is projected to grow by about 6 percent in 2021. It was emphasized that rebalancing of policies implemented over time will form the basis of more durable medium-term growth, and it was noted that fiscal structural reforms will support consolidation and reduce fiscal risks.       TRT News has contributed to this article.