Turkish Economy Grows 3.2 Percent Last Year

In current prices, the size of the Turkish economy reached $1.32 trillion last year with per capita income at $15,463.

In 2024, balanced growth was achieved with domestic demand contributing 2.1 points and net external demand contributing 1.1 points, Finance Minister Mehmet Şimşek commented on the growth data.

“We assess that more favorable financial conditions, which will align with disinflation domestically, along with increased predictability due to our policies and improved confidence, will positively impact economic activity,” Şimşek said in a statement.

“With our [economic] program, we have achieved significant success in many areas so far, reduced our vulnerabilities and strengthened our macroeconomic foundations,” the minister added.

In the fourth quarter of 2024, the Turkish economy expanded 3 percent year-on-year, slightly exceeding economists' expectations.

Economists participating in an Anadolu Agency survey this week predicted that GDP in Turkey would rise 2.98 percent in the October-December period.

The annual growth figure accelerated from 2.2 percent in the third quarter and 2.4 percent in the second quarter.

The Turkish economy recorded its highest growth rate of the year, 5.4 percent, in the first quarter of 2024.

On a quarterly basis, Turkey's GDP increased 1.7 percent in the three months to December, reversing from a 0.1 percent decline in the previous quarter.

The industry sector expanded 0.5 percent last year with the growth rate at 1.4 percent year-on-year in the final quarter. But, the manufacturing production contracted 0.2 percent in 2024.

Agriculture grew 3.9 percent in 2024 and 4.7 percent in the fourth quarter, while the construction sector expanded by 9.3 percent last year.

Private consumption was one of the driving forces of the GDP growth last year.

The share of households’ final consumption was 60.5 percent of national income in the fourth quarter and 59.1 percent in the whole of 2024.

Data from TÜİK showed that households’ final consumption increased by 3.9 percent year-on-year in the final quarter of 2024, accelerating from 2.6 percent in the third quarter. For the full year, the increase in household consumption was 3.7 percent.

The annual increase in government expenditures, which accounted for 14.7 percent of GDP, picked up from 0.1 percent in the third quarter to 1.6 percent in the fourth quarter. In 2024, government expenditures rose by 1.2 percent, slowing from 2.4 percent in the previous year.

Gross fixed capital formation was up 6.1 percent annually in the October-December period, against the 0.1 percent decline in the third quarter.

The government targets a GDP growth of 4 percent in 2025, forecasting that per capita income will increase to $17,028. The government’s growth forecast for 2026 is 4.5 percent.

Source: HDN