What is turkey's economy like?

Answer 1

Turkey's economy is increasingly driven by its industry and service sectors, although its traditional agriculture sector still accounts for about 30% of employment. An aggressive privatization program has reduced state involvement in basic industry, banking, transport, and communication, and an emerging cadre of middle-class entrepreneurs is adding dynamism to the economy. Turkey's traditional textiles and clothing sectors still account for one-third of industrial employment, despite stiff competition in international markets that resulted from the end of the global quota system. Other sectors, notably the automotive, construction, and electronics industries, are rising in importance and have surpassed textiles within Turkey's export mix. Oil began to flow through the Baku-Tbilisi-Ceyhan pipeline in May 2006, marking a major milestone that will bring up to 1 million barrels per day from the Caspian to market. Several gas pipelines also are being planned to help move Central Asian gas to Europe via Turkey, which will help address Turkey's dependence on energy imports over the long term. After Turkey experienced a severe financial crisis in 2001, Ankara adopted financial and fiscal reforms as part of an IMF program. The reforms strengthened the country's economic fundamentals and ushered in an era of strong growth - averaging more than 6% annually until 2008, when global economic conditions and tighter fiscal policy caused GDP to contract in 2009, reduced inflation to 6.3% - a 34-year low - and cut the public sector debt-to-GPD ratio below 50%. Turkey's well-regulated financial markets and banking system weathered the global financial crisis and GDP rebounded strongly to 7.3% in 2010, as exports returned to normal levels following the recession. The economy, however, continues to be burdened by a high current account deficit and remains dependent on often volatile, short-term investment to finance its trade deficit. The stock value of FDI stood at $174 billion at year-end 2010, but inflows have slowed considerably in light of continuing economic turmoil in Europe, the source of much of Turkey's FDI. Further economic and judicial reforms and prospective EU membership are expected to boost Turkey's attractiveness to foreign investors. However, Turkey's relatively high current account deficit, uncertainty related to policy-making, and fiscal imbalances leave the economy vulnerable to destabilizing shifts in investor confidence.

Answer 2

ranks 17th