European Bank for Reconstruction and Development Announces Growth Forecasts for Turkish Economy

The European Bank for Reconstruction and Development published its Regional Economic Prospects report, announcing its projection that the Turkish economy will grow by 3 percent this year and 4 percent in 2027.

New Growth Forecasts for the Turkish Economy

While the European Bank for Reconstruction and Development projected that the Turkish economy will grow by 3 percent this year, it set its growth forecast for 2027 at 4 percent. The bank thus revised its 2026 growth forecast, which it had announced as 3.5 percent in June, downwards.

Main Drivers Behind the Revision

The bank's report emphasized that weakening domestic demand amid high inflation and tight financial conditions played a significant role in the downward revision of growth expectations for the Turkish economy.

Additionally, details included in the report stated that the ongoing impact of the war in the Middle East and pressures on cost competitiveness for exports also played a role in this process.

Regional Economic Outlook and Expectations

Average economic growth in the countries where the EBRD operates is projected to be 2.5 percent this year and 4 percent in 2027. These figures indicate that the bank has revised its economic growth forecast for the region downwards compared to its June levels.

Potential Factors That Could Support Growth

The report noted that the establishment of lasting peace in the Middle East, strengthening external demand, and the maintenance of monetary policy discipline could support investments and faster growth. Meanwhile, the EBRD has investments of over 25 billion euros in Turkey, the large majority of which are in the private sector.