Turkey | The economy grew by 0.9% in 2019

Summary

Turkish Economy grew by 6% yoy in 4Q19, leading the whole year GDP growth to be realized at 0.9%, beating the consensus but parallel to our initial forecast of 0.8%. We remain prudent and maintain our GDP growth forecast at 4% for 2020.

Key points

• Key points:
• Domestic demand contribution continued to recover further in 4Q19 while deterioration in net exports deepened more.
• 2019 GDP growth was underpinned by a positive contribution from net exports at 2.3pp, while domestic demand dragged down 1.4pp.
• On the sectorial side, the recovery in industry and services sectors accelerated while construction sector recovered somehow but it displayed negative growth rate.
• Recent impulses on policy and regulation fronts with current positive momentum and still some positive base effects but diminishing in the first half of the year will continue to support growth.
• Complacency should be ruled out as global risks especially on coronavirus and geopolitical factors bring downside pressures on activity.

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