World Bank Praises Turkey’s Success..

The report notes that a 7.4 percent shrinkage due to the economic crisis in 2001 has turned into growth of 7.8 percent in 2002.

This 15 point improvement is viewed as a ‘dramatic recovery’.

In the report, growth in 2003 is projected to stay below the growth rate of 2002. The report highlighted the small recession in the tourism sector due to Iraq war as well as the negative effects of limited foreign investments.

The World Bank Report also commented that the International Monetary Fund’s (IMF) economic program should be continued to aid sustainable growth. According to the report, if Turkey follows the program, it will contribute to the correction of domestic balances.

If interest rates fall, this will trigger domestic demand. If real interest rates cannot be pulled down in significant proportions, growth will be negatively affected.

Turkey is placed in the below-average income level group. Turkey is in the same group with Albania, Armenia, Romania, and Bulgaria. Turkey is ranked below the Gabon, Botswana, Mauritius, Libya, and Lebanon.

The report estimates that Turkey’s income level increased by 6.3 percent in 2002. Previously, in the average-high income level category, Turkey had fallen to average-low income level with the 2001 economic crisis.

It is expected that if Turkey realizes reasonable growth in next two years, it would return to the average-high income group.