IMF announces its report for Turkish economy

IMF announces its report for Turkish economy

International Monetary Fund (IMF) pointed out that the macro-economic conditions of Turkish economy reached its highest level over the last ten years while it indicated that current account deficit and debt level constitutes risk for economy. IMF in its report highlighted that the strict monetary program under the floating exchange rate regime helped establish the Central Bank's credibility and cause a dramatic decline in real interest rates as confidence recovered. Under these conditions, real GDP (Gross Domestic Product) grew by close to 8% in 2002 and 6% in 2003, and it is expected to grow by at least 5% in 2004. At the same time, it is stated that inflation has fallen to its lowest levels in decades, and is on track to reach its annual target of 12% in 2004. On the other hand, Turkish economy reportedly still faces a number of risks. Domestic demand has started to increase rapidly and as a result the current account deficit is widening. The large size of the public debt, short maturity and currency composition are also threatening the economic recovery. For the medium term, government's main challenge is to implement policies that achieve the goals of sustained growth and low inflation, IMF said.