European Bank: Turkish economy to grow 2.5% in 2020

By Tuba Sahin

ANKARA (AA) - The European Bank for Reconstruction and Development (EBRD) on Wednesday projected 2.5% economic growth for Turkey in 2020 as the recovery from the ongoing slowdown is likely to be gradual.

The bank noted a significant improvement in macroeconomic stability and decline in inflation rate in the country, according to its latest Regional Economic Prospects report.

It added that "a banking crisis" has eased thanks to the stabilization of the lira.

The bank also predicts a contraction of around 0.2% this year in the Turkish economy.

It stated that the unpredictable domestic and geopolitical environment creates uncertainty for the country.

"Despite some stabilization in recent months, the economic situation remains fragile.

"The response to Turkey’s recent incursion into Syria serves as a reminder that geopolitical tensions are never far from the surface," it said.

The EBRD added that slowdowns in both Turkey and Russia weigh down on economic growth in other economies where the bank invests.

An average growth rate of 2.4% is expected this year across all EBRD regions while the report sees a recovery to 2.9% in 2020.