Turkey: 2018 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Turkey

IMF Staff Country Reports, April 30, 2018

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Canonical URL: Turkey: 2018 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Turkey

Growth rebounded sharply in 2017, helped by strong policy stimulus in the wake of the 2016 post-coup attempt slump and by favorable external conditions.
Expansionary policies that were initially warranted are no longer appropriate as the economy is showing clear signs of overheating.
Political uncertainty and regional instability remain elevated.
The integration of the many refugees poses challenges.

Monetary policy appears too loose and its credibility is low.
On- and off-budget fiscal policies (including credit guarantee schemes and PPP activities) are expansionary and risk undermining Turkey’s hard-earned fiscal credibility.
Policy implication stated in the source: expansionary policies should be withdrawn given overheating.

The economy faces internal and external imbalances:
- A positive output gap.
- Inflation well above target.
- A current account deficit of more than 5 percent of GDP.

Subject: Current account deficits, Expenditure, External debt, Financial institutions, Foreign exchange, Inflation, Loans, Prices, Public investment and public-private partnerships (PPP)
Keywords: authority, commercial loan, CR, economy, Global, growth contribution, headline CPI inflation, impairment signal, Inflation, inflation spillover, ISCR, labor market, Loans, policy, Public investment and public-private partnerships (PPP), public-private partnership, quality weakness, state loan guarantee