Anticipated Mid-Term Plan Predicts 3.3% Economic Expansion in 2025

The Turkish government has announced its Medium-Term Program (OVP) for the 2026-2028 period, aiming to steer the economy towards a stronger outlook. The program, unveiled on September 8 in Ankara by Vice President Cevdet Yılmaz and Treasury and Finance Minister Mehmet Şimşek, outlines several key objectives and projections.

According to Yılmaz, the OVP aims to enhance predictability for both the public and private sectors by establishing macroeconomic targets based on global, regional, and national economic developments, as well as economic and social policies. One of the primary goals is to improve macroeconomic and financial stability, maintain fiscal discipline, and ensure price stability by reducing inflation to single digits.

The program includes projections for foreign trade. Exports are forecast to reach $273.8 billion by the end of 2025, rising to $282 billion in 2026, $294 billion in 2027, and $308.5 billion by the end of the program. Imports, on the other hand, are expected to total $367 billion by the end of this year, increasing to $378 billion in 2026, $393 billion in 2027, and $410.5 billion in 2028. However, it's important to note that there are no specific publicly available projections or forecasts for Turkey's foreign trade balance for the year 2028 in the current major economic reports.

Inflation is expected to reach 28.5 percent by the end of this year, with targets set at 16 percent for 2026, 9 percent for 2027, and 8 percent for 2028. The budget deficit as a share of gross domestic product is projected to be 3.5 percent in 2026 and decline to 2.8 percent by the end of the program period.

The OVP also projects the Turkish economy's growth rates. The growth forecast for this year in the OVP is 3.3 percent, a downward revision from the previous program's 4 percent. The economy is projected to grow by 3.8 percent in 2026, 4.3 percent in 2027, and 5 percent in 2028.

Yılmaz stated that by the end of 2025, Turkey will rank as the 16th largest economy in the world and the 6th largest in Europe. By this same year, Turkey's national income will exceed $1.5 trillion, and its per capita income will surpass $17,000. By the end of 2028, national income will approach $1.9 trillion, and per capita income will rise to $21,000.

It's worth noting that the OVP does not have a policy target or forecast regarding the exchange rate. Relevant institutions will intervene to maintain market stability in cases of excessive volatility.

The OVP does not repeat earlier forecasts for the growth rates in 2026, 2027, and 2028. This suggests that the program may contain revised or updated projections compared to previous economic forecasts.

Turkey's Medium-Term Program seeks to position the country among high-income countries. Yılmaz added that by the end of 2025, Turkey will be classified among high-income countries according to the World Bank's categorization.

In conclusion, the Medium-Term Program for Turkey presents a roadmap towards economic growth, stability, and development. The program's objectives, projections, and targets underscore the Turkish government's commitment to fostering a strong and resilient economy.