10 Contributors to Turkey’s Rising Economy
Turkey has one of the fastest growing economies in the world today. Turkey’s rising economy came after the economic and banking crisis that occurred in 2001. Turkey’s economy is growing and will continue to improve over the next several years. The following are 10 aspects that have contributed to the Turkish economy’s growth:
- Trade With Africa
Over the past 15 years, Turkish and African trading has increased over 600 percent to over $17 billion USD. Trading with Africa has brought a substantial amount of money into Turkey and has created countless jobs for the country’s rising economy.
- Turkish Airlines and Boeing Deal
Turkish Airlines has made a deal with Boeing to purchase 25 Boeing 787-9 Dreamliner aircraft, which will help Turkey meet demand in their country. M. İlker Aycı, Turkish Airlines’ Chairman of the Board and the Executive Committee, said, “We are pleased to finalize a landmark agreement that will bring significant benefit to Turkish Airlines and Turkey’s aviation industry.”
- Middle Class Growth
In the past several years, the size of Turkey’s middle class has doubled; it increased from 18 percent to just over 40 percent. This is one of the biggest contributors to Turkey’s rising economy. The growth of the middle class has helped Turkey strive toward becoming an upper-middle income economy.
- Growing Tourism
In the past decade, travel to Turkey has increased tremendously. In 2017 Turkey was ranked the sixth most-visited country and was ranked ninth in income from tourism. Turkey is most visited by Europeans, and tourists frequently visit Antalya, Istanbul and Mugla. These areas make up 70 percent of the places visited in Turkey.
The government of Turkey has been attempting to privatize many sectors in the country. They aim to limit the role of the government to health, education, social security, national defense, and infrastructure. Increasing the size of the private sector has created a highly competitive market that has improved Turkey’s economy. From 1986 to 2003, the revenue for privatization reached only $8 billion; by contrast, revenue from 2004 to 2015 reached approximately $58 billion. In addition to creating a competitive market, privatization has created many jobs throughout the country.
- Employment Increase
1.5 million more people became employed from November 2016 to November 2017 in Turkey, and the labor participation rate of women increased to 33.8 percent. The unemployment rate for the youth in Turkey also decreased by 3.3 percent. This job growth has stimulated the economy and contributed to its growth.
- The Turkey Sustainable Cities Program
The Sustainable Cities program consists of two parts. The first part was approved in 2016, and the second was approved in April of 2018. These programs provide investment financing and technical assistance. The investment financing is used for public projects such as municipalities for water, wastewater, solid waste, energy efficiency and street lighting. The goal of this program is to improve the economic, financial, environmental, and sustainability aspects of cities in Turkey. This will improve Turkish cities while also providing jobs for many people in Turkey.
- Increasing Foreign Trade
Turkey’s exports have continued to increase over the past few years, and the increase is estimated to continue. In 2016, Turkey’s exports totaled $143 billion, and exports are estimated to reach $193 billion by the year 2019.
- Contracting Abroad
The construction sector in Turkey is one of the biggest in the world, just after China. The first foreign project took place in the 1970s, but such projects have increased greatly since then. From 2008 to 2017, Turkey engaged in more than 4,000 construction jobs abroad, equal to approximately $220 billion. This nine-year period accounts for 64 percent of all foreign contracting jobs taken by Turkey in 45 years. The cost of these projects has also increased. In 2008, the average project cost $37 million, but by 2017 this average had risen to roughly $79 million. Contracting abroad has greatly increased jobs and contributed to the rising economy in Turkey.
- Rapid Growth
In 2017, the Turkish economy grew by 7.4 percent, meaning it expanded faster than both India and China. Turkey’s economy was ranked as the fastest-growing economy in the group of G-20 nations.
There are still many improvements to be made throughout the country. However, Turkey’s rising economy shows that the country has made great strides toward becoming an upper-middle income country. The people of Turkey have successfully reduced poverty, decreased unemployment and increased the overall living conditions in their country.
– Ronni Winter