The FINANCIAL — The European Bank for Reconstruction and Development (EBRD) has revised its 2010 growth rate projection for the Turkish economy up to 3 percent from its previous estimate of 1 percent, taking into consideration the improved conditions of the overall global economy and signs of recovery in the Turkish economy, the Anatolia news agency reported on October 18.
However, the bank, which put forward negative economic forecasts for Central and Eastern European countries for this year, expects a fragile recovery in 2010.
"Despite a more positive outlook for the year ahead, the EBRD revised its projection of the rate of contraction in the Turkish economy this year upwards by 0.5 percent to 6 percent and estimates that Central and Eastern European economies will contract by an average of 6.3 percent, following steep output declines in the first half of the year," Today's Zaman reported.
The EBRD says signs of positive growth in the third quarter suggest that the recession is now bottoming out in many countries, noting, however, that any upturn in 2010 is likely to be fragile and patchy. "It is also clear that the social costs of the global economic crisis are only likely to be felt in earnest next year, when corporate bankruptcies and unemployment will continue to rise. Growth over the medium term in the EBRD region is also likely to be below the trend experienced over the last decade," said Erik Berglof, the EBRD's chief economist.
Although the EBRD revised its projections for average year-on-year growth for 2010 up to 2.5 percent — 1.5 percent higher than its May forecasts — it sees this mostly as a reflection of recovery from a deeper than anticipated downturn in the first half of this year rather than a more vigorous economy during 2010. The bank had announced its plans to gradually withdraw from Eastern European countries and place a priority on Turkey in delivering investments. The EBRD declared this year that Turkey, which is attempting to become a full member of the European Union, will be the main target of its expansion plans in the new era.
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