Turkish annual economic growth outperformed Europe’s largest economies, beating forecasts in the second quarter, driven by the construction and IT sectors.
Second-quarter gross domestic product (GDP) increased by 4.8%, compared with a forecast of 3.8%, the Turkish Statistical Institute said on Monday. GDP growth quarter-on-quarter also beat expectations, rising 1.6% compared with a forecast of 1.1%.
In comparison, the German economy expanded by an annual 0.2% in the second quarter. French GDP grew 0.8% for the second quarter, while Spain increased 2.8%, according to data from Trading Economics.
“Turkey’s second-quarter GDP data reflected a notable pick-up in annual growth, largely supported by resilient domestic demand,” ING Think said on Monday. “Investments grew by 8.8% YoY, adding 2.2ppt to GDP. This was largely driven by a continued surge in construction investments.”
Construction expanded 10.9% annually in the second quarter, while information and communication grew by 7.1%, the institute’s data showed. The agriculture sector slowed by 3.5%.
Meanwhile, exports from Turkey fell 0.9% year-on-year to US $21.8 billion in August, preliminary data from the Trade Ministry showed. Germany remained Turkey’s largest market, followed by the US and the UK.
The Turkish economy has accelerated “despite tighter financial conditions following political developments,” ING Think said. Turkish President Recep Tayyip Erdogan’s crackdown on opposition parties this year remains a threat to GDP and investor sentiment.
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