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Turkey - Country Profile

Turkey's dynamic economy is a complex mix of modern industry and commerce along with a traditional agriculture sector that in 2004 still accounted for more than 35% of employment. It has a strong and rapidly growing private sector, yet the state still plays a major role in basic industry, banking, transport, and communication. The largest industrial sector is textiles and clothing, which accounts for one-third of industrial employment; it faces stiff competition in international markets with the end of the global quota system. However, other sectors, notably the automotive and electronics industries, are rising in importance within Turkey's export mix. In recent years the economic situation has been marked by erratic economic growth and serious imbalances. Real GNP growth has exceeded 6% in many years, but this strong expansion has been interrupted by sharp declines in output in 1994, 1999, and 2001.

Inflation, in recent years in the high double-digit range, fell to 9.3% by 2004 - a 30-year low. Despite these strong economic gains in 2002-04, which were largely due to renewed investor interest in emerging markets, IMF backing, and tighter fiscal policy, the economy is still plagued with high debt and deficits. The public sector fiscal deficit exceeds 6% of GDP - due in large part to the huge burden of interest payments, which accounted for more than 40% of central government spending in 2004, and to populist spending. Foreign direct investment (FDI) in Turkey remains low - averaging less than $1 billion annually, but further economic and judicial reforms and prospective EU membership are expected to boost FDI. A major political and economic issue over the next decade is whether or not Turkey will become a member of the EU.


Economic Statistics
Exports : $69.46 billion f.o.b. (2004 est.)
Export
Commodities :
apparel, foodstuffs, textiles, metal manufactures, transport equipment
Export
Partner
Germany 13.9%, UK 8.8%, US 7.7%, Italy 7.4%, France 5.8%, Spain 4.2% (2004)
Imports $94.5 billion f.o.b. (2004 est.)
Import
Commodities :
machinery, chemicals, semi-finished goods, fuels, transport equipment
Imports
Partners :
Germany 12.9%, Russia 9.3%, Italy 7.1%, France 6.4%, US 4.8%, China 4.6%, UK 4.4% (2004)