Turkey will lose about 1% of GDP due to earthquake
2023.02.16 04:05
Turkey will lose about 1% of GDP due to earthquake
By Tiffany Smith
Budrigannews.com – The European Bank for Reconstruction and Development (EBRD) stated in a report that was released on Thursday that the potential economic effects of the earthquake in Turkey could result in a loss of up to one percent of the country’s gross domestic product this year.
Due to the anticipated boost from reconstruction efforts later this year, which will offset the negative effects on infrastructure and supply chains, the bank stated that this is a “reasonable estimate.”
According to Beata Javorcik, chief economist for the EBRD, “The earthquake affected to a large extent agricultural areas and areas where there is light manufacturing, so spillovers to other sectors are limited.”
On February 6, a devastating earthquake that killed over 41,000 people and left millions in need of humanitarian assistance rocked Turkey and Syria, leaving many survivors homeless in near-freezing temperatures.
Without taking earthquake effects into account, growth estimates for Turkey, the EBRD’s single largest recipient, have been revised down to 3% from 3.5 percent in 2023.
The bank added that significant economic vulnerabilities are created by rising external financing requirements and political uncertainty surrounding elections in 2023.
Plans for elections to take place by June in Turkey have been thrown off by the earthquake, which has sparked frantic debate within the government of President Tayyip Erdogan and the opposition over the possibility of a delay.
According to the report, “Turkey’s exports have been growing rapidly, benefiting from lower costs expressed in US dollars” as depreciation of the Turkish lira has outpaced inflation since 2015.
on Wednesday, a new record low was reached.
