The Turkish Economy

Turkey's dynamic economy is a complex mix of modern industry and commerce, along with a traditional agriculture sector that still accounts for more than 35 per cent 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 of rising importance in Turkey's export mix. Real GNP growth has exceeded 6 per cent for many years. The economy is turning around with the implementation of economic reforms, and 2004 GDP growth reached 9 per cent, followed by roughly 5 per cent annual growth in 2005-06. Inflation fell to 7.7 per cent in 2005, a 30-year low. The country showed strong economic gains in 2002-06, which were largely due to renewed investor interest in emerging markets. Prior to

2005, FDI in Turkey averaged less than $1 billion (£515.39 million) annually, but further economic and judicial reforms and prospective EU membership are expected to help boost FDI. Privatization sales are currently approaching $21 billion (£10.8 billion). Oil has been flowing through the Baku-Tblisi-Ceyhan pipeline since May 2006, marking a major milestone that will bring up to 1 billion barrels per day from the Caspian to market