by ELYSEE HOME 
Turkey is a country located at the crossroads of Europe and Asia, and has a diverse and growing economy. With a population of around 83 million people and a Gross Domestic Product (GDP) of $764 billion in 2021, Turkey is ranked as the world’s 20th largest economy. In this report, we will discuss the current state of Turkey’s economy, including its strengths and weaknesses, and the challenges it faces.
Overview of the Turkish economy
Turkey’s economy has shown impressive growth in recent years, with an average GDP growth rate of around 5% between 2010 and 2019. However, the COVID-19 pandemic had a severe impact on Turkey’s economy in 2020, leading to a contraction of 1.8%. Nevertheless, the economy rebounded quickly in 2021 with an estimated growth rate of 9.2%.
The services sector, including tourism, is the largest contributor to Turkey’s GDP, accounting for around 61% of the economy. The manufacturing sector follows, contributing around 27%, while agriculture accounts for the remaining 12%. Turkey’s major exports include textiles, automotive parts, electronics, and food products. The country has a strong industrial base and is one of the leading producers of steel, cement, and chemicals in the region.
Strengths of the Turkish economy
One of the strengths of the Turkish economy is its young and educated workforce. Around 25% of the population is under the age of 15, and the country has a high literacy rate of around 98%. This provides Turkey with a competitive advantage in terms of human capital and the potential for innovation and growth.
Turkey also has a strategic location that makes it a gateway between Europe, Asia, and the Middle East. This location has helped the country to develop a dynamic and diversified economy that is well-positioned to take advantage of global trade opportunities.
Another strength of the Turkish economy is its robust banking sector, which is considered to be one of the most developed in the region. The country’s banks are well-regulated and have shown resilience in times of economic stress.
Challenges facing the Turkish economy:
One of the major challenges facing the Turkish economy is inflation. Inflation has been a persistent problem in Turkey for many years, and the country has experienced several periods of high inflation in the past. Inflation reached a 20-year high of 36.1% in November 2021, largely due to the COVID-19 pandemic and supply chain disruptions.
Another challenge facing the Turkish economy is the country’s external debt, which is quite high at around $450 billion, equivalent to 60% of GDP. While Turkey has been able to service its debt in the past, any future economic shocks could put pressure on the country’s ability to repay its creditors.
Turkey is also facing political instability and geopolitical tensions that could potentially impact its economic growth. The country has been experiencing social and political unrest in recent years, and its relations with some of its neighbors have been strained.
Conclusion
Overall, Turkey’s economy is diverse and dynamic, with a strong industrial base and a young, educated workforce. However, the country faces several challenges, including high inflation, external debt, and political instability. The Turkish government will need to address these challenges in order to maintain economic stability and continue to attract investment and grow the economy.