EBRD upgrades Türkiye forecast for 2025 to 3.1 pct

LONDON

The European Bank for Reconstruction and Development (EBRD) expects Türkiye’s economy to grow by 3.1 percent in 2025, upgrading it from the bank’s previous 2.8 percent growth forecast in May 2025.

The bank expects the Turkish economy to further grow by 3.5 percent in 2026, unchanged from the previous forecast.

The forecasts were published on Sept. 25 in the bank’s Regional Economic Prospects report.

Türkiye’s GDP growth accelerated from 2.3 percent year-on-year in the first quarter of 2025 to 4.8 percent in the second quarter.

On the upside, easing tensions in Syria and the Caucasus and closer cooperation with the EU could allow Türkiye to capitalize on its established strengths in construction, logistics and defense, according to the EBRD report.

Volatile risk sentiment and tighter global financing conditions remain key risks for Türkiye, it added.

The EBRD invested a record 2.6 billion euros in Türkiye in 2024, driven by the private sector’s appetite for green investments and the bank’s continuing support for regions affected by the February 2023 earthquakes.

The bank’s cumulative investment in the country stands at over 22.4 billion euros, with its current portfolio in the country totaling around 8 billion euros.

Growth in the EBRD regions (excluding six economies in sub-Saharan Africa and Iraq) is expected to moderate to 3.1 percent in 2025 as a whole from stronger-than-expected outturns in the first half of the year, before picking up to 3.3 percent in 2026, the report said.

The economies in the EBRD regions remain under pressure from continued global geopolitical tensions, increased competition from China in export markets and limited fiscal space, it added.