World Bank2013-07-262013-07-262003-07-28https://hdl.handle.net/10986/14625This report addresses key questions facing Turkish policymakers: how to sustain the economic recovery that began in 2002 following the deep crisis of 2001, how to ensure disinflation and public debt sustainability, and how to foster broad-based and equitably distributed growth in the future. After a brief review of the 2001 crisis and the Government response, the report analyzes the economic opportunities and challenges facing Turkey, and identifies policies to build on the economic recovery which began in 2002. The CEM develops a comprehensive four-point agenda for sustainable and more equitably distributed growth. The agenda encompasses: (i) macroeconomic stability, (ii) effective government, (iii) improved business environment, and (iv) stronger social policies. The report closes with medium-term macroeconomic projections to illustrate Turkey's prospects under a scenario of sustained reform and to highlight the risks to growth and macroeconomic stability should the economic program go off track.en-USCC BY 3.0 IGOACCOUNTINGADVERSE CONSEQUENCESAGRICULTUREBANK RESTRUCTURINGBANKING CRISESBANKING SECTORBANKING SYSTEMBENCHMARKBUSINESS CYCLECAPITA GROWTHCAPITA INCOMECAPITAL ACCOUNTCAPITAL ADEQUACYCAPITAL FLOWSCAPITAL INFLOWSCAPITAL MOBILITYCAPITAL OUTFLOWSCENTRAL BANKCHRONIC INFLATIONCIVIL SERVICECOMPETITIVENESSCONSUMER PRICE INDEXCONTINGENT LIABILITIESCPICURRENCY BOARDCURRENCY CRISESCURRENT ACCOUNTCURRENT ACCOUNT DEFICITDEMOGRAPHICSDEPOSITSDEVALUATIONDISINFLATIONECONOMIC ACTIVITYECONOMIC GROWTHECONOMIC PERFORMANCEECONOMIC REFORMEMERGING ECONOMIESEMERGING MARKET ECONOMIESEMERGING MARKETSEXCHANGE RATEEXCHANGE RATE PEGEXCHANGE RATE POLICYEXCHANGE RATE REGIMEEXCHANGE RATE REGIMESEXCHANGE RATE SYSTEMSEXOGENOUS SHOCKSEXPORT GROWTHEXPORTSEXTERNAL SHOCKSFACTOR INCOMEFINANCIAL CRISISFINANCIAL MARKETSFINANCIAL RESOURCESFINANCIAL SECTORFINANCIAL SECTOR REFORMFINANCIAL STABILITYFINANCIAL SYSTEMFISCAL ADJUSTMENTFISCAL MEASURESFISCAL POLICYFISCAL SUSTAINABILITYFIXED EXCHANGE RATEFOREIGN EXCHANGEGDPGDP PER CAPITAGNPGOVERNMENT SECURITIESGOVERNMENT SPENDINGGROSS DOMESTIC PRODUCTGROWTH POTENTIALGROWTH RATEHIGH INFLATIONHUMAN CAPITALHUMAN DEVELOPMENTIMPORTSINCOME GROUPSINFLATION RATEINFLATION RATESINFLATION TARGETSINTERNATIONAL INVESTORSINVENTORYLABOR FORCELABOR MARKETLEGISLATIONLIQUIDITYMACRO POLICIESMACROECONOMIC CONDITIONSMACROECONOMIC FRAMEWORKMACROECONOMIC INSTABILITYMACROECONOMIC STABILITYMACROECONOMIC STABILIZATIONMARKET CONFIDENCEMARKET ECONOMIESMARKET LIBERALIZATIONNOMINAL ANCHORNOMINAL EXCHANGE RATEOILOIL PRICESOUTPUT GROWTHPER CAPITA INCOMEPOLICY CREDIBILITYPOVERTY REDUCTIONPRIMARY SURPLUSPRIVATE BANKSPRIVATE CONSUMPTIONPRIVATE INVESTMENTPRIVATE SECTORPRIVATIZATIONPROFIT MARGINSPUBLIC CONSUMPTIONPUBLIC DEBTPUBLIC DEBT SUSTAINABILITYPUBLIC GOVERNANCEPUBLIC SECTORPUBLIC SERVICESREAL EXCHANGEREAL EXCHANGE RATEREAL GDPREAL GNPREAL GROWTHREAL INTERESTREAL INTEREST RATEREAL INTEREST RATESREAL PROGRESSREAL WAGESREFORM AGENDARISK AVERSIONRISK FACTORSRISK PREMIUMSECTOR RESTRUCTURINGSOCIAL SECURITYSTATE BANKSSTRUCTURAL REFORMSSUSTAINABLE GROWTHSUSTAINED GROWTHTAX REVENUESTELECOMMUNICATIONSTOTAL FACTOR PRODUCTIVITYTROUGHUNEMPLOYMENTUNEMPLOYMENT RATE DISINFLATIONCRISIS MANAGEMENTMACROECONOMIC FRAMEWORKPUBLIC SECTOR MANAGEMENTBUSINESS ENVIRONMENTSOCIAL POLICYDISASTER RECOVERYFINANCIAL ADMINISTRATIONSTRUCTURAL REFORMSGOVERNANCEFINANCIAL PERFORMANCE INDICATORSCORPORATE RESTRUCTURINGREGULATORY REFORMSMARKET LIBERALIZATIONSOCIAL CONTRACTSHUMAN CAPITAL DEVELOPMENTLABOR MARKETSECOMOMIC INTEGRATIONEXPORT PERFORMANCEFOREIGN DIRECT INVESTMENTSEXOGENOUS VARIABLESEXCHANGE RATE REGIMESEUROPEAN UNION MEMBERSHIPWorld Bank10.1596/14625