Our annual exports and imports grew by 32.8% and 23.6% respectively. Tourism and transportation revenues contributed positively to the current accounts balance in the third quarter of the year. Strong rise in exports coupled with tourism and services revenues pushed the current deficit down to the order of USD 15 billion. The manufacturing activity remained strong throughout the year, and improvements were observed in capacity utilization rate and confidence indices.
During 2021, the vaccination campaigns that gained momentum, manufacturing and services industries that reopened, and increased international circulation followed by tourism activity paved the way for the rapid growth of the Turkish economy. The national economy expanded by 7.3%, 21.9%, 7.5% and 9.1% in the first four quarters of the year respectively, which translated into an annual growth of 11%.
The climate conditions in the food exporting countries negatively affected global food prices. With the added burden of increased transportation costs, food prices surged across the world. The International Monetary Fund (IMF) estimated global economic growth for 2021 as 5.9% due to increased volatilities and supply constraints.
The rise in inflation carried on in the last quarter of the year in the US, and consumer inflation was registered as 7.0%. The US Federal Reserve System (the Fed) deserted its supportive stance and signaled three rate hikes in the coming year.
After increasing the rates due to the increased inflationary pressure in the initial months of the year, the CBRT changed its policy from September.
Our country was also affected by the rising food and energy prices worldwide; annual inflation surged to 36.1% at the end of December. The Central Bank of the Republic of Türkiye (CBRT) kept the policy rate at 19% in July and August. Stating that the rise in inflation was associated with transitory factors, the CBRT cut the rates from September. With a 500-point reduction, benchmark rate was decreased to 14%.
In the aftermath of rate cuts and amid an environment where the Fed was hawkish, the Turkish lira depreciated. From September, the two-year Treasury bill rate went up by 450 bps, and the 10-year bill by 560 bps. The rate on 5-year Eurobonds increased by 230 bps and that on 5-year CDS by 190 bps.
| December 2021 | December 2020 | |
|---|---|---|
| Assets | TL 9.21 trillion | TL 6.11 trillion |
| Loans | TL 5.02 trillion | TL 3.66 trillion |
| Marketable Securities | TL 1.48 trillion | TL 1.02 trillion |
| Deposits | TL 5.54 trillion | TL 3.63 trillion |
Our annual exports and imports grew by 32.8% and 23.6% respectively. Tourism and transportation revenues contributed positively to the current accounts balance in the third quarter of the year. Strong rise in exports coupled with tourism and services revenues pushed the current deficit down to the order of USD 15 billion. The manufacturing activity remained strong throughout the year, and improvements were observed in capacity utilization rate and confidence indices.
With the contribution of powerful fiscal expansion and net exports, we project that the national economy might grow by more than 3.5% in 2022.
