The OECD said on November 25 that it expected the Turkish economy to grow 3% this year and 3.2% in 2015.

The Organisation released its November issue of the Economic Outlook Report on Tuesday. Earlier this month, the OECD cut its 2015 forecast for Turkey to 3.2% from a previous 4% in the advanced G20 release of the Economic Outlook. The Organisation did not change its 2016 forecast of 4% GDP growth.

In the context of serious regional geopolitical tensions and the sluggish recovery in Europe, exports are projected to be subdued and GDP growth to be relatively weak by Turkish standards in 2015 and 2016, the OECD said in the report. The current account deficit is set to stay above 5% of GDP (projected at 5.4% this year and 5.1% in 2015), and large short-term foreign debt refinancing needs make Turkey vulnerable to shifts in international investor sentiments, the Organisation stressed. The report also underlined that enhancing the credibility of monetary policy is essential with inflation far above target despite ample slack. The OECD forecasts inflation to be 9% this year, 7.4% next year, and 6.8% in 2016. The unemployment rate will rise to 10.1% next year from a projected 9.9% in 2014, according to the OECD, which forecasts a jobless rate of 10.2% in 2016. Structural reforms are needed to boost productivity in the business sector, to achieve durable competitiveness gains and balanced growth, the report concluded.