Turkey projects lower growth and increased inflation in its Medium-Term Program for the years 2026-2028, indicating a financial struggle ahead.
In a significant move, Turkey has revised its medium- and long-term economic program for the years 2026 to 2028. The updates include revised targets for inflation, unemployment, and foreign trade.
The Turkish central bank has raised the inflation targets for 2026 and 2027. The target for 2026 is now set at 16%, up from the previous 9.7%. For 2027, the target has been increased to 9%, up from 7%. The target for 2028 remains at 8%.
Unemployment is forecast to gradually ease over the next few years. The unemployment rate is projected to be 8.5% at the end of 2025, gradually easing to 8.4% in 2026, 8.2% in 2027, and 7.8% in 2028.
Foreign trade projections have also been revised. The new program sees slightly lower momentum in foreign trade, with exports projected at $273.8 billion in 2025, down from the earlier target of $279.6 billion. Imports are forecast at $367 billion for 2025, compared with the previous projection of $369 billion.
For 2026, exports are now set at $282 billion, while imports are expected at $378 billion. In 2027, exports are projected at $294 billion, and imports at $393 billion. The target for 2028 is $308.5 billion in exports and $410.5 billion in imports.
The economy is projected to expand by 3.8% in 2026 and 4.3% in 2027, compared with the earlier program's higher targets. This revised growth projection for 2025 is 3.3%, down from the previous plan's target of 4%.
Notably, Turkey's economy grew 3.3% in 2024, reaching ₺44.58 trillion ($1.36 trillion) in gross domestic product.
The budget balance-to-GDP ratio is projected to narrow from minus 3.5% in 2026 to minus 2.8% by 2028, compared to the earlier framework's tighter targets. The current account balance-to-GDP ratio has been revised to minus 1.4% for 2025, minus 1.3% for 2026, and minus 1.2% for 2027, with a target of minus 1% for 2028.
Turkey's inflation sustained its decline trend for the 15th consecutive month in August, sliding to 32.9% from its May 2024 peak of 75.5%. The Turkish central bank's latest inflation projection is 28.5% for the year-end.
As of August 2025, Turkey's annualized export and import figures rose to $269.2 billion and $340.5 billion, respectively. The unemployment rate declined to 8% in July, one of the lowest levels over the decade.
The available search results do not provide information on which institutions or persons were involved in preparing the updated medium- and long-term program for the years 2026 to 2028 or who drafted its version.
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