EBRD lowers Türkiye growth forecast for 2026

• EBRD lowers its 2026 growth forecast for Türkiye to 3.0 per cent from 3.5 per cent
• Bank expects Türkiye to grow by 4.0 per cent in 2027
• Domestic demand weakens while regional tensions continue to weigh on outlook

The European Bank for Reconstruction and Development (EBRD) expects Türkiye’s economy to grow by 3.0 per cent in 2026, down from a 3.5 per cent forecast made in June 2026.

Growth is projected to accelerate to 4.0 per cent in 2027.

These forecasts were published today in the Bank's latest Regional Economic Prospects (REP) report.

The downward revision reflects weaker domestic demand amid high inflation and tight financial conditions, as well as the continuing impact of the conflict in the Middle East and cost competitiveness pressures on exports.

The REP states that an escalation of hostilities in the Middle East could put further pressure on energy prices, reduce tourism revenues, trigger capital outflows and disrupt trade. In addition, growing foreign-exchange liabilities expose corporate balance sheets to lira depreciation.

On the upside, a lasting peace in the Middle East, stronger external demand and continued policy discipline could support investment and faster growth.

Aggregate growth across the EBRD regions is projected at 2.5 per cent in 2026 before accelerating to 4.0 per cent in 2027. The 2026 forecast has been revised down by 0.6 percentage points since June, reflecting tighter financing conditions, the impact of drought across parts of Europe and the Black Sea blockade related to Russia’s continued invasion of Ukraine.

The EBRD is one of Türkiye’s key investors, with more than €25 billion invested in the country, largely in the private sector.