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2002 OECD Economic Outlook, Volume 2002 Issue 2

image of OECD Economic Outlook, Volume 2002 Issue 2

Twice a year, the OECD Economic Outlook analyses the major trends that will mark the next two years. The present issue covers the outlook to the end of 2004 and examines the economic policies required to foster high and sustainable growth in member countries. Developments in selected major non-OECD economies are also evaluated in detail.

In addition to the themes featured regularly, this issue contains four analytical chapters addressing the following important questions: the deterioration in budgetary positions in most OECD countries, raising the labour force participation of older workers,  the benefits that OECD countries could achieve from undertaking reforms to promote product market competition, and inflation rates in some of the larger, slow-growing economies have not declined sufficiently to offset higher rates elsewhere in the euro area.

English Also available in: French, German

Turkey

The Turkish economy is recovering unexpectedly quickly, following the worst recession in decades. Real growth of close to 4 per cent is likely in 2002, with inflation slowing to below its target of 35 per cent by year-end. Given renewed lira weakness since mid-year, achieving next year’s 20 per cent inflation target appears problematical, especially if the pace of growth were to strengthen further. However, with real interest rates also higher and policies set to remain tight, growth should be contained between 3½ and 4½ per cent in 2003 and 2004.

A strong and credible government following the 3 November elections, able to carry through the current stabilisation programme, is key to any lasting improvement in Turkey’s creditworthiness. A decline in the sovereign risk premium to reasonable levels is critical to achieving fiscal sustainability and low-inflation growth.

English Also available in: French

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