Economic Scenarios for 2020

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Economic Scenarios for 2020

• Turkey European Union
• Will there be an enlargement?
• 06.05.2006

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2020
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2020
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LOW TURKEY SCENARIO

• Macroeconomic indicators worse than EU average
  (GDP growth, inflation, government debt, interest
  rate, unemployment)
• IMF expectations did not met
• Instability in Turkey
• Copenhagen Economic Criteria failed
• Low degree of industrialization
• Low technology absorption
• Brain-drain and low results of educational
  reforms

5
HIGH TURKEY SCENARIO

• Substantial GDP Growth. Determined by
• - low inflation
• - low unemployment rate
• - budget surplus
• - decreasing interest rate
• - high inflow of FDI
• - trade surplus
• Competitiveness

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• Liberalization of the economy
• - modernization of banking sector
• - privatization
• - increased significance of Turkish foreign
  trade with EU
• Companies modernization
• - high result of educational reforms
• - successful expenditure in R D
• - adoption of know-how and high tech
• - exploitation of economies of scale and scope

7
BASE TURKEY SCENARIO

• Macroeconomics indicators at average level
• Structural reforms not completely implemented
• Privatization succeeded partly
• Moderate decrease of unemployment rate
• Not all Copenhagen Economic Criteria met
• Adoption of Acquis Communitaire

8
LOW EU SCENARIO

• No constitution
• EMU difficulties
• No social security reforms
• Privatisation not accomplished
• Unsuccessful integration of new members
• CAP causes internal conflicts
• Asymmetric shocks

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• Scarcity of energy resources and water
• Senseless EU Common Market
• Conflicts between member states
• No confidence of EU citizens in EU vision
• Absence of political union
• Macroeconomic problems / High unemployment

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HIGH EU SCENARIO

• Constitution as a symbol of strength
• GDP growth / Low unemployment
• Common market and privatisation completed
• Successful EMU and a common fiscal policy
• Increasing birthrate
• Reformation of social system
• Flexibility of labour market
• Renewable energy resources
• European investment staying within the EU

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BASE EU SCENARIO

• GDP growth average
• Unemployment rate unchanged
• Lags in privatisation
• EMU and different fiscal policies
• Social issues not resolved
• Limited labour flexibility
• Maastricht criteria not accomplished
• Moderate flow of FDI to new member states

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2020
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Thanks for your attention!!!