Turkey's Budget Deficit for 2018 Expected to Reach 17.3 Billion Dollars

Turkey via AAWSAT arabic.
Turkey via AAWSAT arabic.
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Turkey's Budget Deficit for 2018 Expected to Reach 17.3 Billion Dollars

Turkey via AAWSAT arabic.
Turkey via AAWSAT arabic.

The Turkish government expected the budget deficit in 2018 to reach $17.3 billion. Turkey’s parliament has approved on Saturday the government’s 2018 budget, which includes increased spending on defense and projects a rise in the fiscal deficit to 65.9 billion lira ($17.28 billion).

The 2018 budget includes changes in tax regulations, including tax increases for companies and motor vehicles, to help pay for increased security.

The government announced a 40 percent increase on motor vehicles taxes in September to divert the proceeds to the defense and security budget, but then dropped it to 25 percent after wide-range public objections.

Turkey's budget deficit for the current year is expected to hit $16.5 billion, nearly twice the 2016 budget deficit of about $8.5 billion.

Turkey’s 2018 budget also projects tax income of 599.4 billion lira, up some 15 percent from estimates for 2017.

Over the past two years, Turkey’s current account deficit has widened due to increasing government incentives to boost the economy and defense spending. Next year’s budget deficit to gross domestic product ratio is expected to be 1.9 percent.

Turkey's trade deficit rose 85.23 percent year-on-year in September to $8.14 billion.

The government says the additional defense spending is urgently needed to modernize the military, the second-largest in the NATO alliance, and meet the costs of domestic and foreign security operations.

Turkey’s economy has recovered from a downturn that followed an attempted coup last year, helped by a series of government stimulus measures.

GDP grew 11.1 percent year-on-year in the third quarter, its fastest expansion in six years, according to official data.



German Central Bank Chief: US Tariffs Would Eat Up German Growth in 2025

President of the Bundesbank, Dr Joachim Nagel, speaks during an interview at the G20 finance meeting in Durban, South Africa, on July 17, 2025. REUTERS/Rogan Ward
President of the Bundesbank, Dr Joachim Nagel, speaks during an interview at the G20 finance meeting in Durban, South Africa, on July 17, 2025. REUTERS/Rogan Ward
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German Central Bank Chief: US Tariffs Would Eat Up German Growth in 2025

President of the Bundesbank, Dr Joachim Nagel, speaks during an interview at the G20 finance meeting in Durban, South Africa, on July 17, 2025. REUTERS/Rogan Ward
President of the Bundesbank, Dr Joachim Nagel, speaks during an interview at the G20 finance meeting in Durban, South Africa, on July 17, 2025. REUTERS/Rogan Ward

The Bundebank expects growth of 0.7% in Germany in 2026 but this could be eaten up if US tariffs of 30% threatened by President Donald Trump were implemented, the central bank's President Joachim Nagel told Reuters in an interview.

“If tariffs materialize in August, a recession in Germany in 2025 cannot be ruled out,” Nagel said in Durban, South Africa, where the meeting of G20 finance chiefs is taking place on Thursday and Friday.

The 30% tariff on European goods threatened by Trump would, if implemented, be a game-changer for Europe, wiping out whole chunks of transatlantic commerce and forcing a rethink of its export-led economic model.

“The outlook for the German economy has just improved, especially due to the fiscal program that has been announced and is now being implemented by the German federal government, which also sets the right accents: investments in infrastructure, in future technologies,” Nagel said. “But this uncertainty could significantly weaken a positive outlook.”

Also, German Finance Minister Klingbeil told Reuters on Thursday that the European Union should find solutions to its finances without using common borrowing.

Klingbeil said the EU had joint debt in the last few years, but that was in a crisis situation during the COVID pandemic, he said in an interview on the sidelines of a G20 meeting in Durban, South Africa.

“Overall, we need to resolve the finances of the EU differently than through a policy of joint debt,” he said.

“Fortunately, we are not in such a crisis right now,” he added.