Türkiye Earthquake Could Result in Loss of Up to 1% of Country's GDP in 2023

This handout photograph taken and released by Turkish agency DHA (Demiroren News Agency) shows smoke rising from burning containers at the harbor of Iskenderun in Hatay, a day after a 7.8-magnitude earthquake struck the country's southeast, on February 7, 2023. (Photo by Handout / DHA (Demiroren News Agency) / AFP)
This handout photograph taken and released by Turkish agency DHA (Demiroren News Agency) shows smoke rising from burning containers at the harbor of Iskenderun in Hatay, a day after a 7.8-magnitude earthquake struck the country's southeast, on February 7, 2023. (Photo by Handout / DHA (Demiroren News Agency) / AFP)
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Türkiye Earthquake Could Result in Loss of Up to 1% of Country's GDP in 2023

This handout photograph taken and released by Turkish agency DHA (Demiroren News Agency) shows smoke rising from burning containers at the harbor of Iskenderun in Hatay, a day after a 7.8-magnitude earthquake struck the country's southeast, on February 7, 2023. (Photo by Handout / DHA (Demiroren News Agency) / AFP)
This handout photograph taken and released by Turkish agency DHA (Demiroren News Agency) shows smoke rising from burning containers at the harbor of Iskenderun in Hatay, a day after a 7.8-magnitude earthquake struck the country's southeast, on February 7, 2023. (Photo by Handout / DHA (Demiroren News Agency) / AFP)

The potential economic effects of the earthquake in Türkiye could result in a loss of up to 1% of the country's gross domestic product this year, the European Bank for Reconstruction and Development (EBRD) said in a report published on Thursday.

The bank added this is a "reasonable estimate" due to the expected boost from reconstruction efforts later this year, which will offset the negative impact to infrastructure and supply chains, Reuters said.

"The earthquake affected to a large extent agricultural areas and areas where there is light manufacturing, so spillovers to other sectors are limited," EBRD chief economist Beata Javorcik told Reuters.

Türkiye and neighboring Syria have been rocked by a devastating earthquake on Feb. 6 which has killed more than 41,000 people and left millions in need of humanitarian aid, with many survivors having been left homeless in near-freezing winter temperatures.

Growth for Türkiye, the single biggest recipient of EBRD funds, has been revised down to 3% from 3.5% in 2023, without considering the impact of the earthquake in the estimates.

The bank added that growing external financing requirements and political uncertainty associated with elections in 2023 create significant economic vulnerabilities.

Türkiye’s earthquake has thrown into disarray plans for elections to be held by June, sparking frantic debate within President Tayyip Erdogan's government and the opposition over a possible delay.

"As depreciation of the Turkish lira outpaced inflation since 2015, Türkiye’s exports have been growing fast, benefiting from lower costs expressed in US dollars," the report added.

Türkiye’s lira hit a fresh record low on Wednesday.



Kremlin: Putin Not Ruling Out Talks with Ukraine, but Wants Guarantees

Russian President Vladimir Putin is seen on a TV camera screen as he speaks during a meeting at the Russian Foreign Ministry in Moscow, Russia, Friday, June 14, 2024. (AP Photo/Alexander Zemlianichenko, Pool)
Russian President Vladimir Putin is seen on a TV camera screen as he speaks during a meeting at the Russian Foreign Ministry in Moscow, Russia, Friday, June 14, 2024. (AP Photo/Alexander Zemlianichenko, Pool)
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Kremlin: Putin Not Ruling Out Talks with Ukraine, but Wants Guarantees

Russian President Vladimir Putin is seen on a TV camera screen as he speaks during a meeting at the Russian Foreign Ministry in Moscow, Russia, Friday, June 14, 2024. (AP Photo/Alexander Zemlianichenko, Pool)
Russian President Vladimir Putin is seen on a TV camera screen as he speaks during a meeting at the Russian Foreign Ministry in Moscow, Russia, Friday, June 14, 2024. (AP Photo/Alexander Zemlianichenko, Pool)

Russian President Vladimir Putin is not ruling out talks with Ukraine, but guarantees will be needed to ensure the credibility of any negotiations, Russian news agencies cited Kremlin spokesman Dmitry Peskov as saying on Sunday.

More than 90 countries took part in a two-day event at the Buergenstock resort in central Switzerland aimed at uniting global opinion on how to end Moscow's 27-month-old invasion.
Russia was not invited to those talks.

Kyiv's positions have been taken into consideration in the final communique for the summit, Ukrainian Foreign Minister Dmytro Kuleba said on Sunday.

"The text is balanced, all of our principled positions on which Ukraine had insisted have been considered," he told reporters.

Kuleba also hinted that Russia could be involved in a future summit but dismissed Putin's demand on Friday that Kyiv cede four regions of Ukraine that Russia has occupied and drop its goal of joining NATO.