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)
TT

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.



Iran Tells France to Review ‘Unconstructive’ Approach Ahead of Meeting

Iranian flag flies in front of the UN office building, housing IAEA headquarters, amid the coronavirus disease (COVID-19) pandemic, in Vienna, Austria, May 24, 2021. (Reuters)
Iranian flag flies in front of the UN office building, housing IAEA headquarters, amid the coronavirus disease (COVID-19) pandemic, in Vienna, Austria, May 24, 2021. (Reuters)
TT

Iran Tells France to Review ‘Unconstructive’ Approach Ahead of Meeting

Iranian flag flies in front of the UN office building, housing IAEA headquarters, amid the coronavirus disease (COVID-19) pandemic, in Vienna, Austria, May 24, 2021. (Reuters)
Iranian flag flies in front of the UN office building, housing IAEA headquarters, amid the coronavirus disease (COVID-19) pandemic, in Vienna, Austria, May 24, 2021. (Reuters)

Iran's foreign ministry called upon Paris to review its "unconstructive" approach, a few days before Tehran is set to hold a new round of talks about its nuclear program with major European countries.

On Monday, Emmanuel Macron said Tehran's uranium enrichment drive is nearing a point of no return and warned that European partners in a moribund 2015 nuclear deal with Iran should consider reimposing sanctions if no progress is reached.

"Untrue claims by a government that has itself refused to fulfil its obligations under the nuclear deal and has played a major role in (Israel's) acquisition of nuclear weapons is deceitful and projective," Foreign Ministry spokesperson Esmaeil Baghaei wrote on X on Wednesday.

France, Germany and Britain were co-signatories to the 2015 deal in which Iran agreed to curb enrichment, seen by the West as a disguised effort to develop nuclear-weapons capability, in return for lifting international sanctions.

Iran says it is enriching uranium for peaceful purposes and has stepped up the program since US President-elect Donald Trump pulled Washington out of the 2015 deal during his first term of office and restored tough US sanctions on Tehran.

French, German and British diplomats are set to hold a follow-up meeting with Iranian counterparts on Jan. 13 after one in November held to discuss the possibility of serious negotiations in coming months to defuse tensions with Tehran, as Trump is due to return to the White House on Jan. 20.

Baghaei did not mention French Foreign Minister Jean-Noel Barrot's comment regarding three French citizens held in Iran.

Barrot said on Tuesday that future ties and any lifting of sanctions on Iran would depend on their release.