Turkish economy grows official 3.2% in first quarter

ANKARA- Output expanded by 3.2 percent in the first three months of 2012, pointing to a halving of the growth rate, data from the Turkish Statistics Institute (TUIK) showed.

"3.2 percent is a pretty good rate when you think about the financial crisis the European Union, our biggest trade partner, is caught up in," Turkey's Finance Minister Mehmet Sahin told Anatolia news agency.

The growth rate is "faster than both our forecast at 2.5 percent and market consensus at 2.8 percent," Turkey's Finansbank said in a newsletter following the TUIK announcement. But the bank said the surprising growth did not pull up their annual growth forecast for 2012, at about 2.9 percent, lower than the government forecast of 4.0 percent.

Turkey, a country of about 73 million people and the world's 17th-biggest economy, expanded by 8.5 percent in 2011, and 8.9 percent in 2010. It aspires to join the ranks of the world's top 10 by 2023.

But its expansion had already started slowing down by the last quarter of 2011, with a growth rate of 5.2 percent -- considered a healthy slowdown by Ankara as its economy gears up for a "soft landing."

Sahin noted that the slowdown was not a surprise, but an "expected trend," due to the challenges posed by the eurozone crisis, further troubling Turkey's already poor record of current account deficit.

Analysts say the widening current account deficit, currently standing at about $60 billion (47.5 billion euros), was a sign the economy is overheating and is set for an even sharper slowdown.