Turkey has an emerging free-market economy. It ranked as the 16th-largest in the world and 7th-largest in Europe by nominal GDP in 2025. It also ranked as the 11th-largest in the world and 5th-largest in Europe by PPP in 2025. Turkey is a founding member of the OECD and G20. Ratified in 1995, the European Union–Turkey Customs Union is a free trade area between Turkey and the European Union.
Turkey experienced an economic boom since the 2000s, later curtailed and moderated by a protracted downturn since 2018. It is the fourth-most-visited destination in the world, with its tourism sector generating 10-15% of total GDP. It has a large industrial manufacturing base through which it is a leading producer of motor vehicles, consumer electronics, home appliances and defense products. Turkish inflation has been a perennial challenge since the 1970s due to historic pro-growth economic and monetary policies.
History
The economy of the Ottoman Empire was characterised by international trade and commerce, silk and textile weaving, agriculture, dairy farming and pastoralism. The Empire's economy began to stagnate in the 18th century, after it lost important territories in Central and Eastern Europe. By then, the Empire had also lost its monopoly in spice and silk trade between Asia and Europe, as a result of the discovery of new maritime routes which increasingly replaced the Ottoman-controlled land routes. Several other factors also led to the relative economic obsolescence of the late Ottoman Empire, such as its failure to immediately adapt to the innovative methods in industrial production that were introduced with the First Industrial Revolution in the 18th and 19th centuries; though improvements in industrial production took place during and after the Tanzimat reforms, in the late 19th and early 20th centuries. The National Economy (Millî İktisat) program implemented by the Committee of Union and Progress at the end of the Ottoman Empire — which involved the expropriation of Christian property and the elimination of Christians from the economy — exerted a major and enduring influence on the political economy of the Republic of Turkey.
The economic history of the modern Republic of Turkey has four eras. The first era's development policy, put into motion with Atatürk's reforms, was defined by the transition from a mainly agricultural economy into a more diversified and industrialized economy. It emphasized on private accumulation between 1923 and 1929. The second era's focus was on state accumulation in a period of global crises between 1929 and 1945. The third era focused on state-guided industrialization based on import-substituting protectionism between 1950 and 1980. The fourth and current era began with the opening of the economy to liberal trade in goods, services, and financial market transactions on January 24, 1980. Under Prime Minister Turgut Özal, the administration devalued the lira, liberalized trade and deepened the financial sector, and successfully integrated Turkey into global markets that created a robust, export-oriented business class. However, it was also marred by macroeconomic instability, volatile inflation and recurrent fiscal crises through the 1990s.
Following a deep banking recession in 2001, the government implemented structural reforms under a stringent IMF program, leading to a decade of rapid expansion. Output quadrupled between 2001 and 2013 and Turkey transitioned to an upper-middle-income country with strong exports in automotive, textile and appliances manufacturing that also fueled a construction boom and credit-based domestic consumption.
Since 2018, Turkey under Recep Tayyip Erdoğan has faced significant macroeconomic vulnerabilities as unorthodox monetary policies (Erdoğanomics) such as lowering interest rates through repeated currency interventions despite soaring inflation had led to a sharp depreciation of the Turkish lira and an economic crisis.
Data
The following table shows the main economic indicators from 1980 to 2023 (with IMF staff estimates for 2024–2029). Inflation below 10% is in green. YearGDP (in bil. US$PPP)GDP per capita (in US$ PPP)GDP (in bil. US$nominal)GDP per capita (in US$ nominal)GDP growth (real)Inflation rate (in percent)Unemployment (in percent)1980159.23,516.396.62,133.7-0.8%110.6%7.2%1981181.93,926.597.92,113.14.4%36.4%7.2%1982199.74,215.088.91,876.63.4%31.1%7.6%1983217.44,486.285.01,753.34.8%31.3%7.5%1984240.64,857.982.61,668.56.8%48.4%7.4%1985258.85,116.592.81,835.24.3%44.5%6.9%1986282.35,471.0102.31,983.16.9%34.6%7.7%1987318.36,051.1118.92,260.710.0%38.9%8.1%1988336.56,280.3125.02,333.22.1%73.7%8.7%1989350.66,427.2147.72,707.90.3%63.3%8.6%1990397.47,159.3207.53,738.29.3%60.3%8.0%1991414.77,344.8208.43,691.40.9%66.0%7.7%1992449.57,831.6219.23,818.86.0%70.1%7.9%1993497.28,523.4248.64,261.68.0%66.1%8.4%1994480.18,101.2179.43,026.7-5.5%104.5%8.0%1995525.48,729.4233.63,880.97.2%89.6%7.1%1996572.59,368.7250.54,099.27.0%80.2%6.1%1997626.210,096.0261.94,221.97.5%85.7%6.3%1998652.810,376.8275.84,384.53.1%84.7%6.4%1999640.410,035.0256.64,020.3-3.3%64.9%7.2%2000700.310,819.4274.34,238.06.9%55.0%6.0%2001674.910,288.1202.23,082.9-5.8%54.2%7.8%2002729.610,988.4240.23,617.26.4%45.1%9.8%2003786.911,712.5314.84,684.75.8%25.3%9.9%2004887.213,045.3409.16,015.79.8%8.6%9.7%2005997.314,483.1506.27,350.99.0%8.2%9.2%20061,099.515,768.3555.17,961.16.9%9.6%8.7%20071,186.216,804.9680.59,640.65.0%8.8%8.9%20081,218.817,042.0770.810,778.10.8%10.4%9.8%20091,167.416,089.1648.88,941.4-4.8%6.3%13.0%20101,281.017,376.4776.610,533.58.4%8.6%11.0%20111,454.119,459.8838.511,221.411.2%6.5%9.0%20121,550.720,504.4880.111,637.94.8%8.9%8.3%20131,703.722,221.4957.512,489.08.5%7.5%8.9%20141,860.523,945.5938.512,079.34.9%8.9%9.9%20152,022.925,691.1864.110,973.66.1%7.7%10.3%20162,116.226,513.6869.310,891.23.3%7.8%10.9%20172,282.328,242.5858.910,628.97.5%11.1%10.9%20182,406.529,345.6779.79,508.03.0%16.3%10.9%20192,468.729,688.0759.59,132.90.8%15.2%13.7%20202,546.930,490.5720.18,612.31.9%12.3%13.1%20212,953.935,063.5817.59,654.111.4%19.6%12.0%20223,009.835,293.4905.810,621.45.5%72.3%10.8%20233,277.538,390.91,129.913,235.85.1%53.8%10.5% Numbers below are 2024 IMF estimates.20243,456.740,283.31,344.315,665.93.0%60.9%10.4%20253,614.541,913.61,455.416,876.52.7%32.9%10.4%20263,801.043,865.01,477.317,048.63.2%19.2%10.4%20274,002.545,976.91,565.517,982.63.4%15.9%10.4%20284,226.648,333.71,660.518,988.93.6%15.0%10.4%20294,471.850,917.7661,764.220,088.23.8%15.0%10.4%
Main economic sectors As of November 2023, there are 1,086,670 registered companies based in Turkey. The sector with the highest number of companies registered in the country is manufacturing, with 241,362. This is followed by wholesale trading and services with 197,476 and 187,325 companies respectively.
Agricultural, fishing and forestry sector
Industry
Service sector Banking and finance
During the 19th and early 20th centuries, Bankalar Caddesi (Banks Street) in Istanbul was the financial center of the Ottoman Empire, where the headquarters of the Ottoman Bank (established as the Bank-ı Osmanî in 1856, and later reorganized as the Bank-ı Osmanî-i Şahane in 1863) and the Ottoman Stock Exchange (1866) were located. Bankalar Caddesi continued to be Istanbul's main financial district until the 1990s, when most Turkish banks began moving their headquarters to the modern central business districts of Levent and Maslak.
Originally established as the Ottoman Stock Exchange (Dersaadet Tahvilat Borsası) in 1866, and reorganized to its current structure at the beginning of 1986, the Istanbul Stock Exchange (ISE) is the sole securities market of Turkey. In 1995, the Istanbul Stock Exchange moved to its current building in the Istinye quarter. The Istanbul Gold Exchange was also established in 1995.
The Central Bank of the Republic of Turkey (Türkiye Cumhuriyet Merkez Bankası) was founded in 1930 as a privileged joint-stock company. The CBRT possesses the sole right to issue notes. It also has the obligation to provide for the monetary requirements of the state agricultural and commercial enterprises.
The "New Turkish lira" (TRY) was introduced on 1 January 2005. On 1 January 2009, the New Turkish lira was renamed once again as the "Turkish lira", with the introduction of new banknotes and coins.
Banking came under stress beginning in October 2008, as a result of the 2008 financial crisis. Turkish banking authorities warned state-run banks against the pullback of loans from the larger financial sectors.
Turkey's economy resumed its growth between 2009 and 2013, which was followed by a period of stagnation and recession between 2014 and 2020. Turkey's GDP began to recover and grow again in the period between 2020 and 2024.
In 2020, the total value of assets of the banking sector in Turkey amounted to more than $800 billion. As of January 2021, there were a total of 48 banks operating with 9,880 branches in Turkey and 71 branches abroad. , the foreign currency deposits of the citizens and residents in Turkish banks stood at $234 billion, equivalent to around half of all deposits. , the foreign currency reserves of the Turkish Central Bank were $85 billion, its gold reserves were $67.4 billion, while its official reserve assets stood at $159.8 billion.
Education
Healthcare
Real estate and housing
Retail and hospitality
Telecommunications and media
As of 2008, there were 17,502,000 operational landline telephones in Turkey, which ranked 18th in the world; while there were 65,824,000 registered mobile phones in the country, which ranked 15th in the world during the same year. The largest landline telephone operator is Türk Telekom, which also owns TTNET, the largest internet service provider in Turkey. The largest mobile phone operators in the country are Turkcell, Vodafone Turkey, Avea and TTNET Mobil.
The telecommunications liberalisation process started in 2004 after the creation of the Telecommunication Authority, and is still ongoing. Private sector companies operate in mobile telephony, long-distance telephony and Internet access. Additional digital exchanges are permitting a rapid increase in subscribers; the construction of a network of technologically advanced intercity trunk lines, using both fiber-optic cable and digital microwave radio relay, is facilitating communication between urban centres.
The remote areas of the country are reached by a domestic satellite system, while the number of subscribers to mobile-cellular telephone service is growing rapidly.
The main line international telephone service is provided by the SEA-ME-WE 3 submarine communications cable and by submarine fiber-optic cables in the Mediterranean Sea and Black Sea that link Turkey with Italy, Greece, Israel, Bulgaria, Romania, and Russia. In 2002, there were 12 Intelsat satellite earth stations; and 328 mobile satellite terminals in the Inmarsat and Eutelsat systems.
Türksat A.Ş. is the primary communications satellite operator of Turkey, controlling the Turksat series of satellites. Göktürk-1, Göktürk-2 and Göktürk-3 are Turkey's earth observation satellites for reconnaissance, operated by the Turkish Ministry of National Defense. BILSAT-1 and RASAT are the scientific observation satellites operated by the TÜBİTAK Space Technologies Research Institute, which (together with Turkish Aerospace Industries and Aselsan) also takes part in the production of Turkey's satellites.
As of 2001, there were 16 AM, 107 FM, and six shortwave radio stations in the country.
As of 2015, there were 42,275,017 internet users in Turkey, which ranked 15th in the world; while as of 2012, there were 7,093,000 internet hosts in the country, which ranked 16th in the world.
Transport