People are seen at Taksim square in Istanbul, Turkey, Feb. 25, 2021.(Photo: Xinhua)

 

People walk past stores in Istanbul, Turkey, Feb. 25, 2021.(Photo: Xinhua)

 

A hot-air balloon flies in the sky over Cappadocia, Turkey, on Feb. 20, 2021.(Photo: Xinhua)

 

A man wearing a mask carries a bouquet of flowers in Ankara, Turkey, on Feb. 14, 2021, Valentine's Day.(Photo: Xinhua)

 
Turkey's gross domestic product (GDP) expanded 1.8 percent in 2020 despite the COVID-19 pandemic, the country's statistical authority announced on Monday.

The Turkish economy ended 2020 on a high note, growing by 5.9 percent in the last quarter and 1.8 percent in the year as a whole, the Turkish Statistical Institute said.

"Turkey is one of the few economies that could achieve growth in the pandemic year," said Enver Erkan, an economist at Istanbul-based Tera Securities.

Erkan forecasted a growth rate of 4.8 percent for 2021, amid the mass vaccination drive launched in mid-January in Turkey.

However, some analysts underlined that this growth is partly due to a credit boom, which helps recovery while at the same time causing instability in currency and triggering inflation.

"Credit growth, which is among the main drivers of growth, was a continuation of the credit boom brought about by the low-interest policy in Q3 2020," Erkan said.

Turkey's economy was slowly improving after a 2018 currency meltdown, while it was hit hard by the fallout of the COVID-19 pandemic in early 2020.

Inflation and unemployment went up to two-digit figures despite government supports and loans for closed businesses and workers who lost their jobs.

Ankara is expected to announce a series of measures in mid-March to help the ailing economy, focusing on investment, production, export, and employment, according to analysts.

"We have come to the end of our economic reform work, which includes macroeconomic stability policies and structural policies," Turkish Treasury and Finance Minister Lutfi Elvan said last week on his Twitter account.

Elvan stressed that 2021 would be a year of reforms for Turkey.

On Monday, in another tweet, Elvan noted that Turkey would maintain fiscal discipline and focus on sustainable and "high quality" economic growth policies in the coming period to increase employment.

"Ensuring price stability will be Turkey's main priority in 2021," the minister added.

Several international financial institutions had recently revised their growth forecasts upward for the economy for both 2020 and 2021.

To address the growing monetary weaknesses and eroding Central Bank reserves, Turkish President Recep Tayyip Erdogan changed the head of the Central Bank and the treasury and finance minister in November 2020.

Since then, interest rates have been raised by 675 basis points to pull the weak Turkish lira up from a record low and address inflation amid soaring food prices.