Global credit squeeze, escalating political tensions and monetary tightening will weigh on economic growth in 2008. From 2006 to 2007, the annual growth rate decreased from to . Slower growth in 2007 was attributable to the strength of the Turkish currency, which hurt the export industry, the delayed effects of monetary tightening in mid-2006 and a drought-related drop in agricultural output. The most significant slowdowns in growth in 2007 were in agriculture, construction and manufacturing. The unfavourable developments in the global economy which began during the second half of 2007 have increased downside risks on domestic and external demand.
