Turkey to cut 2014 growth target to 4% due to Mideast tensions

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Turkey is likely to revise down its growth target for 2014 to four percent from five due to an expected slowdown in the U.S. Fed's stimulus program, tensions in the Middle East, and the risk of higher oil prices, economy officials said on Friday.

The government is officially expecting growth of four percent this year and five percent next, but ministers have already talked down the outlook for 2013, saying the economy is instead likely to expand at three to four percent.

“The Fed tapering its stimulus program, the lack of sufficient fund flows into Turkey, the possibility of intervention in Syria and the risk of it spreading into the region, developments in Egypt, a rise in oil prices and global economic problems pose significant risks to Turkey's growth, “one of the senior economy officials told Reuters.

“It's impossible to overlook these risks.”

Financial markets have been concerned about possible U.S. intervention in Syria, which shares a 900 km (560 mile) border with Turkey, thinking it could push oil prices higher in the short term, further increasing Turkey's import bill and its gaping current account deficit.

The prospect of the U.S. Federal Reserve gradually reining in its huge program of dollar printing has also hit appetite for emerging markets, with Turkey particularly vulnerable to lower capital flows because of its current account gap.

The government's new medium-term program, due to be announced within the next month, may include measures and incentives to support growth, investment and exports, the officials said, without giving details.

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