Dareen Cone 
The human toll of the two earthquake in Turkey is heartbreaking, and its potential economic consequences are beginning to reveal themselves. Early estimates suggest this disaster will be immense, with a lasting effect on Turkish citizens for years to come.
More Devastating for the Economy than the Recent Van Earthquake
Bloomberg Analysis has revealed that, based on prior calamities, the Kahramanmaraş earthquake could have an effect of 1 percent on Turkey’s national income. Bloomberg Economics Economist Selva Bahar Baziki released a statement as part of her research suggesting that Turkish growth expectations for 2023 were diminished from 3 to 2.6 percent due to this event.
To make estimations about the financial repercussions of the Kahramanmaraş-centered earthquakes, a three-stage technique based on the seismic event that occurred in Van back in 2011 was implemented. Moreover, the influence of mentioned tremor on 10 leading economic sectors within Van was examined and calculated.
To better understand the Van region’s real GDP growth, a weighted average of all cities that were similar to Van before their earthquake was assessed. To create this comparison, factors such as regional population, industry composition, construction output, and national GDP share were considered.
The Contraction in GDP Could Be Around 1%
The earthquake had a disastrous impact on many sectors of the economy, with agriculture, industry, professional services, and support services among the most affected. By taking into account the extreme magnitude of these earthquakes, however, it was found that each sector’s contraction had been scaled accordingly – resulting in an estimated 12% decline in real Gross Domestic Product (GDP) for 10 provinces.
Bloomberg recently revealed that 10 provinces are estimated to contribute around 9% of Turkey‘s total GDP, with a projected 1% contraction by 2023. This calculation is based on static assumptions in which no shift in production from disaster-affected areas occurs, and the same effects are assumed for all ten provinces due to limited data. However, if such shifts occur, it could mitigate some negative impacts on overall economic growth.
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