Southeastern Europe & Mediterranean Emerging Market Economies: Bi-Weekly Report 17 February - 2 March 2026

TÜRKIYE 
Domestic absorption sustained Q4:25 expansion amid easing momentum, with FY:25 GDP growth reaching 3.6%, up from 3.3% in FY:24
A more supportive policy mix and normalizing agricultural production should keep FY:26 GDP growth broadly flat at c. 3.7%, close to the economy’s long-term potential growth rate 
Risks to the outlook are heavily tilted to the downside, largely reflecting the impact of a prolonged Middle East conflict

BULGARIA
Snap parliamentary elections are scheduled for April 19, following a deadlock in negotiations over the formation of a new Government
Prolonged political uncertainty has weighed on economic growth, primarily through persistent under-investment
While RRF-financed investment will continue to underpin growth in 2025–26, sustaining momentum beyond the programme’s expiry will pose a significant challenge

NORTH MACEDONIA
Fiscal consolidation advanced in FY:25, but mainly due to lower capital spending, prompting concerns about its quality 
The planned fiscal improvement for FY:26 also hinges on further CapEx under-execution, with global energy price shocks posing additional risks to the fiscal outlook


APPENDIX:
DETAILED MACROECONOMIC DATA
REGIONAL SNAPSHOT:  
        MACROECONOMIC INDICATORS