Industry Trend Analysis - Healthcare Market Will Remain Regional Outperformer Despite Precarious Fiscal Position - AUG 2017


BMI View: Turkey ' s precarious fiscal position will weigh on the long-term growth outlook for the country' s healthcare market, which will also impact on the country ' s pharmaceutical sales picture. Nevertheless, we remain bullish on both markets' growth , and Turkey will be a growth outperformer within the CEE region over our forecast period.

While we maintain our positive outlook for Turkey's healthcare sector - and, by association, its pharmaceutical market - we note that there are significant downside risks to the continued rapid expansion of expenditure. Despite political stability in the country on the domestic front being boosted by President Erdogan's victory in the April 2017 constitutional referendum, the country's macroeconomic outlook will be a significant factor in driving healthcare spending.

According to BMI's Country Risk team, the ruling Justice and Development Party (AKP) will push on with its plans to stimulate the Turkish economy through increased fiscal spending. However, the enactment of this fiscal stimulus has led to rapid deterioration of fiscal metrics, and the Country Risk team believe that the government will have to scale back its expansionary fiscal policy or risk a deterioration of market confidence ( see ' Fiscal Position Increasingly Precarious Despite Headline Figures ' , May 26 2017).

Government Spending Drives Market Outlook
Turkey - Healthcare Expenditure (TRYbn)
f = BMI forecast. Source: World Health Organization (WHO), TurkStat (TUIK), BMI

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