PASHA_BANK ANNUAL REPORT 2021

25 Annual Report 2021 PASHA Bank In October 2021, current account surplus was realized as USD 3.2 billion, which is the highest level since October 2018, thanks to increases in exports and service income. Twelve‑month cumulative current account deficit continued its downward trend since March to USD 15.4 billion in October, the lowest level in the last 16 months. Exports were strong in accordance with the rapid recovery of global demand and high export prices. Despite high increases in commodity prices and strong economic activity, imports demonstrated a moderate increase trend in the third quarter in comparison with the previous quarter. Relatively stronger import price increases limit the effect of quantity‑wise balancing in foreign trade on current account balance. On the service income side, recovery is stronger with the speeding up of vaccination and removal of restrictions. In 2022, improvement in current account balance is expected to continue with increasing trend in exports in accordance with foreign demand. Turkish economy grew by 7.41% in the first quarter and 22% in the second quarter of 2021. In the third quarter, it grew by 7.38% in line with market expectations. It is anticipated that growth will lose acceleration during the fourth quarter due to fluctuations in the financial markets. However, the annual growth is expected to be greater than 10%, the highest performance in the last 10 years. In the following period, monetary policy followed by the Central Bank will continue to be monitored in terms of contribution to growth through investments and net exports. Additionally, it is expected that monetary policies of central banks of developed countries and new variants of the virus will continue to affect economic activity in 2022. Turkish economy grew by 7.38% in the third quarter in line with market expectations. In 2021, the Turkish economy is expected to perform the highest growth of the last 10 years. strong growth 1 st quarter 2 nd quarter 3 rd quarter +7.41% +22.0% +7.38% Turkish economy growth rates for 2021 GNP Growth (%) 11.7 1.8 2.8 7.5 0.9 2021 (9M) 2020 2019 2018 2017