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Although the Turkish economy ( TUR , quote ) grew at a much slower pace year-over-year, the underlying fundamentals in the country look relatively strong assuming Europe returns to growth in the near future.

According to figures released Monday, the Turkish economy grew 2.9% for the second quarter of 2012 ; a far cry from the 8+% growth Turkey experienced during 2010-2011. However, this slowdown is but one chapter in the Turkish growth story.

While its biggest trading partner, the euro zone, has fallen on hard times, exports to the Middle East have soared. Without demand from the Middle East, it is unclear if Turkey would have experienced any growth this quarter.

Exports grew substantially this quarter, up 19.8% year-over-year, even while imports dropped. This trend is crucial for the health of the Turkish economy as it previously suffered from a crippling balance of payments deficit . As a net importer of oil, without strong exports, this problem would be exacerbated.

Although exports to the Middle East are superficially a good sign, not all of the growth was organic; last quarter, Turkey exported massive quantities of gold to Iran as citizens there looked to diversify their holdings away from a rapidly inflating rial.

It is clear that the Turkish economy is not in an ideal position at this point due to the European slowdown. However, with Turkish government policy proving both deft and effective  in preventing the economy from overheating, lowering the inflation rate, and ameliorating the country's trade deficit, you could consider Turkey as a great way to play a global comeback.

If the European Union continues to introduce policy such as increased fiscal integration and pro-growth policies, dynamic economies like Turkey with its geo-strategic location stand to benefit hugely from such a global turnaround.

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