Turkey Economic Growth Q4 2007

Turkey's economic growth remained weak in the fourth quarter of 2007 and was unchanged at a five-year low of 3.4 percent due to weak consumer spending and a poor harvest the statistics office (Turkstat) said today, since third-quarter growth was also revised to 3.4 percent. Consumer spending has slowed steadily since the central bank raised interest rates in mid-2006 amid a financial crisis and in order to combat inflation. Low rainfall has also hit farm output.



Agricultural output fell 9.7 percent in the quarter, while construction expanded 0.5 percent, compared with growth of 4 percent the previous quarter and 18.5 percent in 2006, when the economy as a whole grew 6.9 percent. Industrial production increased at an average rate of 5.2 percent in the fourth quarter.

Gross domestic product in 2007 was $659 billion, the agency said. Growth for the year was 4.5 percent. The government's target was 5 percent.

A court case to outlaw the ruling Justice and Development Party which is rumbling around in the background may also lead to political instability, further damping the economic expansion.

Consumer confidence has also taken a hit, and the index of consumer confidence fell from a previous high of 96.2 to 93.9 during the fourth quarter and in February hit 87.6, the lowest since records began in 2003.



Private consumption increased an annual 2.9 percent in the quarter, slowing from 8.2 percent three months earlier.

The central bank cut its benchmark overnight borrowing rate by a total of 2.25 percentage points to 15.25 percent between September and February before halting its reductions this month. Any pick-up in domestic demand will be limited by the impact of the global credit squeeze, central bank Governor Durmus Yilmaz said on March 13.

Turkey Consumer Confidence February 2008

The Turkish consumer confidence index fell by 4.9 percent in February according to the latest monthly Consumer Tendency Survey carried out by the Turkish Statistics Institute (TurkStat) and the Turkish Central Bank, which was released yesterday.





The survey shows that consumer confidence declined from 92.12 in January to 87.6 in February. The index indicates an optimistic outlook if it is above 100 and a neutral outlook if it is equal to 100. When it is below 100 points, it means consumers are pessimistic about their future.

The decrease in the Consumer Confidence Index stemmed from a deterioration in consumers' assessments concerning their purchasing power for the present and coming periods, the general situation of the economy, job opportunities in the next six months and the "buying time conditions" of durable goods in the present period.

The index value of consumer purchasing power was 82.66 in December 2007 but retreated to 80.78 and 77.68 in the first two months of the year, respectively. Consumers are not anticipating an increase in their purchasing power in the coming six months, either, as they are expecting it to decrease by a further 2.63 percent.

The index for "buying time conditions" was also down in the survey, from 118.41 in January to 112.14 in February. Under this subtitle, the changes in the index values were as follows: probability of buying durable goods in the next six months (0.48 percent); probability of buying a car in the next six months (7.47 percent); probability of buying or building a home within the next 12 months (1.57 percent); probability of spending money on home improvements or renovations in the next six months (22.68 percent); probability of borrowing money to finance consumption expenditures in the next three months (-2.74 percent); "saving time conditions in the present time" (2.11 percent); probability of saving in the next six months (7.95 percent); expectation about the direction of price changes in the next 12 months (-5.38 percent).

Turkey Unemployment December 2007

Turkey's unemployment rate increased by 0.1 percentage points in December 2007 over the same period last year, rising to 10.6 percent, while the non-agricultural unemployment rate was 13 percent, according to the latest data released by the Turkish Statistical Office, Turkstat.

The latest Household Labor Survey by the Turkish Statistics Institute (TurkStat) has shown that the unemployment rate in urban areas increased to 12.2 percent in December 2007, up by 0.3 percentage points over the same month last year, whereas in rural areas it increased to 8.1 percent, a 0.6 percentage point increase over the same period last year.
The non-agricultural unemployment rate was down by 0.3 percentage points to 13 percent. TurkStat's figures showed that 74.9 percent of those who were unemployed in December 2007 were male. The figures indicated that 57.8 percent of the unemployed had a below-high-school education level, 27.4 percent had been seeking jobs for one year or more, 32.5 percent were seeking jobs through "their acquaintances." Furthermore, 83.7 percent of them, 2.04 million people, had worked previously and, among those who were employed previously, 46.2 percent were employed in services, 23.2 percent in industry, 19.7 percent were in construction and the remaining 10.9 percent were in agriculture.

According to the figures, the working age population increased by 763,000 in December 2007 compared to the same period of the previous year. While the non-institutional civilian population increased by 756,000 and has reached 69.25 million persons, the non-institutional working age civilian population increased by 763,000, a total of 49.58 million.

The number of employed people decreased by 315,000 compared to the same period the previous year, totaling 20.44 million. The figures also shoed that the agricultural employment decreased by 508,000 and the non-agricultural employment increased by 193,000 in December 2007.

Of those who were employed in December 2007, 24 percent were employed in agriculture, 21 percent in industry, 5.5 percent in construction and 49.5 percent in the services sector. Of the people who were employed in this period, 75.3 percent were male, 60.5 percent had a below-high-school education level and 59.9 percent were regular or part-time employees, whereas 27.8 percent were self-employed or employers, and the remaining 12.3 percent were unpaid family workers. Other facts about this group include: 59.4 percent worked in establishments consisting of 1 to 9 employees, 2.5 percent had an additional job, 3 percent were seeking jobs either to replace their current job or to augment their existing job and 90.2 percent of regular employees were working in permanent jobs.

For the survey, a total of 37,385 sample households, 26,391 of which were from urban areas and 10,994 of which were from rural areas, were used. Of these, 31,850 households were interviewed and non-response forms were filed for various reasons for 5,535 households. In December 2007, the non-response rate was 13.3 percent in rural areas, 13.8 percent in urban areas and 13.7 percent for overall Turkey.

Turkish Foreign Trade January 2008

Turkish exports increased by 61.4% in January 2008 compared with January 2007...

According to the provisional data from Turkstat, in January 2008; exports grew by 61.4% and reached to 10,596 Million Dollars and imports grew by 53.9% and reached to 16,306 Million Dollars compared with January 2007. At the same month, foreign trade deficit increased by 41.8%, reached from 4,027 Million Dollars to 5,710 Million Dollars.

In January 2008 exports coverage imports was 65% while it was 62% in 2007.

Exports to EU were 5,460 Million Dollars...

The weight of the EU in Exports has continued in January 2008. As compared with the same month of the previous year, exports to EU were 5,460 Million Dollars increased by 44.3%. The proportion of the EU countries was 51.5% while the proportion of Free Zones was 2.5% and other countries was 45.9%.

In January 2008, the main partner country for exports was Germany with 1,070 Million Dollars and increased by 39%. For exports, Germany was followed by the Switzerland (745 Million Dollars), UK (733 Million Dollars), Italy (678 Million Dollars), France (586 Million Dollars), and Russia (420 Million Dollars).

In January 2008, while the European Union Countries were the most intensive country group for imports (5,989 Million Dollars), followed by other European Countries (3,708 Million Dollars), Asian Countries (4,589 Million Dollars) and Free Zones in Turkey (140 Million Dollars).

For January 2008, the top country for Turkey’s imports was Russia (2,618 Million Dollars), records for imports range from Germany (1,463 Million Dollars), China (1,336 Million Dollars), Italy (852 Million Dollars) and USA (738 Million Dollars).

Road vehicles are forefront in exports according to chapters...

For January 2008, road vehicles and their parts has by far the highest value exported at 1,633 Million Dollars and then, pearl and other precious stone and products,coins 1,078 Million Dollars, machineries, mechanical appliances, boilers, equipments and parts 742 Million Dollars, iron and steel 729 Million Dollars, articles of apparel and clothing accessories 714 Million Dollars.

At the same period, the top categories for imports were mineral fuels and mineral oils (3,764 Million Dollars) and then machineries, mechanical appliances, boilers, equipments and parts (1,870 Million Dollars), iron and steel (1,730 Million Dollars), electrical machinery and equipment (1,340 Million Dollars).

Turkey Consumer Price Inflation February 2008

The Turkish Statistics Institute (TurkStat) has announced that year-on-year consumer price inflation as of the end of February was up`by 9.1 percent. The Turkish Central Bank's year-end inflation target was 4 percent for 2008, but Turkey has just seen a full half of this inflation rate in one single month.



The highest annual increase was 14.75 percent in the housing index over same month of the previous year. Alcoholic beverages and tobacco prices increased by 14.34 percent; food and non-alcoholic beverages by 12.93 percent; and hotel, cafe and restaurant prices jumped by 11.02 percent.

The highest monthly increase in February was in food and non-alcoholic beverage prices, at 5.05 percent. The consumer price indices rose for miscellaneous goods and services by 1.73 percent; for hotels, cafes and restaurants by 0.90 percent; for furnishings and household equipment by 0.86 percent; for transportation by 0.54 percent; for housing by 0.39 percent; for communications by 0.12 percent; for health by 0.07 percent; and for alcoholic beverages and tobacco by 0.02 percent.

The indices declined for education by 0.03 percent, while for clothing and footwear dropped by 6.93 percent due to discount sales and campaigns. The index remained the same for recreation and culture. The highest price increase was for cucumbers, by 62.69 percent in February, while the price of green peppers rose by 45.51 percent. Women's boots saw the largest decline, at 12.14 percent.

Turkey Producer Price Index February 2008

Turkey's Producer Price Index continued to accelerate in February rising by 2.56%, over January and by 8.15% over February 2007.

Monthly changes were 2.06% in the index for agriculture and 2,69% in the index for industry.



The agriculture PPI increased by 3.68% compared with December 2007, by 15.58% compared with February 2007. The industry PPI increased by 2.83% compared with December 2007, and by 6.45% compared with February 2007.

The highest monthly increase in the PPI of industrial activities was 21.32% in the index for electricity and gas.

There were increases 1.64% in manufacturing industry and 18.12% for electricity, gas and water and a decrease of 0,08% in the index for mining and stone quarrying.

The highest rates of monthly increase in the PPI were in the industrial price indices for electricity and gas (21.32%), for basic metal industry (6.55%), for wearing apparel (3.55%), for textile products (2.37%), for coke and refined petroleum (2.35%).