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ECONOMIC OUTLOOK MAY 2012 Economic Outlook is revized in the 1st and the 3rd weeks of the month. Recent Update:05/07/2012 May 2012.

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Presentation on theme: "ECONOMIC OUTLOOK MAY 2012 Economic Outlook is revized in the 1st and the 3rd weeks of the month. Recent Update:05/07/2012 May 2012."— Presentation transcript:

1 ECONOMIC OUTLOOK MAY 2012 Economic Outlook is revized in the 1st and the 3rd weeks of the month. Recent Update:05/07/2012 May Ministry of Economy

2 OUTLINE A- MACROECONOMIC OUTLOOK B- FOREIGN TRADE OUTLOOK 1) MERCHANDISE 2) SERVICES C- INVESTMENTS , FOREIGN CAPITAL and INCENTIVES D- FREE ZONES in TURKEY E- BILATERAL, REGIONAL, PLURILATERAL and MULTILATERAL TRADE May Ministry of Economy

3 A- MACROECONOMIC OUTLOOK
May Ministry of Economy

4 Growth Forecasts for Selected Countries/Country Groups (%)
Source: IMF, OECD, UN, WB Turkish Economy expanded by 8,5% in 2011. According to the IMF, Turkish Economy is expected to grow by 2,3% in 2012. May Ministry of Economy

5 Forecasts for Merchandise and Services Trade Growth (%)
Source: IMF and WTO According to the IMF estimates, global trade volume of merchandise and services is expected to increase by 3.8% in 2012 and 5.4% in 2013. According to the WTO estimates, global trade volume of merchandise and services is expected to increase by 3.7% in 2012 and 5.6% in 2013. May Ministry of Economy

6 Economic Targets of 2012-2014 Medium Term Programme
*Forecast (Medium Term Programme, Ministry of Development – October 13, 2011) Medium Term Programme aims to sustain economic growth, to decrease the current account deficit, and to preserve macroeconomic and financial stability. May Ministry of Economy

7 Real GDP Growth of Selected Countries/Country Groups (2011)
Source: TURKSTAT, IMF Turkish Economy expanded by 8,5% in 2011, which was well beyond the expectations of the IMF (7.5%). May Ministry of Economy

8 Annual Economic Growth Rates (2002-2011)
* Forecast, Medium Term Programme Source:TURKSTAT Turkey has recovered fast from the global financial crisis and amongst those countries affected less from current global economic uncertainties. Turkey has the fastest economic growth rates in Europe. Mean annual growth rate between 2002 and 2011 was 6%. Real GDP growth for 2011 realized as 8,5%. May Ministry of Economy

9 GDP Per Capita Source: Dollar value is from TURKSTAT GDP per capita has tripled in the last ten years from 3,492 USD to 10,444 USD. According to Purchasing Power Parity (PPP),GDP per capita came close to 16 thousand USD. May Ministry of Economy

10 Capacity Utilization Ratio (%)
Source: TURKSTAT Capacity utilization ratio realized as 74.7% in April 2012. May Ministry of Economy

11 Industrial Production Index
Source: TURKSTAT Industrial production index increased by 4.4% year-over-year in February up to May Ministry of Economy

12 Inflation (Annual Percent Change)
Source: TURKSTAT Annual inflation in 2011 realized as 10.4%. May Ministry of Economy

13 Real Effective Foreign Exchange Rate (2003=100)
  Source: CBRT As of April 2011, Turkish Lira has depreciated by 2.2% annually in terms of the CPI-based real effective exchange rate. The level of depreciation is 4.9% in terms of the PPI-based real effective exchange rate. May Ministry of Economy

14 Total Credits and Consumer Credits (Billion TL)
Credits and specifically consumer credits increased in parallel to the growing domestic demand. Total credits increased slightly on a monthly basis in March 2012. May Ministry of Economy

15 CDS Premiums (May 5th, 2012) * Higher CDS premiums indicate higher risk levels. CDS premium of Turkey is significantly low compared to most of the European countries. May Ministry of Economy

16 Financial Markets Total assets of the banking sector increased by 20.6% and reached trillion TL in February 2012. Capital Adequacy Ratio of Turkish Banking Sector is 16,76% in January May Ministry of Economy

17 EU Defined Budget Deficit/ GDP (%)
2011 EU defined general government budget deficit/GDP ratio was 2.6% in Turkey in 2011 and Turkey satisfied the Maastricht criteria of 3%. Turkey also outperformed 18 EU Countries. Central government budget deficit/GDP ratio was 1.3% in Turkey in 2011 and Turkey outperformed 23 EU Countries. In January-March 2012, central government budget deficit has increased by %55.9 to 6.4 billion dollars. May Ministry of Economy

18 Government Debt / GDP (%)
Debt/GDP ratio of Turkey was 39.4% in 2011, which was below the level in 21 EU Countries and the Maastricht Criteria (60%). May Ministry of Economy

19 Unemployment Rates (%)
Source: TURKSTAT Unemployment rates have returned to the pre-crisis level. In January 2012, the unemployment rate was 10.2%. Seasonally adjusted unemployment rate was 8.9%. Seasonally adjusted unemployment rate in Euro Area was 10.9% and 10.2% in (EU27) in March. Turkey has the 5th largest labor force among the European countries. (2009, World Bank) May Ministry of Economy

20 Potential of Population (2010)
Source: World Bank Turkey has a population of 74.7 million in which half of the population is under the age of 29.7. Growth rate of population is 1.36% in Turkey, 0.28% in EU Countries and -0.24% in Germany. May Ministry of Economy

21 Growing Dynamism in Turkey's Domestic Market
Cell phone penetration rate in households: 91.9% Internet access rate in households: 42.9% Internet access rate in enterprises: 90.9% PC penetration rate in households: 34.3% Laptop penetration rate in households: 22.6% Digital camera penetration rate in households: 27.8% Printer penetration rate in households: 14.0% 1 of each 5 people owns a vehicle. (2010) May Ministry of Economy

22 B- FOREIGN TRADE OUTLOOK
May Ministry of Economy

23 I) MERCHANDISE May Ministry of Economy

24 Targets in Merchandise Trade
* Actual (Source: TURKSTAT) **Forecast: Medium Term Programme, Ministry of Development- 13/10/2011) May Ministry of Economy

25 Turkey's Share in Global Merchandise Exports (%)
Turkey’s share in global merchandise exports was %0.74 in 2011. May Ministry of Economy

26 Foreign Trade Volume/GDP (%)
The ratio of foreign trade volume/GDP was 48,7% in 2011. Turkey’s integration to the international trade system is eminent. May Ministry of Economy

27 Foreign Trade Developments
/ January-March * Energy corresponds to Chapter 27. Source:Ministry of Economy In January- March 2012 compared to the same period of the previous year, exports increased by 12,6 % and imports decreased by 0,7% respectively. May Ministry of Economy

28 Monthly Exports In March 2012 compared to March 2011 exports have increased by 12,2% and imports have decreased by 4,8% and reached to the level of 13,3 and 20,6 billion dollar respectively. May Ministry of Economy

29 Distribution of Foreign Trade in Broad Economic Categories
EXPORT IMPORT May Ministry of Economy

30 Main Export Items May 2012 Ministry of Economy
* Percent change is related to the annual change in exports in 2012. Source: TURKSTAT May Ministry of Economy

31 Main Import Items May 2012 Ministry of Economy
* Percent change is related to the annual chamge in imports in 2012. Source: TURKSTAT May Ministry of Economy

32 Main Trade Partners (January-March 2012)
Main Export Partners (Share,%) Main Import Partners (Share,%) Source: TURKSTAT May Ministry of Economy

33 Exports by Regions Source: TURKSTAT May Ministry of Economy

34 Imports by Regions Source: TURKSTAT May Ministry of Economy

35 Tariff Rates May 2012 Ministry of Economy
Source: WTO Tariff Profiles, 2011 May Ministry of Economy

36 2) SERVICES TRADE May Ministry of Economy

37 Targets in Services Tourism: Besides increasing the number of tourist arrivals, creating a structure that improves service quality, targets high-income groups by diversifying marketing channels, preserves natural capital and sustainability, and stimulates those types of tourism where Turkey has comparative advantages Construction, Engineering-Architecture, Technical Consultancy and Contracting Services: Establishing a structure that fits Turkey’s economic and social needs, that is compatible with high technology and international rules, that is sensitive to environment, that creates high value added, high foreign exchange inflow and high employment, that grants high service quality, and that relies on qualified human and physical capital. Commercial Services: Increasing productivity and commercial trade volume in a competitive way, and to encourage technology and innovation. May Ministry of Economy

38 Turkey's Share in Global Services Exports (%)
Source: WTO, CBRT Turkey’s share in global exports of services was 0.92% in 2011. May Ministry of Economy

39 Balance of Payments - Services
*January-February Source: CBRT May Ministry of Economy

40 Tourism Statistics (Quarterly)
Tourists visited, Source: TURKSTAT Turkey ranks as the 7th in the world and the 5th in Europe among the most favourite tourism destinations. Turkey’s income per tourist increased by 18% in 2010 and 1% in 2011. May Ministry of Economy

41 Constructing Services Abroad
Contributions to the overall economic performance: Creating foreign exchange inflow, exports, employment, technology transfer; adding to the machinery stock, facilitating internationalization 31 out of the world’s top 225 constructing companies are Turkish. Turkey ranks as the 2nd country (following China) in terms of the number of top constructing companies. May Ministry of Economy

42 Logistics Europe’s biggest truck fleet
(45 thousands trucks and 1,420 companies) Almost 1 million flights in 2011 (2.3 million tonnes freight and 117 million passengers) 25. biggest fleet in the world 45 airports and 51 ports Total length of divided highways will reach 15 thousand kilometers. High-speed railway projects are carried out rapidly. 2.080 km. otoyol, km. devlet yolları, km. il yolları ağı olmak üzere toplam km. yol ağı (1/1/2011) 2011 Ocak-Eylül: %14,1 artış ve uçuş ile 1,7 milyon ton yük ve 91,2 milyon kişi taşınmıştır. (Devlet Hava Meydanları İşletmesi) Dünyadaki 25. büyük filo (2008 Ağustos, Denizcilik Müsteşarlığı) 45 Havaalanı ve 51 liman Avrupa’nın En Büyük Kamyon Filosu (45 bin adet kamyon ve şirket) May Ministry of Economy

43 Energy Turkey is an energy hub between energy producer and consumer regions May Ministry of Economy

44 C- INVESTMENTS, FOREIGN CAPITAL and INCENTIVES
May Ministry of Economy

45 Investment Climate in Turkey
May Ministry of Economy

46 Time Required to Start a Business
Source: Invest In Turkey The required time to start a business is 6 days in Turkey. May Ministry of Economy

47 Skilled Labour Availability
Source: Invest In Turkey Scoring is between 0 and 10. May Ministry of Economy

48 Transparency in Finance Sector
Source: Invest In Turkey Scoring is between 0 and 10. May Ministry of Economy

49 The Sectoral Breakdown of Foreign Investments
* January - February Source: CBRT May Ministry of Economy

50 Breakdown of Foreign Investments by Country
* January – February Source: CBRT May Ministry of Economy

51 Investment Incentive System
The current investment incentive system of Turkey is structured in four sub systems: General Investment Incentive System Regional Investment Incentive System Investment Incentive System for Big Scale Projects Incentives for Strategic Investments May Ministry of Economy

52 Investment Incentives (January-February)
Source: General Directorate of Incentive Implementation and Foreign Investment May Ministry of Economy

53 D - FREE ZONES IN TURKEY May Ministry of Economy

54 The Advantages of Free Zones for Users
Tax advantages for manufacturers Medium-and long-term investment view Availability to transfer profits Commercial facilities Exemptiın from customs duties Acquisition of the documents relating to the free movement of goods under the scope of Customs Union with the EU Principle of equality No time restrictions Flexibility to adjust to the market needs and conditions Reliable inflation accounting Market access to domestic and foreign markets Reduced bureaucratic procedures and dynamic business management Strategic advantages. Affordable and compatible infrastructure Supply chain opportunities May Ministry of Economy

55 Free Zones in Turkey 54,022 people have been employed in Free Zones of Turkey in 2011. May Ministry of Economy

56 Trade Flows of Free Zones
*January-February Source: General Directorate of Free Zones, Foreign Investments and Services In January-February 2012 total trade volume of the Free Zones reached to 3.7 billion dollars, increasing 17 % annually. May Ministry of Economy

57 Concentration in Free Zones by Industries
Source: General Directorate of Free Zones, Foreign Investments and Services May Ministry of Economy

58 E - BILATERAL, REGIONAL, PLURILATERAL and MULTILATERAL TRADE
May Ministry of Economy

59 Trade Relationships of Turkey with Others
Bilateral Trade Relationships of Turkey Europe, Asia-Pacific, Eurasia, Middle East and North Africa, Sub-Saharan Africa, Americas Regional and Multiple Trade Relationships of Turkey EU, ECO, D8, BSEC, OIC, COMCEC Multilateral Trade Relationships of Turkey WTO, OECD, ACTA May Ministry of Economy

60 Regional Breakdown of Exports
Source: TURKSTAT * January-March ** Except Lebanon and Mauritius In January-March period of 2012, our exports to OECD countries increased 7.2 % and our exports to FTA countries increased 25.8 % annually. The annual increase of our exports to EFTA countries in the same period was 72.7 % and EFTA countries became the fastest growing export destination of the regions above. May Ministry of Economy

61 Chronological Evolution of the Relationship between Turkey and the EU
12 September 1963: Ankara Agreement 13 November 1970: The signing of the Additional Protocol 1 January 1973: Additional Protocol to come into force 14 April 1987: Turkey’s Application for Membership 5 March 1995: The Association Council Decision Establishing the Customs Union 10-11 December 1999: Recognition of the Candidate Status of Turkey at the Helsinki Summit 8 March 2001: The first Accession Partnership Document issued 17 December 2004: European Council decision to start Negotiations with Turkey in Brussels Summit 3 October 2005: Start of the Negotiations between Turkey and the EU 20 October 2005: Start of the Screening Process 13 October 2006: End of the Screening Process May Ministry of Economy

62 The process of Accession Negotiations between Turkey and the EU
Negotiations for 1 chapter were temporarily opened and closed afterwards. Science and Research Negotiations for 12 chapter were opened but closure criteria to all those negotiations were imposed bt the EU. Business and Industry Policy, Statistics, Financial Control, Consumer and Health Protection, Trans-European Networks, Intellectual Property Law, Company Law, Free Movement of Capital, Information Society and Media, Taxation, Environment, Food Safety, Veterinary and Plant Health Position papers of Turkey for 2 negotiations were forwarded to the EU. EU Common Position Paper is expected to be announced. Education and Culture, Economic and Monetary Policy For the opening of 8 chapters opening criterias of the EU have to be met by Turkey. In all other chapters, Screening Reports are expected to be announced by the EU. May Ministry of Economy

63 Trade between Turkey and the EU
Source: Data Source of the Ministry of Economy May Ministry of Economy

64 FTA Countries Egypt EFTA (Norway, Switzerland, Iceland, Liechtenstein)
Israel Macedonia Croatia Bosnia and Herzegovina Palestine Tunisia Morocco Syria Egypt Albania Georgia Montenegro Serbia Chile Jordan Lebanon* Mauritius* (*) Agreements that are in the approval process May Ministry of Economy

65 Trade with FTA Countries
Our exports to FTA Countries increased %7,2 in 2011. The share of FTA Countries in total exports reached 10%. Turkey recorded a trade surplus of 1,4 billion USD in with FTA Countries, while there was a trade deficit of 1.5 billion USD in 2002. May Ministry of Economy

66 Trade Representatives Abroad
195 trade representatives from the Ministry are serving in 130 locations and 6 offices abroad. May Ministry of Economy

67 Locations of Trade Representatives
AMERİKA Buenos Aires Karakas Mexico City Ottava Santiago Vaşington Houston Los Angeles New York Sao Paulo Şikago Toronto Miami San Francisco Seattle AFRİKA Abuja Addis Ababa Akra Cezayir Dakar Darüsselam Hartum İskenderiye Kahire Nairobi Pretoria Rabat Trablus Tunus Kazablanka ASYA Astana Aşkabat Bangkok Bişkek Cakarta Duşanbe Hanoi İslamabad Kabil Kuala Lumpur Manila Pekin Seul Singapur Taşkent Tokyo Ulan Bator Yeni Delhi Almatı Guangzhou Hong Kong Karaçi Mumbai Şangay Georgetown GEORGETOWN AVRUPA/KAFKASYA AB DTÖ OECD Atina Bakü Belgrad Berlin Bern Bratislava Brüksel Budapeşte Bükreş Dublin Helsinki Kiev Kişinev Kopenhag Lahey Lizbon Lefkoşa Londra Lubliyana Madrid Minsk Moskova Oslo Paris Podgorica Prag Priştine Roma Saraybosna Sofya Stokholm Tiflis Tiran Üsküp Varşova Viyana Zagreb Barselona Batum Düsseldorf Hamburg Hannover Kazan Marsilya Milano Münih Novorossisk Odessa Rotterdam Selanik St. Petersburg Stutgart Birmingham Krasnodar Novosibirsk Yekaterinburg ORTA DOĞU Abu Dhabi Amman Bağdat Beyrut Doha Kuveyt Manama Muskat Riyad Sana Şam Tahran Tel Aviv Basra Cidde Dubai Erbil Halep Kudüs Musul Tebriz Daimi Temsilci Yardımcılığı AVUSTRALYA Ticaret Müşavirliği Sidney Melbourne Ticaret Ataşeliği İrtibat Büroları May Ministry of Economy

68 Projects with Future Prospects
Export Oriented Production Strategy and Input Supply Strategy Market Access Strategy Supporting Exports Trade Remedies Restructuring the Incentive System Improving the Investment Climate Trade Agreements Next-Generation Free Zones Trade in Services and Turkish Investments Abroad Market Surveillance and Inspection Strengthening the Organization Abroad May Ministry of Economy


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