Embed Size (px)
Citation preview
ContactTo find out more about the opportunities to engage with the Turkey Group please contact:
Senior Manager: Jim Begbie T: 020 7776 8994M: 07764 170056E: [email protected]
Relationship Director:Richard Adler T: 020 7776 8978M: 07799 746810E: [email protected]
Visit www.thecityuk.com for more information on TheCityUK and all of our Working Groups.
In association with:
Seasonally adjusted GDP rose by 1.8% on the quarter in Q2, the fastest pace of expansion since early 2011. However, this strength was entirely driven by surging exports (boosted by extraordinary sales to Iran) while both consumer spending and investment actually fell on the quarter.
The combination of faltering domestic demand, the weakness of the global economy and the expectation that inflation would fall significantly during H2 has prompted the central bank to loosen monetary conditions significantly over the last few months. This easing, together with a still fairly healthy labour market, may lead to a modest upturn in consumer spending and offer some support to investment. But at the same time, growth in exports is set to moderate. Overall, GDP is expected to rise modestly in H2 but more significantly through 2013 as global trade starts to pick up again, resulting in growth of 2.7% in 2012 as a whole and 4.2% next year.
But there remain serious threats to these reassuring forecasts. First, if the Eurozone were to break up, Turkey would be hit very hard by the resulting financial turmoil. Second, inflation could be more ‘sticky’ than the central bank assumes, which might undermine policy credibility and push the exchange rate lower, adding to inflationary pressure and the likelihood of a policy reversal. In addition, the rapid growth of bank credit over the last five years may be a source of instability in the future.
On TheCityUK members’ website
Members can log-in at www.thecityuk.com to access our latest documentation, including:
Government Response to the House of Commons Foreign Affairs Committee Report of Session 2010-12This note sets out the Government’s Response to the House of Commons Foreign Affairs Committee Report of Session 2010-12, initiated by TheCityUK.
TheCityUK’s evidence to the Foreign Affairs Committee - ‘UK-Turkey relations and Turkey’s regional role’This note sets out views on behalf of TheCityUK in the form of evidence submitted to the Foreign Affairs Committee concerning UK-Turkey relations and Turkey’s regional role.
Regional commentary
Turkey economic reportOctober 2012
Upcoming events: Turkey
8 November 2012Development and opportunities in the Turkish market
This seminar organised by White & Case will cover current hot topics impacting the Turkish market. It will include an overview of the key changes to the Turkish Commercial Code and the new capital markets law and its impact on initial public offerings, project financing opportunities in the infrastructure industry and managing risk issues.
7 December 2012Turkey Market Advisory Group meeting
Members of the Group are invited to the next meeting.
Find out more at www.thecityuk.com
Turkey data October 2012
This report is based upon material in TheCityUK’s possession or supplied to us from reputable sources, which we believe to be reliable. Whilst every effort has been made to ensure its accuracy, we cannot offer any guarantee that factual errors may not have occurred. Neither TheCityUK nor any officer or employee thereof accepts any liability or responsibility for any direct or indirect damage, consequential or other loss suffered by reason of inaccuracy or incorrectness. This publication is provided to you for information purposes and is not intended as an offer or solicitation for the purchase or sale of any financial instrument, or as the provision of financial advice. Copyright protection exists in this publication and it may not be produced or published in any other format by any person, for any purpose without the prior permission of the original data owner /publisher and / or TheCityUK. © Copyright October 2012
www.thecityuk.com
2000 2002 2004 2006 2008 2010 2012 2014
Turkey: GDP and industrial production
% year
Source : Oxford Economics/Haver Analytics
F'cast GDP
Industrialproduction
30
20
10
0
-10
-20
-30
Turkey: Balance of payments
Forecast
2000 2002 2004 2006 2008 2010 2012 2014
US$
Current account balance
Visible trade balance
Source : Oxford Economics/Haver Analytics
5,000
0
-5,000
-10,000
-15,000
-20,000
-25,000
-30,000
2000 2002 2004 2006 2008 2010 2012 2014
Turkey: Interest rates%
Source : Oxford Economics/Haver Analytics
Forecast
3 month interbank rate
(RHS)
Coroporate borrowing rate (LHS)
Consumer borrowing rate (LHS)
10 year government bond (LHS)
100
90
80
70
60
50
40
30
20
10
0
180
160
140
120
100
80
60
40
20
0
Turkey: Stockmarket
Jan-86=1
Source : Oxford Economics/Haver Analytics
2000 2002 2004 2006 2008 2010 2012
80,000
70,000
60,000
50,000
40,000
30,000
20,000
10,000
0
FOReCAST FOR TURKey (ANNUAl peRCeNTAGe CHANGeS UNleSS SpeCiFieD)
2009 2010 2011 2012 2013 2014
Domestic Demand -7.4 13.5 9.6 -0.5 5.1 6.0 Private Consumption -2.3 6.7 7.8 -0.1 4.5 5.6 Fixed Investment -19.0 30.5 18.5 -2.0 3.9 8.5 Stockbuilding (% of GDP) -2.2 0.3 0.0 -0.5 0.3 0.0 Government Consumption 7.8 2.0 4.5 5.9 4.2 5.1
exports of Goods and Services -5.0 3.4 6.4 12.7 5.3 10.3imports of Goods and Services -14.3 20.7 10.9 -0.6 8.3 11.7
GDp -4.8 9.2 8.5 2.7 4.2 5.5industrial production -9.9 13.1 8.9 2.5 5.5 7.5Consumer prices 6.3 8.6 6.5 8.9 5.9 5.4
Government Budget (% of GDp) -5.5 -3.7 -1.4 -2.1 -1.7 -0.9Trade Balance ($bn) -24.9 -56.4 -89.1 -73.6 -78.3 -85.5Current Account ($bn) -13.4 -46.6 -77.1 -58.8 -60.2 -63.5Current Balance (% of GDp) -2.2 -6.4 -9.9 -7.4 -7.1 -7.2
Short-Term interest Rates (%) 8.8 7.0 8.4 7.9 7.2 8.9exchange Rate (per US$) 1.55 1.50 1.67 1.79 1.85 1.97
Source: Oxford Economics
