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Overview of Turkish Economy
Prepared for:
Southeast Europe Series: Turkey November 5, 2013
Ilhan K. Geckil, Senior Economist and
Director of Strategy & Business Valuation Margarita Shatskikh, Analyst
© 2013, Anderson Economic Group, LLC
O u t l i n e
1. Overview of Turkish Economy, Last Decade
2. Current State
3. Concluding Remarks
1. Overview of Turkish Economy, Last Decade
Turkish Economy Snapshot
Population (in millions) 75.6
GDP (in billions $)2000 266.4 2005 482.7 2011 778.1 2012 794.5 CAGR 2000-2012 10.4%
GDP Composition, 2012 est.Agriculture 9%Industry 27%Services 64%
Labor Force, 2012 (in millions) 27.3
Unemployment, 2012 9.2%
Exports, 2012 (in billions $) 152.5 Imports, 2012 (in billions $) 236.5
Source: CIA Factbook; Federal Reserve Bank of St. Louis; TurkStat
GDP Ranking, Top 20 Economies
Ranking Economy (millions of current US$) Ranking Economy (millions of current US$)1 United States 15,684,800 1 United States 9,898,8002 China 8,358,363 2 Japan 4,731,1993 Japan 5,959,718 3 Germany 1,886,4014 Germany 3,399,589 4 United Kingdom 1,475,7065 France 2,612,878 5 France 1,326,3356 United Kingdom 2,435,174 6 China 1,198,4757 Brazil 2,252,664 7 Italy 1,104,0098 Russian Federation 2,014,776 8 Canada 724,9199 Italy 2,013,263 9 Brazil 644,702
10 India 1,841,717 10 Mexico 581,42611 Canada 1,821,424 11 Spain 580,34512 Australia 1,520,608 12 Korea, Rep. 533,38413 Spain 1,349,351 13 India 474,69214 Mexico 1,177,956 14 Australia 415,77415 Korea, Rep. 1,129,598 15 Netherlands 385,07516 Indonesia 878,193 16 Argentina 284,20417 Turkey 789,257 17 Turkey 266,56818 Netherlands 772,227 18 Russian Federation 259,70819 Saudi Arabia 711,050 19 Switzerland 256,04320 Switzerland 632,194 20 Sweden 247,260
Source: The World Bank
2012 2000
Global Economy Transformation
Source of the Chart: The Economist
Global Economy Transformation: Example 1
Source: International Organization of Motor Vehicle Manufacturers
12.8 11.4
12.3 12.1 12.0 11.9 11.3 10.8
8.7
5.7
7.8 8.7
10.3
2.1 2.3 3.3
4.4 5.2 5.7
7.2
8.9 9.3
13.8
18.3 18.4 19.3
-
5.0
10.0
15.0
20.0
25.0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Vehi
cle
Uni
ts in
Mill
ions
Motor Vehicle Production in the U.S. and China, 2000-2012
U.S.
China
Global Economy Transformation: Example 2
Source: International Organization of Motor Vehicle Manufacturers
431
271 347
533
823 879
988 1,099
1,147
870
1,095 1,189
1,072
1,738
1,580
1,427 1,322
1,142 1,038
1,212 1,284
1,024
843 838 790 672
-
200
400
600
800
1,000
1,200
1,400
1,600
1,800
2,000
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Vehi
cle
Uni
ts in
Tho
usan
ds
Motor Vehicle Production, Turkey and Italy, 2000-2012
Turkey
Italy
Turkey’s GDP Compared to the State of New York
Turkey’s Real GDP Growth, 2000-2012
Source: Federal Reserve Bank of St. Louis
6.8
-5.6
6.1 5.5
9.0 8.66.8
4.9
0.6
-4.7
9.58.6
2.2
-8
-6
-4
-2
0
2
4
6
8
10
1220
00
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
Unemployment Rate
Source: IMF World Economic Outlook Database; TurkStat
10.3 10.5 10.3 10.6 10.2 10.2 10.9
14.0
11.9
9.8 9.2
-
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Inflation Rate
Source: IMF World Economic Outlook Database; TurkStat
70.1 66.1
104.5
89.6 80.2
85.7 84.7
64.9 55.0 54.2
45.1
25.3
8.6 8.2 9.6 8.8 10.4 6.3 8.6 6.5 8.9
-
20.0
40.0
60.0
80.0
100.0
120.0
Volume of Imports and Exports of Goods, Percent Change
*Estimate
Source: IMF World Economic Outlook Database
-40.0
-30.0
-20.0
-10.0
0.0
10.0
20.0
30.0
40.0
50.0
60.0
Perc
ent C
hang
e
Imports
Exports
Top Exports Partners: Germany - 8.6% Iraq - 7.1% Iran - 6.5% UK - 5.7% UAE - 5.4%
Top Import Partners:
Russia - 11.3% Germany - 9% China - 9% US - 6% Italy - 5.6%
Import and Export Data, 2012
Top Exports Commodities: Apparel Foodstuffs Textiles Metal manufactures Transport equipment
Top Import Commodities:
Machinery Chemicals Semi-finished goods Energy, e.g. fuels Transport equipment
Source: CIA Factbook
U.S. Trade in Goods with Turkey
Source: United States Census Bureau
3,516 3,788
4,934 5,182 5,359
4,601 4,642 3,662
4,207 5,221
6,293
3,113 2,900 3,362 4,239
5,291
6,499
9,959
7,095
10,538
14,657
12,520
-
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
mill
ions
of U
.S. d
olla
rs
Imports
Exports
Current Account Balance in Billions of USD
Source: Federal Reserve Bank of St. Louis
-7.6-14.2
-21.4
-31.8-37.8 -40.4
-12.2
-45.4
-75.1
-47.8
-80
-70
-60
-50
-40
-30
-20
-10
02003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Current Account Balance, Percent of GDP
Source: Federal Reserve Bank of St. Louis
-2.5-3.6
-4.4
-6.0 -5.8 -5.4
-1.9
-6.1
-9.6
-6.1
-12
-10
-8
-6
-4
-2
02003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Fast growth during the last decade.
Revamped and well capitalized banking system.
Public finance is healthy.
Broad shift to a manufacturing economy. Populous young labor, contrasted with Europe’s aging population.
Current account deficit is the most important problem the Turkish
economy is facing.
Summary of Turkish Economy
2. Current State
Growth expectation, 2013 based on the partial year data: 3.5%. Turkey’s economy continues on its growth track for the 15th
consecutive quarter, expanding by 4.4% in the second quarter of 2013. The 4.4 percent growth rate exceeds forecasts and makes the country the highest performing economy in Europe and the third fastest grower in the world. Turkey had grown 3.7% in the first half of the year.
Government’s medium term growth target: 4% annual growth. Unemployment rate as of July 2013: 9.3%. Inflation rate as of October 2013: 7.7%, higher than Central Bank’s
target.
Current account deficit back to $71.7 billion annualized (IMF-estimate)
Current State, 2013
3. Concluding Remarks
Concluding Remarks
Thank You for Your Attention!
Questions?
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