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Newsletter January 2006

 Economy


Overview of monthly data

YTL-Rates

 30.12. 31.1.

Change in %

YTL per Euro

 1.5981 1.6049 0.4

YTL per USD

 1.3495 1.3283  -1.5

 

 

 

 

Stock exchange index

  39,837.27  44,891.25 12.7

 

 

 

 

Inflation in %

Monthly inflation

Annual inflation

 

Producer prices

 1.96 5.11

 

Consumer prices

  0.75  7.93

 
(Dünya/DIE 30.12.05/31.1./4.2.06)

Foreign trade figures

  December  
In Millionen USD 2004 2005 Increase in %
Export 6,541 6,963 6.4
Import 10,474 11,213 7.1
Deficit -3,933 -4,250 8.1
(Dünya, 1.2.06)
  January - December  
In Millionen USD 2004 2005 Increase in %
Export 63.167 73.122 15,8
Import 97.540 116.048 19,0
Deficit -34.373 -42.926 24,9
(Dünya, 1.2.06)

 

The top 10 exporting cities  in 2005
City Export in Mil. USD Share (%)
Istanbul 38.741 52,76
Bursa 5.965 8,12
Izmir 5.248 7,15
Kocaeli 3.382 4,61
Sakarya 2.631 3,58
Ankara 2.494 3,40
Manisa 2.380 3,24
G.Antep 1.735 2,36
Denizli 1.494 2,03
Trabzon 948 1,29
Rest 8.408 11,46
Total Export 73.426 100,00

(Dünya, 3.1.06)

 

Export development of branches (in Mil. USD)

Branches

2004 

2005

Share (%) 

I. AGRICULTURE

 7,591 9,668 27.37

A. Plant products

 5,762 7,528 30.64

Pulses

 1,694 2,221 31.06

Fruits and vegetables

 804 969 20.54

Fruit and vegetable products

 784 866 10.47

Dried fruit and fruit products

 617 637 3.16

Nut and nut products

 1,221 1,929 57.93

Olive and olive oil

 136 307 126.54

Tobacco

 471 564 19.82

Cut flowers

 35 35 0.00

B. Plant products

 360 413 14.77

C. Wood- and forest products

 1,468 1,727 17.64

II. INDUSTRY

 55,237 62,244 12.68

A. Processed agricultural products 

 6,124 6,549 6.93

Textiles and raw materials

 4,565 4,861 6.50

Leather and leather products

 1,039 1,017 -2.12

Carpets

 520 670 28.86

B. Chemical substances

 5,009 6,750 34.76

C. Industrial products

 44,104 48,945 10.98

Clothing industry

 13,095 13,708 4.68

Vehicle and delivery industry

 10,804 13,059 20.88

Electricity and electronics

 6,085 6,964 14.44

Machinery and accessories

 2,094 2,666 27.32

Steel and other metals

 9,219 9,440 2.39

Cement and earth products

 1,713 1,847 7.80

Precious stones and mining products

 934 1,079 15.58

Other industrial products

 159 182 14.28

III. MINING

 1,199 1,514 26.26

TOTAL

 64,027 73,426 14.68
(Dünya, 3.1.06)

The draft bill for changing the income tax has been approved by the budget commission
The draft bill for changing income taxation passed the budget commission of the Turkish parliament. The draft provides the following tax tariffs which should be valid for employees as well as the self-employed:

Annual Income Tax Rate
up to 7.000 YTL  15%
7.001 - 16.000 YTL 20%
16.001- 40.000 YTL 27%
over 40.000 YTL 35%

The draft abolishes tax relief based on premature investment write-offs once again. (Dünya, 2.2.2006)

A draft bill for reducing the corporate tax to 20% is still being examined. 
The Turkish government is still in consultation about the draft bill for the reduction of corporate tax to 20%. (Dünya, 31.1.2006)

20% of total exports has been realized by the ten most exporting companies  
The ten most exporting companies of 2005 comprise four automobile companies and four companies of the Koc Group:

  Company City Export in Mio. USD
1 Toyota Turkey Sakarya

2,317.8
2 Ford Otomotiv Istanbul

2,061.3
3 Vestel Dis Tic Manisa

2,061.1
4 TÜPRAS Kocaeli

1,922.7
5 GISAD Dis Tic Istanbul

1,893.2
6 OYAK Renault Bursa

1,422.6
7 GSD Dis Tic Istanbul

840.9
8 TOFAS Oto Fab. Bursa

840.5
9 Arcelik Istanbul

732.6
10 Ram Dis Tic Istanbul

669.9

(Dünya, 26.1.2006)

Unemployment was 10.1% in October
According to data released by Turkish Statistics Institute (TÜIK) the unemployment rate increased to 10.1% in October and the number of unemployed was 2,487,000. Of the total 22.2 million employed, 6.2 million work in agriculture, 4.4 million in industry, 1.2 million in the construction industry and 10.3 million in the services branch. Compared to the previous month, the number of the employed went down by 369 thousand whereas the number of unemployed increased by 64 thousand. According to surveys 49.8% of the employed supposedly were officially unregistered. (Dünya, 26.1.2006)

The Istanbul stock exchange achieved the second best result worldwide
In 2005 Istanbul stock exchange achieved the highest increase in stock exchange index after Malta:

Stock exchange Increase in stock exchange index (%)

Malta

63,4

Istanbul

59,3

Korea

54,0

Osaka

50,6

Tokyo

43,5

Vienna

42,7

India

36,3

Suisse

35,6

Athens

31,5

Germany

25,1

London

18,1

Italia

13,9

Barcelona

12,7

New York

 7,0

China

-11,7

(Dünya, 23.1.2006)

The number of foreign companies has increased faster since 2004 and almost totaled to 12.000
At the end of November 2005 the number of companies with foreign capital had increased to 11.919. Of this the majority of companies (2,062 in number) are with German capital. Where a total of 5,072 companies were founded by foreign investors until 2000 - 504 in 2001, 517 in 2002 and 141 in 2003 were added to this figure. As of 2004 the figure increased substantially by 2,150. In the first eleven months of 2005 an astonishing 2,535 new companies were established with foreign capital. Followed by the Germans, the Dutch have the most companies (934) in Turkey as of the end of November 2005. They are followed in number by the British companies (932). The number of companies with US (609) and Iranian (732) capital is also striking. The majority of foreign companies are active in wholesale and retail trade, the remaining ones in industry and other services. Those foreign companies active in industry are mainly represented in textile production, followed by food production and chemical products. The low level of capital seems to be problematic. The majority of newly established companies are established with less than 50,000 USD as capital. The number of those with a capital exceeding 500,000 USD is less than 2%. (Dünya, 3.1.2006)

 

Politics

 

Erdogan criticizes the violent outrages in cartoon crisis and asks the media to have more sense of delicacy
Prime Minister Erdogan stated that the incidents triggered by the cartoons published in Denmark should not lead to a conflict of civilizations and asked the population not to get involved in provocations. In his speeches with party members and before the Turkish parliament he added that the cartoonist has acted irresponsibly, far from any sense of delicacy and in so doing deeply hurt the Moslems. However the reactions should not become aggressive otherwise the Moslems would fall from right to wrong. Violence would only harm Islam, its image and efforts for a long lasting peace between civilizations. Now damage limitation is necessary and everyone should take responsibility for that because revenge and hatred have no place in Islam. Also the Chairman of the Union of Turkish newspapers, Orhan Erinc, took the view that the cartoons did not correspond to media ethics. Foreign Affairs Minister Gül was sad about the assassination of the Italian priest Santoro who was victim of an individual act of retaliation in Trabzon. He has offered his deep condolences to his Italian colleague Fini. (Dünya, 6./7./8.2.2006)

Straw welcomes Cyprus-Initiative of Turkey
During his visit in Ankara the British Foreign Minister Straw stated that his country, the EU and UN are welcoming the new action plan for Cyprus which was presented by his Turkish colleague Gül. This 10-item plan includes measures for opening the sea ports and air routes, abolishment of trade restrictions and resumption of the talks. (Dünya, 27./25.1.2006)

Further Topics
 

Galataport tender should be renewed
The Minister of Finance Unakitan announced that the tender for Galataport-Project had to be annulled based on the decision of the court. With Galataport-Project the port in old city quarter Galata where cruise ships from all over the world are mooring should be renovated.  The tender should be shortly renewed by taking into account the objections of the court. It is anxiously waited for whether other privatizations already carried out will also be threatened with a court decision.  (Dünya, 8./4.2.2006)

In 2005 24 million people visited Turkey and generated an income of 18.2 billion USD  
In 2005 a total of 24,124,501 tourists visited Turkey and spent approx. 752 USD per capita so that the total income from tourism was 18.15 billion USD. However, of this figure only 20.5 million were foreign tourists who left 13.9 billion USD in total, i.e. 679 USD per capita in the country. (Dünya, 28.1.2006)

Textile branch sends crisis signals
Representatives of the textile branch warn that the appreciated YTL and the competition from Far East would lead the branch to a crisis. The increase in exports of the branch by 6.5% to 4.86 billion was realized with losses. The capital of the textile companies did shrink, 15,000 small producers shut down their operations, according to the Chairman of Textile Unions. The State Planning Organization DPT and Undersecretary of Foreign Trade DTM should now prepare a package of measures for textile and clothing branches. (Dünya, 16.1.2006)

Automobile exports continued to increase also in 2005