The industry's capacity has decreased with a rate of sharp 22.9% in March. The effects are still green for the automobile industry-known as the second biggest industry in Turkey after textile. Thousands of workers has been laid off from the factories located in the capital of car industry, Bursa. This depression in the car industry also affected the growing rates for the first quarter.
Turkey is a partially globalized country. Thus this gives several advantages like protection in short term. In addition the Turkish executives are highly experienced in crisis management. (remember the 1999&2001 crisis) However the question is: are those factors enough to avoid the effects of the global crisis in wide range in the real sector in Turkey.
According to the expectations of IMF and EU commission, Turkish economy will lose value of 5.9% during the year 2009 and the inflation will be around 6.8%. These numbers, however, not always reflect the truth. If one takes a look at the commodity prices like natural gas, electricity and water it can be directly marked that these are in a trend of increase up to 40% in average. The price of natural gas has increased 72.6% via 4 stages by the beginning of Feb. 2009. Later on there occured several cuts in the price -18% in industrial and %17 commercial- , but those were never enough to compensate the unstoppable rises.
The unemployment rate of 16% is a serious fact to be considered. Hosting a very young population (40% of 78 mil.) Turkey will suffer from these rates. the 40% decrease in the export volume.
The numbers sometimes seem to be fuzzy, but definately not in the case of Turkey. They are strictly pointing the direction of economics problems.
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2 comments:
(i) "Turkish lira (TL) has lost 25% of its value since Jan. 2008. " - is it really about the mortgage crisis? i think the constant inflation itself is reasonably enough to explain the loss of TL's value.
(ii) From what I have heard from the seminar by Prof. Refet Gurkaynak, the "Mayday" from GM is not also about the crisis. They were already having severe problems before the crisis. The company attitude towards the crisis is just about covering up this fact. Of course, this should still has its effects on the market. After all, GM was an important symbol for the Americans.
(iii) I observe that the banks in Turkey seem to have learned from 2001 crisis - they have grown their money reserves substantially ever since and now they are employing those reserves to protect themselves from the harsh crisis environment. How long will their current situation last, though, is open to question.
Finally, some say that the crisis is far from finish and yet more severe conditions shall arise. Let's see how shall the unemployed act in Turkey. I guess that many illegal businesses will return from the dead... unless some serious and smart policies are implemented.
Yes, you're right. TL's loss of value cannot be directly related to the mortgage crisis however the decrease in the volume of production affected and stimulated that.
The banks in Turkey.. I have read a column claiming that Turkish banks are probably some of the best crisis-survivors. Especially Garanti Bank has increased its revenues in the first quarter of 2009. Thus, they seem to take some lessons from the previous '99 & '01 crisis.
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