ICI Turkish Export Climate Index February Results Were Announced

• 10.03.2020
• News

Istanbul Chamber of Industry (ICI) Turkish Manufacturing Industry Export Climate Index which measures the activity conditions of Turkish manufacturing industry at main markets realized as 50,4 in February and pointed out to a moderate improvement in the export activities. Direct impact of China and Hong Kong which has experienced serious shrinkages in their economies due to Coronavirus was relatively low on the sales since the their total share in the export market of Turkish manufacturing industry was around 1 percent.

Production increases in Germany, Italy and United Kingdom which are the three biggest markets of Turkish manufacturing sector supported the overall improvement in the export conditions. Economic activity in USA has been shrunk for the first time since October 2013. It was observed that the economic activity in several regions of Middle East lost speed in the middle of the first quarter.

The February 2020 results of Istanbul Chamber of Industry (ICI) Turkish Manufacturing Industry Export Climate Index which measures the activity conditions of Turkish manufacturing industry at main export markets were announced. All figures to be measured above 50,0 which is the threshold in index points out to the recovery while others to be measured under 50,0 point out to the deterioration in export climate.

According to the data announced as independent to seasonal impacts, ICI Turkish Manufacturing Sector Export Climate Index which was recorded as 51,1 in January was above 50,0 which is the critical threshold value by realizing as 50,4 in February. The results pointed out to a moderate improvement in export conditions of Turkish manufacturers. Refreshment was recorded in the export climate of China even if various trade partners have experienced serious hampers due to Coronavirus outbreak in China. Especially, serious shrinkages were experienced in economies of China and Hong Kong. However, the direct impact on the sales was relatively low since the total share of both countries was around 1 percent in the export market of Turkish manufacturing industry. Other markets located in Southern Asia were impacted by the virus and therefore, serious decreases were experienced in the production. Among such countries, South Korea, Singapore, Japan, Malaysia, Vietnam and Taiwan took place.

Increase in the production within the biggest markets supported the improvement

Increase in production of Turkish manufacturers within such three biggest markets supported the overall improvement in export conditions. Economic activity increased during the last three months in Germany and during the last two months of Italy. Strong production growth in United Kingdom was recorded at the highest speed since September 2018. These three countries form more than one fifth of the export market of Turkish manufacturing sector. Improvement in the demand was observed in other important European markets such as French, Spain and the Netherlands. On the other side, implications of weakness were observed in the biggest economy of the world. Economic activity decreased in February in USA and shrinkage was recorded for the first time since October 2013.

It was observed that the economic activity in several regions of Middle East lost speed in the middle of the first quarter. While the activity in United Arab Emirates recorded the first decrease of the last 10 years, shrinkage in Egypt, Qatar and Lebanon maintained their existence. Production continued in Saudi Arabia; however, the growth lost speed dramatically and was recorded in the slowest speed since August 2009 when PMI survey was started. Production increase was experienced in BRIC countries except for China during February. Economic activity recorded a moderate growth in Brazil and Russia. Strong increase in demand was observed in India and growth in the production gained speed for the third month successively and recorded in the highest rate since February 2012.

Andrew Harker, Deputy Director of Markit, who evaluated Turkish Export Climate Index of Istanbul Chamber of Industry, Türkiye Manufacturing PMI, said: “Turkish manufacturers have not been exposed to the direct and most effective impact of Coronavirus outbreak in China in February. The reason is that the markets of Eastern and Southeastern Asian markets have relatively low share in the export and the primary markets in Europe maintained their growth tendency. On the other hand, the potential of failure in global supply chain and the potential of virus to spread through the significant markets point out that the following months might be challenging for Turkish exporters.”