ICI Türkiye Export Climate Index posted 53.2 in May

• 08.06.2022
• News

Measuring the operating conditions in the key export markets of the Turkish manufacturing sector, the Istanbul Chamber of Industry (ICI) Türkiye Manufacturing Export Climate Index rose to 53.2 in May, pointing out that the improvement in demand conditions in export markets has reached 16 months. However, the index fell from its April level of 54.4, thus the recovery rate was measured at the lowest level since January.

There was a slowdown in growth in Germany, the United Kingdom, the United States and Italy, the four largest export markets of Turkish manufacturers. The strong upward trend in economic activity in Spain and France was among the positive developments of the survey. In May, the Middle East region significantly supported the export climate. Production in Russia contracted for the third month in a row. The most obvious slowdown in production was recorded in China, where Covid-19 restrictions continue to limit company activities. It was observed that the problems in China also affected other regional economies. Economic activity declined in Taiwan, South Korea and Malaysia.

The Istanbul Chamber of Industry (ICI) Türkiye Manufacturing Export Climate Index, which measures the operation conditions in the key export markets of the Turkish manufacturing sector, announced the results of the index for May 2022. In the index, the figures above the 50.0 no-change mark signals an improvement in the export climate, while the figures below signals deterioration. The Istanbul Chamber of Industry (ICI) Türkiye Manufacturing Export Climate Index rose to 53.2 in May, pointing out that the improvement in demand conditions in export markets has reached 16 months. However, the index fell from its April level of 54.4, thus the recovery rate was measured at the lowest level since January.

Growth slowed down in the four largest markets

The slowdown in growth in Germany, the United Kingdom, the United States and Italy, the four largest export markets of Turkish manufacturers, drew attention. In May, growth slowed sharply, especially in the UK, at the lowest pace in the last 15 months. Growth also lost momentum in the USA compared to the previous month. On the other hand, the strong upward trend in economic activity in Spain and France was among the positive developments of the survey. This improvement was mainly driven by the post-Covid recovery in service sector demand.

Middle East supported export climate, most notable slowdown in China

In May, the Middle East region significantly supported the export climate. Non-oil economic activity in the United Arab Emirates recorded a sharp increase, which was at the fastest pace at the beginning of the year. Among the countries monitored in the survey, the strongest growth was measured in Qatar. On the other hand, production trends in Egypt and Lebanon continued their weak course. The war in Ukraine continued to affect economic activity in parts of Europe. Production in Russia contracted for the third month in a row, but this contraction was at the most moderate level of the period in question. And Poland’s manufacturing industry production experienced the sharpest decline in the last two years. The most obvious slowdown in production was recorded in China, where Covid-19 restrictions continue to limit company activities. The contraction in production in the last three months continued at a sharp pace in May as well. It was observed that the problems in China also affected other regional economies. Economic activity declined in Taiwan, South Korea and Malaysia.

Commenting on the Istanbul Chamber of Industry Türkiye Manufacturing Export Climate Index, Andrew Harker, Economics Director, S&P Global Market Intelligence, said:

“Latest PMI data gives some concerning signals of growth slowdown in some of the key export markets of the Turkish manufacturing sector. Considering the role of high price pressures in limiting the demand, the companies would likely to try to find ways of competing fiercely in order to secure orders in the coming months.”

You can find attached the Istanbul Chamber of Industry Türkiye Export Climate Index May 2022 reports.