Turkey

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Economic and political outline

Economic indicators | Foreign Trade in figures | Sources of general economic information | Political outline

Economic indicators

Turkey, a country of 74 million inhabitants, has an economy in transition, a relatively high degree of dependence on agriculture and heavy industry, and a tertiary sector in full expansion. After going through a serious economic and political crisis in 2001, Turkey has made a spectacular recovery thanks to a more favorable political climate but also to monetary, fiscal and structural reforms inspired by the World Bank and the IMF. Thus Turkey adopted a floating currency regime and has given total independence to the Central Bank. The GDP growth rate was high in recent years. In 2009, GDP growth was negative because of the international financial crisis impact, but should start up again from 2010.
The governement is following a budgetary strictness and inflation control policy. However, the current environement makes this orientation more and more difficult to justify to the population. The Turkish economy is also vulnerable because of its great dependence on exports and foreign investments. At the end of 2007, foreign investors held 73% of the Istabul market float, a fact which makes a massive withdrawal by investors and a deterioration of the Turkish lira fearful. The unemployment rate exploded due to the current economic crisis, to settle at 15%. Turkey is affected by the support of a significant informal sector.

Main indicators	2006	2007	2008	2009	2010
GDP (billions USD)	529.19	649.13	729.44e	552.18	535.32e
GDP (constant prices, annual % change)	6.9	4.7	1.1e	-5.1e	1.5e
GDP per capita (USD)	7,767	9,422	10,472e	7,840e	7,517e
Inflation rate (%)	9.6	8.8	10.4	6.9	6.8
Unemployment rate (% of the labor force)	9.9	9.8	-	-	-
Current Account (billions USD)	-31.89	-37.68	-41.42e	-6.65	-8.35
Current Account (in % of GDP)	-6.0	-5.8	-5.7e	-1.2e	-1.6e

Source: IMF - World Economic Outlook Database

Note: (e) Estimated data

Main sectors of industry

Agriculture in Turkey, which contributes nearly 10% of the GDP and employs practically a third of the population, still suffers from low productivity because of its management system (small farms). Wheat is the main crop. The country is the third biggest exporter of tobacco in the world, the leading producer of hazelnuts (70% of world production). Mineral resources are abundant but under-exploited.
The manufacturing industry makes up nearly 30% of the GDP, the textile and automobile sectors being the main activities. The Turkish government gives special priority to large infrastructure projects, particularly in the transport sector, which mostly function under the BOT model (build, operate, transfer).
The tertiary sector contributes slightly less than two-thirds to the GDP. Tourism represents 4% of the GDP with about 13 million tourists a year.

Breakdown of economic activity by sector	Agriculture	Industry	Services
Employment by sector (in % of total employment)	29.5	24.7	45.8
Value added (in % of GDP)	8.7	28.3	63.0
Value added (annual % change)	-6.9	5.8	6.0

- last available data.

Monetary indicators	2003	2004	2005	2006	2007
Turkish New Lira (TRY) - Average annual exchange rate for 1 USD	1.50	1.43	1.34	1.43	1.30

Source: World Bank - World Development Indicators

Indicator of economic freedom

Score:: 61.6/100
Position:: moderately free
World Rank:: 75 out of 179
Regional Rank:: 31 out of 44

Distribution of Economic freedom in the world
Source: 2008 Index of Economic freedom, Heritage Foundation

Country risk

See the country risk analysis provided by Ducroire.

Foreign trade in figures

The spearheads of Turkish foreign trade are the automobile and textile industries, followed by the food industry (raw and processed products), machinery and equipment and electronic equipment sectors respectively. The European Union is by far Turkey's leading customer (56.4% of Turkish exports). Yet the country shows a high trade deficit level because of its high energy dependence on Russia and its Middle Eastern neighbors. In addition, like the household appliance sector, which paradoxically is a high export industry, many components (about 80%) are imported to subsequently be assembled in Turkey. Despite government efforts to promote innovation (namely with the development of competitiveness centers and the establishment of tax credits in favor of Research and Development), Turkish exports have relatively low added value. Similarly, Turkish exports are still not very present on markets with high development potential (China or Eastern Europe) and suffer from being compared to German ones.

Foreign trade indicators	2003	2004	2005	2006	2007
Imports of goods (millions USD)	65,883	91,271	111,353	134,552	162,025
Exports of goods (millions USD)	52,394	68,535	78,365	93,611	115,356
Imports of services (millions USD)	7,502	10,163	11,376	11,481	14,974
Exports of services (millions USD)	18,013	22,960	26,648	25,312	28,853
Imports of goods and services (annual % change)	23.5	20.8	12.2	6.9	10.7
Exports of goods and services (annual % change)	6.9	11.2	7.9	6.6	7.3
Imports of goods and services (in % of GDP)	24.0	26.2	25.4	27.6	27.1
Exports of goods and services (in % of GDP)	23.0	23.6	21.9	22.7	22.0
Trade Balance (millions USD)	-13,489	-22,736	-32,988	-40,941	-46,669
Trade Balance (including service) (millions USD)	-2,978	-9,939	-17,716	-27,110	-32,790
Foreign trade (in % of GDP)	47.0	49.7	47.2	50.3	49.2

Source: World Bank

Main partner countries

Main customers (% of exports)	2008
Germany	9.8%
United Kingdom	6.2%
United Arab Emirates	6.0%
Italy	5.9%
France	5.0%
Russia	4.9%
United States	3.3%
Spain	3.1%
Romania	3.0%
Iraq	3.0%
Netherlands	2.4%
Switzerland	2.2%
Greece	1.8%
Saudi Arabia	1.7%
Ukraine	1.7%
Bulgaria	1.6%
Belgium	1.6%
Iran	1.5%
Israel	1.5%
Azerbaijan	1.3%
See more countries	67.0%

Main suppliers (% of imports)	2008
Russia	15.5%
Germany	9.3%
China	7.8%
United States	5.9%
Italy	5.5%
France	4.5%
Iran	4.1%
Ukraine	3.0%
Switzerland	2.8%
United Kingdom	2.6%
Spain	2.3%
South Korea	2.0%
Japan	2.0%
Romania	1.8%
Saudi Arabia	1.6%
Algeria	1.6%
Belgium	1.6%
Netherlands	1.5%
India	1.2%
Kazakhstan	1.2%
See more countries	56.1%

Source: Comtrade

Main products

Main exports (% of exports)	2008
Vehicles other than railway or tramway...Vehicles other than railway or tramway rolling-stock, and parts and accessories thereof	13.8%
Iron and steelIron and steel	11.3%
Nuclear reactors, boilers, machinery and...Nuclear reactors, boilers, machinery and mechanical appliances; parts thereof	7.8%
Electrical machinery and equipment and parts...Electrical machinery and equipment and parts thereof; sound recorders and reproducers, television image and sound recorders and reproducers, and parts and accessories of such articles	6.0%
Articles of apparel and clothing accessories,...Articles of apparel and clothing accessories, knitted or crocheted	5.9%
Mineral fuels, mineral oils and products of their...Mineral fuels, mineral oils and products of their distillation; bituminous substances; mineral waxes	5.7%
Articles of iron or steelArticles of iron or steel	4.4%
Natural or cultured pearls, precious or...Natural or cultured pearls, precious or semi-precious stones, precious metals, metals clad with precious metal, and articles thereof; imitation jewellery; coin	4.1%
Articles of apparel and clothing accessories, not...Articles of apparel and clothing accessories, not knitted or crocheted	4.0%
Plastics and articles thereofPlastics and articles thereof	2.7%
Edible fruit and nuts; peel of citrus fruits or...Edible fruit and nuts; peel of citrus fruits or melons	2.2%
Ships, boats and floating structuresShips, boats and floating structures	2.0%
Other made-up textile articles; sets; worn...Other made-up textile articles; sets; worn clothing and worn textile articles; rags	1.6%
Salt; sulphur; earths and stone; plastering...Salt; sulphur; earths and stone; plastering materials, lime and cement	1.6%
Furniture; bedding, mattresses, mattress supports,...Furniture; bedding, mattresses, mattress supports, cushions and similar stuffed furnishings; lamps and lighting fittings, not elsewhere specified or included; illuminated signs, illuminated name-plates and the like; prefabricated buildings	1.4%
Rubber and articles thereofRubber and articles thereof	1.4%
Aluminium and articles thereofAluminium and articles thereof	1.3%
CottonCotton	1.2%
Preparations of vegetables, fruit, nuts or other...Preparations of vegetables, fruit, nuts or other parts of plants	1.1%
Man-made filamentsMan-made filaments	1.0%
Carpets and other textile floor coveringsCarpets and other textile floor coverings	0.9%
Copper and articles thereofCopper and articles thereof	0.9%
Articles of stone, plaster, cement, asbestos, mica...Articles of stone, plaster, cement, asbestos, mica or similar materials	0.9%
Knitted or crocheted fabricsKnitted or crocheted fabrics	0.9%
Paper and paperboard; articles of paper pulp, of...Paper and paperboard; articles of paper pulp, of paper or of paperboard	0.8%
Ores, slag and ashOres, slag and ash	0.8%
Glass and glasswareGlass and glassware	0.8%
Edible vegetables and certain roots and tubersEdible vegetables and certain roots and tubers	0.7%
Ceramic productsCeramic products	0.7%
Man-made staple fibresMan-made staple fibres	0.6%
Animal or vegetable fats and oils and their...Animal or vegetable fats and oils and their cleavage products; prepared edible fats; animal or vegetable waxes	0.6%
Products of the milling industry; malt; starches;...Products of the milling industry; malt; starches; inulin; wheat gluten	0.5%
Preparations of cereals, flour, starch or milk;...Preparations of cereals, flour, starch or milk; pastrycooks' products	0.5%
Tobacco and manufactured tobacco substitutesTobacco and manufactured tobacco substitutes	0.5%
Special woven fabrics; tufted textile fabrics;...Special woven fabrics; tufted textile fabrics; lace; tapestries; trimmings; embroidery	0.5%
Soap, organic surface-active agents, washing...Soap, organic surface-active agents, washing preparations, lubricating preparations, artificial waxes, prepared waxes, polishing or scouring preparations, candles and similar articles, modelling pastes, 'dental waxes' and dental preparations with a basis of plaster	0.5%
Miscellaneous articles of base metalMiscellaneous articles of base metal	0.5%
Miscellaneous edible preparationsMiscellaneous edible preparations	0.4%
Wood and articles of wood; wood charcoalWood and articles of wood; wood charcoal	0.4%
Organic chemicalsOrganic chemicals	0.4%
Tanning or dyeing extracts; tannins and their...Tanning or dyeing extracts; tannins and their derivatives; dyes, pigments and other colouring matter; paints and varnishes; putty and other mastics; inks	0.3%
Articles of leather; saddlery and harness; travel...Articles of leather; saddlery and harness; travel goods, handbags and similar containers; articles of animal gut (other than silkworm gut)	0.3%
Essential oils and resinoids; perfumery, cosmetic...Essential oils and resinoids; perfumery, cosmetic or toilet preparations	0.3%
Pharmaceutical productsPharmaceutical products	0.3%
Cocoa and cocoa preparationsCocoa and cocoa preparations	0.3%
Fish and crustaceans, molluscs and other aquatic...Fish and crustaceans, molluscs and other aquatic invertebrates	0.3%
Optical, photographic, cinematographic, measuring,...Optical, photographic, cinematographic, measuring, checking, precision, medical or surgical instruments and apparatus; parts and accessories thereof	0.3%
Miscellaneous chemical productsMiscellaneous chemical products	0.3%
Sugars and sugar confectionerySugars and sugar confectionery	0.3%
Footwear, gaiters and the like; parts of such...Footwear, gaiters and the like; parts of such articles	0.3%
Impregnated, coated, covered or laminated textile...Impregnated, coated, covered or laminated textile fabrics; textile articles of a kind suitable for industrial use	0.3%
Inorganic chemicals; organic or inorganic...Inorganic chemicals; organic or inorganic compounds of precious metals, of rare-earth metals, of radioactive elements or of isotopes	0.2%
Aircraft, spacecraft, and parts thereofAircraft, spacecraft, and parts thereof	0.2%
Dairy produce; birds' eggs; natural honey; edible...Dairy produce; birds' eggs; natural honey; edible products of animal origin, not elsewhere specified or included	0.2%
Wool, fine or coarse animal hair; horsehair yarn...Wool, fine or coarse animal hair; horsehair yarn and woven fabric	0.2%
Wadding, felt and nonwovens; special yarns; twine,...Wadding, felt and nonwovens; special yarns; twine, cordage, ropes and cables and articles thereof	0.2%
FertilizersFertilizers	0.2%
Beverages, spirits and vinegarBeverages, spirits and vinegar	0.1%
Oil seeds and oleaginous fruits; miscellaneous...Oil seeds and oleaginous fruits; miscellaneous grains, seeds and fruit; industrial or medicinal plants; straw and fodder	0.1%
Furskins and artificial fur; manufactures thereofFurskins and artificial fur; manufactures thereof	0.1%
Arms and ammunition; parts and accessories thereofArms and ammunition; parts and accessories thereof	0.1%
Tools, implements, cutlery, spoons and forks, of...Tools, implements, cutlery, spoons and forks, of base metal; parts thereof of base metal	0.1%
See more products	55.1%

Main imports (% of imports)	2008
Mineral fuels, mineral oils and products of their...Mineral fuels, mineral oils and products of their distillation; bituminous substances; mineral waxes	16.2%
Iron and steelIron and steel	11.5%
Nuclear reactors, boilers, machinery and...Nuclear reactors, boilers, machinery and mechanical appliances; parts thereof	11.3%
Electrical machinery and equipment and parts...Electrical machinery and equipment and parts thereof; sound recorders and reproducers, television image and sound recorders and reproducers, and parts and accessories of such articles	6.7%
Vehicles other than railway or tramway...Vehicles other than railway or tramway rolling-stock, and parts and accessories thereof	6.2%
Plastics and articles thereofPlastics and articles thereof	4.6%
Natural or cultured pearls, precious or...Natural or cultured pearls, precious or semi-precious stones, precious metals, metals clad with precious metal, and articles thereof; imitation jewellery; coin	2.8%
Pharmaceutical productsPharmaceutical products	2.2%
Organic chemicalsOrganic chemicals	2.0%
Optical, photographic, cinematographic, measuring,...Optical, photographic, cinematographic, measuring, checking, precision, medical or surgical instruments and apparatus; parts and accessories thereof	1.7%
Copper and articles thereofCopper and articles thereof	1.6%
Paper and paperboard; articles of paper pulp, of...Paper and paperboard; articles of paper pulp, of paper or of paperboard	1.3%
Aluminium and articles thereofAluminium and articles thereof	1.3%
CottonCotton	1.2%
Articles of iron or steelArticles of iron or steel	1.1%
Rubber and articles thereofRubber and articles thereof	1.1%
CerealsCereals	1.1%
Miscellaneous chemical productsMiscellaneous chemical products	0.9%
Man-made staple fibresMan-made staple fibres	0.8%
Inorganic chemicals; organic or inorganic...Inorganic chemicals; organic or inorganic compounds of precious metals, of rare-earth metals, of radioactive elements or of isotopes	0.8%
Animal or vegetable fats and oils and their...Animal or vegetable fats and oils and their cleavage products; prepared edible fats; animal or vegetable waxes	0.8%
Tanning or dyeing extracts; tannins and their...Tanning or dyeing extracts; tannins and their derivatives; dyes, pigments and other colouring matter; paints and varnishes; putty and other mastics; inks	0.8%
Aircraft, spacecraft, and parts thereofAircraft, spacecraft, and parts thereof	0.8%
Man-made filamentsMan-made filaments	0.7%
FertilizersFertilizers	0.7%
Oil seeds and oleaginous fruits; miscellaneous...Oil seeds and oleaginous fruits; miscellaneous grains, seeds and fruit; industrial or medicinal plants; straw and fodder	0.7%
Articles of apparel and clothing accessories, not...Articles of apparel and clothing accessories, not knitted or crocheted	0.6%
Wood and articles of wood; wood charcoalWood and articles of wood; wood charcoal	0.6%
Furniture; bedding, mattresses, mattress supports,...Furniture; bedding, mattresses, mattress supports, cushions and similar stuffed furnishings; lamps and lighting fittings, not elsewhere specified or included; illuminated signs, illuminated name-plates and the like; prefabricated buildings	0.6%
Ships, boats and floating structuresShips, boats and floating structures	0.4%
Essential oils and resinoids; perfumery, cosmetic...Essential oils and resinoids; perfumery, cosmetic or toilet preparations	0.4%
Ores, slag and ashOres, slag and ash	0.4%
Residues and waste from the food industries;...Residues and waste from the food industries; prepared animal fodder	0.4%
Articles of apparel and clothing accessories,...Articles of apparel and clothing accessories, knitted or crocheted	0.4%
Miscellaneous articles of base metalMiscellaneous articles of base metal	0.4%
Footwear, gaiters and the like; parts of such...Footwear, gaiters and the like; parts of such articles	0.3%
Soap, organic surface-active agents, washing...Soap, organic surface-active agents, washing preparations, lubricating preparations, artificial waxes, prepared waxes, polishing or scouring preparations, candles and similar articles, modelling pastes, 'dental waxes' and dental preparations with a basis of plaster	0.3%
Glass and glasswareGlass and glassware	0.3%
Tools, implements, cutlery, spoons and forks, of...Tools, implements, cutlery, spoons and forks, of base metal; parts thereof of base metal	0.3%
Articles of leather; saddlery and harness; travel...Articles of leather; saddlery and harness; travel goods, handbags and similar containers; articles of animal gut (other than silkworm gut)	0.3%
Raw hides and skins (other than furskins) and...Raw hides and skins (other than furskins) and leather	0.3%
Salt; sulphur; earths and stone; plastering...Salt; sulphur; earths and stone; plastering materials, lime and cement	0.2%
Pulp of wood or of other fibrous cellulosic...Pulp of wood or of other fibrous cellulosic material; recovered (waste and scrap) paper or paperboard	0.2%
Wool, fine or coarse animal hair; horsehair yarn...Wool, fine or coarse animal hair; horsehair yarn and woven fabric	0.2%
Wadding, felt and nonwovens; special yarns; twine,...Wadding, felt and nonwovens; special yarns; twine, cordage, ropes and cables and articles thereof	0.2%
Ceramic productsCeramic products	0.2%
Toys, games and sports requisites; parts and...Toys, games and sports requisites; parts and accessories thereof	0.2%
Articles of stone, plaster, cement, asbestos, mica...Articles of stone, plaster, cement, asbestos, mica or similar materials	0.2%
Edible vegetables and certain roots and tubersEdible vegetables and certain roots and tubers	0.2%
Tobacco and manufactured tobacco substitutesTobacco and manufactured tobacco substitutes	0.2%
Miscellaneous edible preparationsMiscellaneous edible preparations	0.2%
Miscellaneous manufactured articlesMiscellaneous manufactured articles	0.2%
Albuminoidal substances; modified starches; glues;...Albuminoidal substances; modified starches; glues; enzymes	0.2%
Railway or tramway locomotives, rolling-stock and...Railway or tramway locomotives, rolling-stock and parts thereof; railway or tramway track fixtures and fittings and parts thereof; mechanical (including electro-mechanical) traffic signalling equipment of all kinds	0.2%
Zinc and articles thereofZinc and articles thereof	0.2%
Edible fruit and nuts; peel of citrus fruits or...Edible fruit and nuts; peel of citrus fruits or melons	0.2%
Cocoa and cocoa preparationsCocoa and cocoa preparations	0.1%
Impregnated, coated, covered or laminated textile...Impregnated, coated, covered or laminated textile fabrics; textile articles of a kind suitable for industrial use	0.1%
Knitted or crocheted fabricsKnitted or crocheted fabrics	0.1%
Clocks and watches and parts thereofClocks and watches and parts thereof	0.1%
Photographic or cinematographic goodsPhotographic or cinematographic goods	0.1%
Nickel and articles thereofNickel and articles thereof	0.1%
Carpets and other textile floor coveringsCarpets and other textile floor coverings	0.1%
Lead and articles thereofLead and articles thereof	0.1%
See more products	48.0%

Source: Comtrade

See more products: More imports (Intracen Data)
More exports (Intracen Data)

Sources of general economic information

Ministries: State Planning Organization
Ministry of Agriculture and Rural Affairs
Ministry of Industry and Trade
Turkish Ministry of Finances
Statistical Office: Turkish Statistical Institute
Central Bank: Central Bank of The Republic of Turkey
Stock Exchange: Istanbul Stock Exchange
Search Engines: Netbul
Turk Evi
Turk Net
Turkey Web
Economic portals: Ministry of Foreign Trade
Capital Markets Board of Turkey

Political outline

Executive Power: The President of the Republic is the Head of State. He is elected by indirect universal suffrage for a single 7 year term of office, by secret ballot in Parliament. However, following a constitutional change in 2007, the next election (2014) will be by direct universal suffrage. He has the function of an arbitrator (promulgation of laws, signature of decrees..) and he appoints the Prime Minister and the Council of Ministers. The President also appoints the judicial organs and other governmental organs. His role is above all ceremonial but his position benefits from considerable symbolic importance.
The Prime Minister is the head of the government. He is elected by Parliament when there is a vote of confidence in the government, for a five year term of office. He holds the executive power, which includes law enforcement and managing the current business of the country. The government he directs is responsible before Parliament which can overturn it with an absolute majority of its members.
Legislative Power: Legislative power in Turkey is unicameral. The Parliament, called Great National Assembly of Turkey, has 550 seats, and its members are elected by universal suffrage for five years according to a system of proportional representation.
Main political parties: - The AKP (Justice and Development Party) - a conservative party, moderately Islamic
- The CHP (Republican People's Party) - a nationalist, social-democratic party
- The MHP (Nationalist Movement Party) - extreme right nationalist party
- The DEHAP (Democratic People's Party) and Independents - left wing party, pro-Kurd
- The ANAP (Motherland Party) - center right and liberal party
- The DYP ( Just Way Party) - non-religious, right wing conservative party.
Current political leaders: President : Abdullah GÜL (since August 2007) - AKP and former Minister of Foreign Affairs (March 2003 to July 2007 )
Prime Minister: Recep Tayyip ERDOGAN (since March 2003) - AKP
Minister of Foreign Affairs: Ali BABACAN
Minister of Foreign Trade: Kürsad TÜZMEN
Minister of Finance: Kemal UNAKITAN
Minister of the Interior: Besir ATALAY
Next election dates: Presidential : August 2014
Legislative : November 2012

Indicator of freedom of the press

World Rank:: 103/173
Evolution:: 2 places down compared to 2007

Source: Worldwide Press Freedom Index 2007, Reporters Without Borders

Indicator of political freedom

Ranking:: Partly Free
Political freedom:: 3/7
Civil liberties:: 3/7

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