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Turkey News July 2021

Covid-19 Status

(as of July 25, 2021)

turkey covid july 2021Business

Kraft Heinz acquires Assan Foods
U.S. food company Kraft Heinz has struck a deal to acquire the Turkish sauce manufacturer Assan Foods for USD 100 mn. Assan Foods, owned by Kibar Holding, had already been a certified production partner of Kraft Heinz since 2019. The company has around 400 employees and exports its products to 50 countries.
June 14, 2021

Customs duties on various products removed
The customs duties on various products used as inputs by the manufacturing industry have been removed by the presidential decree no. 4106, coming into effect as of July 1. The products are categorized under 14 different chapters, including chemicals, plastics, steelware, electrical appliances, and motor vehicles. The stated purpose of the decree is to increase the competitiveness of the local industry using raw materials not produced in Turkey.
June 23, 2021

Onur Air suspends its flights
Due to long-standing financial problems exacerbated by the pandemic, the Turkish low-cost airline company Onur Air has suspended its entire flight operations. Execution proceedings were initiated for all of its aircraft. Most recently, the company had operated 11 airplanes, 3 of them being rental.
June 24, 2021

ISS Facility Services acquires Rönesans İşletme Hizmetleri
Danish ISS A/S, a global leader in facility management services, has acquired Turkish Rönesans İşletme Hizmetleri (RIH), which operates five state-owned “city hospitals”, in Adana, Yozgat, Elazığ, Bursa, and İstanbul-Başakşehir, with a total capacity of 9,500 beds. A subsidiary of Rönesans Holding, RIH is the country’s largest healthcare operator, while ISS had already been operating in Turkey with more than 40,000 employees.
June 25, 2021

EBRD and Actera invest in Martı
Perpetual Motion S.à.r.l., an investment fund jointly established by the European Bank for Reconstruction and Development (EBRD) and the private equity firm Actera Group, has decided to build a partnership with the leading Turkish e-scooter company Martı İleri Teknoloji. Founded as recently as 2019, Martı (“Seagull”) provides e-scooter services to more than 5 million users in ten cities across Turkey.
June 25, 2021

New packaging waste control regulation issued
In Turkey, a new packaging waste control regulation has entered into force as of June 26. The regulation provides for the collection of wastes to be in line with the Zero Waste Regulation published in 2019, the recycling of packaging waste to be prioritized, and a deposit management system to be introduced by January 1, 2022.
June 28, 2021

Investment incentives updated
Turkey’s investment incentive system has been updated through a presidential decree. Accordingly, interest rate support has been increased by 25%, data centre investments have been given priority, and the scope of environmental incentives has been widened. Also, imported machinery and equipment which could have been manufactured in Turkey will no longer be eligible for customs duty exemption. Furthermore, the minimum fixed investment amount required to receive investment support has been increased by 200%.
June 30, 2021

TEİAŞ to be privatized
The Turkish Privatization Administration (ÖİB) has announced that the Turkish Electricity Transmission Corporation (TEİAŞ) shall be privatized by public offering. However, the majority share of the corporation shall remain under state ownership. The privatization process is scheduled to be completed by the end of 2022. The 2020 turnover of the corporation was TRY 14.9 bn.
July 7, 2021

Ban on plastic waste imports lifted
The Turkish Ministry of Trade has issued a new regulation lifting the ban on plastic, specifically polyethylene waste imports that had been imposed in May. Rather than a complete ban, a “tight control” is now being envisaged. The ban had elicited reactions from the plastics industry processing PE waste as a raw material. Turkey had become the largest importer of plastic waste from Europe.
July 12, 2021

New employment supports announced
While the short-time compensation for employees has ended as of the end of June, the Turkish government has announced new employment supports. President Recep Tayyip Erdoğan stated that for employees newly hired by the end of 2021, the social security premiums and taxes on the minimum wage shall be paid by the state for twelve months, or 18 months for female, juvenile and disabled new employees. In addition, according to the omnibus law approved by the parliament, a monthly minimum wage support of TRY 75 per employee shall be provided to all companies throughout 2021.
July 7-19, 2021

Politics

EU allocates EUR 3 bn for Syrian refugees in Turkey
Ursula von der Leyen, the President of the European Commission, has announced that the EU shall allocate a budget of EUR 3 bn until 2024 to provide social and economic support to Syrian refugees in Turkey. An additional EUR 2.2 bn shall be provided to Syrian refugees in Jordan and Lebanon.
June 25, 2021

Turkey continues to scale down Coronavirus measures
The Turkish government has announced new normalization steps regarding the pandemic, to come into effect as of July 1. Accordingly, the lockdown and the restrictions on travel across province borders have been lifted. Cafés and restaurants have been allowed to admit patrons in both open and covered areas with proper precautions. Also, cinemas have been reopened.
June 27, 2021

Economy

Imports increased by 54.0% in May
In May 2021, the exports of the Turkish economy rose by 65.7%, whereas imports were up 54.0% over the same month of the previous year (YOY). With exports increasing to USD 16.5 bn, and imports to USD 20.6 bn, the trade deficit increased by 20.2% to USD 4.1 bn. In May, the main partner for exports continued to be Germany (USD 1.4 bn), ahead of the USA (USD 1.2 bn), and the UK (USD 1.1 bn). China was again the country where the most imports to Turkey came from (USD 2.6 bn), followed by Russia (USD 2.1 bn) and Germany (USD 1.8 bn).
June 30, 2021

Inflation increases
In June 2021, consumer prices in Turkey rose by 1.94% in comparison to the previous month, with the CPI going up by 17.53% YOY. The highest monthly rise was registered in furnishings and household equipment (4.50%), ahead of recreation and culture (4.46%). The only, however minuscule decrease occurred in alcoholic beverages & tobacco (-0.01%). The biggest annual price increase was in transportation (26.29%). The domestic producer price index (D-PPI) rose by 4.01% monthly, and by 42.89% YOY.
July 5, 2021

Unemployment announced as 12.4% in May
In May 2021, some 3,942,000 people in Turkey aged 15 and older were officially out of work. The non-seasonally adjusted unemployment rate was 12.4%, a 0.2-point decrease YOY. The labour force participation rate increased to 50.0% in total, and to 31.3% for females. Of those with employment in this period, 55.4% were employed in the service sector, 21.2% in industry, 17.6% in agriculture, and 5.8% in construction.
July 12, 2021

Industrial production gains 40.7%
Turkey’s industrial production index in May went up by as high as 40.7% YOY because of the high base effect, with the manufacturing industry recording an increment of 42.8%. The highest increases in the manufacturing industry category took place in the product groups “wearing apparel” (81.3%), “textiles” (70.6%), and “furniture” (63.4%). The only decrease was reported in “computer, electronic & optical products” (-2.2%).
July 13, 2021

Turkish Central Bank keeps interest rate constant
The Central Bank of the Republic of Turkey has kept its policy rate (the one-week repo auction rate) constant at 19.00%. The bank decided to maintain its tight monetary policy considering the high levels of inflation and inflation expectations.
July 14, 2021

Overview of Monthly Data

turkey economy july 2021 1Growth Rates

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Inflation

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