Turkey News July 2022
Business
Gilead Sciences invests in Turkey
In cooperation with the Turkish producer Pharmactive İlaç, the global biotechnology company Gilead Sciences has started manufacturing hepatitis and HIV drugs in Turkey, following an investment of USD 60 mn. Thanks to this investment, the company is aiming to produce 70% of its Turkey sales volume in the country.
June 14, 2022
ADQ acquires long-established Turkish drug company
Abu Dhabi Developmental Holding Company (ADQ) has decided to acquire Turkish sterile injectable products manufacturer Birgi Mefar Group. Established in 1963, Birgi Mefar exports its products to more than 30 countries.
June 14, 2022
Hilton launches Canopy brand in Turkey
According to the agreement signed by Hilton and Turkish Çalık Holding, Hilton is going to operate with its Canopy by Hilton brand in Turkey from 2023 on, starting with the Taksim, Istanbul location. It will be the eighth brand of Hilton in Turkey, and the number of Hilton hotels in the country has reached 100.
June 16, 2022
Law on Istanbul Finance Centre in force
The Law on the Istanbul Finance Centre, which is being established on the Asian side of Istanbul, has come into force. There will be a one-stop-shop in the Centre to accelerate the application and permission process. 75% of the profit generated by the financial service exports realized at the Centre shall be deducted from the business profit in the calculation of the corporate income tax base. The deduction rate shall be 100% for the period between 2022 and 2031.
June 28, 2022
Nestlé opens fifth plant in Turkey
The food giant Nestlé has commissioned its fifth plant in Turkey in Karacabey, Bursa, following an investment of TRY 433 mn. The plant will operate under Nestlé’s Health Science division to produce enteral nutrition with an annual production capacity of 9,000 tons.
July 5, 2022
Medtronic continues to invest in Turkey
U.S. medical device company Medtronic has announced an additional investment of USD 10 mn in its innovation center in Istanbul, which had been established in 2014 following an investment of USD 25 mn. The new investment will make the center the sole center in the world providing all trainings together among the six training centers of Medtronic. 60% of the physicians receiving training in the center are from abroad.
July 6, 2022
Politics
King Salman visits Turkey
Turkish President Recep Tayyip Erdoğan has received King Salman bin Abdulaziz Al Saud of Saudi Arabia in Ankara. In the joint declaration following the meeting, it has been stated that the two countries have decided to increase cooperation in various fields, including energy, digital technologies, climate change, defence, tourism, and healthcare.
June 23, 2022
Turkey renounces its NATO veto
At the NATO summit held in Madrid, Turkey has abandoned its policy of blocking the NATO membership of Sweden and Finland. The agreement has been reached as the two countries have promised to Turkey a cooperation regarding terrorism and lifting their arms embargo.
June 29, 2022
Erdoğan receives Draghi
President Erdoğan and Italy’s Prime Minister Mario Draghi have met in Ankara. Following their meetings, nine agreements have been signed to boost cooperation between the two countries in the fields including civil protection, sustainable development, science and technology, and SMEs.
July 5, 2022
Turkey and Malaysia sign seven agreements
President Erdoğan has received Ismail Sabri Yaakob, Prime Minister of Malaysia, in Ankara. Erdoğan stated that they target a trade volume of USD 5 bn for 2024. Seven agreements between the two countries have been signed including the fields of defence, industry and technology, healthcare, communication and media.
July 8, 2022
Economy
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 14.00%. The bank again stated that it “expects disinflation process to start on the back of measures taken and decisively implemented for strengthening sustainable price and financial stability along with the decline in inflation owing to the base effect and the resolution of the ongoing regional conflict.”
June 23, 2022
43.5% import hike in May
In May 2022, the exports of the Turkish economy increased by 15.3%, while imports were up 43.5% compared to the same month of the previous year (YOY). With exports of USD 19.0 bn, and imports of USD 29.6 bn, the trade deficit increased by 155.2% to USD 10.6 bn. In May, Germany was again Turkey’s primary export partner (USD 1.5 bn), leading the USA (USD 1.3 bn) and Iraq (USD 978 mn). Russia remained the country accounting for the most imports to Turkey (USD 4.5 bn), ahead of China (USD 3.2 bn) and Germany (USD 2.0 bn).
June 30, 2022
Net minimum wage raised by 30%
Taking into account the high inflation rate, Turkish President Erdoğan has announced a minimum wage raise as of July. With a 30% increase, it now amounts to TRY 5,500.35 net and TRY 6,471.00 gross. The cost to the employer is TRY 7,603.43. For each employee, the state shall provide TRY 100 support to the employer.
July 1, 2022
Inflation keeps rising
In June 2022, consumer prices in Turkey increased by 4.95% in comparison to the previous month, and the CPI went up by 78.62% YOY. The highest monthly increment took place in transportation (10.59%), followed by housing (8.34%). No decrease occurred among the main product groups. The biggest annual price increase was in transportation (123.37%). The domestic producer price index (D-PPI) rose by 6.77% monthly, and by 138.31% YOY.
July 4, 2022
Fitch downgrades Turkey’s rating
Fitch Ratings has decreased Turkey’s Long-Term Foreign Currency Issuer Default Rating to non-investment grade B while keeping the country’s outlook at negative. The agency emphasized the spiralling inflation, policies which increase macro and external risks, increasingly interventionist policies, higher financing needs, limited inflows, international reserves under pressure, and high financial dollarization.
July 8, 2022
Unemployment drops to 10.1% in May
In May 2022, some 3,453,000 people in Turkey aged 15 and older were officially out of work. The non-seasonally adjusted unemployment rate decreased by 2.3 points YOY to 10.1%. The labour force participation rate increased to 53.0% in total, and to 35.1% for females.
July 13, 2022
Industrial production increases further
In May, Turkey’s industrial production index went up by 9.1% YOY, with the manufacturing industry recording an increment of 10.7%. The highest increases in the manufacturing industry category occurred in the product groups “computer, electronic and optical products” (74.9%), “leather and related products” (46.5%), and “basic pharmaceutical products and pharmaceutical preparations” (32.0%). Decreases were reported in the product groups “basic metals” (-6.3%), “electrical equipment” (-3.7%), and “fabricated metal products” (-3.0%).
July 14, 2022
Overview of Monthly Data
Growth Rates
Inflation
