Turkey News November 2020

Covid-19 Status

(as at November 15, 2020)

Business

BSH-Pitsos relocates production from Greece to Turkey
Long-established Greek company Pitsos, owned by German home appliances manufacturer Bosch Siemens Hausgeräte (BSH), is closing down its original plant in Athens by the end of 2020, moving all production units to Turkey. The largest of 40 BSH factories worldwide is in Turkey, built on an area of 550,000 sqm in Çerkezköy (Tekirdağ province), with an annual production capacity of 6.2 million units.
Oct. 15, 2020

Turkey discovers additional natural gas reserves
President Recep Tayyip Erdoğan has announced that the Turkish exploration ship “Fatih” has come across another natural gas reserve of 85 billion cubic metres in the Black Sea, in addition to the 320 billion cubic metres discovered in August. Natural gas production from this site is scheduled to start in 2023 with an amount of 5 to 10 billion cubic metres per year, reaching its peak in 2026 with 15 billion cubic metres.
Oct. 18, 2020

Chinese Farasis to establish car battery plant in Turkey
TOGG, the consortium to produce Turkey’s “national automobile”, has signed an agreement with the Chinese Li-ion battery producer Farasis Energy to manufacture the battery modules and battery pack of the electric car in Turkey. The business plan of the partnership is to be announced by the end of 2020, and the joint venture shall be established at the beginning of next year.
Oct. 21, 2020

Short-time compensation and ban on dismissals extended for two months
The regulation allowing companies forced to discontinue their activities due to the coronavirus pandemic to benefit from short-time compensation for their employees has been extended for another two months until the end of 2020. In parallel, the ban on dismissals shall also remain in force for two more months after November 17.
Oct. 28, 2020

Turkey fines social media giants
The Turkish Information and Communication Technologies Authority (BTK) has imposed a fine of TRY 10 mn (approx. EUR 1 mn) each on several social media companies, including Facebook, Instagram, Twitter, Periscope, YouTube, and TikTok, because they have not opened a representative office in Turkey by Nov. 2 as required by the new social media regulation. In case the fine is not paid within 30 days, an additional penalty of TRY 30 mn will be applied.
Nov. 5, 2020

Law on tax and social security liabilities passed
Turkey’s Grand National Assembly has approved a law which allows tax and social security liabilities to be restructured and paid in 18 instalments. Accordingly, it will be possible to restructure liabilities including, among others, income tax, corporate income tax, value added tax, motor vehicle tax, excise duty, and all administrative fines.
Nov. 12, 2020

 

Politics

Morocco raises customs duties on Turkish products
The Moroccan government has raised the customs duties on 1,200 product groups imported from Turkey, including textiles and ready-to-wear, up to 90% for the next five years. Moroccan textile producers had been complaining that the free trade agreement between Turkey and Morocco has caused unfair competition.
Oct. 13, 2020

U.S. condemns Turkey’s testing of S-400 missiles
The U.S. Department of Defence has condemned Turkey’s testing of the Russian S-400 missile system in Sinop province. The Pentagon also stated that the S-400 issue continues to be an obstacle to progress in the bilateral relationship.
Oct. 24, 2020

Erdoğan calls for boycott of French goods
Turkish President Erdoğan has called for boycotting French goods as a reaction against what is perceived as the French government defending the publishing of caricatures mocking the Prophet Mohammad following the Jihadist murder of a teacher. Erdoğan also sharply criticized the raid conducted by the German police on a mosque in Berlin on fraud charges, contending that there is no freedom of religion in Europe.Erdoğan also sharply criticized the raid conducted by the German police on a mosque in Berlin on fraud charges, contending that there is no freedom of religion in Europe.
Oct. 27, 2020

EU lowers quotas for Turkish steel
The EU has lowered the quotas for imports of Turkish steel from 75,000 tons to 58,926 tons for the first quarter of 2021, and to 59,480 tons for the second, prompting the Turkish Steel Producers Association (TÇÜD) to call for countermeasures against imports from the EU.
Nov. 3, 2020

 

Economy

Turkish Central Bank keeps policy rate constant
The Central Bank of the Republic of Turkey has kept its policy rate (one-week repo auction rate) constant at 10.25%. On the other hand, the bank set the margin between the CBRT Late Liquidity Window lending rate and overnight lending rate to 300 basis points, up from 150 basis points. The bank stated that it has decided “to keep the policy rate unchanged, while enhancing flexibility in liquidity management and continuing with liquidity measures until inflation outlook displays a significant improvement”.
Oct. 22, 2020

Import increase of 23.0% in September
In September 2020, the exports of the Turkish economy increased by 4.8%, and imports by 23.0% over the same month of the previous year (YOY). With exports increasing to USD 16.0 bn, and imports to USD 20.8 bn, the trade deficit surged 189.6% to reach USD 4.8 bn. In September, the main partner for exports continued to be Germany (USD 1.5 bn), ahead of the UK (USD 1.1 bn), and the USA (USD 947 mn). China was the country where the most imports to Turkey came from (USD 2.2 bn), followed by Germany (USD 2.1 bn) and Russia (USD 1.6 bn).
Oct. 30, 2020

Inflation increases slightly
In October 2020, consumer prices in Turkey rose by 2.13% in comparison to the previous month, with the CPI going up by 11.89% YOY. The highest monthly rise was registered in clothing & footwear (6.81%), ahead of food & non-alcoholic beverages (3.03%). The expenditure groups reporting an ever-so-slight drop were recreation & culture with -0.09%, and alcoholic beverages & tobacco with -0.01%. The biggest annual increases were in miscellaneous goods & services (27.40%), and food & non-alcoholic beverages (16.51%). The domestic producer price index (D-PPI) increased by 3.55% monthly, and by 18.20% YOY.
Nov. 3, 2020

Central Bank Governor replaced, Minister of Treasury and Finance resigns
President Erdoğan has replaced the Governor of the Central Bank of the Republic of Turkey with the Head of Strategy and Budget, Naci Ağbal, a former Finance Minister. He has also accepted the resignation of his son-in-law Berat Albayrak, and appointed Lütfi Elvan, formerly Minister of Development, to the post of Minister of Treasury and Finance.
Nov. 7-10, 2020

Unemployment announced as 13.2% in August
In August 2020, some 4,194,000 people in Turkey aged 15 and older were officially out of work. The unemployment rate was 13.2%, a 0.8-point decrease YOY. The youth unemployment rate in the 15-24 age bracket dropped to 26.1%. The labour force participation rate went down to 50.6% in total, and to 32.0% for females. Of those with employment in this period, 54.7% were employed in the service sector, 19.8% in industry, 19.2% in agriculture, and 6.2% in construction.
Nov. 10, 2020

Industrial production increases by 8.1%
Turkey’s industrial production index in September went up by 8.1% YOY, with the manufacturing industry recording an increment of 8.5%. The highest increases in the manufacturing industry category took place in the product groups “other non-metallic mineral products” (24.2%), “furniture” (23.8%), and “repair and installation of machinery and equipment” (22.0%). The highest decreases, on the other hand, were reported in “printing and reproduction of recorded media” (-30.5%), “coke and refined petroleum products” (-8.8%), and “computer, electronic and optical products” (-8.5%).
Nov. 13, 2020

 

Overview of Monthly Data

Growth Rates

Inflation