Novinky a publikácie
06. 06. 2015
Ekonomické publikácie

Turkey : Challenges amid global changes

Turkey : Challenges amid global changes

After a decade of well-imple­mented reforms and high growth rates, the Turkish economy seems to be struggling to maintain the same growth performance. Coface expects a growth rate of 3.5% this year - still a solid rate, yet below the po­tential growth rate estimated at 5% and lower than some of the country’s peers.

The recovery in the US economy and the Federal Reserve exit strategy have pushed the global economy into a new era. Emerging countries face new chal­lenges due to less available liquidity and structural vulnerabilities. Over the period ahead, the high volatility of the Turkish lira, the recovering but still-fragile growth in Europe and geopolitical risks weighing on the top export markets, are considered as the main challenges for the Turkish economy. Coupled with the gene­ral elections in June 2015, these factors are leading to a slowdown in household consumption and investment expendi­ture.

The textile and clothing sectors are among the most impacted by the deve­lopments in the global economy. Regional tensions are also weighing on the export performance of Turkish textile and clo­thing companies. Coface has increased the textile sector risk assessment to high risk level from medium risk, mainly due to the restrictive impact of the euro’s strengthening on export revenues, in­creasing import and production costs, the fragile recovery in the core market of Europe, losses recorded in Ukraine and Russia and finally deterioration in compa­nies’ payment performance. The clothing sector currently stands at medium risk level, but is being closely monitored.

The pharmaceutical sector remains solid, despite heavy regulations and lower profit margins. Coface evaluates the risk level of this sector as low. The sector is bene­fitting from the greater access of Turkish citizens to healthcare services, higher per capita income and higher pharmaceuti­cal expenditure per capita. Although the reference pricing system puts pressure on prices, which in turn restrains investments in new technologies, the sector still has the strong foundations necessary for steady financial performance. Payment collection is steady, as no delays have been detected in State payments.

 

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  • Household consumption continues but for how long?
  • Slump in private investments
  • Challenge of export sophistication
  • Textile and clothing sector
  • Pharmaceutical sector
  • Sector risk assessments
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Ľubomíra TARGOŠOVÁ

MARKETING MANAGER AND SALES SUPPORT
Soltésovej 14
811 08 Bratislava
SLOVAKIA
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mail: lubomira.targosova@coface.com

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