ICI Turkey Export Climate Index at 50.1 in November

The export climate for Turkish manufacturers improved fractionally during November. Weakness in some key export markets was cancelled out by signs of growth picking up in the US and other major economies. The Turkey Manufacturing Export

The export climate for Turkish manufacturers improved fractionally during November. Weakness in some key export markets was cancelled out by signs of growth picking up in the US and other major economies.

The Turkey Manufacturing Export Climate Index is calculated by weighting together national PMI data on output trends from PMI surveys. Weights are derived from statistics on the relative importance of individual trading partners’ contributions to the exports of Turkish manufacturers.

The Istanbul Chamber of Industry Turkey Manufacturing Export Climate Index was at 50.1 in November, down from 50.3 in October and signalling a fractional improvement in demand conditions for exporters in the Turkish manufacturing sector.

The climate for exporters was negatively impacted by signs of weakness in each of the three largest markets for Turkish manufacturers -Germany, the UK and Italy. Combined, these economies account for around 23% of Turkey’s manufacturing exports.

Business activity in Germany decreased for the third successive month in November, although the rate of decline softened to the weakest in the current sequence of contraction.

Output in the UK decreased for the fourth month running, with demand conditions continuing to be restricted by uncertainty around Brexit and the future trading relationship with the EU.

Meanwhile, Italy posted a reduction in activity for the first time since May.

Outside of these top three destinations there were some signs of improvement midway through the final quarter of the year. Output growth in the US quickened to a four-month high, while Spain also saw momentum pick up. Activity rose in France for the eighth month running, albeit at a slightly reduced pace. This was also the case in Russia, where output increased solidly again in November.

There were signs of demand softening in the Middle East during November. Both Saudi Arabia and the UAE continued to see activity expand, albeit at slower rates than in October. Egypt recorded the sharpest fall in output for over two years. Meanwhile, protests in Lebanon resulted in a substantial reduction in activity.

Protests continued to impact negatively on conditions in Hong Kong SAR. Elsewhere in Asia, however, growth improved. Activity in mainland China increased at a solid pace that was the fastest since February 2018. Meanwhile, the Indian economy posted a return to expansion for the first time in three months.

Of the PMI surveys conducted worldwide, the strongest increases in activity in November were seen in Nigeria and Uganda. That said, only 1% of Turkish manufacturing exports currently go to the sub-Saharan African countries covered by the PMI, and so firms in Turkey will not see a large benefit from the strength in conditions there.

Comment

Commenting on the Istanbul Chamber of Industry Turkey Manufacturing Export Climate Index, Andrew Harker, Associate Director, IHS Markit, said:

“Weakness in some of Turkish manufacturers’ key export destinations hampered growth in November. In fact, each of the three largest export markets - Germany, the UK and Italy - saw business activity decrease during the month. Soft demand in these markets adds a further hurdle to firms. On a more positive note, some of the world’s largest economies saw growth improve, most notably the US and China. This could help breathe life into the global economy and improve demand conditions elsewhere.”


Hibya News Agency

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