Turkish Growth Rate Surges to 4.4% in Fourth-Quarter 2013 as Domestic Demand Strengthens

---

Researched by Industrial Info Resources (Sugar Land, Texas)--The Turkish economy secured growth of 4.4% in the fourth quarter of 2013, above market consensus of 4%. According to figures from the Turkish Statistical Institute (Turkstat), the full-year growth reached 4% in 2013. With this expansion, Turkey's economy continued growing for the 17th consecutive quarter. Strong consumption and investment demand were the main factors. As of 2013, Turkey's gross domestic product reached $820 billion (1.76 trillion liras).

Turkish Finance Minister Mehmet Simsek said that gaining political stability after local elections, in which the ruling AK Party received a plurality of 45%, may strengthen domestic demand. "We recorded strong growth despite the negative conjecture. We managed to grow above our 3.6% forecast in the medium term program," he said in an e-mailed statement. The government forecast 4% growth for 2014 in its medium-term program.

The main driver of growth was private consumption, which has surged 5.3% from the same quarter last year, contributing 3.5 percentage points to the GDP growth. Also, public consumption and private investments rose 6.8% and 4.9%, respectively, which contributed 0.9 percentage points each. The 11.9% surge in public investment added another 0.6 percentage points to the growth rate.

In contrast, net trade shaved 3 percentage points off the GDP growth. Exports fell 1.5% from fourth-quarter 2013, while imports were up 9.3% in that period from fourth-quarter 2012. The mining sector contracted 4.1% in the fourth quarter, while the sector contracted 3.5% for all of 2013. The manufacturing sector expanded 4.9% in the last quarter of 2013, and it recorded an expansion of 3.8% for all of 2013.

"The sharp slowdown in consumer loan growth, the weakening in consumer confidence and the plunge in consumer durable sales in the first months of this year [...] signalled a slowdown early this year," said Yarkin Cebeci, an economist at JP Morgan Chase in Istanbul. "We keep our 2014 GDP growth forecast unchanged at 1.9%. We expect the Turkish economy to return back to its potential growth rate of 4% next year."

Turksat revised the third-quarter growth rate to 4.3% from 4.4%, and first-quarter growth to 2.9% from 3%. It also revised the 2012 GDP growth rate to 2.1% from 2.2%.

Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, three offices in North America and nine international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle™, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities.