Turkey has made remarkable progress. Aside from the real growth in its national revenue, Turkey’s economic growth multiplied in a few years time with the help of its overvalued currency, New Turkish Lira. Turkey’s annual revenue has doubled since 2002. The Gross National Product (GNP) of Turkey was $240 billion in 2003 and ranked 22nd worldwide. It is expected to rank 20th in 2007 with its $400 billion GNP, jumping two places. According to the estimations of the International Monetary Fund (IMF) Turkey’s GNP will have increased 66.4 per cent in 2007 when compared to 2003 statistics.
GNP: Turkey’s GNP was $240.6 billion in 2003 and has gradually increased since then, reaching $302.6 billion in 2004, $362.5 billion in 2005 and an estimated $378.4 billion in 2006. Based on these estimates, Turkey will have outnumbered the countries like Poland, Austria, Denmark, Greece, Ireland, Finland and Portugal. In 2007, the estimated GNP of Poland will be $351.3 billion, Austria’s $340.6 billion, Denmark’s $296,4 billion, Greece with $266.7 billion, Ireland $242.8 billion, Finland with $217.8 billion and Portugal at $203.3 billion in 2007.
The United States will rank first for 2007 with its $13,928.5 billion GNP. Japan will rank second with its GNP of $4,599.4 billion and Germany will follow in third place with a $3,036.9 billion GNP. China will rank fourth in this classification with its GNP of $2,871 billion.
Domestic income: The country’s annual domestic income has doubled since 2002. The recently introduced reforms made the Turkish economy reliable and stable. It has become financially stable as a result of political stability and the introduction of substantial reforms. The country recorded remarkable growth rate of 7.5 per cent in the first half of 2006. The inflation rate has come down from 54 per cent to eight per cent since 2001. While public debt has decreased from 102 per cent to 66 per cent.
This year, Turkey has exported 22 per cent of its economic production, while this figure was three per cent in 1980. Turkey’s May crisis did not change the fundamentals of the Turkish economy. The International Monetary Fund has also appreciated Turkey’s economic progress. It has underlined the fact that Turkey was the sixth biggest car and spare parts manufacturer, and that 40 per cent of the TVs sold in Germany were imported from Turkey. Turkey’s former trade structure, based on textiles, was over.
Exports in September have broken a record by increasing by 10.5 per cent compared to the same period last year. Monthly exports have reached $7.7 billion and annual exports have reached $81.5 billion. The data from the Turkish Exporters Assembly indicates that exports in September hit a record. According to the data, exports have reached $7.7 billion in September with an increase of 10.5 per cent compared to last year. So, the export record in June has been registered in records by increasing by $9 million in September.
According to the statement, exports for nine months have reached $61.5 billion by increasing by 15 per cent.
Countries such as China and India, with their cheap labor and capital, have vastly increased their presence in the world’s export market. In contrast, Turkey’s nightmarish current account’s deficit continues to grow along with its trade deficit. Turkey’s export target in 2006 is $ 79 billion, but we will try to increase this amount. During the last decade, Turkey has diversified its exports not only in agricultural products but also in terms of industrial products.
Trading partners: Turkey’s main trading partners during the last decade have been the EU countries. Turkey’s exports to the central and eastern European countries and the CIS countries have also been increasing steadily. According to World Trade Organization, Turkey ranks the 22nd among world’s most exporting countries, and 14th among importing countries. Import target for 2006 is 124 billion USD and export target is 79 billion USD. Thus Turkey’s trade volume in 2006 is expected 203 billion dollars.
Turkey is the biggest economy in the Middle East, Balkans and Caucasia regions. The economy has broken new records in continuous growth over the past 4 years. In the second quarter of 2006, the economy grew by 8.5 per cent, while the Turkish Institute for Statistics (TUIK) has announced that the first 6 months of this year saw a growth speed of 7.5 per cent. Growth was recorded in 2005 as being at 7.6 per cent, while the first quarter of 2006 saw 6.3 per cent growth. TUIK is also estimating that the per capita income levels will have risen by the end of 2006, calculating that the average income of Turkish citizens is currently $5,008, but will rise to $5,800 by the end of the year.
Australia
The GDP growth is expected to average around three per cent in 2007-08, supported in both years by export expansion and continued solid growth in domestic demand. Continued growth in employment is allaying public concern that the new industrial relations regime could lead to substantial job-shedding. The current-account deficit will expand next year, despite a smaller merchandise trade deficit.
The services deficit will return to more normal levels next year, and income deficits will remain large. The International Monetary Fund expects the Australian economy will continue to perform strongly, growing by 2.9 per cent in 2006 and 3.2 per cent in 2007. The IMF expects unemployment to remain at around its current low level over this period, and inflation to remain moderate.
IMF: The IMF praises the state of Australia’s public finances, noting that Australia continues to demonstrate an ‘enviable’ record of fiscal prudence with the budget remaining in surplus and public debt ratios staying on a firm downward track.
The IMF welcomes the Government’s workplace relations reforms and changes to the tax and benefits systems, pointing out that these will improve work incentives, and ‘set the stage for continued strong employment growth’.
Global growth: Favourable global conditions should continue to support Australia’s economy. The IMF has strengthened its forecasts and is forecasting global growth of 4.9 per cent in 2006 and 4.7 per cent in 2007.
While high and volatile oil prices remain a significant risk to world growth, the Fund notes that higher oil prices have not yet significantly impacted on inflationary expectations. The Fund highlights the importance of credible monetary policy frameworks in keeping inflationary expectations in check and the need to improve the supply-demand balance in oil markets.
The IMF again draws attention to global current account imbalances and reiterates the need for policy responses across a large number of countries to facilitate the orderly adjustment of these imbalances, including: fiscal consolidation and measures to increase private savings in the US, structural reforms to boost growth in Japan and Europe, deeper financial and corporate sector reform in key Asian economies and increased investment in oil-exporting countries. The government remains committed to sound macroeconomic policy frameworks and to reforms which will sustain Australia’s strong economic performance.
Trade deficit: Exports are fast catching up with imports. The trade deficit is now only $0.2 billion. Finding an extra $4 billion per year worth of services exports and about $2 billion per year worth of services imports goes some way to narrowing the trade deficit. Despite the revisions, the key driver of the narrowing in the trade deficit over the year remains the surge in mining exports. However, poor growing conditions in rural Australia may prevent the trade balance moving into surplus soon. Any prospective decline in rural exports needs to be kept in perspective. Mining exports are three to four times larger than rural exports.
The ongoing increase in exports highlights the boost to the economy from buoyant foreign demand for minerals. The Reserve Bank referred to the effect of high commodity prices on domestic income and spending when it increased the cash rate in August.
Consistent with the recovery in the Japanese economy, exports to Japan have now breached the $30 billion per year threshold. Exports to eurozone have also picked up significantly over the year. Only exports to North America stand out as a source of weakness.
The trend in imports has turned down on the back of lower oil and capital goods imports. Imports increased by one per cent in August but are four per cent below the peak recorded in May 2006. As a net oil importer, Australian’s purchasing power is rising in response to the significant fall in world oil prices.
Capital imports appear to have peaked and capital spending is high enough to support to strong growth in the capital stock and an improvement in productivity and production growth. Consumption imports appear to have regained some momentum as retail sales have improved. There is also likely to be some restocking of store rooms following the recent decline in inventories.
The trade deficit narrowed from $0.3 billion in July to only $0.2 billion in August. The trade deficit was much smaller than the median expectation of $0.6 billion. In August, higher transport exports pushed down the trade deficit.
There were also significant upward revisions to services exports reflecting new data sources and methodology. Despite the revisions, the key driver of the narrowing in the trade deficit over the year remains the surge in mining exports.
