Page 12 - TURKRptOct19

Investment in Turkey saw the biggest drop since the 2008 global financial crisis, sinking 22.8% y/y, ING noted in an analysis of the country’s Q2 GDP data released on September 2.
“The state statistics office figure showed household spending only slipped 1.1%, helping limit the second-quarter annual contraction, but other consumer data, including imports of consumption goods, would indicate that households are spending even less, they said. Other data, including rising unemployment, slower lending at banks and a current account surplus, all indicate a slowing economy. Even the slowdown in inflation suggests consumers are spending less. Yet households are still finding new and unpleasant price increases. Late last week the government hiked natural gas prices for households by 15%, bringing the total increase over the past year to 54%. One Twitter user quipped that sweaters may not be enough to keep Turks warm—but at least the fall in inflation could make them cheaper to buy”: Al-Monitor.
According to the official GDP data, the construction industry contracted by 9.3% y/y in Q1 and 12.7% y/y in Q2.
Data from the trade association IMSAD showed on September 4 that construction materials production in Turkey contracted by 20.3% y/y in H1.
According to data from the national statistical institute TUIK, the issuance of construction permits declined by 60% y/y in the first half.
Doesn’t add up.
New business orders placed with construction materials producers increased by 2.9% in August from the previous month, data from the business group IMSAD showed.
“The latest figures suggest the industry may be finally bottoming out, but orders are still too weak. The construction sector is likely to continue contracting in the coming quarters,” the association said in a statement.
News portal Diken reported that cement producer Destebasi Group, one of the major players in the industry, has gone bankrupt.
The company first sought to restructure its TRY 500mn debt owed to creditors. It was given five months to improve its financial situation. Last week, a court in Istanbul declared the company bankrupt, according to Diken.
Founded in the late 1970s, Destebasi has eight factories and two quarries in Istanbul. It was the main supplier of cement for the construction of the 220- metre high Camlica TV-radio tower in Istanbul.
12 TURKEY Country Report October 2019 www.intellinews.com