Turkey in 2025
Presented by Semi Azaplar, Berk Bulut, Olti Kurti,
Mihir Naik, Kerem Can Oğuz,
Turkey in 2025
Outline
Indicators
• Growth Rate in GDP
• Saving Rate
• Inflation Rate
• Human Capital
• Unemployment Rate
• Female Labour Force Participation
• Education
• International Trade
Turkey in 2025
Outline
Expectations About Some Sectors
• Tourism
• Banking Sector
• Automobile Industry
• Energy
• Agriculture
• Construction
Turkey in 2025
Turkey’s GDP Expectations
• Total GDP $ 799.54 billion (2015) (world bank)
• $ 9,437 per capita
• The targets by government;
GDP $ 2 trillion (nominal)
To be among the world’s biggest 10 economies
$ 25 000 dollar per capita
• According to Jean-Pierre Lehmann, the GDP growth
rate on average must be 8% to reach these goals
(beginning in 2012)
Turkey in 2025
Turkey in 2025
International Monetary Fund’s (IMF) Forecast
on GDP Growth Rate
4.5
4.2
3.8
4
3.8
3.5
3.5
3.5
3.5
3.5
2017
2018
2019
2020
2021
2.9
3
2.5
3.4
2.1
2
1.5
1
0.5
0
2012
2013
2014
2015
2016
Turkey in 2025
OECD’s Expectation
Turkey in 2025
World Bank’s Expectation
Turkey in 2025
Saving Rates In Turkey
Turkey in 2025
Main Problems
Prospects of higher future income
naturally leads to a decline in national
saving due to consumption smoothing
motives. It is related with capital inflows,
Turkey reached strong growth rates and
higher income level thanks to inflows
and Turkey’s saving rate is decreased in
recent years. On the other hand after
2008 crisis capital inflows rapidly
returned to Turkey and also increasing
trend in globalization supports the idea
of more permanent capital inflows.
Turkey in 2025
Turkey in 2025
Turkey in 2025
Methods To Increase Saving Rates
• IMF (2005) report that, in emerging
countries, a 1 percentage point increase
in flow of credit relative to GDP is
associated with a decline in the saving
rate of 0.74 percentage points in the long
run.
• Increasing income independently of
saving –institutional reforms, import of
new technologies and so on- are an
indirect and effective way of increasing
saving amount. So increasing investments
in technology and education will increase
the saving level in long run.
Turkey in 2025
Inflation Rate In Turkey
Turkey in 2025
Turkey in 2025
Turkey in 2025
Turkey in 2025
Controversial Issues About CB In Turkey
• Whether CB should be independent or
not
• The government wants to have an
active role to decide interest rates
• Whether inflation targets by CB is
realistic or not
Turkey in 2025
TARGET
ACCUREMENT
Turkey in 2025
Human Capital
• Turkey’s population of 78.6 million ( 2015 ) has a labour force of over 29
million people.
• Turkey is ranked as the 4° largest labor force in relation to EU countries.
Turkey in 2025
Turkey in 2025
Turkey in 2025
Employment challenges for Turkey
The main challenges of Turkish labour market are :
• The high level of unemployment and informal employment
• The low level of female labour force participation.
• The weak connection between education and employment.
• These challenges are also some of the biggest barriers which block to ensure
an additional economic growth of 2% in five years.
Turkey in 2025
Unemployment: different forecasts
IMF : 2016 - 10.8 %
; 2017 – 10.5 %
Turkey in 2025
Unemployment: different forecasts
EC :
2016 - 11 %
;
2017 – 11.3 %
Turkey in 2025
Unemployment: different forecasts
OECD :
2016 - 10.81 %
;
2017 – 10.26 %
Turkey in 2025
Turkey in 2025
Turkey in 2025
Female Labor Force Participation
• According to the UNDP and WEF, Turkey
is ranked 101/109 on gender
empowerment
• Current FLFP = 31.2%
• Less than half the average of other OECD
countries
• Many barriers: social conservatism, lack
of job opportunities in urban areas, poor
education rates, lack of childcare services
Turkey in 2025
FLFP Trends
World Bank; 2014
Turkey in 2025
FLFP Potential Policies
Turkey in 2025
Female Empowerment Policies
• 10th Development Plan includes “Program
for Protection of the Family and Dynamic
Population Structure”
• “Maternity Gift” government provides cash
reward for a couple’s first 3 children
• Both parents offered right to paid part-time
work until child begins primary school
• Increased access to affordable quality
childcare
Turkey in 2025
FLFP Goals and Challenges
• At the G20 summit in Brisbane in 2014, the
member countries committed to decrease
their individual gender gaps by 25% by
2025
• In Turkey this means raising FLFP to 42%
Turkey in 2025
Education in Turkey
Today
Highest Educational Attainment
(25-64 year-olds)
2014 (Turkey)
2014 (OECD Average)
Below upper secondary
64%
24%
Upper secondary or postsecondary non-tertiary
19%
43%
Tertiary
17%
34%
Turkey in 2025
Education in Turkey
Today
OECD ranked Turkey 32nd out of 34 based on
mathematical, scientific, and reading skills of 15
year-old students
• WEF ranked Turkey 63rd and 74th out of 144
countries in terms of primary education and
higher education/training
• UNDP ranked Turkey 90th out 187 in terms of
average duration of education for 25 year-olds
•
Turkey in 2025
Education for the Future
• A WB report says Turkey’s growth will be mainly
driven by human capital thanks to increased
compulsory education and increased FLFP
• WB report refers to 2012 education reforms
• A Chatham House report doubts the projected benefits
of these reforms
• Lower age limit for vocational schooling and homeschooling will have a negative effect
Turkey in 2025
Foreign Trade in Turkey
(Reference Year, 2008)
2008
2009
2010
2011
2012
2013
2018
2023
17
17
17
16
16
15
12
10
Exports as Share of GDP
17,8%
16,5%
15,3%
16,3%
16,9%
17,5%
22,0%
25,0%
Rate of Exports Meeting Imports
65,4%
72,5%
62,9%
63,7%
64,5%
65,0%
75,0%
80,0%
Import Growth / Export Growth
>1
<1
>1
<1
<1
<1
<1
<1
Imports ($ billion)
202
141
178
200
223
245
278
625
Exports ($ billion)
144
111
123
146
161
166
312
500
15,2%
14,8%
14,2%
13,8%
13,4%
13,0%
12,0%
10,0%
Turkey's Ranking Among Biggest
Economies
Dependence of Exports to Imports
Ratio
Turkey in 2025
Foreign Trade in Turkey
• Trade Balance for Turkey (1995 – 2014) Red: Imports Blue: Exports
$ million
Q1/16
Q2/16
Q3/16
Q4/16
Q1/17
2020
Balance of Trade
-4950
-4921
-5148
-5368
-5468
-9379
115
111
109
109
108
113
Terms of Trade
Turkey in 2025
Tourism
Ziyaretçi sayısı
Number of departing
visitors
Kişi başı ortalama
harcama
Average expenses per capita
($)
Ortalama geceleme sayısı
Average number of
overnights
Yıl
Year
Yıllık-Annual
Turizm geliri
Tourism income
( 000 $)
2001
Yıllık-Annual
10 450 728
13 450 127
777
-
2002
Yıllık-Annual
12 420 519
15 214 514
816
-
2003
Yıllık-Annual
13 854 868
16 302 053
850
11,1
2004
Yıllık-Annual
17 076 609
20 262 640
843
10,7
2005
Yıllık-Annual
20 322 111
24 124 501
842
10,4
2006
Yıllık-Annual
18 593 950
23 148 669
803
12,0
2007
Yıllık-Annual
20 942 501
27 214 988
770
11,3
2008
Yıllık-Annual
25 415 067
30 979 979
820
11,0
2009
Yıllık-Annual
25 064 481
32 006 149
783
11,2
2010
Yıllık-Annual
24 930 996
33 027 943
755
10,8
2011
Yıllık-Annual
28 115 694
36 151 328
778
11,0
2012
Yıllık-Annual
29 007 003
36 463 921
795
10,8
2013
Yıllık-Annual
32 308 991
39 226 226
824
10,2
2014
Yıllık-Annual
34 305 904
41 415 070
828
10,0
2015
Yıllık-Annual
31 464 777
41 617 530
756
10,1
Turkey in 2025
2023 Targets in Tourism Sector
• 63 million tourist
• 85 billion dollar Tourism income
• $ 1350 Average expenses per tourist
• The tourism sector has the opportunity to benefit
from a larger exposure to an emerging-market
demographic which is expected to grow relatively
strongly in the medium-term
• The advantage of Turkey in tourism sector is that it
is well diversified. Turkey has potential growth for
cultural, archaeological, geotourism, medical
tourism, ecotourism, Business Tourism, religious
tourism
Turkey in 2025
World Travel and Tourism
Council’s Expectation
Turkey in 2025
World Travel and Tourism
Council’s Expectation
Turkey in 2025
Turkey in 2025
Future Of Banking Sector
• Basel3 comes with solutions to liquidity which is
one most important topics in finance sector
because of increasing liquidity and higher frequency
and impact of financial crises connected to
globalization.
• Turkish Finance Sector is ready to Basel3
improvements and regulations. On the other hand
basel 3 increase capital ratio’s so it will make harder
to enter banking sector.
• New instruments will make harder for the banks to
get higher growth rates and basel3 offers a solution
to high leverage problems which is limiting banks
assets.
Turkey in 2025
Automotive Industry
•
Turkey currently acts as a major regional centre for the manufacture
and assembly of automobiles, producing over 1 million vehicles in
2010 and forecast to produce 1.4 million vehicles by 2017.
•
Turkey is particularly specialised in the manufacture of light
commercial vehicles (LCVs).
•
Future growth prospects : Turkey currently already ranks 15th
globally in terms of the size of operations in the automobile industry.
Turkey in 2025
Energy and Alternative Energy
•
It is particularly strong in hydroelectric and solar technologies :
- Turkey had the second highest solar hot water installed capacity in the
world after China in 2009
Turkey in 2025
Nuclear Energy in Turkey
•
Akkuyu Nuclear Power Plant ( 2020 )
•
Sinop Nuclear Power Plant ( 2023 )
•
Igneada Nuclear Power Plant ( after 2023 )
Turkey in 2025
Agricultural Sector
Today
• Agricultural sector’s share of GDP has been
decreasing for the past several decades
• Currently at 7.1%, but still world’s 7th largest
agricultural producer overall
• Employs over a quarter of Turkey’s working
population
Turkey in 2025
Agricultural Sector Goals &
Means of Attainment
• 10th development plan
• Enter top 5 producers globally
• Continue rise in professional enterprises
that are expected to increase sector
efficiency and total Gross Value Added
• Increased focus on agricultural R&D
• New agricultural technopark (2011) in Mersin
to pursue R&D, greenhouse systems, and
seed/soil improvement
Turkey in 2025
Construction Sector in Turkey
• According to TurkStat data, at the end of 2014
the construction sector was worth around
TL79.7bn (€28.1bn) at current prices, up from
TL69.6bn (€24.5bn) a year earlier. That
represented 4.6% of GDP.
• A report from the European construction sector
body, European International Contractors (EIC),
argues, when the sector’s impact on other parts
of the economy is taken into account, the share
of GDP attributable to it could be as high as
30%.
Turkey in 2025
Construction Sector in Turkey
• In 2009, the sector shrank 18.1%, but it
rebounded quickly, growing by 24.9% in 2010
and 26.5% in 2011.
Turkey in 2025
Construction Sector in Turkey
The share of construction industry in the global
economy is around 10-12%. In this respect, by 2025 the
share of the industry in the economy is expected to be
16,7% in developing countries.
Turkey in 2025
Construction Sector’s Goals in Turkey
• Turkey will need to spend $700bn on infrastructure
in the years to 2023 if it is to meet the
government’s goal of boosting GDP to $2trn by
then.
• Exceeding USD 100 billion in total worth, the
highways, bridges, airports, power plants and
other mega projects remain on schedule with
Turkey Vision 2023 Projects.
• International construction business share of Turkey
is targeted to be increased to 10%. (current 4% )
Turkey in 2025
Thank you for listening!
Presented by Semi Azaplar, Berk Bulut, Olti Kurti,
Mihir Naik, Kerem Can Oğuz,
Turkey in 2025
REFERENCES
GROWTH PROSPECTS AND FISCAL REQUIREMENTSOVER THE LONG TERM
REPORT BY OECD
GLOBAL ECONOMİC PROSPECTS REPORT BY WORLD BAN
TURKEY BENCHMARKİNG REPORT 2015 BY WORLD TRAVEL AND TRAVEL
COUNCİL
Turkey in 2041 Looking to the future By Pwc
TURKEY’S 2023 ECONOMIC GOAL IN GLOBAL PERSPECTIVE by Jean-Pierre
Lehmann
TUIK
MEDIUM-TERM PROGRAM BY DEVELOPMENT MINISTERY
Turkey in 2025
REFERENCES
websites
http://www.oxfordbusinessgroup.com/overview/turkeys-construction-sectormaintain-its-significant-role-economy-several-large-projects-underwayhttps://ekonomi.isbank.com.tr/UserFiles/pdf/insaatsektoru.pdf
http://www.tobb.org.tr/Documents/yayinlar/Türkiye%20İnşaat%20Malzemeleri
%20Sektör%20Görünüm%20Raporu.pdf
http://www.invest.gov.tr/en-US/infocenter/news/Pages/180815-turkey-megaprojects-2023-vision.aspx
http://www.ito.org.tr/itoyayin/0000400.pdf
http://www.tim.org.tr/files/downloads/2023/2023_english.pdf
http://atlas.media.mit.edu/en/visualize/line/hs92/show/tur/all/all/1995.2014/