Türkiye export climate remains robust for 8th straight month
Panama-flagged oil tanker Blue Lagoon I transits the Bosporus in Istanbul, Türkiye, June 14, 2024. (Reuters Photo)


The export climate for Turkish manufacturers maintained its momentum in August, driven by demand in key markets like the U.S., the U.K. and parts of the eurozone, while some challenges persist in regions such as Germany and Eastern Europe, a survey showed on Monday.

The Manufacturing Export Climate Index rose to 51.3 points from 50.8 in July, the Istanbul Chamber of Industry (ISO) said, signaling further improvement in export conditions.

The index is a key indicator that measures the economic conditions in Türkiye’s main export markets. It uses a threshold value of 50.0 to distinguish between improvement and deterioration. Values above 50.0 indicate a better export climate, while those below suggest a decline.

August's reading marks the eighth consecutive month above the 50.0 mark, reflecting a strengthening trend in Türkiye’s export environment midway through the third quarter.

The data revealed that economic activity increased in most of Türkiye’s main export markets.

The U.S. emerged as a major demand driver, with production accelerating strongly compared to July. Similarly, economic activity in the U.K. reached its highest growth rate in four months.

France and Italy, representing 9% of Turkish manufacturing exports, showed signs of renewed production growth.

France recorded its first increase in output in 15 months, growing at its fastest pace since March 2023. Spain, another major economy in the eurozone, maintained a robust growth trend.

However, Germany, Türkiye’s largest export market, presented a different narrative.

The German market contracted for the third consecutive month, with the rate of decline being the steepest since March.

In Central and Eastern Europe, a weak performance persisted through the mid-third quarter, with countries like Romania, Poland, Czechia and Austria experiencing declines in manufacturing output.

In contrast, Russia recorded a modest rise in economic activity for the second consecutive month, indicating some stabilization.

The Middle East largely continued to provide supportive demand conditions.

Non-oil economic activity in the United Arab Emirates (UAE) and Saudi Arabia grew rapidly in August, while Qatar sustained its growth trajectory.

Egypt showed signs of recovery for the first time in three years, reflecting a potential turnaround. However, Lebanon continued to face production contraction.

Among all countries and regions monitored by the Purchasing Managers' Index (PMI) survey in August, India reported the strongest growth in production.

On the opposite end of the spectrum, Myanmar experienced its sharpest decline in output in 20 months.

"August was broadly positive for Turkish manufacturers in terms of their key export markets," said Andrew Harker, economics director at S&P Global Market Intelligence.

"However, the most important exception remains Germany, which continues to stay in contraction territory and contributes to the ongoing weakness in Central and Eastern Europe," Harker noted.

"Exporting firms will be keen to see the strengthening growth trends in major export markets like the U.S. and the U.K. continue, along with the renewed positive momentum in France and Italy."