ICI Turkey Export Climate Index for June Released

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The Istanbul Chamber of Industry (ICI) Turkey Manufacturing Export Climate Index, which measures the operation conditions in the key export markets of the Turkish manufacturing sector, increased to 58.5 in June. The Index signalled continuity of substantial strengthening in demand conditions for Turkish manufacturing exporters, as well as the strongest strengthening since June 2006. 

A strong increase was seen in economic activity throughout Europe. Germany, which is the largest single destination for Turkish manufacturing exports, posted the fastest increase of the last decade in the manufacturing sector. Italy and France also saw the highest growth rates of the last 41 months and 11 months, respectively. The United Kingdom maintained strong expansion in economic activity, while the US saw one of the highest growth rates of the survey history. And the increase in Covic-19 cases negatively affected demand in some parts of the Asia. 

The Istanbul Chamber of Industry (ICI) Turkey Manufacturing Export Climate Index, which measures the operation conditions in the key export markets of the Turkish manufacturing sector, announced the results of the index for June 2021. In the index, the figures above the 50.0 no-change mark signals an improvement in the export climate, while the figures below signals a deterioration.

The Istanbul Chamber of Industry Turkey Manufacturing Export Climate Index posted 58.5 in June, up from 58.4 in May and signalling a continuity of substantial strengthening in demand conditions for Turkish manufacturing exporters. It also signals the strongest strengthening since June 2006. 

Strong increase in economic activity in Europe

A strong increase was seen in economic activity in the end of 2Q throughout Europe. Germany, which is the largest single destination for Turkish manufacturing exports, posted the fastest increase of the last decade in the manufacturing sector. As for the other markets of the Euro zone, Italy and France also saw the highest growth rates of the last 41 months and 11 months, respectively. And Spain recorded the strongest growth since February 2000. The UK maintained its strong economic activity expansion rate in June, slightly below the record high in May. The same applies to the US. The growth rate of the US showed a slight drop after the peak reached the last month, but again saw one of the highest rates of the survey history. 

Mostly positive demand in Middle East but negative in some parts of the Asia

Demand trends in the Middle East were mostly positive in June. While the Saudi Arabia saw a sharp increase in non-oil economic activity, the United Arab Emirates maintained its strong growth. Egypt saw output expand for the first time in the last seven months. And Qatar recorded the strongest growth since the August of the last year. Only the Lebanon’s economic activity showed a drop, though slight contraction, in economic activity among the monitored Middle Eastern countries.

The output volumes were negatively affected from the increase in number of Covid-19 cases in some countries in June. But this situation was mostly applicable for markets which account for small portion of Turkish manufacturing exports. The fastest contraction was seen in Uganda and Malaysia. Due to the problems caused by Covid-19, the economic activities have weakened in many Asian economies, including India, Japan and Vietnam. In China, however, the output expansion continued in the end of the second quarter of the year, though slightly, and recorded the lowest rate of the last fourteen months of expansion period.

Commenting on the Istanbul Chamber of Industry Turkey Manufacturing Export Climate Index, Andrew Harker, Economics Director, IHS Markit, said: 

“Depending on the loosening of COVID-19 restrictions in June, demand conditions for Turkish manufacturing exporters in the main export markets of Europe and in the US continued to grow. This trend is expected to support the new business volume of businesses in the upcoming months. On the other hand, the Covid-19 outbreak continues to negatively affect the demand climate of some regions of the world, primarily the Asia. Even though this situation does not affect the Turkish exporters directly, it shows that the outbreak is still able to disrupt the economic recovery.”

ICI Turkey Export Climate Index (News Bulletin, June 2021) Attach