Export climate index fell in June

The June 2022 results of the Istanbul Chamber of Industry (ICI) Turkish Manufacturing Industry Export Climate Index, which measures the operating conditions of the Turkish manufacturing sector in the main export markets, have been announced.

All figures measured above the threshold value of 50.0 in the index indicate an improvement in the export climate, while values ​​below 50 indicate deterioration.

Istanbul Chamber of Industry Turkey Manufacturing Industry Export Climate Index was 51.8 in June and decreased compared to 53.2 in May. Although the latest data point to a moderate improvement in export demand conditions, this improvement was recorded at the lowest rate since February 2021.

Developed countries lost momentum
Many developed countries completed the first half of the year with a growth that lost momentum. Growth in the USA, which is the world's largest economy and has a share of approximately 7 percent from the Turkish manufacturing sector exports, slowed down for the third month in a row. Similar trends were observed in many European economies. In June, production growth slowed down in Germany, Italy, Spain, France and the Netherlands.

The United Kingdom fell short of this trend and economic activity rose slightly faster than in May. On the other hand, when compared to April, the growth was again quite slow.

The strongest growth in the Middle East is in Qatar

One of the important sources of demand increase in June was the United Arab Emirates. Although the increase in non-oil production in this country lost momentum compared to the previous month, it maintained its strong course. Among the other Middle Eastern economies followed in the survey, the strongest growth was recorded in Qatar.

On the other hand, the most significant contraction in economic activity was in Poland. Manufacturing industry production in this country recorded the fastest decline in more than two years. Production decreased in Greece, the Czech Republic and Austria.

Economic activity in Russia showed a slight increase at the end of the second quarter after three months of contraction in a row. Economic activity in China, which started to grow again due to the easing of some restraint measures against the Covid-19 epidemic, recorded an increase for the first time since February. China's share in Turkish manufacturing sector exports is at the level of 1 percent.

Commenting on the Istanbul Chamber of Industry Turkey Export Climate Index, Andrew Harker, Economy Director of S&P Global Market Intelligence, said:

“At the end of the second quarter, signs of slowdown in the global economy continued, showing that demand continues to be adversely affected by widespread price increases. Accordingly, Turkish exporters are expected to find it increasingly difficult to sell products abroad, especially in the European and US markets, where the most significant loss of momentum is observed.