Project LINK October, 2012 Country Report: Turkey. Prepared by

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Project LINK October, 212 Country Report: Turkey Prepared by Suleyman Ozmucur University of Pennsylvania, Department of Economics and Bogazici University, Center for Economics & Econometrics, Istanbul, Turkey 1. Recent Trends Real GDP, which increased by.7% in 28 and decreased by 4.8% in 29, surged 9.% in 21, and 8.5% in 211. However, growth rates 1 slowed significantly in 212. Real GDP growth was 3.3% in the first quarter, 2.9% in the second quarter, and 3.1% in the first half of 212. This marked slowdown is expected to continue. the first half of 212. Real government final consumption growth was 4.9% during the two quarters of 212, compared with a 4.5% growth in 211. 2 15 1 5-5 Real Private and Public Consumption Growth (year-on-year) 15 Real GDP Growth (year-on-year) -1 1 5-15 I II III IV I II III IV I II III IV I II III IV I II III IV I II III IV I II III 25 26 27 28 29 21 211 Real Private Consumption Growth (year-on-year) Real Public Consumption Growth (year-on-year) -5-1 -15-2 25 26 27 28 29 21 211 212 Real final consumption of resident households, which decreased 2.3% in 29 and.3% in 28, increased 6.7% in 21 and 7.8% in 211. The growth rate of final consumption of residents was.2% in the first quarter, and negative.5% in the second quarter, and negative.2% in Real private fixed investment which surged with a 23.1% increase in 211, increased 1.4% in the first quarter, and decreased 7.9% in the second quarter. The decrease was 3.5% during the first half of 212. On the other hand, public fixed investment decreased 1.5% during the first half of 212. 1 Unless otherwise noted, growth rate refers to year-on year growth (growth compared to the same quarter, same month or same half a year ago). Project LINK Country Report: Turkey, October 212 1

4 3 2 1-1 -2-3 Real Fixed Investment Growth (year-on-year) 25 26 27 28 29 21 211 212 Private Fixed Investment (year-on-year growth) Public Fixed Investment (year-on-year growth) Real exports of goods and services increased 16.% during the first two quarters of 212, following a 6.4% increase in 211. Real imports of goods and services decreased 4.8% during the first half of 212, compared with an increase of 1.9% in 211. 3 2 1-1 -2-3 -4 I II III IV I II III IV I II III IV I II III IV I II III IV I II III IV I II III 25 26 27 28 29 21 211 Real exports of goods and services (year-on-year growth) Real imports of goods and services (year-on-year growth) Sectors which were most severely affected from global recession, namely manufacturing, construction, and retail & wholesale trade, bounced back strongly in 21 and 211, but slowed down in 212. Growth in manufacturing during the first half of 212 was 3.1% compared with a 9.6% increase in 211. Growth in wholesale and retail trade was.9% during the first two quarters of 212, compared with a 7.7% increase in 211. Construction sector grew by 1.5% during the first two quarters of 212, following an increase of 11.3% in 211. Some sectors seem to be not affected by global recession. Agriculture grew 4.2% during the first 6 months of 212, following a 5.8% growth in 211, 2.4% growth in 21, a 3.7% growth in 29 and a 4.6% growth in 28. Growth in financial intermediation was 4.% during the first two quarters of 212, compared with 9.6% in 211. Real estate sector enjoyed a 7.% growth during the first half of 212. The growth rate in real estate renting and business activities was 6.7% in 28, 4.4% in 29, 7.6% in 21, and 9.3% in 211. Education, health and other services sectors realized modest growth rates in 211, and during the first half of 212. The Index of industrial production increased 3.4% (y-o-y) in July 212 to 132.9 (25=1), following a 3.% increase in the previous month. The growth rate for the year 211 was 8.9%, following a 13.1% increase in 21, a 9.9% drop in 29, and a.6% decrease in 28. The manufacturing component grew by 3.% in July, while the production in utilities increased 8.2%, and output in mining decreased by 1.7%. On a seasonal and calendar adjusted basis, total industrial production and its manufacturing component both increased by 1.7% in July from the previous month, while mining output decreased by 5.8% and the production in utilities increased by.4%. Project LINK Country Report: Turkey, October 212 2

15 14 13 12 11 1 9 8 Industrial Production Index (25=1) -3 25 26 27 28 29 21 211 212 Year-on-year Growth in Industrail Production Index (right scale) Industrial Production Index (left scale) The industrial turnover index in July increased 6.6% from July of 211. The manufacturing sector index increased 6.8%, while the mining sector index increased 2.3%. In July, year-onyear growth rates were 6.5% in intermediate goods, 12.4% in durable consumer goods, 7.% in non-durable consumer goods, 7.6% in energy, and 4.% in capital goods. 85 8 75 7 65 6 55 Capacity Utilization Rate in Manufacturing I II III IV I II III IV I II III IV I II III IV I II III IV I II III 27 28 29 21 211 212 The industrial new orders index increased 5.2% (y-o-y) in July. In July, year-on-year growth rates in components of industrial new orders index were 5.5% in intermediate goods, 1.3% in durable consumer goods, 16.5% in nondurable consumer goods, and negative 6.% in capital goods. Shipments in commerce and services rose 3.7% (year-on-year) in the second quarter of 212, compared with a 22.2% growth in the second quarter of Project LINK Country Report: Turkey, October 212 3 4 3 2 1-1 -2 211. Employment rose 5.1%, while hours worked rose 5.5%. Wages and salaries in commerce and services rose 18.1% (index compared with the same quarter a year ago). The quarterly turnover index in construction decreased 1.2% (year-onyear) in the second quarter. The turnover index for building construction dropped 3.8%, while the index in civil engineering increased 2.4%. On the other hand, the production index in construction increased.7% in the second quarter. The growth rate was 2.2% in production index in building construction, and negative 5.9% in the production index in civil engineering. In August, exports were $12.9 billion, compared with $11.2 billion in August of 211. This represents a 14.5% increase. Imports decreased 4.8%, from $19.7 billion in August 211 to $18.7 billion in August of 212. The deficit was $5.9 billion, compared with $8.4 billion in August of 211. During the first eight months, exports were $1.1 billion, compared with $88.7 billion during the first eight months of 211 (12.8% increase). During the first eight months, imports were $156.6 billion, compared with $16.5 billion during the first eight months of 211 (2.4% decrease). As a result of these developments there was a decrease in foreign trade deficit. Trade deficit during the first eight months of 212 was $56.6 billion, compared with $71.8 billion during the same period in 211. Current account deficit was $3.9 billion in July, compared with $4.2 billion in June, and $5.7 billion in January. The goods deficit was $6.4 billion, while services surplus was $2.9 billion. The current account deficit was $34.5 billion during the first seven months, compared with a deficit of $5.2

billion during the first seven months of 211. The deficit on goods was $4.9 billion during January-July, compared $54.4 billion during the first seven months of 211. During the January-July period, the surplus on goods was $9.7 billion, compared with $8.5 billion during the same period of the previous year. Exports, Imports, and Current Account Balance and 6.2% in August of 21. Year-onyear price increases in August were 11.4% in agriculture, 2.8% in manufacturing, and 6.1% in utilities. 2 16 12 8 Inflation Rate (%) 7, 6, 4 5, 4, -5, -1, 3, 2, 1, -4 25 26 27 28 29 21 211 212 Producer Price Index (% change from the same month a year ago) Consumer Price Index (% change from the same month a year ago) -15, -2, -25, 25 26 27 28 29 21 211 Current Account Balance Exports Imports The Turkish Lira/US dollar exchange rate was 1.79 on September 28, 212, 1.92 on December 3, 211, and 1.66 on September 3, 211. The Turkish Lira/euro exchange rate was 2.32 on September 28, 212, 2.47 on December 3, 211, and 2.51 on September 3, 211. 2.6 2.4 2.2 2. 1.8 1.6 1.4 1.2 1. 25 26 27 28 29 21 211 212 Turkish Lira/US Dollar Turkish LIra/Euro The producer price index which stands at 23.65 (23=1) increased 4.6% (y-o-y) in August. Annual increase (twelve month average, (September 211-August 212)/ (September 21- August 211)) was 9.3%. Annual increases were 9.8% in August 211, Consumer price index which stands at 25.43 (23=1) increased 8.9% (y-o-y) in August, compared with 6.7% in August 211 and 8.3% in August of 21. Annual increase (twelve month average, (September 211-August 212)/ (September 21-August 211)) was 9.3%, compared with 6.2% in August of 211. Year-on-year increases were 9.1% in food and beverages, 7.2% in clothing, 11.8% in housing, 8.9% in furniture, 1.8% in health, 5.2% in transportation, and 7.8% in education. Non-institutional population increased 1.24 million, from June 211 to June 212, to 73.561 million, while non-institutional working age population increased by 1.141 million to 54.68 million. Labor force rose by 365 thousand to 27.83 million, while employment rose by 676 thousand to 25.577 million. The number of unemployed persons decreased by 311 thousand to 2.226 million in June 212, and the unemployment rate decreased from 9.2% in June 211 to 8.% in June 212. The unemployment rate was 1.% in urban areas, and 4.3% in rural areas. Project LINK Country Report: Turkey, October 212 4

16 15 14 13 12 11 1 9 8 Rate of Unemployment 25 26 27 28 29 21 211 212 Hourly labor cost (wages and benefits) index rose by 1.3% (y-o-y) in the second quarter of 212 compared to the same quarter of the previous year, following a 9.% increase in the previous quarter. Increases in hourly labor costs in the second quarter were 1.8% in industry, 5.7% in construction, and also 1.8% in services. 26 24 22 2 18 16 14 12 1 Industrial Gross Wages and Salaries Index (25=1) I II III IV I II III IV I II III IV I II III IV I II III IV I II III IV I II 26 27 28 29 21 211 212 Year-on-year Growth in Index (right scale) Index (left scale) 3 25 2 15 1 5-5 -1 hand, total expenditures rose 15.9%, from 193.8 billion to 224.1 billion during the first eight months. The general budget deficit was 8.8 billion liras during the first eight months of 212, compared with a surplus of.3 billion during the first eight months of 211. On the other hand, the primary surplus was 27.4 billion liras during the first eight months of 212, compared with a surplus 32.1 billion during the first eight months of 211. Domestic debt stock rose 5.% to 384.9 billion liras ($212.6 billion) at the end of August, from 366.6 billion liras ($29.5 billion) at the end of August 211. External debt of the general government was $85.5 billion at the end of first quarter of 212, up 3.2% from the previous quarter, and up.4% from the first quarter of 211. Currency in circulation decreased 4.4% (year-on-year) in August to $53.5 billion. During the same period, narrow money supply (M1) rose 2.8%, to 163.8 billion while the broad money supply (M2) rose 6.6% to 75.4 billion. On the other hand, M3 (which also includes repos, money market funds, and debt securities issued) rose 7.2% to 746. billion in August. General budget revenues decreased 6.7% (year-on-year) in August to 29.6 billion liras, while expenditures rose 11.6% to 3.7 billion. The general budget deficit was 1.1 billion liras, compared with a surplus of 4.2 billion in August of 211. The primary budget surplus was 4.7 billion liras in August, compared with 9.9 billion in August of 211. General government revenues rose to 215.3 billion Liras during the first eight months of 212, compared with 194.1 billion during the same period in 211 (1.9% increase). On the other 5 4 3 2 1-1 Money Supply Growth (year-on-year) 25 26 27 28 29 21 211 212 M1 M2 M3 Istanbul stock exchange index, which reached a peak of 71,543 on November 9 th, 21, was 66,675.67 on Project LINK Country Report: Turkey, October 212 5

September 26 th 212. The index was 51,266.62 on December 3, 211, and 59,693.43 on September 3, 211. 8, 7, 6, 5, 4, 3, 2, 1, Istanbul Stock Exchange Stock Price Index (January 1986=1) 23 24 25 26 27 28 29 21 211 212 Confidence indices for services, retail trade and construction sectors decreased 2.8%,.2%, and 2.%, respectively over the previous month in September. The decrease in the services confidence index stemmed from the deterioration in business situation over the past three months, demand (turnover) over the past and turnover expectation over the next three months. The decrease in retail trade confidence index was due to deterioration in business activity-sales expectation over the next three months. On the other hand, the decrease in construction confidence index was due to total employment expectation over the next three months. The Consumer Confidence Index decreased by 1.8 points to 91.1 in August, from 92.8 in July. The index was 91.7 in August of 211. EC, Consumer Confidence Index for Turkey On September 18 th, the Monetary Policy Committee decided to set the short-term interest rates as follows: a) One-week repo rate (the policy rate) was kept at 5.75%, b) Overnight Interest Rates: Borrowing rate was kept at 5.%, while lending rate was lowered to 1.% from11.5%, c) Late Liquidity Window Interest Rates (between 4: p.m. 5: p.m.): Borrowing rate was kept at zero, while lending rate was lowered to 13.% from 14.5%. 24 2 16 12 8 4 Euro-market rates (Bid, % per annum) 25 26 27 28 29 21 211 212 1-month 6-month 3-month 12-month The Committee also raised the upper limit foreign exchange reserves that might be held to maintain Turkish lira reserve requirements. The Committee stated that increasing the reserve option coefficients and narrowing the interest rate corridor would support financial stability, and indicated that a measured step in the same direction may be taken in the future if necessary. -4-8 -12-16 -2-24 -28-32 -36 I II III IV I II III IV I II III IV I II III IV I II III IV I II III 27 28 29 21 211 212 Project LINK Country Report: Turkey, October 212 6

2. National Policy Assumptions and International Environment The global financial crisis and its impact on economic slowdown are expected to continue throughout the forecast period. Increased uncertainty has possible negative effects on Turkish financial markets. Growth rate in the world economy is expected to be lower than the rates before the crisis. World trade is to be lower in 212, and expected to recover at a modest pace. Despite slower growth, crude oil prices are not expected to drop significantly. The one-party majority government in the parliament does not reflect the true representation in popular votes. This will always be a problem if there are no changes in election and political party laws. 4. Policy Issues and Uncertainties The biggest concern and source of uncertainty is the global recession, and economic and political situation in the region. Increasing tensions and the possibility of new conflicts in the Region coupled with the long-lasting and widespread recession are major concerns. The large outstanding public debt and the current account deficit are always a source of concern for Turkey. The economic system is extremely open, which makes it difficult for the government to adopt a policy independent of the international system. The economy is quite vulnerable to international economic and financial crises. Many sectors, especially tourism, are vulnerable to any unfavorable news or events. Fortunately, there are others sectors, which are not that much affected from international developments. 3. Forecast Summary Real GDP, which bounced back in 21 with a 9.2% growth rate from a 4.8% decline in 29, and continued its march with an 8.5% growth in 211. However, unfavorable developments in the world, especially in Europe, are expected to have adverse effects on growth. Real GDP is expected to grow at 3.8% in 212, and 4.4% in 213. The GDP deflator is forecasted to be 3.9% in 212, and 6.2% in 213. In 212, exports are expected to be $144.1 billion, and imports are expected to be $195.5 billion leading to a current account deficit of $38.2 billion. Other forecasts are given in the Table. Project LINK Country Report: Turkey, October 212 7

Turkey - October 212 28 29 21 211 212 213 214 215 GDP and Major Components : Current Prices (Billions of Turkish Liras) Private Consumption 663.9 68.8 787.8 923.6 989.4 165.9 1146.2 1216.8 (%chg) 1.4 2.5 15.7 17.2 7.1 7.7 7.5 6.2 Government Consumption 121.7 14. 157.5 18.7 28.5 26.7 346.2 475.8 (%chg) 12.9 15.1 12.5 14.7 15.4 25.1 32.8 37.4 Fixed Capital Formation 189.1 16.7 27.8 282.8 36.3 37.8 439.6 525.6 (%chg) 4.7-15. 29.3 36.1 8.3 21.1 18.5 19.6 Inventory Change 17.9-18.4 6.7 26.4 13.1-4.4-3.5 -.7 (%chg) -76.2-22.7-136.4 293.1-5.3-133.2-18.6-8.3 Exports of Goods & Services 227.3 222.1 233. 38.2 342.2 377.3 44.1 444.3 (%chg) 2.7-2.3 4.9 32.2 11.1 1.3 7.1 1. Exports of Goods 181.4 17. 181. 242.5 272.1 34.2 327.4 361.4 (%chg) 2.5-6.3 6.5 34. 12.2 11.8 7.6 1.4 Exports of Services 45.8 52.1 52. 65.6 7.1 73.1 76.7 82.9 (%chg) 21.8 13.6 -.1 26.2 6.9 4.2 4.9 8.1 Imports of Goods & Services 269.4 232.6 294. 423.6 457. 544.6 639.5 74.4 (%chg) 16.2-13.6 26.4 44.1 7.9 19.2 17.4 15.8 Import of Goods 246.6 27. 265.2 389.1 419.6 55.8 593.4 687.5 (%chg) 16.6-16. 28.1 46.7 7.8 2.6 17.3 15.8 Import of Services 22.8 25.6 28.8 34.5 37.4 38.8 46.1 53. (%chg) 12.1 12.1 12.6 19.7 8.5 3.6 18.9 14.9 GDP 95.5 952.6 198.8 1298.1 142.4 1525.8 1693. 1921.4 (%chg) 12.7.2 15.4 18.1 8. 8.8 11. 13.5 GDP and Major Components : Constant Prices (Billions of Turkish Liras, 1998 prices) 28 29 21 211 212 213 214 215 Private Consumption 7.2 68.6 73.2 78.9 8.9 83.2 87.8 93.3 (%chg) -.3-2.3 6.7 7.8 2.5 2.9 5.5 6.3 Government Consumption 1.3 11.1 11.3 11.8 12.4 13.2 14. 14.9 (%chg) 1.7 7.8 2. 4.5 5. 6.4 6.1 6.5 Fixed Capital Formation 23.9 19.4 25.3 29.9 3. 32.7 34.5 35.8 (%chg) -6.2-19. 3.5 18.5.2 9.2 5.3 3.8 Inventory Change.2-2.1.3. -.9 -.7 -.6 -.4 (%chg) -259.9-185.4-113.1-95.1-634.1-19.1-1.8-3.6 Exports of Goods & Services 26. 24.7 25.5 27.1 29.2 29.9 3.9 32.1 (%chg) 2.7-5. 3.4 6.4 7.6 2.4 3.2 3.9 Exports of Goods 2.8 18.9 19.8 21.4 23.3 24.2 25.1 26.2 (%chg) 2.7-9.2 5.1 8. 8.9 3.8 3.7 4.3 Exports of Services 5.2 5.8 5.7 5.7 5.9 5.7 5.8 5.9 (%chg) 3. 11.8-2..9 2.8-3.4 1.2 1.8 Imports of Goods & Services 28.7 24.6 29.7 32.9 32.3 34.5 37.3 39.3 (%chg) -4.1-14.3 2.7 1.9-1.8 6.8 8. 5.4 Import of Goods 26.3 21.9 26.8 3.2 29.7 32. 34.6 36.5 (%chg) -3.8-16.7 22.3 12.9-1.8 8. 7.9 5.4 Import of Services 2.4 2.7 2.9 2.7 2.6 2.5 2.7 2.8 (%chg) -7.9 11.6 7.6-7.9-1.2-7.1 9.4 4.7 GDP 11.9 97. 15.9 114.9 119.3 123.8 129.2 136.4 (%chg).7-4.8 9.2 8.5 3.8 3.8 4.4 5.6 Project LINK Country Report: Turkey, October 212 8

28 29 21 211 212 213 214 215 GDP and Major Components : Deflator (1998=1) Private Consumption 946.1 992.1 176.8 1171.2 1218.2 1294.8 1388.7 155.8 (%chg) 1.9 4.9 8.5 8.8 4. 6.3 7.2 8.4 Government Consumption 1178.8 1263.1 1395.2 1528.1 163.1 1837.9 285. 2365.8 (%chg) 1.8 7.2 1.5 9.5 6.7 12.7 13.4 13.5 Fixed Capital Formation 79.7 833.2 825.7 944.9 125.1 1144.8 1282.6 1461.9 (%chg) 11.4 5.4 -.9 14.4 8.5 11.7 12. 14. Inventory Change 79.7 833.2 825.7 944.9 985.8 13.6 178.2 1142.7 (%chg) 11.4 5.4 -.9 14.4 4.3 1.8 7.4 6. Exports of Goods & Services 874. 91.7 913.6 1129.9 1171.3 126.7 137.3 1383.2 (%chg) 17.3 3.2 1.3 23.7 3.7 7.6 3.7 5.8 Exports of Goods 874. 91.7 913.6 1129.9 1171.3 126.7 137.3 1383.2 (%chg) 17.3 3.2 1.3 23.7 3.7 7.6 3.7 5.8 Exports of Services 874. 91.7 913.6 1129.9 1171.3 126.7 137.3 1383.2 (%chg) 17.3 3.2 1.3 23.7 3.7 7.6 3.7 5.8 Imports of Goods & Services 942.9 948.2 99.4 1288.9 1413.4 1576.4 1714.3 1883.7 (%chg) 21.5.6 4.5 3.1 9.7 11.5 8.7 9.9 Import of Goods 942.9 948.2 99.4 1288.9 1413.4 1576.4 1714.3 1883.7 (%chg) 21.5.6 4.5 3.1 9.7 11.5 8.7 9.9 Import of Services 942.9 948.2 99.4 1288.9 1413.4 1576.4 1714.3 1883.7 (%chg) 21.5.6 4.5 3.1 9.7 11.5 8.7 9.9 GDP 932.4 983.1 137.3 1129.1 1173. 1245.7 1334.6 1445.7 (%chg) 12. 5.4 5.5 8.9 3.9 6.2 7.1 8.3 Trade Statistics (Billions of USD, except for Volume, Unit Value and Price Indexes 23=1) 28 29 21 211 212 213 214 215 Exports of Goods (US$) 132. 12.1 113.9 134.9 144.4 138.4 149.7 166.1 (%chg) 23.1-22.6 11.5 18.5 7. -4.2 8.2 11. Imports of Goods (US$) 22. 14.9 185.5 24.8 225. 231. 223.9 254.3 (%chg) 18.8-3.2 31.7 29.8-6.6 2.7-3.1 13.6 Exports of Goods (National Currency) 169.9 158. 17.9 226.4 26.1 267.8 37.4 358.2 (%chg) 22.2-7. 8.2 32.5 14.9 2.9 14.8 16.5 Imports of Goods (National Currency) 259.1 217.3 278.3 43.4 45.3 446.9 459.7 548.9 (%chg) 17.6-16.1 28. 45..5 1.3 2.9 19.4 Export of Goods Volume Index 167.1 154.6 164.3 174.5 29.7 236.5 268.1 33.4 (%chg) 6.5-7.5 6.3 6.2 2.2 12.8 13.4 13.2 Import of Goods Volume Index 163.1 142. 172.2 193.4 218.6 244.2 242.8 241.7 (%chg) -1.4-12.9 21.2 12.3 13. 11.7 -.6 -.5 Export Unit Value Index 166.6 139.7 146.6 163.7 168.4 184.1 187.9 197.3 (%chg) 15.5-16.1 4.9 11.7 2.9 9.3 2. 5. Import Unit Value Index 177.4 142.8 155. 179.4 178. 178.1 177.6 177.3 (%chg) 2. -19.5 8.6 15.7 -.8. -.3 -.2 Export Price Index 166.7 139.7 146.6 163.6 168.3 184.1 187.9 197.5 (%chg) 15.5-16.2 4.9 11.6 2.8 9.4 2.1 5.1 Import Price Index 177.4 142.8 155.1 179.4 177. 183.7 191.8 21.7 (%chg) 2. -19.5 8.5 15.7-1.4 3.8 4.4 5.2 Project LINK Country Report: Turkey, October 212 9

28 29 21 211 212 213 214 215 BOP: Current Accounts (Billions of USD) Exports of Goods (FOB, US$) 14.8 19.6 12.9 143.4 144.1 147.7 159.7 177. (%chg) 22.1-22.1 1.3 18.6.5 2.5 8.1 1.9 Imports of Goods (FOB, US$) 193.8 134.5 177.3 232.5 195.5 221.8 214.9 244.1 (%chg) 19.5-3.6 31.9 31.1-15.9 13.4-3.1 13.6 Trade Balance (US$) -69.9-38.8-71.7-15.9-8.6-92.7-74.2-88.2 (%chg) 11.4-44.5 84.8 47.8-23.9 14.9-19.9 18.7 Current Account Balance (US$) -41.5-13.4-46.6-77.1-38.2-62.4-42.9-52.1 (%chg) 8. -67.8 248.9 65.4-5.5 63.2-31.2 21.4 28 29 21 211 212 213 214 215 Key Economic Indictors Exchange Rates (YTL/USD) 1.3 1.55 1.5 1.67 1.8 1.94 2.5 2.16 (%chg) -.3 19.2-3.1 11.5 7.6 7.5 6.1 5. Unemployment Rate (%)(Level) 1.97 14.1 11.92 9.82 9.6 6.33 5.19 4.52 (%chg) 7.3 27.7-14.9-17.6-2.3-34. -18.1-12.8 Earnings (25=1) 143.7 14.9 163.2 187.7 194.2 199.7 25.9 217.5 (%chg) 1.6-1.9 15.8 15. 3.5 2.8 3.1 5.7 CPI (23=1) 154.7 164.3 178.4 189.9 2.1 215.4 233. 255.6 (%chg) 1.4 6.3 8.6 6.5 5.3 7.6 8.2 9.7 HICP (for EU only) (%chg) PPI/WPI (23=1) 158.9 16.9 174.6 194. 2.7 216.1 235.4 257.4 (%chg) 12.7 1.2 8.5 11.1 3.5 7.6 8.9 9.4 Policy Interest Rate 16. 9.2 5.8 3. 5. 4.9 4.8 4.8 (%chg) -7.2-42.2-37.1-48.6 66.3-1.3-1.3-1.3 Short-term Interest Rate (Deposit/Savings) 22.9 17.6 15.3 14.2 15.8 15.4 14.9 14.5 (%chg) 1.6-23. -13.5-6.9 11.2-2.7-2.8-2.9 Long-term Interest Rate(1 Year) 19.5 21. 19.1 18.1 18.7 18.5 18.3 18. (%chg) -.4 7.7-9. -5.5 3.6-1.3-1.3-1.3 Government Surplus (+)/Deficit (-) (Billions of TL) -17.9-53.1-4.7-18.5-36.3 12.5 63.7 181.3 (%chg) 23.3 197.2-23.3-54.6 96.6-134.4 41.1 184.5 Government Surplus as % of Nominal GDP -1.9-5.7-3.7-1.4-2.6.7 3.1 6.9 (%chg) 11.6 196.3-34.4-62.8 85.6-128.7 316.4 127. Government Debt Outstanding (Billions of TL) 364.5 43.7 469.5 512.1 575.5 687. 749.8 8.6 (%chg) 3.8 18.2 9. 9.1 12.4 19.4 9.1 6.8 Government Debt as % of Nominal GDP 38.5 45.5 43. 39.6 4.6 4.8 36.3 3.8 (%chg) -8.2 18. -5.4-7.9 2.4.6-11. -15.2 28 29 21 211 212 213 214 215 WORLDEXPORTS 16134 12424 15129 1832 1782 18292 19116 2311 (year % ch.) 16.1-23. 21.8 19.2-1.3 2.8 4.5 6.2 WORLDPM 127.6 111. 118.2 134.4 144.6 156.2 168.6 18.8 (year % ch.) 12.3-13. 6.5 13.7 7.6 8. 8. 7.2 PCRUDEaverage 97. 61.8 79. 14. 1.4 1.1 12.4 13.7 (year % ch.) 36.4-36.3 27.9 31.6-3.4 -.3 2.3 1.2 Project LINK Country Report: Turkey, October 212 1