Deterioration is more severe than expected
When we compare the third quarter growth performance with the first two quarters, the sharp deterioration is clear and at this rate, the last quarter and 2019 will be marked by shrinkage.
►Annual total Gross Domestic Product (GDP) declined by $48.74 billion to $832.88 billion compared to Q2. The annual GDP per capita, according to our calculation, has declined to $10,272, a $284 loss compared to last year. Taking into account the number of migrants exceeding 4 million, the per capita income is about $9,700.
►Private consumption grew by only 1.11 percent in the third quarter. The 23.88 percent stiff shrinkage, especially in the consumption of durable goods, is alarming for the future.
►While private consumption made no headway, public spending maintained its tempo with a 7.48 percent increase. If Minister Albayrak’s statements are really implemented, contrary to his expectations, there will be a contraction.
►Export is one of the factors contributing to growth. However, 13.64 percent growth in exports is modest given the high rise in exchange rates.
►The decline in imports is actually a reflection of the recession in the economy. Industrial production grew by only 0.27 percent. In this case, the decline in imports is entirely due to the poor course of domestic demand and investments.
►Investments also contracted by 3.82 percent in the third quarter. The decrease in machinery equipment investments reached 8.55 percent.
►The 5.26 percent shrinkage in construction points to a more severe contraction in the next quarters.
►There is no effective growth except from finance and public-weighted sectors.
►There is 0.97 percent growth in agriculture, but this contradicts TurkStat’s own crop production estimates. TURKSTAT had estimated that the production of grain and field crops would decrease by 4.2 percent and vegetable production by three percent.
►Credit contraction, concordats, declines in confidence indices show that the worst for the economy is not over; on the contrary, it is just beginning.