Transcript Slide 1

Turkey : Struck by the Global Crisis, on Her Way to Recovery, and Still
Transforming
December 11, 2009
1
Some Food for Thought
• What are the basic problems the world system seems to be facing at
the moment?
• Are global imbalances here to stay or will they be eliminated surely
but slowly or even better quite fast?
• What will the engine of growth for the world economy or are there
none in sight at the moment?
• How likely is decoupling in the near future?
• How is an important and sizeable emerging market like Turkey
affected in this crisis and are there any stories that come from hers?
• Are there any paradigmatic shifts in the way analysts may be thinking
about growth dynamics in emerging markets?
• What does the fiscal picture look like for developed and emerging
market economies going forward ?
2
GDP Growth
12%
9.4%
9%
6.8%
6.2%
6%
8.4%
6.9%
5.3%
4.7%
3%
0.9%
0%
-3%
-3.4%
-6%
-5.7%
-9%
1999
Source: TURKSTAT
2000
2001
2002
2003
3
2004
2005
2006
2007
2008
GDP Growth
GDP Growth
11%
8%
5%
2%
9.7%
5.9%
8.1%
7.2%
6.3%5.7%
3.8%3.2%4.2%
2.8%
1.0%
-1%
-4%
-3.3%
-7%
-6.5%
-10%
-7.9%
-13%
-14.7%
20
06
Q
1
20
06
Q
2
20
06
Q
3
20
06
Q
4
20
07
Q
1
20
07
Q
2
20
07
Q
3
20
07
Q
4
20
08
Q
1
20
08
Q
2
20
08
Q
3
20
08
Q
4
20
09
Q
1
20
09
Q
2
20
09
Q
3
-16%
Source: TURKSTAT
4
-10
-1
Private Consumption
Source: TURKSTAT
Private Investment
5
Public Consumption
Public Investment
2009Q3
2009Q2
2009Q1
2008Q4
2008Q3
2008Q2
2008Q1
2007Q4
2007Q3
2007Q2
2007Q1
2006Q4
2006Q3
2006Q2
2006Q1
2005Q4
2005Q3
2005Q2
-5
2005Q1
0
2004Q4
5
2004Q3
10
2004Q2
15
2004Q1
20
04
20 Q1
04
20 Q2
04
20 Q3
04
20 Q4
05
20 Q1
05
Q
20 2
05
20 Q3
05
20 Q4
06
20 Q1
06
20 Q2
06
Q
20 3
06
20 Q4
07
20 Q1
07
20 Q2
07
20 Q3
07
20 Q4
08
Q
20 1
08
20 Q2
08
20 Q3
08
20 Q4
09
20 Q1
09
20 Q2
09
Q
3
Public and Private Sectors’ Contributions to Growth
3
2
2
1
1
0
-1
20
04
20 Q1
04
20 Q2
04
20 Q3
04
20 Q4
05
20 Q1
05
20 Q2
05
20 Q3
05
20 Q4
06
20 Q1
06
20 Q2
06
20 Q3
06
20 Q4
07
20 Q1
07
20 Q2
07
20 Q3
07
20 Q4
08
20 Q1
08
20 Q2
08
20 Q3
08
20 Q4
09
20 Q1
09
20 Q2
09
Q
3
Net Exports’ Contribution to Growth
10
8
6
4
2
0
-2
-4
-6
-8
-10
-12
Exports
Source: TURKSTAT
Imports
6
Net Exports
Contributions to Growth
Contributions to Growth
10
5
0
-5
-10
-15
-20
-25
2007Q2
Source: TURKSTAT
2007Q3
2007Q4
2008Q1
2008Q2
2008Q3
2008Q4
2009Q1
2009Q2
2009Q3
Private Consumption
Public Consumption
Public Investment
Private Investment
Change in Stocks
Net Exports
7
Sectors’ Contributions
Contributions to Growth
10
5
0
-5
-10
Agriculture
Source: TURKSTAT
Industry
8
Services
Q
3
20
09
Q
2
20
09
Q
1
20
09
Q
4
20
08
Q
3
20
08
Q
2
20
08
Q
1
20
08
Q
4
20
07
Q
3
20
07
Q
2
20
07
20
07
Q
1
-15
Contributions to Growth
Contributions to Growth
8
6
4
2
0
-2
-4
-6
-8
2007Q1 2007Q2 2007Q3 2007Q4 2008Q1 2008Q2 2008Q3 2008Q4 2009Q1 2009Q2 2009Q3
Construction
Source: TURKSTAT
Trade
Transportation
Financial Intermediation Services
9
Other Services
Private Fixed Capital Investments
2002
2003
2004
2005
2006
2007
2008
2009 H1
Mil. TL
43,391
62,005
97,378
115,064
143,299
155,442
152,229
63,228
Mil $
28,563
41,842
68,291
85,593
99,817
119,808
118,927
39,243
Growth (Real)
16.9%
23.6%
36.1%
16.2%
15.0%
5.3%
-10.0%
-31.6%
40%
36.1%
30%
23.6%
20%
16.9%
16.2%
15.0%
10%
5.3%
0%
-10%
-10.0%
-20%
-30%
-31.6%
-40%
2002
Source: TURKSTAT
10
2003
2004
2005
2006
2007
2008
2009 H1
Growth Forecasts
Medium Term Real GDP Growth Forecast
%
15
10
5
3.2%
0
4.5%
-5.2%
-5
-10
-15
-20
Annual forecasts
Quarterly forecasts
.
2003
2004
Source: YK Economic Research
2005
2006
2007
11
2008
2009
2010
2011
Industrial Production (YoY Growth)
15% 11.7%
10%
8.5%
5.7% 7.0%
2.4%
7.3%
5%
5.1%5.1%
0%
2.6%
3.7% 3.2%
-5%
6.5%
3.2%
3.7%
-0.7%
2.8%
-4.3% -3.7%
0.4%
-5.7%
-3.5%
-7.2%
-6.3%
-9.0%
-10.3%
-6.3%
-9.0% -8.6%
-6.7%
-7.9%
-10%
-14.7%
-17.8%
-15%
-13.3%
-19.0%
-18.5%
-20.8%
-21.4%
-20%
-12.9%
-17.3%
-17.8%
-18.5%
-21.3%
-23.1%
-23.8%
-25%
20
08
20 M 0
08 1
20 M 0
08 2
20 M 0
08 3
20 M 0
08 4
20 M 0
08 5
20 M 0
08 6
20 M 0
08 7
20 M 0
08 8
20 M 0
08 9
20 M 1
08 0
20 M 1
08 1
20 M 1
09 2
20 M 0
09 1
20 M 0
09 2
20 M 0
09 3
20 M 0
09 4
20 M 0
09 5
20 M 0
09 6
20 M 0
09 7
20 M 0
09 8
20 M 0
09 9
20 M 1
09 0
M
11
-30%
IPI
Source: TURKSTAT, YK Economic Research
1.9%
Eff. Days-Adjusted IPI
12
Industrial Production : MoM Growth
( Seasonally and Effective Days Adjusted Series )
12%
9.08%
8%
4.89%
4%
0%
-4%
1.67%
0.60%
-1.28%
2.39%
3.78%
2.88%
-0.01%
-0.27%
-1.53%
-2.73%
-2.34% -1.73%
-4.97%
1.42%
0.31%
-4.09%
-8%
-12%
-12.77%
20
08
2 0 M0
08 5
2 0 M0
08 6
2 0 M0
08 7
2 0 M0
08 8
2 0 M0
08 9
2 0 M1
08 0
2 0 M1
08 1
2 0 M1
09 2
2 0 M0
09 1
2 0 M0
09 2
2 0 M0
09 3
2 0 M0
09 4
2 0 M0
09 5
2 0 M0
09 6
2 0 M0
09 7
2 0 M0
09 8
2 0 M0
09 9
2 0 M1
09 0
M
11
-16%
Effective Days Adjusted and SA IPI MoM
Source: TURKSTAT, YK Economic Research
13
ta
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an
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tr
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M
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in
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Fo Ind
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.
&
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pp
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ub er
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et
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m
ic
al
s
P
la
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st
on
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et
B
a s alic
ic
M
et
al
M
ac
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e
hi
ne ta l
E
le
ry
ct
&
ri
ca Eq
lM .
ac
R
h
a
M
di .
ot
o,
or
TV
V
E
eh
le
ct
ic
ir
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Fu les
it y
r
, G nit
a s ure
&
W
at
er
M
To
Industrial Production : Sector Growth Rates
25%
Sectors' YoY Growth Rates
20%
15%
10%
5%
0%
-5%
-10%
-15%
-20%
-25%
-30%
Source: TURKSTAT, YK Economic Research
14
Industrial Production :September / Contributions
Contributions
10.0
5.0
0.0
-5.0
-10.0
-15.0
-20.0
-25.0
Nov-08 Dec-08 Jan-09 Feb-09 Mar-09 Apr-09 May-09 Jun-09 Jul-09 Aug-09 Sep-09 Oct-09
Food&Bev.
Textiles
Wearing App.
Chemicals
Basic Metal
Machinery&Eq.
Motor Vehicles
Other Man. Industry
Source: TURKSTAT, YK Economic Research
15
Impact Assessment at the Subsector Level
Total Industry
Mining and Quarrying
Coal Mi. and Ext. of Peat
Crude Pet. and Nat. Gas
Metalic Ore Mining
Other Mining
Manufacturing Industry
Food&Bev.
Tobacco
Textiles
Wearing App.
Leather
Wood
Paper
Publishing
Ref. Petroleum
Chemicals
Plastics
Non-Metalic
Basic Metal
Metal
Machinery&Eq.
Electrical Mach.
Radio, TV
Medical&Opt. Ins.
Motor Vehicles
Other Trans. Eq.
Furniture
El., Gas and Wat
Production Loss
(in terms of one
month's output
multiple)
Months in Crisis
Average
Production Loss
per Month
2.98
1.73
1.85
0.13
2.19
2.04
3.10
0.57
0.87
1.26
2.29
1.21
1.84
1.71
1.70
3.51
2.74
3.13
2.82
4.04
4.88
2.94
3.80
0.70
3.94
6.91
3.72
3.60
1.40
17
16
16
3
12
12
17
11
8
11
17
12
15
16
16
13
20
17
17
16
18
16
15
7
16
18
10
19
14
17.5%
10.8%
11.6%
4.4%
18.3%
17.0%
18.2%
5.2%
10.9%
11.4%
13.5%
10.1%
12.3%
10.7%
10.6%
27.0%
13.7%
18.4%
16.6%
25.2%
27.1%
18.4%
25.3%
10.1%
24.6%
38.4%
37.2%
18.9%
10.0%
Slope of LR Trend
before the Hit
Slope of Recovery
0.0306
0.0425
0.0771
0.1125
0.1609
0.0127
0.0261
0.0141
0.0137
-0.0210
-0.0056
-0.0104
0.0829
0.0305
0.0206
0.0061
0.0453
0.0289
0.0182
0.0459
0.0385
0.0201
0.0590
-0.0056
0.0831
0.2619
0.1481
0.0791
0.0360
0.0931
0.0909
0
0
0.419
0.2846
0.1023
0
0.058
0.0822
0.0148
0.0767
0.1658
0.06
0.0315
0.0303
0.1312
0.1552
0.0583
0.0622
0.1192
0.1967
0.2826
0
0.0855
0.2483
0.2919
0.1799
0.0396
16
Gap
( Potential vs.
Current)
Adjusted Recovery
Slope
First Hit
Begining of the
Recovery
0.843
0.927
0.852
0.977
0.993
0.982
0.851
1.026
0.924
1.024
0.905
0.970
0.956
0.917
0.886
0.712
0.891
0.888
0.914
0.753
0.737
0.908
0.877
1.431
0.805
0.586
0.598
0.782
0.899
0.0785
0.0843
0.0000
0.0000
0.4160
0.2794
0.0871
0.0000
0.0536
0.0842
0.0134
0.0744
0.1585
0.0550
0.0279
0.0216
0.1169
0.1379
0.0533
0.0468
0.0878
0.1785
0.2477
0.0000
0.0688
0.1455
0.1747
0.1406
0.0356
Jun-08
Jul-08
Jul-08
Dec-08
Nov-08
Nov-08
Jun-08
Dec-08
Mar-09
Dec-08
Jul-08
Nov-08
Jul-08
Jul-08
Jul-08
Jul-08
Mar-08
Jun-08
Jun-08
Jul-08
May-08
Jul-08
Aug-08
Sep-08
Jul-08
May-08
Jan-09
Apr-08
Sep-08
Apr-09
Mar-09
N/A
Jan-09
Mar-09
Jun-09
Apr-09
Oct-09
Jun-09
Mar-09
Apr-09
Jan-09
Mar-09
Mar-09
Jan-09
Apr-09
Jan-09
Mar-09
Apr-09
Jan-09
May-09
Apr-09
Apr-09
Feb-09
Mar-09
Mar-09
Aug-09
Mar-09
May-09
M
in To
i
oa ng tal
l M an I nd
d
u
C
ru i. a Qu st
de nd
ar ry
Pe Ex ryi
n
t.
t
M . an of g
et
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ic
a
t
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M
re
an
as
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ac th ini
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tu er
M g
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In i ng
d
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od ry
&
B
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ba .
c
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rin iles
g
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at
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ro g
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m
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ic
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th
s
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Tr cle
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s.
El
Fu Eq
.,
G rni .
as tu
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W
at
C
Impact Assessment at the Subsector Level
8
45.0%
7
40.0%
6
35.0%
5
30.0%
4
25.0%
20.0%
3
2
15.0%
10.0%
1
5.0%
0
0.0%
Production Loss
(in term s of one m onth's output m ultiple)
17
Average Production Loss per Month
M
in To
in
ta
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C
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an
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ac the ini n
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&
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cc
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V
p
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er
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Tr
an s
s.
Fu Eq
El
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.,
G rnit
as
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an e
d
W
at
C
Impact Assessment at the Subsector Level
Slope of LR Trend before the Hit
0.30
0.25
0.20
0.15
0.10
0.05
0.00
-0.05
18
M
in To
in
ta
lI
oa g
l M an nd
i. d Q ust
C
ru
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de nd
r
Pe Ex ryin
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cc
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g
Ap
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at
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ro
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m
ic
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on
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B eta
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ec
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tr
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th
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El
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as
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at
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ta
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rr
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at
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re Ga
an
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uf
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i
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g
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ef
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ro
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m
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B eta
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ic
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al
o,
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M
ot O p
t.
o
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eh
th
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er
i
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an
s.
Fu Eq
El
.
.,
G rnit
as
u
a n re
d
W
at
C
C
Impact Assessment at the Subsector Level
Adjusted Recovery Slope
Gap
( Potential vs. Current)
0.45
0.40
1.00
0.35
0.95
0.90
0.30
0.85
0.25
0.80
0.20
0.75
0.15
0.70
0.10
0.65
0.05
0.60
0.55
0.00
0.50
19
Ja
n06
M
ar
-0
M 6
ay
-0
6
Ju
l-0
6
Se
p06
No
v06
Ja
n07
M
ar
-0
M 7
ay
-0
7
Ju
l-0
Se 7
p07
No
v07
Ja
n08
M
ar
-0
M 8
ay
-0
8
Ju
l-0
8
Se
p08
No
v08
Ja
n09
M
ar
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M 9
ay
-0
9
Ju
l-0
Se 9
p09
No
v09
Capacity Utilization
90
85
80
75
70
65
60
Capacity Utilization
Capacity Utilization_Sa
20
Sources of Capacity Underutilization
60%
50%
40%
30%
20%
10%
Shortage of Demand in Domestic Market
Shortage of Demand in Foreign Market
21
/9
20
09
/7
20
09
/5
20
09
/3
20
09
/1
20
09
/9
/1
1
20
08
20
08
/7
20
08
/5
20
08
/3
20
08
/1
20
08
/9
/1
1
20
07
20
07
/7
20
07
/5
20
07
/3
20
07
20
07
/1
0%
Financial Problems
M
ar
-0
M 6
ay
-0
6
Ju
l-0
Se 6
p0
N 6
ov
-0
6
Ja
n0
M 7
ar
-0
M 7
ay
-0
7
Ju
l-0
Se 7
p0
N 7
ov
-0
Ja 7
n0
M 8
ar
-0
M 8
ay
-0
8
Ju
l-0
Se 8
p0
N 8
ov
-0
Ja 8
n0
M 9
ar
-0
M 9
ay
-0
9
%
Non-Farm Unemployment Rate (%)
20
18
16
Source: TURKSTAT
% 16.4
14
12
10
22
Thresholds for TRY/USD Exchange Rate
THRESHOLDS FOR TRY/USD EXCHANGE RATE*
1.9
1.8
High level regime --» Mean:1.52, Std. Deviation: 0.09
Low level regime --» Mean:1.31, Std. Deviation: 0.07
1.7
1.6
1.5
1.4
1.3
1.2
1.1
1.0
2003
2004
2005
2006
2007
2008
* Thresholds correspond to unobserved switching Markov regimes estimated by Yapı Kredi Economic Research.
Source: YK Economic Research
23
2009
Inflation
YoY Inflation
Monthly Inflation
3%
12%
10%
2%
1.27%
8%
1%
0.64%
6%
5.53%
0%
4%
-1%
2%
Apr-08
Jun-08
Aug-08
Oct-08
Dec-08
Feb-09
Apr-09
Jun-09
Aug-09
Oct-09
Apr-08
Jun-08
Aug-08
Oct-08
Dec-08
Feb-09
Monthly inf lation
Source: TURKSTAT, YK Economic Research
24
Apr-09
Jun-09
Monthly SA
Aug-09
Oct-09
Contributions to Monthly Inflation
1.40
Miscellaneous
Hotels and Restaurants
1.20
Education
1.00
Culture
Communication
0.80
Transportation
0.60
Health
0.40
Houseware
Housing
0.20
Clothing and Shoes
0.00
Tobacco and Liquor
1
Food and Beverages
-0.20
Source: TURKSTAT, YK Economic Research
25
Contributions to Yearly Inflation
7
Miscellaneous
Hotels and Restaurants
6
Education
5
Culture
Communication
4
Transportation
3
Health
2
Houseware
Housing
1
Clothing and Shoes
0
Tobacco and Liquor
1
Food and Beverages
-1
Source: TURKSTAT, YK Economic Research
26
Inflation
Source: TURKSTAT
2006
2007
2008
Sep-09
Oct-09
Nov-09
PPI
11.6%
5.9%
8.1%
0.6%
0.3%
1.3%
CPI
9.7%
8.4%
10.1%
0.4%
2.4%
1.3%
Man. Industry
12.3%
4.3%
6.4%
0.6%
0.2%
1.1%
Dec-08
Jan-09
Feb-09
-3.5%
0.2%
1.2%
-0.4%
0.3%
-0.3%
-3.8%
0.0%
0.3%
27
40%
30%
Goods
Source: CBRT
Food
Au
g0
O 6
ct
-0
D 6
ec
-0
Fe 6
b0
Ap 7
r0
Ju 7
n0
Au 7
g0
O 7
ct
-0
D 7
ec
-0
Fe 7
b0
Ap 8
r0
Ju 8
n0
Au 8
g0
O 8
ct
-0
D 8
ec
-0
Fe 8
b0
Ap 9
r09
Ju
n0
Au 9
g0
O 9
ct
-0
9
Au
g0
D 3
ec
-0
Ap 3
r0
Au 4
g04
D
ec
-0
Ap 4
r0
Au 5
g0
D 5
ec
-0
Ap 5
r0
Au 6
g0
D 6
ec
-0
Ap 6
r0
Au 7
g07
D
ec
-0
Ap 7
r0
Au 8
g08
D
ec
-0
Ap 8
r0
Au 9
g09
Inflation: Goods vs. Services
16%
14%
12%
10%
20%
8%
6%
10%
4%
2%
0%
0%
Services
Goods
28
Food
Services
Inflation Expectations
13.0
12.0
11.0
10.0
9.0
8.0
7.0
12-Month Ahead CPI (%)
Source: CBRT
24-Month Ahead CPI (%)
29
End-Year CPI (%)
Dec-09
Nov-09
Oct-09
Sep-09
Aug-09
Jul-09
Jun-09
May-09
Apr-09
Mar-09
Feb-09
Jan-09
5.0
Dec-08
6.0
Gross External Debt Profile of Turkey
80%
70%
58%
60%
50%
49%
50%
49%
47%
40%
40%
67%
64%
42%
35%
34%
33%
30%
30%
28%
20%
10%
0%
2002
2003
2004
Public Sector
Source: Undersecretariat of Treasury
2005
CBRT
30
2006
Private Sector
2007
2008
GENERAL GOVERNMENT NOMINAL DEBT STOCK (EUDEFINITION) / GDP
90
80
77.6
73.7
70
67.4
59.2
60
52.3
50
%
46.1
40
39.4
39.5
30
20
10
0
2001
2002
Source: Undersecretariat of Treasury
2003
2004
2005
31
2006
2007
2008
General government consolidated gross debt as a
percentage of GDP
EU (25 countries)
EU (15 countries)
Italy
Greece
Belgium
Euro area
Hungary
Germany
France
Portugal
Austria
Netherlands
Poland
United Kingdom
Turkey
Legend ( Series: 2007 )
3.5 - 18.2
18.2 - 29.4
Source: EUROSTAT
29.4 - 40.4
40.4 - 59.5
59.5 - 104.1
32
N/A
59.3
60.4
104.1
94.8
83.9
66.3
65.8
65.1
63.9
63.6
59.5
45.7
44.9
44.2
38.8
Net Public Debt Stock / GDP
70.0
27.6
25.2
60.0
17.2
13.4
50.0
6.4
40.0
4.0
1.3
30.0
20.0
38.8
36.2
37.9
35.7
35.2
2.0
30.0
28.1
26.5
2006
2007
2008
10.0
0.0
2001
2002
2003
2005
2004
Net Domestic Debt Stock
Source: Undersecretariat of Treasury
33
Net External Debt Stock
Net Public Debt Stock / GDP
70.0
40.7
35.4
60.0
23.9
19.1
50.0
10.3
40.0
6.4
3.2
30.0
2.9
20.0
10.0
25.6
26.1
2001
2002
31.2
29.9
31.3
2003
2004
2005
27.6
26.2
25.7
2006
2007
2008
0.0
Net TL Debt Stock
Source: Undersecretariat of Treasury
Net FX Debt Stock
34
Central Administration Budget- 2009 Realizations
SELECTED ITEMS FROM CENTRAL ADMINISTRATION BUDGET (YTL million)
Jan. - Oct. Jan. - Oct. real change
2008 budget
2008 budget
2008
2009
(%)
realization
realization/ 2008
budget target
(%)
Central Administration Revenues
175,768
175,368
-5.0
208,898
102.1
Tax Revenues
140,321
139,164
-5.6
168,087
98.2
Non-Tax Revenues
30,357
30,817
-3.4
34,298
121.6
Other
5,090
5,387
0.7
6,513
126.6
Central Administration Expenditures
180,655
218,600
15.2
225,967
101.5
Non-interest expenditures
137,305
168,356
16.7
175,306
105.3
I. Personnel expenditures
41,295
47,412
9.3
48,825
100.3
II. Government premiums to social security
5,030
5,717
8.2
6,402
99.9
III. Purchases of goods and services
16,828
19,836
12.2
23,941
104.5
IV. Current transfers
57,363
77,071
27.9
70,116
101.3
Duty lossesof SEEs
1,474
3,431
121.5
2,041
131.5
Transfers to social security institutions
31,710
48,548
45.7
36,156
95.2
Agricultural transfers
5,503
3,913
-32.3
5,811
107.6
Other transfers
18,676
21,178
7.9
26,108
107.5
V. Capital expenditures
11,151
11,656
-0.5
18,441
156.6
VI. Other expenditures
5,638
6,664
12.5
7,583
99.9
Interest expenditures
43,351
50,244
10.3
50,661
90.5
Primary Balance
38,464
7,012
-82.7
33,592
88.4
Budget Balance
-4,887
-43,232
-17,069
94.8
Source: General Directorate of Public Accounts, YK Economic Research
35
2009 budget Jan. - Oct 2008 / Jan. - Oct.
target
year-end real. 2009 / yearend target
248,758
202,090
40,867
5,146
259,156
201,656
57,211
7,243
25,454
87,956
3,081
50,501
4,951
29,422
14,839
8,953
57,500
47,102
-10,398
84.1
83.5
88.5
78.2
79.9
78.3
84.6
78.6
70.3
81.8
72.2
87.7
94.7
71.5
60.5
74.3
85.6
114.5
28.6
70.5
68.9
75.4
104.7
84.4
83.5
82.9
78.9
77.9
87.6
111.4
96.1
79.0
72.0
78.5
74.4
87.4
14.9
415.8
Revenues vs. Non-interest Expenditures (Real)
6-Month MA YoY Growth Rate
3-Month MA YoY Growth Rate
20.0%
30.0%
20.0%
10.0%
10.0%
0.0%
0.0%
-10.0%
-10.0%
-20.0%
Revenues
Non-interest Expenditures
Revenues
Source: General Directorate of Public Accounts, YK Economic Research
36
Non-interest Expenditures
Oct-09
Sep-09
Aug-09
Jul-09
Jun-09
Apr-09
May-09
Mar-09
Jan-09
Feb-09
Dec-08
Oct-08
Nov-08
Sep-08
Jul-08
Aug-08
Jun-08
May-08
-20.0%
Apr-08
Oct-09
Sep-09
Aug-09
Jul-09
Jun-09
May-09
Apr-09
Mar-09
Feb-09
Jan-09
Dec-08
Nov-08
Oct-08
Sep-08
Aug-08
Jul-08
Jun-08
May-08
Apr-08
-30.0%
5
Foreign Trade Deficit
Exports
Source: CBRT, YK Economic Research
Imports
37
Exports
Imports
n0
9
-0
9
08
p09
Ju
ar
Se
8
p08
n0
-0
8
07
ec
M
D
Se
Ju
ar
ec
M
D
p07
7
-0
7
n0
12-Month Rolling
Se
Ju
-60%
06
-100,000
ar
-40%
M
-50,000
ec
-
-20%
D
0
6
0%
n0
50,000
p06
20%
Se
100,000
-0
6
40%
Ju
150,000
05
60%
ar
200,000
M
80%
ec
-
p05
250,000
D
Se
-0
6
Ju
n06
Se
p06
D
ec
-0
6
M
ar
-0
7
Ju
n07
Se
p07
D
ec
-0
7
M
ar
-0
8
Ju
n08
Se
p08
D
ec
-0
8
M
ar
-0
9
Ju
n09
Se
p09
05
ec
-
p0
M
ar
D
Se
million $
External Balance
YoY Growth
Financial Account (6-Month Rolling)
20,000
10,000
0
-10,000
Portfolio Investment
Source: Turkstat, YK Economic Research
Banks
38
Other Sectors
Se
p09
Ju
l-0
9
09
M
ay
-
09
M
ar
-
Ja
n09
ov
-0
8
N
Se
p08
Ju
l-0
8
08
M
ay
-
08
M
ar
-
Ja
n08
N
ov
-0
7
-20,000
Financial Account (6-Month Rolling)
20,000
15,000
10,000
5,000
0
-5,000
-10,000
5
6
7
8
9
6
7
8
9
5
6
7
8
9
6
7
8
9
l-0 ct-0 n-0 r-0 ul-0 ct-0 n-0 r-0 ul-0 ct-0 n-0 r-0 ul-0 ct-0 n-0 r-0 ul-0 ct-0
u
a
a
a
a
p
p
p
p
J
J
J
J
J
O
J
O
J
O
J
O
J
O
A
A
A
A
Portfolio Investment
Source: Turkstat, YK Economic Research
Banks
39
Other Sectors
Primary Surplus (% of GDP)
7.0
6.0
6.0
5.4
5.2
5.0
4.9
4.4
4.2
4.0
4.0
3.5
3.3
3.0
2.0
1.0
1.0
0.0
-0.2
-1.0
-0.8
-2.0
-2.1
-3.0
90-99
2000
2001
2002
2003
Source: Undersecretariat of Treasury, YK Economic
Research
2004
2005
40
2006
2007
2008
2009f
2010f
2011f
Current Account Deficit (12-Month Rolling)
0
Nov-07
Jan-08
Mar-08
May-08
Jul-08
Sep-08
Nov-08
Jan-09
Mar-09
-10,000
-20,000
-30,000
-40,000
-50,000
-60,000
Current Account
Source: CBRT, TDM, YK Economic Research
41
Energy Balance
May-09
Jul-09
Sep-09
Non-Debt Financing of CA Deficit
40
125.0%
20
100.0%
-
75.0%
(20)
50.0%
(40)
25.0%
(60)
0.0%
05-2004 11-2004 05-2005 11-2005 05-2006 11-2006 05-2007 11-2007 05-2008 11-2008 05-2009
Non-debt Financing (1, left scale)
Source: CBRT, YK Economic Research
Current Account Deficit (2, left scale)
42
(1)/(2) (right scale)
FDI ($ bln)
25.0
22.1
20.2
20.0
18.0
15.0
12.0
10.0
10.0
10.0
8.0
5.0
1.8
2.8
0.0
2003
2004
2005
Source: Undersecretariat of Treasury, YK Economic
Research
2006
2007
43
2008
2009f
2010f
2011f
6
Source: ISE, CBRT
Secondary Market
44
CBRT O/N
2-Dec-09
26-Oct-09
18-Sep-09
17-Aug-09
14-Jul-09
10-Jun-09
6-May-09
31-Mar-09
25-Feb-09
22-Jan-09
18-Dec-08
10-Nov-08
6-Oct-08
28-Aug-08
25-Jul-08
23-Jun-08
20-May-08
14-Apr-08
11-Mar-08
6-Feb-08
3-Jan-08
27-Nov-07
23-Oct-07
Bond Rates & O/N
30
26
22
18
14
10
Real Interest Rate & Real Exchange Rate
35
200
30
171.2 180
25
160
20
15
140
10
120
5
1.83 100
0
6
4
4
9
9
3
8
2
7
4
5
6
6
7
t-0 ar-0 g -03 an-0 un-0 ov -0 pr-05 ep -0 eb-0 J ul-0 ec -0 ay -0 ct-0 ar-0 g -08 an-0 un-0
Oc
J
J
O
J
J
M
N
A
S
F
D
M
Au
M
Au
Real Interest Rate (left scale)
Real Effective Exchange Rate
* deflated via CPI
** CPI based, 1995=100
Source: CBRT, TURKSTAT
45
Source: CBRT, YK Economic Research
30
-0
503
26
-1
203
23
-0
704
18
-0
205
16
-0
905
14
-0
406
10
-1
106
08
-0
607
04
-0
108
01
-0
808
27
-0
209
25
-0
909
30
-0
503
26
-1
203
23
-0
704
18
-0
205
16
-0
905
14
-0
406
10
-1
106
08
-0
607
04
-0
108
01
-0
808
27
-0
209
25
-0
909
30
-0
503
26
-1
203
23
-0
704
18
-0
205
16
-0
905
14
-0
406
10
-1
106
08
-0
607
04
-0
108
01
-0
808
27
-0
209
25
-0
909
30
-0
503
26
-1
203
23
-0
704
18
-0
205
16
-0
905
14
-0
406
10
-1
106
08
-0
607
04
-0
108
01
-0
808
27
-0
209
25
-0
909
Shares in Bond Stock
Banks
Non-Bank
Sector
65.0%
32.0%
60.0%
28.0%
55.0%
24.0%
50.0%
20.0%
Foreign
Investors
Funds
20.0%
15.0%
10.5%
10.0%
8.5%
6.5%
5.0%
4.5%
0.0%
2.5%
46
Bond Stocks (Billion TL)
245
50
235
45
225
215
40
205
195
35
185
175
30
165
155
25
145
135
20
8
7
8
7
8
8
8
9
7
9
n -07 ar- 0 n -07ug-0 ov -0 a n-0 pr-0 u n-0 ep-0 ov -0 b- 0 a y-0 u l- 09 ct-09
5- Ja23 -M 8- Ju24 -A 9- N 25 -J 11 -A 27 -J 12 -S 28 -N 13 -Fe 1- M 17 -J 2- O
Foreign Investors (right scale)
Source: CBRT, YK Economic Research
Banks' total bond portfolio (right scale)
47
Source: CBRT, YK Economic Research
Housing
Car Loans
48
Other Consumer Credits
12/4/2009
11/4/2009
10/4/2009
9/4/2009
8/4/2009
7/4/2009
6/4/2009
5/4/2009
4/4/2009
3/4/2009
2/4/2009
1/4/2009
12/4/2008
11/4/2008
10/4/2008
9/4/2008
8/4/2008
7/4/2008
6/4/2008
5/4/2008
4/4/2008
3/4/2008
2/4/2008
1/4/2008
Consumer Credits (% ch of 8W rolling)
8-Week Rolling
1.5%
1.0%
0.5%
0.0%
-0.5%
-1.0%
-1.5%
Source: CBRT, YK Economic Research
Commercial Credits
49
Consumer Credits
12/4/2009
11/4/2009
10/4/2009
9/4/2009
8/4/2009
7/4/2009
6/4/2009
5/4/2009
4/4/2009
3/4/2009
2/4/2009
1/4/2009
12/4/2008
11/4/2008
10/4/2008
9/4/2008
8/4/2008
7/4/2008
6/4/2008
5/4/2008
4/4/2008
3/4/2008
2/4/2008
1/4/2008
Commercial Credits (% ch of 8W rolling)
8-Week Rolling
2.5%
2.0%
1.5%
1.0%
0.5%
0.0%
-0.5%
-1.0%
-1.5%
12
/1
5/
20
08
1/
15
/2
00
9
2/
15
/2
00
9
3/
15
/2
00
9
4/
15
/2
00
9
5/
15
/2
00
9
6/
15
/2
00
9
7/
15
/2
00
9
8/
15
/2
00
9
9/
15
/2
00
9
10
/1
5/
20
09
11
/1
5/
20
09
12
/1
5/
20
09
CBRT Expectations Survey
End-Year Exchange Rate (TL/$)
1.8
1.7
1.6
1.5
1.4
1.499
1.3
1.2
1.1
1
Source: CBRT
50
6
Source: CBRT
12
/1
5/
20
08
1/
15
/2
00
9
2/
15
/2
00
9
3/
15
/2
00
9
4/
15
/2
00
9
5/
15
/2
00
9
6/
15
/2
00
9
7/
15
/2
00
9
8/
15
/2
00
9
9/
15
/2
00
9
10
/1
5/
20
09
11
/1
5/
20
09
12
/1
5/
20
09
12
/1
5/
20
08
1/
15
/2
00
9
2/
15
/2
00
9
3/
15
/2
00
9
4/
15
/2
00
9
5/
15
/2
00
9
6/
15
/2
00
9
7/
15
/2
00
9
8/
15
/2
00
9
9/
15
/2
00
9
10
/1
5/
20
09
11
/1
5/
20
09
12
/1
5/
20
09
CBRT Expectations Survey
3-Month Ahead 6-Month T-Bill Rate (com p, %)
3-Month Ahead 5-Year Sem i-Annually Couponed Gov. Bond Rate (com p, %)
20
25
18
16
20
14
12
15
10
10.2
8
8.02
10
4
5
2
0
0
51
CBRT Expectations Survey
2009 Grow th (%)
6
4
2
0
-2
-4
-5.70
-6
08
09
09
09
09
09
09
09
09
09
09
09
09
20
20
20
20
20
20
20
20
20
20
20
20
20
/
/
/
/
/
/
/
/
/
/
/
/
/
5
5
5
5
15
15
15
15
15
15
15
15
15
/1
/1
/1
/1
1/
2/
3/
4/
5/
6/
7/
8/
9/
12
10
11
12
Source: CBRT
52
Relative Currency Performances
31 December 2007= 1.00
0.700
0.700
0.900
0.900
1.100
1.100
1.300
1.300
1.500
Brazil
Argentina
Source: Reuters, YK Economic Research
South Africa
Turkey
53
Hungary
Russia
Poland
11/01/09
09/01/09
07/01/09
05/01/09
03/01/09
01/01/09
11/01/08
09/01/08
07/01/08
05/01/08
01/01/08
11/1/09
9/1/09
7/1/09
5/1/09
3/1/09
1/1/09
11/1/08
9/1/08
7/1/08
5/1/08
3/1/08
1/1/08
Turkey
03/01/08
1.500
1.700
Relative Currency Performances
31 December 2008= 1.00
0.900
0.700
0.800
1.000
0.900
1.100
1.000
1.200
1.100
1.200
Turkey
Brazil
Argentina
Source: Reuters, YK Economic Research
South Africa
Turkey
54
Hungary
Russia
Poland
11/30/09
10/31/09
09/30/09
08/31/09
07/31/09
06/30/09
05/31/09
04/30/09
03/31/09
02/28/09
01/31/09
12/31/08
11/30/09
10/31/09
9/30/09
8/31/09
7/31/09
6/30/09
5/31/09
4/30/09
3/31/09
2/28/09
1/31/09
12/31/08
1.300
Turkey
Source: Reuters, YK Economic Research
Brazil
Hungary
55
Poland
Russia
South Africa
10/31/09
9/30/09
8/31/09
7/31/09
6/30/09
5/31/09
4/30/09
3/31/09
2/28/09
1/31/09
12/31/08
11/30/08
10/31/08
9/30/08
8/31/08
7/31/08
6/30/08
5/31/08
4/30/08
3/31/08
2/29/08
1/31/08
12/31/07
MSCI Indices (31 Dec 2007 =1.0)
1.20
1.00
0.80
0.60
0.40
0.20
-
MSCI Indices (31 Dec 2008 =1.0)
2.400
2.200
2.000
1.800
1.600
1.400
1.200
1.000
0.800
0.600
Turkey
Source: Reuters, YK Economic Research
Brazil
Hungary
Poland
56
Russia
South Africa
11/18/09
11/4/09
10/21/09
10/7/09
9/23/09
9/9/09
8/26/09
8/12/09
7/29/09
7/15/09
7/1/09
6/17/09
6/3/09
5/20/09
5/6/09
4/22/09
4/8/09
3/25/09
3/11/09
2/25/09
2/11/09
1/28/09
1/14/09
12/31/08
0.400
Turkey vs. Selected Emerging Markets
57
Turkey vs. Selected Emerging Markets
58
Turkey vs. Selected Emerging Markets
59
Turkey vs. Selected Emerging Markets
60
Turkey vs. Selected Emerging Markets
61
Middle Class in the Making
GENERAL
GENERAL
1.5
5th 20%
0.8
1.0
0.5
4th 20%
3rd 20%
2008
0.0
2007
-0.5
2006
-1.0
2004
-1.5
2003
2nd 20%
1.0
1.1
3rd 20%
4th 20%
0.2
-2.0
-2.5
1st 20%
-3.0
-3.1
-3.5
0.0
5.0
10.0
15.0
20.0
25.0
30.0
Source: TURKSTAT, YK Economic Research
35.0
40.0
45.0
1st 20%
62
2nd 20%
5th 20%
Middle Class in the Making
FOOD AND NON-ALCOHOLIC BEVERAGES
FOOD AND NON-ALCOHOLIC BEVERAGES
0.5
5th 20%
0.4
0.4
0.3
4th 20%
3rd 20%
2nd 20%
2008
0.2
2007
0.1
2006
0.0
2004
-0.1
2003
-0.2
0.2
0.2
-0.3
1st 20%
-0.4
-0.3
-0.4
-0.5
0.0
5.0
10.0
15.0
20.0
25.0
30.0
1st 20%
ALCOHOLIC BEVERAGES AND TOBACCO
2nd 20%
3rd 20%
4th 20%
5th 20%
ALCOHOLIC BEVERAGES AND TOBACCO
2.0
1.6
5th 20%
1.5
1.0
4th 20%
1.4
0.9
2008
2007
3rd 20%
2nd 20%
0.5
2006
0.0
2004
-0.5
2003
-1.0
-1.5
1st 20%
-2.0
-1.9
-2.0
4th 20%
5th 20%
-2.5
0.0
5.0
10.0
15.0
20.0
25.0
Source: TURKSTAT, YK Economic Research
30.0
35.0
1st 20%
63
2nd 20%
3rd 20%
Middle Class in the Making
CLOTHING AND FOOTWEAR
CLOTHING AND FOOTWEAR
1.5
5th 20%
1.1
1.0
1.0
4th 20%
2008
0.5
2007
3rd 20%
2006
0.0
2004
2003
2nd 20%
-0.1
-0.5
-0.7
-1.0
1st 20%
-1.3
-1.5
0.0
5.0
10.0
15.0
20.0
25.0
30.0
35.0
40.0
45.0
1st 20%
50.0
HOUSING, WATER, ELECTRICITY, GAS AND OTHER FUELS
2nd 20%
3rd 20%
4th 20%
5th 20%
HOUSING, WATER, ELECTRICITY, GAS AND OTHER
FUELS
5th 20%
2.0
1.0
4th 20%
2008
2007
3rd 20%
2006
2004
1.4
1.4
1.3
2nd 20%
3rd 20%
4th 20%
0.3
0.0
-1.0
-2.0
2003
2nd 20%
-3.0
-4.0
1st 20%
-4.4
-5.0
0.0
5.0
10.0
15.0
20.0
25.0
30.0
Source: TURKSTAT, YK Economic Research
35.0
1st 20%
40.0
64
5th 20%
Middle Class in the Making
FURNISHINGS, HOUSEHOLD EQ., ROUTINE MAINT. OF THE HOUSE
FURNISHINGS, HOUSEHOLD EQ., ROUTINE MAINT.
OF THE HOUSE
5th 20%
3.0
2.0
4th 20%
3rd 20%
2008
1.0
2007
0.0
2006
2004
2003
2nd 20%
2.5
1.8
1.7
0.1
-1.0
-2.0
-3.0
-4.0
-5.0
1st 20%
-6.0
-6.1
-7.0
0.0
5.0
10.0
15.0
20.0
25.0
30.0
35.0
40.0
45.0
1st 20%
50.0
2nd 20%
3rd 20%
4th 20%
5th 20%
HEALTH
HEALTH
4.0
5th 20%
3.3
3.0
2.0
4th 20%
2008
3rd 20%
2007
1.0
2006
0.0
2004
-1.0
0.1
-0.2
-0.5
2003
2nd 20%
-2.0
-3.0
1st 20%
-2.7
-4.0
0.0
5.0
10.0
15.0
20.0
25.0
30.0
35.0
Source: TURKSTAT, YK Economic Research
40.0
45.0
1st 20%
50.0
65
2nd 20%
3rd 20%
4th 20%
5th 20%
Middle Class in the Making
TRANSPORT
TRANSPORT
6.0
5th 20%
4.0
2.0
4th 20%
2008
2007
3rd 20%
2006
2nd 20%
3.1
2.8
2nd 20%
3rd 20%
3.6
1.1
0.0
-2.0
2004
-4.0
2003
-6.0
-8.0
1st 20%
-10.0
-10.6
-12.0
0.0
10.0
20.0
30.0
40.0
50.0
60.0
70.0
1st 20%
COMMUNICATIONS
4th 20%
5th 20%
COMMUNICATIONS
4.0
5th 20%
2.1
2.0
4th 20%
2008
2007
3rd 20%
2006
2.5
1.4
1.0
0.0
-2.0
2004
2003
2nd 20%
-4.0
-6.0
1st 20%
-7.0
-8.0
0.0
5.0
10.0
15.0
20.0
25.0
30.0
35.0
Source: TURKSTAT, YK Economic Research
40.0
45.0
50.0
1st 20%
66
2nd 20%
3rd 20%
4th 20%
5th 20%
Middle Class in the Making
RECREATION AND CULTURE
RECREATION AND CULTURE
8.0
5th 20%
5.3
6.0
3.6
4.0
4th 20%
2008
2007
3rd 20%
2006
2004
2003
2nd 20%
2.0
2.5
1.0
0.0
-2.0
-4.0
-6.0
-8.0
-10.0
1st 20%
-12.0
-12.4
-14.0
0.0
10.0
20.0
30.0
40.0
50.0
60.0
1st 20%
70.0
2nd 20%
3rd 20%
4th 20%
5th 20%
EDUCATION
EDUCATION
10.0
5th 20%
5.7
5.0
4th 20%
2.0
2008
2007
3rd 20%
2.7
2.1
0.0
2006
2004
-5.0
2003
2nd 20%
-10.0
1st 20%
-12.5
-15.0
0.0
10.0
20.0
30.0
40.0
50.0
60.0
Source: TURKSTAT, YK Economic Research
70.0
80.0
1st 20%
67
2nd 20%
3rd 20%
4th 20%
5th 20%
Middle Class in the Making
HOTELS, CAFES AND RESTAURANTS
HOTELS, CAFES AND RESTAURANTS
3.0
5th 20%
1.8
2.0
1.2
4th 20%
2008
2007
3rd 20%
1.0
0.3
0.0
2006
2004
2003
2nd 20%
-1.0
-0.5
-2.0
-3.0
1st 20%
-2.8
-4.0
0.0
5.0
10.0
15.0
20.0
25.0
30.0
35.0
40.0
45.0
50.0
1st 20%
2nd 20%
3rd 20%
4th 20%
5th 20%
MISCELLANEOUS GOODS AND SERVICES
MISCELLANEOUS GOODS AND SERVICES
2.0
1.0
5th 20%
1.4
1.6
0.8
1.0
4th 20%
2008
3rd 20%
2007
-1.0
2006
-2.0
2004
2003
2nd 20%
0.0
-3.0
-4.0
-5.0
1st 20%
-4.8
-6.0
0.0
10.0
20.0
30.0
40.0
Source: TURKSTAT, YK Economic Research
50.0
60.0
1st 20%
68
2nd 20%
3rd 20%
4th 20%
5th 20%
Quintile Inflation Divergence from the Headline
Divergence from the Headline
1.5%
1.0%
0.5%
0.0%
-0.5%
-1.0%
-1.5%
1.%20
2.%20
3.%20
2004
Source: TURKSTAT, YK Economic Research
2005
2006
69
4.%20
2007
2008
5.%20