Latest Macroeconomic Developments Turkey · Graph 15: Breakdown of GDP The contribution from...
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Latest Macroeconomic Developments
Turkey
April 18, 2013
Economic Research
“This report, prepared by T. Garanti Bankası A.Ş. from sources which we believe to be reliable and trustworthy is provided for information purposes only. Although the comments and assumptions
based on the informations provided from official sources reflect our opinion on that date, these information shall not construe as investment consultancy activity. T. Garanti Bankası A.Ş. does not
accept any liability for any kind of loss arising out of faults and deficiencies in sources herein mentioned and usage of these informations. Our Bank has the copyright of the information in this
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Table of Contents
Macro Comment: Contrary to Expectations Domestic Demand Has Not Bottomed Out in 3Q12… 1
Inflation: Higher Than Expected March CPI due to High Food Prices… 2
FX & Interest Rates: Benchmark Bond Yield Fell to Historic Lows after CBT Rate Cuts… 3
Growth: After Weak Growth in GDP in 4Q’12, Moderate Rise in IP in Jan-Feb’13… 4
Sectorial Details: Upward Trend in Consumption Indicators … 5
Labor: Seasonally Adjusted Unemployment Rate Fell in January’13… 6
Public Finance: The Growth Rate of Non-Interest Expenditures Decelerated in March… 7
Debt: External Debt Ratio Rose Mainly in the Short-Term in 2012… 8
Foreign Trade: Deterioration in Net External Demand with Slowing Exports and Improving Domestic
Demand…9
Balance of Payments: Acceleration in 12M Current Account Deficit in February’13… 10
CBT Balance Sheet: CBT Lowered Short Term Interest Rates More Than Expectations… 11
Banking: Upward Trend Continued in Loan Growth Rate in March… 12
Emerging Markets: Economic Activity Worsened in Most of EM Countries in 4Q12… 13
Charts of the Month 14
Macroeconomic Indicators 15-18
Rating 19
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Macro Comment
1
Contrary to Expectations Domestic Demand Has Not Bottomed
Out in 3Q12…
GDP growth figure for the last quarter of 2012 surprised us as it
pointed out that economy has not bottomed out in 3Q12
contrary to expectations. Yet, GDP growth rate (yoy) was only
1.4% in 4Q12, below 1.6% realization the quarter before and on
seasonal adjusted terms, there was no growth in the economic
activity compared to the quarter before. Accordingly, annual
growth rate declined sharply to 2.2% in 2012 from 8.8% in 2011.
Growth in Turkey was totally driven by external demand, while
domestic demand contracted in all quarters of 2012. Compared
to the third quarter, the contribution from external demand fell
only slightly and the negative contribution from domestic
demand remained almost stable. If we divide domestic demand
into public and private expenditures, the story is completely
different. The contraction in both private consumption and
investment expenditures deepened in 4Q12, lowering GDP
growth rate by 2.5 points. On the other hand, public expenditures
accelerated contributing by 1.8 points to GDP growth. The
changes in stocks caused 0.9 point fall in GDP growth, almost
similar to the quarter before. (page 4)
As we mentioned in our last report, signals for the economic
recovery are moderate in 1Q13 and mainly in consumption
indicators. In addition, there is no clear improvement in
investment expenditures. However, as most of the indicators were
already pointed out a bottoming out in 4Q12, the magnitude of
the strengthening in the domestic demand in 1Q13 became hard
to estimate.
Considering our 2013 growth rate estimate of 4.8%, the risks are
tilted to the downside as of April. Weak economic activity in the
world, especially in Europe is the most important risk on our
estimate. Recent foreign trade statistics indicated that the
contribution from external demand is likely to fall sharply as of
the first quarter of 2013 (graph 44). Due to still contracting
Eurozone economies and narrowing demand from MENA
countries it is getting hard to increase our export market share
in the international market.
In its latest Monetary Policy Committee Meeting note, the CBT
also stressed the worsening in exports. We think the rate cut in
interest rates are mainly aiming to support exporters through
containing appreciation pressure on TL (graph53). However, in
a world of excessive global liquidity (especially to be seen after
BoJ actions), ongoing problems in advanced economies and
positive perceptions regarding Turkish economy, it could be
hard to depreciate TL. Even if TL depreciates as aimed, it might
not lead an acceleration in exports due to weak global
economic activity.
Above mentioned developments pointed out rebalancing of
the economy happened in 2012 is likely to come to an end as
of 1Q13. Only moderate domestic demand recovery and
falling commodity prices would contain the widening in current
account deficit if continues in the rest of the year. Otherwise, it
would be hard to keep financial stability concerns from
escalating.
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Inflation- Higher Than Expected March CPI due to High Food Prices…
Graph 4: Nonfood Diffusion Index (S.A., 3 M.A)
Source: TURKSTAT, Garanti Bank calculations Source: CBTSource: TURKSTAT, Garanti Bank calculations
Graph 1: Inflation (YoY )
Source: TURKSTAT
Graph 3: Food Inflation (YoY)
Source: TURKSTAT, Garanti Bank calculations
Graph 2: Contributors to March CPI
Source: CBT
In March, CPI rose by 0.66%, higher than 0.42% market expectations, pushing annual inflation up to 7.29% from 7.03%. PPI monthly inflation which fell in the previous 3 months rose in March by 0.81%, leading annual PPI to increase to 2.3% from 1.8% the month before.
Annual food price inflation increased sharply to 8.3% from 5.5% the month before. Annual unprocessed food inflation accelerated to 6.8% from 1.9% while annual processed food inflation to 8.7% from 8.4% in March.
The reason behind the higher than expected realization was food prices, contributing 0.5 point to headline inflation. Clothing prices contribution was 0.1 point in March, while there was no major contribution from other sub groups.
Annual core inflation fell only slightly to 5.80% in March from 5.82% in February. The seasonally adjusted core inflation as CBT follows to indicate the trend of core inflation fell from 5.9% in February to 5.6% in March.
In March, inflation outlook much slightly improved for non-food items compared to the previous month if the CBT’s inflation diffusion index was considered.
Graph 6: Expectations
2
Graph 5: Seasonally Adj I Index (Annualized 3-Month avg.)
According to the CBT’s expectation survey of April’13, inflation expectations for the year-end almost remained the same at 6.6% while expected inflation for the next 12 and 24 months slightly decreased to respectively, 6.13% and 5.85%.
7.3%
2.3%
-8%
-4%
0%
4%
8%
12%
16%
20%
2007 2008 2009 2010 2011 2012 2013
CPIPPI
0.49%0.06%
0.04%
0.04%0.01%0.01%0.01%0.01%
-0.01%
-0.1%
0.0%
0.1%
0.2%
0.3%
0.4%
0.5%
0.6%
FoodClothing&text.Rest &hotels
HousingMisc.
HealthRecr. &culture
Household equip.Transportation
0%
2%
4%
6%
8%
10%
12%
-10%
0%
10%
20%
30%
40%
01.10
03.10
05.10
07.10
09.10
11.10
01.11
03.11
05.11
07.11
09.11
11.11
01.12
03.12
05.12
07.12
09.12
11.12
01.13
03.13
Unprocessed foodProcessed food (right)
-4%-2%
0%2%
4%6%
8%10%
12%14%
16%
03.07
07.07
11.07
03.08
07.08
11.08
03.09
07.09
11.09
03.10
07.10
11.10
03.11
07.11
11.11
03.12
07.12
11.12
03.13
4%
6%
8%
10%
12%
14%
15%
25%
35%
45%
55%
65%
03.07
09.07
03.08
09.08
03.09
09.09
03.10
09.10
03.11
09.11
03.12
09.12
03.13
Non-Food Diffusion IndexCPI (YoY, right)
3%4%5%6%
7%8%9%10%
11%12%
04.08
08.08
12.08
04.09
08.09
12.09
04.10
08.10
12.10
04.11
08.11
12.11
04.12
08.12
12.12
04.13
Expected (next 12 months)Expected (next 24 months)Expected end of the yearTarget
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3
FX & Int. Rates- Benchmark Bond Yield Fell to Historic Lows after CBT Rate Cuts…
Source: Reuters Source: Reuters, GarantiBank calculationsSource: Bloomberg, Reuters, GarantiBank calculations
Graph 7: Nominal FX Rates
Source: CBT
Graph 9: TL’s Performance Compared to EM Currencies
Source: CBT Source: Reuters, Garanti Bank calculations
In nominal terms, TL appreciated against USD by 1.2% and remained unchanged against Euro, as of 17th of April on monthly basis; while the appreciation of TL against the currency basket was 0.5% in the same period.
Even if TL slightly depreciated against the currency basket compared to the average of major emerging market currencies after CBT’s rate cuts, as of 18th of April TL appreciated on average compared to March signaling the REER could easily surpass the reference level of 120.
Graph 11: Spread Between 2-Year Swap Rates and Benchmark Graph 12: Yield Curve
The yield curve shifted downwards apparently in both ends by mid-April as a result of CBT rate cuts and reaccelerating capital inflows.
The spread between 2-year swap rate and benchmark bond rate had rose above 0.8 points with the rapid rise in benchmark toward the end of March. The 2-year swap rate fell below 4.7% and the spread to 0.6 points as of 18th of April.
Graph 10: Benchmark Bond Yield
After benchmark bond yield remarkably increased above 6.3% due to the concerns regarding Cyprus bail-out plan toward the end of March, it fell below 5.7% levels with CBT rate cut expectations. After the rate cut, yield fell to historic lows below 5.6%.
Graph 8: CPI Based Real Exchange Rates (2003=100)
In real terms, TL appreciated by 0.6% against currencies of advanced economies and depreciated by 1% against emerging market currencies in March. TL’s appreciation against currency basket was 0.2%, pushing the index level slightly up to 119.95.
80
90
100
110
120
130
140
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
BasketEmerging MarketsAdvanced Economies
4.5
5.5
6.5
7.5
8.5
9.5
10.5
-350 650 1650 2650 365012/06-12 10/10-12 16/11-12
19/03-13 17/04-13
1.10
1.30
1.50
1.70
1.90
2.10
2.30
2.50
04.11
10.11
04.12
10.12
04.13
Basket (0.5$+0.5€)USD/TLEUR/TL
8%
9%
10%
11%
12%
13%
14%
15%
16%
04-12
05-12
06-12
07-12
08-12
09-12
10-12
11-12
12-12
01-13
02-13
03-13
04-13
5.3
6.3
7.3
8.3
9.3
10.3
11.3
-1.0
-0.5
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
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4
Source: TURKSTATSource: TURKSTAT
After a 1.6% rise in February’13, industrial production signed a moderate improvement with a 1.9% rise in the first two months of 2013, compared with same period last year.
The moderate growth in industrial production in January-February period signed again an improvement in the economic activity.
Graph 17: IP Growth Rate (YoY)
Growth – After Weak Growth in GDP in 4Q’12, Moderate Rise in IP in Jan-Feb’13…
Source: TURKSTAT
Graph 15: Breakdown of GDP
The contribution from external demand to GDP in 4Q’12 (2.9 points) was lower than previous quarter (3.1 points) while domestic demand lowered the total GDP by 1.5 points as in the previous quarter.
Source: TURKSTAT
Graph 13: GDP (YoY)
In 4Q’12 Turkish economy grew by 1.4% below 2.2% expectations. Thus, for the whole year, GDP growth rate fell to 2.2% from the revised 8.8% growth in 2011.
Graph 16: GDP (YoY)
Graph 14: Calendar and Seasonal Adjusted GDP
Source: TURKSTAT
Source: TURKSTAT
In 4Q’12,total investment expenditures fell by 4% as in the previous quarter, on a year on year basis, while consumption expenditures rose slightly by 0.4% on the same basis .
On calendar and seasonally adjusted basis, quarterly GDP growth rate was 0%, slightly below the previous quarter (0.1%)
Graph 18: IP vs. GDP (SA, 1Q’08=100)
-17%
-12%
-7%
-2%
3%
8%
13%
2Q06
4Q06
2Q07
4Q07
2Q08
4Q08
2Q09
4Q09
2Q10
4Q10
2Q11
4Q11
2Q12
4Q12
-8%
-6%
-4%
-2%
0%
2%
4%
6%
8%
4Q00
3Q01
2Q02
1Q03
4Q03
3Q04
2Q05
1Q06
4Q06
3Q07
2Q08
1Q09
4Q09
3Q10
2Ç11
1Q12
4Q12
-25%-20%-15%-10%-5%0%5%10%15%20%
4Q06
4Q07
4Q08
4Q09
4Q10
4Q11
4Q12
Foreign Demand
Domestic Demand
-10%
-8%
-6%
-4%
-2%
0%
2%
4%
6%
8%
10%
12%
-40%
-30%
-20%
-10%
0%
10%
20%
30%
40%
50%
2005Ç4
2006Ç4
2007Ç4
2008Ç4
2009Ç4
2010Ç4
2011Ç4
2012Q4
investment - leftconsumption
-25%
-20%
-15%
-10%
-5%
0%
5%
10%
15%
20%
25%
02.07
06.07
10.07
02.08
06.08
10.08
02.09
06.09
10.09
02.10
06.10
10.10
02.11
06.11
10.11
02.12
06.12
10.12
02.13
78
83
88
93
98
103
108
113
3Q '08
4Q '08
1Q '09
2Q '09
3Q '09
4Q '09
1Q '10
2Q '10
3Q '10
4Q '10
1Q '11
2Q '11
3Q '11
4Q '11
1Q '12
2Q '12
3Q '12
4Q '12
Jan-Feb
GDP IP
![Page 7: Latest Macroeconomic Developments Turkey · Graph 15: Breakdown of GDP The contribution from external demand to GDP in 4Q’12 (2.9 points) was lower than previous quarter (3.1 points)](https://reader036.fdocuments.in/reader036/viewer/2022070816/5f0fc3ac7e708231d445c4e3/html5/thumbnails/7.jpg)
Sectorial Details- Upward Trend in Consumption Indicators…
Graph 19: Auto Domestic Sales (YoY)
After a 10% decelerated rise in auto domestic sales in March’13, there was a 11% rise in the first quarter compared with the same period last year.
5
Source: AMASource: WGMA
Source: CBT, Garanti Bank Calculations
There was a 17% rise in passenger car domestic sales , supporting the higher contribution expectations from consumption in 1Q’13, while commercial vehicle domestic sales fell by 1% (YoY).
Graph 21: White Goods Domestic Sales (YoY)
In March’13, there was a rise in domestic orders expectations (next three months), while export orders expectations fell slightly, on a seasonally adjusted basis.
Source: TEİAS
Despite the decelerated fall in March’13, there was a 5.2% fall in 1Q’13 electricity production, signed a divergence with moderate growth in IP in the January-February period.
Source: TURKSTAT
Graph 22: Electricity production (YoY) Graph 23: GDP by Sectors (YoY)
The another leading consumption indicator, white goods domestic sales, rose by 10% in February’13.
Graph 24: Orders Expectations
Source: AMA
In the last quarter of 2012, there was a slight improvement in all sector‘s growth rate, on a year on year basis, while GDP in industry sector fell slightly, on the same basis.
Graph 20: PC & Commercial Vehicle Domestic Sales (YoY)
-60%
-10%
40%
90%
140%
190%
240%
03.07
07.07
11.07
03.08
07.08
11.08
03.09
07.09
11.09
03.10
07.10
11.10
03.11
07.11
11.11
03.12
07.12
11.12
03.13
-60%
-10%
40%
90%
140%
190%
240%
03.08
07.08
11.08
03.09
07.09
11.09
03.10
07.10
11.10
03.11
07.11
11.11
03.12
07.12
11.12
03.13
PCCommercial vehicle
-35%
-15%
05%
25%
Agriculture IndustryConstruction Trade
75
85
95
105
115
125
135
145
06.08
09.08
12.08
03.09
06.09
09.09
12.09
03.10
06.10
09.10
12.10
03.11
06.11
09.11
12.11
03.12
06.12
09.12
12.12
03.13
exports
domestic
-10%
-5%
0%
5%
10%
15%
20%
03.07
07.07
11.07
03.08
07.08
11.08
03.09
07.09
11.09
03.10
07.10
11.10
03.11
07.11
11.11
03.12
07.12
11.12
03.13
-30%-20%-10%0%
10%20%30%40%50%60%
02.08
05.08
08.08
11.08
02.09
05.09
08.09
11.09
02.10
05.10
08.10
11.10
02.11
05.11
08.11
11.11
02.12
05.12
08.12
11.12
02.13
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Labor – Seasonally Adjusted Unemployment Rate Fell in January’13…
Graph 25: Unemployment Rate
Source: TURKSTAT
Graph 29: The Change in The Number of Employed People (S.A, MoM)
Source: TURKSTAT
Graph 27: Number of Unemployed People (000 - S.A)
Source: TURKSTAT
Unemployment rate rose from 10.1% in December’12 to 10.6% in January’13 while there was a slight fall in seasonally adjusted data from 9.5% to 9.4% in this period.
Employment expectations (next three months) sub-index has been rising as of March’13 on a three months average basis.
Source: TURKSTAT
Graph 28: Workforce Participation Rate & Employed People (S.A)
Workforce participation rate remained nearly same (at 50.9%) on a seasonally adjusted basis in January’13 while the number of employed people accelerated slightly compared with previous month, on the same basis.
6
Source: CBT
The rise in the number of employed people in all sectors, except agriculture, lowered the unemployment rate on a seasonally adjusted basis.
Source: TURKSTAT
Graph 30: Real Sector Sentiment Index
Graph 26: Non-Agricultural Unemployment Rate
The number of unemployed people reached 2,890 thousand as of January’13 with a 100 thousand people rise (MoM) while with a slight fall (MoM) it fell to 2,634 thousand people, on seasonally adjusted basis.
Non-agricultural unemployment rate also rose to 12.9% in January’13 from 12.4% in December’12 while seasonally adjusted data fell to 11.7% from 11.9% in this period.
8%
10%
12%
14%
16%
18%
01.07
07.07
01.08
07.08
01.09
07.09
01.10
07.10
01.11
07.11
01.12
07.12
01.13
Unemployment rate S.AUnemployment rate
8%
10%
12%
14%
16%
18%
20%
01.07
07.07
01.08
07.08
01.09
07.09
01.10
07.10
01.11
07.11
01.12
07.12
01.13
Non agriculture (S.A) Total (S.A)
2200
2400
2600
2800
3000
3200
3400
3600
3800
01.09
04.09
07.09
10.09
01.10
04.10
07.10
10.10
01.11
04.11
07.11
10.11
01.12
04.12
07.12
10.12
01.13
46%
47%
48%
49%
50%
51%
52%
20,000
21,000
22,000
23,000
24,000
25,000
26,000
01.07
05.07
09.07
01.08
05.08
09.08
01.09
05.09
09.09
01.10
05.10
09.10
01.11
05.11
09.11
01.12
05.12
09.12
01.13
Employed (S.A.)
Workforce participation rate (S.A) - right
455565758595105115125
03.08
08.08
01.09
06.09
11.09
04.10
09.10
02.11
07.11
12.11
05.12
10.12
03.13-20
0
20
40
60
80
100
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Public Finance– The Growth Rate of Non-Interest Expenditures Decelerated in March…
Source: Ministry of Finance Source: Ministry of FinanceSource: Ministry of Finance
Graph 31: Budget Performance
Source: Ministry of Finance 2012: According to Garanti GDP estimate
Graph 32: Interest Expenditures/Tax Revenues
Source: Ministry of Finance
Graph 33: Indirect Tax Revenues (3 month avg.)
We expect central budget deficit to GDP ratio to remain at 2.0% in 2013.
Interest burden on central budget declined to the lowest levels in early 2013.
Tax on imports jumped significantly, being one of the highest tax increase in 1Q13. Special Consumption Tax revenues decelerated in March, however, continued to stay at high levels.
The growth rate of tax revenues continued to be above budget targets in March. The acceleration is more evident in indirect tax revenues.
The momentum of the growth rate of non-interest expenditures slowed down in March.
On a 12 month cumulative basis, the growth rate of revenues (14%) was slightly lower than the growth rate of expenditures (15%) as of March. Budget deficit was TL 23.3 bln.
Graph 35:Revenues (12 month average, yoy) Graph 36: Expenditures (12 month average, yoy )
7
Graph 34: Budget Performance
Source: Ministry of Finance
-10%
0%
10%
20%
30%
40%
50%
60%
01-10
05-10
09-10
01-11
05-11
09-11
01-12
05-12
09-12
01-13
Total Tax Revenue Income Tax
VAT SCT
-5%
5%
15%
25%
35%
01/10
05/10
09/10
01/11
05/11
09/11
01/12
05/12
09/12
01/13
Personnel Payments Goods&Servs Proc.
Current Transfers Non-Int Payments
160
210
260
310
360
410
Jan-10
May-10
Sep-10
Jan-11
May-11
Sep-11
Jan-12
May-12
Sep-12
Jan-13
(bln TL)
Expenditures
Revenues
5.5%
4.1%3.5%
0.1%0.8%
1.9% 1.4%
-0.5%-1.6% -1.8%
-5.5%
-3.6%
-1.3%-2.0%
-7%
-5%
-3%
-1%
1%
3%
5%
7% Primary Surplus/GDP
Budget Balance/GDP
56.5%
29.6%
36.1%
-10.0%
0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
60.0%
70.0%
01-10
04-10
07-10
10-10
01-11
04-11
07-11
10-11
01-12
04-12
07-12
10-12
01-13
VAT on imports
Special Consumption Tax
30% 28%
18%16%
14%
19%
24%
29%
34%
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Debt – External Debt Ratio Rose Mainly in the Short-Term in 2012…
Source: Treasury Source: Treasury, Garanti Bank calculationsSource: Treasury
Source: Treasury Source: Treasury, Garanti Bank calculations Source: Treasury
EU defined public debt to GDP ratio fell to 36.1% as of end 2012 from 39.1% in 2011.
According to our calculations made on current debt stock, domestic debt payments are high in the following four quarters.
In the first quarter of 2013, domestic debt roll-over ratio remained below full year estimate of the Treasury.
In 2012, the ratio of total external debt of Turkey to GDP rose by 4 points to 43%, of which 3 points rise was in private sector.
The share of short-term external debt of Turkey increased by 3 points to 30%, the highest level in recent history.
According to Treasury figures, external debt payments are low in the rest of 2013, while they are high in early 2014.
Graph 37: EU Defined Public Sector Debt Stock/GDP Graph 38: Domestic Debt Redemption Schedule
Graph 40: Turkey External Debt/GDP Graph 41: Maturity Structure of External Debt Stock Table 1: Financing Table
Graph 39: Foreign Public Debt Redemption Schedule
8
2012 2013 2013
Realization 1Q13Treasury Program
Financing Need 143.8 46.8 188.6
Dom. Debt Service 124.6 40.1 172.1
Principal 84.0 27.6 130.8Interest 40.6 12.5 41.3
Ext. Debt Service 19.2 6.7 16.5
Principal 11.9 4.2 8.8Interest 7.3 2.5 7.7
Financing 143.9 46.8 188.6
Dom. Borrowing 101.5 33.8 150.6Ext. Borrowing 13.6 3.4 13.7Other Financing 20.1 9.6 24.3
Domestic Debt Roll Over Ratio 81.5% 84.3% 87.5%
52.7%
46.5%
39.9%40.0%
46.1%42.3%
39.1%36.1%
0%
10%
20%
30%
40%
50%
60%
2005 2006 2007 2008 2009 2010 2011 2012
100
400
700
1,000
1,300
1,600
1,900
2,200
2,500
(US$, mln) Interest
Principal47.3
41.143.4
45.6 44.2
35.0
12.4
05
101520253035404550
(TL bln)
35%
40%39% 38%
44%
40% 39%
43%
20%
25%
30%
35%
40%
45%
2005
2006
2007
2008
2009
2010
2011
2012
77% 79% 83% 81% 82%73% 73% 70%
23% 21% 17% 19% 18%27% 27% 30%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2005 2006 2007 2008 2009 2010 2011 2012
Long Term Short Term
![Page 11: Latest Macroeconomic Developments Turkey · Graph 15: Breakdown of GDP The contribution from external demand to GDP in 4Q’12 (2.9 points) was lower than previous quarter (3.1 points)](https://reader036.fdocuments.in/reader036/viewer/2022070816/5f0fc3ac7e708231d445c4e3/html5/thumbnails/11.jpg)
Foreign Trade-Deterioration in Net External Demand with Slowing Exports and Improving Domestic Demand…
Source: TURKSTAT, GarantiBank calculations
Graph 42: Exports and Imports (3MA, YoY)
Source: TURKSTAT
Graph 45: Energy and Non-Energy Imports (YoY)
Source: TURKSTAT
Graph 43: Exports/Imports (S.A.)
Source: TURKSTAT
Graph 47: Exports to Country Groups (3MA, YoY)
9
In February, foreign trade deficit was US$6.9 billion lower than the market expectation of US$8.7 billion. Exports rose by 5.8% (YoY) to US$ 12.4 billion while imports increased by 9% to US$ 19.4 billion. Thus, exports decelerated in the first two months of 2013, whereas imports accelerated compared to the Q4 2012.
Source: TURKSTAT, GarantiBank calculations
Graph 44: Real Exports& Real Imports (adjusted series, 3MA, YoY)
Seasonally and calendar adjusted exports rose by 6.2% and imports by 6.5% in February’13 compared to January’13. The ratio of exports to imports on seasonally adjusted basis experienced the lowest level since Nov’2011.
Annual growth rate of exports to EU-25 decelerated to 2% from 7% in February while exports to emerging countries decelerated to 10% from 16% on 3 month average. Exports to North America shrank by 12% on the same basis.
In February, real exports’ annual growth rate was 4.5% while real imports rose by 7.7%, the first negative difference between annual growth rates since Oct’2011, indicating deterioration in net external demand.
Graph 46: Imports Excluding Gold (YoY)
Source: TURKSTAT, GarantiBank calculations
In February, gold imports were US$ 1 billion, reaching the last 7 months’ peak. Imports excluding gold increased only by 4% (YoY) in the same period.
In February, energy imports contracted annually by 3%. Non-energy imports increased by 13% as it bid up in January, underlining the recovery in domestic demand.
50%
55%
60%
65%
70%
75%
80%
85%
90%
2006 2007 2008 2009 2010 2011 2012 2013
-50%
-30%
-10%
10%
30%
50%
02.09
06.09
10.09
02.10
06.10
10.10
02.11
06.11
10.11
02.12
06.12
10.12
02.13
ExportsImports
-60%
-40%
-20%
00%
20%
40%
60%
80%
02.06
08.06
02.07
08.07
02.08
08.08
02.09
08.09
02.10
08.10
02.11
08.11
02.12
08.12
02.13
Energy importsNon-energy imports -50%
-30%
-10%
10%
30%
50%
02.10
08.10
02.11
08.11
02.12
08.12
02.13
Emerging countriesNorth AmericaEU-25Total
-5%
0%
5%
10%
15%
20%
25%
02.10
05.10
08.10
11.10
02.11
05.11
08.11
11.11
02.12
05.12
08.12
11.12
02.13
Real exports
Real imports
-50%
-30%
-10%
10%
30%
50%
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Balance of Payments- Acceleration in 12M Current Account Deficit in February’13…
Graph 48: Current Account Balance (Bn USD)
Source: CBT
Graph 50: Current Account (S.A., mn USD)
After a surplus during August-December ‘12 period, on a seasonally adjusted basis, there was a USD 1.3 billion deficit in non energy current account deficit in January-February’13 period.
10
Source: CBT, Garanti Bank Calculations
Table 3: Hot Money (12 month , mn USD)
Graph 49: Net Energy Bill & CA Deficit (12-month, bn USD)
Source: CBT, Garanti Bank Calculations
Net energy bill slightly decelerated to USD 53.7 billion in February’13 compared with January’13 , on a 12 month cumulative basis .
12 ’12 01 ’13 02 ’13
Current Account Balance -47,476 -47,561 -48,432
Capital and Financial Account 45,553 47,572 51,438
Direct Investment 8,346 7,961 7,691
Abroad -4,073 -4,207 -4,317
In Turkey 12,419 12,168 12,008
Real Estate (Net) 2,636 2,623 2,612
Portfolio Investment 40,780 41,224 43,482
Assets 2,648 1,870 1,981
Liabilities 38,132 39,354 41,501
Equity Securities 6,274 5,953 5,334
Bond 16,835 18,478 21,067
Eurobond 4,823 4,323 3,520
Banks 8,973 9,371 10,343
Other Investment 17,285 25,613 27,251
Assets -1,125 4,102 3,432
Currency Deposits 660 5,676 5,659
Liabilities 18,410 21,511 23,819
Banks 4,691 4,482 6,281
Long Term -260 -1,234 -1,455
Short Term 4,951 5,716 7,736
Other Sectors 6,517 7,057 7,302
Long Term 3,749 4,440 4,582
Short Term 2,768 2,617 2,720
Currency and Deposits 7,783 8,767 7,973
Banks 7,113 7,736 8,079
Reserve Assets -20,814 -27,188 -26,948
Net Errors and Omissions 1,923 -11 -3,006
Together with a USD 5.1 billion deficit in February’13, 12M current account deficit accelerated to USD 48.4 billion.
In February13, residents’ and non residents’ portfolio rose by USD 1.5 billion and USD 1.2 billion while there was a USD 3.0 billion fall in net error & omissions . Thus, hot money rose by USD 0.2 billion (MoM, 12 month cum).
Source: CBT, Garanti Bank Calculations
Table 2: External Financing (12-month, Million USD)
In February’13, net FDI was just USD 0.3 billion, thus, net 12 month cumulative FDI fell to USD 7.7 billion .
Source: CBT, Garanti Bank Calculations
12’12 01’13 02’13
Non-Resident 33,484 35,688 36,868
Government Securities 17,183 18,724 21,313Equity securities 6,274 5,953 5,334
Deposits (TL+FX+Repo) 10,027 11,011 10,221
Resident 7,186 8,149 9,719
ST lending of ban. to oversees -533 -184 -737
ST ext. debt of banking sector 4,951 5,716 7,736
ST ext. debt of private sector 2,768 2,617 2,720
Net Error & Omissions 1,923 -11 -3,006
TOTAL 42,593 43,826 43,581
% of Current Account -90% -92% -90%
-9,000
-6,000
-3,000
0
3,000
2008
2009
2010
2011
2012
2013
Current account
Non energy current account
01020304050607080
02.08
05.08
08.08
11.08
02.09
05.09
08.09
11.09
02.10
05.10
08.10
11.10
02.11
05.11
08.11
11.11
02.12
05.12
08.12
11.12
02.13
Current Account Deficit
Net Energy Bill
-80
-70
-60
-50
-40
-30
-20
-10
02.09
06.09
10.09
02.10
06.10
10.10
02.11
06.11
10.11
02.12
06.12
10.12
02.13
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CBT Balance Sheet - CBT Lowered Short Term Interest Rates More Than Expectations…
Source: CBT Source: CBT Source: CBT, Turkstat
Source: CBT Source: CBT
Graph 56: YoY Change in Monetary Indicators
11
Graph 53: Interest Rates
CBT continued to lower its funding via monthly repo auctions and did not increase its funding much via weekly repo auctions toward the end of March. Hence, CBT’s funding fell below the one third of total funding as of 18th of April compared to its level of almost half of total funding in February.
All monetary indicators’ year on year growth rates accelerated in March, they all continued to increase remarkably above the annual CPI.
In its last meeting, CBT lowered short term interest rates by 50 basis points by indicating that the proper policy would be to keep interest rates low while increasing foreign currency reserves via macro prudential measures .
Graph 54: Reserve Option Coefficients (ROC)
As a result of its stance to keep financial stability against increasing global risks, the CBT led the excess liquidity held by banks to fall to the levels before the 2nd half of 2012 when the CBT squeezed market liquidity. On 29th of March, primary dealers borrowed from the upper bound for the first time since August’12.
Graph 51: Volumes at CBT Funding (TL Mn) Graph 52: Excess Reserves (4-Week avg., US$ mln)
Source: CBT
Graph 55: International Reserves (US$ bn)
FX reserves of the CBT increased by US$ 1.2 billion to US$105.7 billion in March while gold reserves rose by US$ 0.9 billion to US$21.0 billion as a result of ongoing bank preferences to utilize reserve option mechanism.
105.7
21.0
60
70
80
90
100
110
120
130
07.05
04.10
08.10
12.10
04.11
08.11
12.11
04.12
08.12
12.12
Gold FX Reserves
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
04.07 04.08 04.09 04.10 04.11 04.12 04.13
CBT continued to utilize macro-prudential measures by further increasing reserve option coefficients (ROC) in order to balance risks on financial stability due to re-acceleration in capital inflows and credit growth.
-10%
0%
10%
20%
30%
40%
03.10
06.10
09.10
12.10
03.11
06.11
09.11
12.11
03.12
06.12
09.12
12.12
03.13
M1 Emission M2M2Y M3 CPI
1
1.2
1.4
1.6
1.8
2
2.2
2.4
2.6
2.8
0% 20% 40% 60%
Coeefficients
Portions kept as foreign exchange
0
20,000
40,000
60,000
80,000
08.11 12.11 04.12 08.12 12.12 04.13One-week repo O/N Lending (PD)O/N Lending ISE RepoOne-Month Repo 1-Week Repo Traditional
5%
6%
7%
8%
9%
10%
11%
12%
13%
04.11
06.11
08.11
10.11
12.11
02.12
04.12
06.12
08.12
10.12
12.12
02.13
04.13
Avg. funding rate from CBT CBT Policy RateON Lending Benchmark bond rate
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Banking- Upward Trend Continued in Loan Growth Rate in March…
Source: BRSA, Garanti Bank calculations
Graph 58: Change in Credits (Annualized, 13 Week Average)
Credit growth upward trend continued in March both in consumer and commercial loans.
Source: BRSA
Graph 59: Interest Rates on Loans
Source: BRSA *Consumer loans do not include credit cards
Source: BRSA
Graph 60: NPL Ratios
In early 2013, there was a sharp acceleration in other investment loans, pointing out an improvement in investment appetite.
12
Graph 57: Loan Growth Rate (YoY)
As of the first week of April, growth rates (yoy) of consumer and commercial loans are 20% and 18%, respectively. The CBT’s benchmark loan growth rate is 15% for the whole 2013.
Source: BRSA, Garanti Bank calculations Source: BRSA, Garanti Bank calculations
Graph 61:Annual Growth Rates
Compared to end of February, FX deposits increased by some USD 3 bln, while the rise in TL deposits was slight by TL 0.3 bln.
Compared to February, average interest rate on commercial loans fell by 0.6 points in March, however, commercial loan interest rate rose to 12.1% in the first week of April.
Graph 62: Deposits
NPL ratio of total loans rose slightly by 13 basis points to 2.92% in 1Q13.
23%
28%
0%
10%
20%
30%
40%
50%
60%
03/11
05/11
07/11
09/11
11/11
01/12
03/12
05/12
07/12
09/12
11/12
01/13
03/13
Commercial Loans (FX adjusted)Consumer Loans
18.3%
20.2%
10%
15%
20%
25%
30%
35%
40%
45%
03/11
05/11
07/11
09/11
11/11
01/12
03/12
05/12
07/12
09/12
11/12
01/13
03/13
Commercial Loans (FX adjusted)
Consumer Loans
16.0%
11.5%
18.3%
12.1%
8.0%
10.0%
12.0%
14.0%
16.0%
18.0%
20.0% Commercial Loans Consumer Loans
-10%
0%
10%
20%
30%
40%
50%
60%
01-10
04-10
07-10
10-10
01-11
04-11
07-11
10-11
01-12
04-12
07-12
10-12
01-13
Working Capital Loans Total Loans
Credit Cards Other Investment Loans
100
110
120
130
140
300
350
400
450
500
550
01/10
03/10
05/10
07/10
10/10
12/10
02/11
05/11
07/11
09/11
12/11
02/12
04/12
06/12
09/12
11/12
01/13
04/13
TL deposits (TL billion, left)
FX deposits (US$ billion, right)
-1%
1%
3%
5%
7%
9%
11%
03/09
09/09
03/10
09/10
03/11
09/11
03/12
09/12
03/13
Total NPL/Total loans Cons. NPL/Cons. loans
Com. NPL/Com. loans Cards NPL/Total cards
![Page 15: Latest Macroeconomic Developments Turkey · Graph 15: Breakdown of GDP The contribution from external demand to GDP in 4Q’12 (2.9 points) was lower than previous quarter (3.1 points)](https://reader036.fdocuments.in/reader036/viewer/2022070816/5f0fc3ac7e708231d445c4e3/html5/thumbnails/15.jpg)
Emerging Markets- Economic Activity Worsened in Most of EM countries in 4Q12
Graph 66: EM Stock Exchange (03.01.2011=100)
Source: Reuters, Garanti Bank Source: Oxford Economics, Garanti BankSource: Oxford Economics, Garanti Bank
Graph 63: Average Policy Rates in EM Graph 64: Policy Rates & Annual Inflation
Source: IIF, Bloomberg, GarantiBank, *Average monthly funding rate from CBT
Graph 65: EM Currencies Against Basket (0.5*EUR+0.5*USD) (01.01.11=100)
Source: Reuters, Garanti Bank
Rate cuts were 25 basis points in Hungary and India, while 50 basis points in Mexico, Poland and Colombia in March. In April policy rates were reduced by 50 basis points in Turkey. On the other hand, Brazil raised its policy rate (from 7.25% to 7.50%) for the first time since July 2011.
Positive real rates are high in China, Hungary and Poland among selected EM economies.
Czech Republic and Hungary continued to contract in 4Q12, while Turkey and Poland slowed down compared to 3Q12 growth rate.
Compared to the month before, HUF and TRY appreciated by 2.9% and 0.8%, respectively. Monthly depreciations in ZAR, BRL and RUB were 0.2%, 1.0% and 2.9%, respectively as of 15th of April.
Among selected EM economies, GDP growth rate accelerated in Brazil and China, while slowed down slightly in South Korea in the last quarter of 2012.
Stock exchange index rose only in Turkey (2.4%) in monthly basis as of 15th of April, while other indices fell: Hungary (2.4%), South Africa (4.2%), Brazil (6.9%) and Russia (11.1%).
Graph 67: GDP Growth Rate(yoy) Graph 68:GDP Growth Rate (yoy)
13
Source: Bloomberg, Garanti Bank*Czech Republic, South Africa, Hungary, Mexico, Poland, Romania, Russia, Ukraine, Turkey, Indonesia, Colombia, China, S. Korea, Taiwan, Thailand, Malaysia, India, Peru, Brazil, Chile
90
100
110
120
130
140
150
01.01.2011
01.07.2011
01.01.2012
01.07.2012
01.01.2013
TRY ZAR
RUB HUF
BRL
Depreciation
Appreciation
4.0%
4.5%
5.0%
5.5%
6.0%
6.5%
7.0%
7.5%
8.0%
8.5%
11/07
02/08
05/08
08/08
11/08
02/09
05/09
08/09
11/09
02/10
05/10
08/10
11/10
02/11
05/11
08/11
11/11
02/12
05/12
08/12
11/12
02/13
1.0%
4.3%
5.9%
2.2%
5.3%
7.3%
2.1%
6.6%
7.3%
0%
3%
6%
9%
Poland
Mexico
South Africa
Hun
gary
Rom
ania
Turkey*
China
Brazil
Russia
Policy Interest Rates Annual Inflation
708090100110120130140150160
01-11
04-11
07-11
10-11
01-12
04-12
07-12
10-12
01-13
04-13
Turkey South Africa
Russia Hungary
Brazil
1.4%1.4%
6.1%
8.1%
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
9.0%
2012Q1 2012Q2 2012Q3 2012Q4
Brazil South KoreaIndonesia China
-1.7%
-2.8%
1.1%1.4%
-4.0%
-3.0%
-2.0%
-1.0%
0.0%
1.0%
2.0%
3.0%
4.0%
2012Q1 2012Q2 2012Q3 2012Q4
Czech Republic Hungary
Poland Turkey
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Charts of the Month
Source: IMF Source: IMF
14
Table 5: IMF April WEO Forecasts
Source: Turkstat, CBT, Garanti Bank
Graph 71: Energy Bill&Current Account Deficit
In 2012, net energy bill/GDP ratio rose to 6.9% from 6.4% in 2011. Accordingly, other part of current account deficit/GDP was negative due to contracting domestic demand in 2012.
Graph 72:Growth Rate (yoy-4 quarter average) Table 4: IMF April WEO Turkey Forecasts
Source: CBT
In the last quarter of 2012, public expenditures accelerated while private expenditures continued to contract.
Despite the rise in the share of EU Countries in some main exporting sectors of Turkey in the first two months of 2013, continuous concerns about these economies still preserve downward risks on the exports growth rate.
Source: TURKSTAT, Garanti Bank Calculations
The fall in expenses per capita in tourism sector (5%, YoY) stemmed from the lower growth rate in tourism revenue compared with the growth in the number of tourists.
Source: TURKSTAT, Garanti Bank Calculations
Graph 69: The Share of EU Countries in Export Graph 70: Tourism Sector (YoY)
According to IMF April World Economic Outlook (WEO) forecasts, Turkey’s GDP growth rate forecasts were revised from 3.5% to 3.4% for 2013 and 4% to 3.7% for 2014 compared to October WEO forecasts.
According to IMF April World Economic Outlook (WEO) forecasts, world GDP growth rate forecast was revised from 3.5% to 3.3% for 2013 compared to October WEO forecasts. US and Eurozone growth rates were lowered by 0.2 points while Japan growth was risen by 0.4 points.
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
auto clothing textile basicmetal
electricalmac
machine
200720122013/2
-15%
-10%
-5%
0%
5%
10%
15%
20%
25%
02.10
06.10
10.10
02.11
06.11
10.11
02.12
06.12
10.12
02.13
expenses per capita Departing tourist number
4.0%
5.0% 4.6%5.7%
4.4%4.8%
6.4% 6.9%0.4%
1.1% 1.2%
-0.2%
-2.5%
1.4%
3.3%
-0.9%
-4.0%
-2.0%
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
2005 2006 2007 2008 2009 2010 2011 2012
CA Exc. Energy Bill/GDP
Net Energy Bill/GDP
IMF WEO Turkey Forecasts 2013 2014GDP Growth 3.4% 3.7%GDP (billion TL) 1,570 1,722GDP (billion US$) 852 882GDP per capita (US$) 11,236 11,499CPI (year-end) 5.5% 5.0%Unemployment rate 9.4% 9.5%Gen. Gov. Budget Balance/GDP -2.2% -2.3%Gen. Gov. Primary Balance/GDP 0.8% 0.5%Gen. Gov. Public Debt/GDP 35.5% 35.4%Current Account Balance (Bn US$) -57.9 -64.2Current Account Balance/GDP -6.8% -7.3%US$/TL* (year avg.) 1.84 1.95* Calculated over growth figures
2013 2014World Growth 3.3% 4.4% Advanced Economies Growth 1.2% 2.2% US 1.9% 3.0% Eurozone -0.3% 1.1% Japan 1.6% 1.4%Advanced Economies CPI (year avg.) 1.7% 2.0%Emerging and Developing Economies CPI (year avg.) 5.9% 5.6%Oil US$ (avg.) 102.6 97.58
-15%
-10%
-5%
0%
5%
10%
15%
20%Private Consumption&InvestmentPublic Consumption&Investment
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Macroeconomic Indicators – I
15
Grow th 2009 2010 2011 2012 Garanti Gov ernment 1Q 12 2Q 12 3Q 12 4Q 12GDP (TL billion, nominal prices) 953 1,099 1,298 1,417 1,588 1,571 326.9 349.3 376.4 364.2GDP (US$ billion) 617 732 774 786 874 858 181.5 193.5 208.6 202.6GDP (12-month, TL billion, nominal prices) - - - - - - 1,334.7 1,366.6 1,391.9 1416.8GDP (12-month, US$ billion) - - - - - - 771.9 762.8 768.5 786.3GDP Per C apita (US$) 8,559 10,022 10,466 10,500 11,422 11,318 - - - -GDP Yearly Grow th Rate -4.8% 9.2% 8.8% 2.2% 4.8% 4.0% 3.3% 2.9% 1.6% 1.4%Industrial Production 2009 2010 2011 2012 Garanti Gov ernment 11.2012 12.2012 01.2013 02.2013Industrial Production (YoY) -9.9% 12.8% 10.1% 2.5% - - 13.3% -2.8% 2.3% 1.6%Capacity Utilization Rate 65.2% 72.6% 75.4% 73.6% - - 74.0% 73.6% 72.4% 72.2%Labor 2009 2010 2011 2012 Garanti Gov ernment 1Q 12 2Q 12 3Q 12 4Q 12Real Wage Index in Industry (Per hour, 2005=100) 85.7 91.5 98.7 106.7 - - 100.3 102.5 107.5 106.7
YoY C hange -7.7% 6.7% 7.9% 5.2% - - 6.2% 6.1% 5.1% 5.2%Productiv ity Index in Industry (Per hour, 2005=100) 109.0 118.0 122.3 125.8 - - 116.0 122.2 121.2 125.8
YoY C hange 1.1% 8.2% 3.7% -2.1% - - -1.8% 0.6% 0.0% -2.1%2009 2010 2011 2012 Garanti Gov ernment 10.2012 11.2012 12.2012 01.2013
Unemployment Rate 14.0% 11.9% 9.8% 9.2% - 9.0% 9.1% 9.4% 10.1% 10.6%Inflation 2009 2010 2011 2012 Garanti Gov ernment 12.2012 01.2013 02.2013 03.2013C PI (MoM) - - - - - - 0.38% 1.65% 0.30% 0.66%CPI (YoY) 6.5% 6.4% 10.4% 6.2% 6.5% 5.3% 6.2% 7.3% 7.0% 7.3%CPI (A nnual av erage) 6.3% 8.6% 6.5% 8.9% 7.0% - - - - -PPI (MoM) - - - - - - -0.1% -0.2% -0.1% 0.8%PPI (YoY) 5.9% 8.9% 13.3% 2.5% - - 2.5% 1.9% 1.8% 2.3%
PPI (A nnual av erage) 1.2% 8.5% 11.1% 6.2% - - - - - -Deflator 5.6% 5.5% 8.6% 6.8% 7.0% 5.3% - - - -
Source: TURKSTA T, Ministry of Dev elopment, C BT and GarantiBank
Realizations 2013 Forecast Latest Four Realizations
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Macroeconomic Indicators – II
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Interest Rates 2009 2010 2011 2012 Garanti Gov ernment 12.2012 01.2013 02.2013 03.2013Benchmark bond (End of period) 8.9% 7.1% 11.0% 6.2% 6.5% - 6.2% 5.8% 5.7% 6.4%F ixed Int. Rate Dom. Borrow ing A v erage C ost 11.5% 8.5% 9.1% 5.8% - - 5.8% 6.5% 6.2% 6.5%Dom. Borrow ing C ash Maturity (Month) 32.6 43.1 38.2 21.7 - - 21.7 57.4 54.5 59.7O /N (End of period) 6.5% 1.5% 5.0% 5.0% - - 5.0% 4.8% 4.50% 4.50%Eurobond (2030, Yield) 6.4% 5.7% 6.1% 4.0% - - 4.0% 4.3% 4.5% 4.7%Foreign C urrency 2009 2010 2011 2012 Garanti Gov ernment 12.2012 01.2013 02.2013 03.2013Basket (0.5*USD+0.5*EURO , end of period) 1.8150 1.7976 2.1829 2.0672 2.13 - 2.0672 2.0697 2.0839 2.0672EURO /US$ (end of period) 1.44 1.33 1.29 1.3193 1.31 - 1.32 1.35 1.31 1.28TL/USD (av erage) 1.5462 1.5070 1.6742 1.7791 1.81 - 1.7791 1.7639 1.7699 1.8072TL/USD (end of period) 1.4873 1.5460 1.9065 1.7826 1.84 - 1.7826 1.7588 1.8050 1.8137TL/EURO (end of period) 2.1427 2.0491 2.4592 2.3517 2.41 - 2.3517 2.3805 2.3627 2.3206Balance of Payments (US$ million) 2009 2010 2011 2012 Garanti Gov ernment 11.2012 12.2012 01.2013 02.2013Exports (f.o.b) 102,143 113,883 134,906 152,537 165,000 158,000 13,760 12,614 11,498 12,435Imports (c.i.f) 140,929 185,544 240,839 236,543 263,000 253,000 20,948 19,827 18,801 19,394C urrent A ccount Balance -12,168 -45,447 -75,092 -46,935 -62,000 -60,700 -4,022 -4,823 -5,817 -5,126C urrent A ccount Balance (12-month) -12,168 -45,447 -75,092 -46,935 -62,000 -60,700 -49,160 -47,476 -47,561 -48,432C urrent A ccount Balance/GDP -2.0% -6.2% -9.7% -6.0% -6.8% -7.1% - - - -Non-energy C .A . Balance (12-month) 15,160 -9,973 -25,699 7,122 - - 4,774 6,582 6,237 5,309Net Tourism Rev enue 18,405 17,391 20,171 21,559 - 25,400 1,462 994 795 727Foreign Direct Inv estment (Net) 7,110 7,572 13,698 8,335 - - 317 599 486 311C apital A ccount Balance 9,289 44,042 65,659 44,971 - - 4,623 6,486 5,594 6,773Eurobond Issues (net) 3,750 6,698 4,275 7,073 - - 0 1,000 0 197
Source: Treasury , C BT, TURKSTA T, Ministry of Dev elopment, Reuters and GarantiBank
2013 Forecast Latest Four RealizationsRealizations
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Macroeconomic Indicators – III
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Total External Debt Stock 2009 2010 2011 2012 Garanti Gov ernment 1Q 12 2Q 12 3Q 12 4Q 12Total External Debt Stock (US$ Billion) 269.6 292.3 306.6 336.9 - - 316.3 321.1 325.4 336.9
Public 96.8 100.8 103.8 110.8 - - 111.1 111.7 109.2 110.8Priv ate 172.8 191.5 202.8 226.0 - - 205.2 209.4 216.2 226.0
F inancial Sector 57.3 82.1 89.5 111.5 - - 96.3 99.6 104.6 111.5Real Sector 115.5 109.4 113.2 114.5 - - 109.0 109.8 111.6 114.5
Short-term 49.0 77.5 83.8 101.0 - - 88.4 96.6 98.2 101.0F inancial Sector 21.9 47.7 48.0 58.4 - - 48.5 52.0 56.1 58.4
Long-term 220.6 214.8 222.7 235.9 - - 227.9 224.5 227.2 235.9Total External Debt Stock/GDP 43.7% 40.0% 39.7% 42.8% - - 41.0% 42.1% 42.3% 42.8%
Public/GDP 15.7% 13.8% 13.4% 14.1% - - 14.4% 14.6% 14.2% 14.1%Priv ate/GDP 28.0% 26.2% 26.2% 28.7% - - 26.6% 27.5% 28.1% 28.7%
F inancial Sector/GDP 9.3% 11.2% 11.6% 14.2% - - 12.5% 13.1% 13.6% 14.2%Real Sector/GDP 18.7% 15.0% 14.7% 14.6% - - 14.1% 14.4% 14.5% 14.6%
Short-term/GDP 8.0% 10.6% 10.8% 12.8% - - 11.4% 12.7% 12.8% 12.8%F inancial Sector/GDP 3.5% 6.5% 6.2% 7.4% - - 6.3% 6.8% 7.3% 7.4%
Long-term/GDP 35.8% 29.4% 28.8% 30.0% - - 29.5% 29.4% 29.6% 30.0%Reserv es (US$ million) 2009 2010 2011 2012 Garanti Gov ernment 12.2012 01.2013 02.2013 03.2013Total F oreign Reserv es 74,810 85,960 88,218 120,290 - - 120,290 123,344 124,606 126,687C entral Bank Reserv es 70,689 80,696 78,330 100,320 - - 100,320 103,551 104,437 105,650C B Net FX Position 37,182 50,156 41,886 43,856 - - 43,621 44,526 44,312 45,227Monetary A ggregates (US$ billion) 2009 2010 2011 2012 Garanti Gov ernment 12.2012 01.2013 02.2013 03.2013M1 68.6 86.6 77.9 93.7 - - 93.7 88.9 86.4 91.0
M2 326.0 380.2 349.1 409.5 - - 409.5 416.6 405.5 410.0M3 344.5 398.6 367.4 433.5 - - 433.5 439.8 429.4 435.1
Base Money 42.7 48.9 43.9 43.4 - - 43.4 39.9 41.6 45.4O pen Market O peration (End of period) -12.5 -7.0 -20.5 -10.9 - - -10.9 -9.0 -8.5 -12.7
Realizations 2013 Forecast Latest F our Realizations
Source: Treasury , Ministry of Dev elopment, C BT and GarantiBank
![Page 20: Latest Macroeconomic Developments Turkey · Graph 15: Breakdown of GDP The contribution from external demand to GDP in 4Q’12 (2.9 points) was lower than previous quarter (3.1 points)](https://reader036.fdocuments.in/reader036/viewer/2022070816/5f0fc3ac7e708231d445c4e3/html5/thumbnails/20.jpg)
Macroeconomic Indicators – IV
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Banking Sector (TL Billion) 2009 2010 2011 2012 Garanti Gov ernment 1Q 12 2Q 12 3Q 12 4Q 12A ssets 834.0 1,006.7 1,217.7 1,370.6 - - 1,228.9 1,273.7 1,308.5 1,370.6A ssets/GDP 87.6% 91.6% 94.0% 96.7% - - 92.1% 93.2% 94.0% 96.7%Loans 392.6 525.9 682.9 794.8 - - 699.1 737.2 755.6 794.8Loans/GDP 41.2% 47.9% 52.7% 56.1% - - 52.4% 53.9% 54.3% 56.1%
Commercial Loans/GDP 27.6% 32.1% 35.4% 37.0% - - 35.0% 35.9% 35.8% 37.0%Consumer Loans/GDP 13.6% 15.7% 17.3% 19.1% - - 17.4% 18.0% 18.5% 19.1%
Housing 44.9 60.8 74.7 85.1 - - 74.2 77.3 80.0 85.1A uto 4.4 5.7 9.1 8.0 - - 7.3 7.5 7.7 8.0O ther 44.0 62.6 91.2 100.2 - - 89.0 93.1 96.0 100.2C redit C ards 37.6 45.2 58.5 77.5 - - 61.7 68.0 73.4 77.5
Deposits 514.6 617.0 695.5 771.9 - - 696.4 718.8 738.0 771.9FX Deposits (Billion US$) 116.4 119.8 126.7 142.0 - - 135.9 139.3 138.4 142.0Deposits/GDP 54.0% 56.2% 53.7% 54.5% - - 52.2% 52.6% 53.0% 54.5%Shareholders' Equity 110.9 134.5 144.6 165.9 - - 147.7 152.6 158.4 165.9Shareholders' Equity /GDP 11.6% 12.2% 11.2% 11.7% - - 11.1% 11.2% 11.4% 11.7%C entral Gov ernment Budget (TL Billion) 2009 2010 2011 2012 Garanti Gov ernment 12.2012 01.2013 02.2013 03.2013Rev enues 215.1 254.0 295.9 331.7 378.4 370.1 27.3 36.9 32.5 24.8Expenditures 267.3 293.6 313.3 360.5 411.1 404.0 42.8 30.9 33.9 30.2Interest Payments 53.2 48.3 42.2 48.4 50.8 53.0 1.7 5.2 5.0 4.9Budget Balance -52.2 -39.6 -17.4 -28.8 -32.7 -33.9 -15.5 5.9 -1.4 -5.4Primary Balance 1.0 8.7 24.8 19.6 18.1 19.1 -13.8 11.2 3.5 -0.5C entral Gov ernment Domestic Debt Stock 330.0 352.8 368.8 386.5 - - 386.5 388.9 390.8 -
Interest Expenditures/GDP 5.6% 4.4% 3.3% 3.4% 3.1% 3.4% 3.4% - - -Budget Balance/GDP -5.5% -3.6% -1.3% -2.0% -2.0% -2.2% -2.0% - - -
Primary Balance/GDP 0.1% 0.8% 1.9% 1.4% 1.1% 1.2% 1.4% - - -C entral Gov ernment Debt Stock 2009 2010 2011 2012 Garanti Gov ernment 1Q 12 2Q 12 3Q 12 4Q 12
C .G. Domestic Debt Stock/GDP 34.6% 32.0% 28.5% 27.3% - - 28.1% 27.6% 27.9% 27.3%C .G. External Debt Stock/GDP 12.0% 10.6% 11.5% 10.3% - - 10.8% 10.7% 10.5% 10.3%
Total Public Debt Stock/GDP 48.9% 45.0% 42.2% 39.7% - - 41.1% 40.3% 40.3% 39.7%
Total Public Net Debt Stock/GDP 32.5% 28.8% 22.4% 17.0% - - 21.7% 20.1% 18.1% 17.0%
EU Defined Debt Stock/GDP 46.1% 42.4% 39.4% 36.1% 35.7% 35.0% 37.8% 37.1% 36.8% 36.1%
Source: BRSA , C BT, TURKSTA T, M inistry of F inance, Ministry of Dev elopment, Treasury and GarantiBank
Realizations 2013 Forecast Latest F our Realizations
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Rating
Foreign Currency Local CurrencyLatest Change Direction
Turkey S&P Long-Term Outlook/Watch Long-Term
08.03.2004 B+ Positive BB-
17.08.2004 BB- Positive BB
29.06.2006 BB- Stable BB
03.04.2008 BB- Negative BB
01.08.2008 BB- Stable BB
14.11.2008 BB- Negative BB
18.09.2009 BB- Stable BB
19.02.2010 BB Positive BB+
20.09.2011 BB Positive BBB-
01.05.2012 BB Stable BBB-
27.03.2013 BB+ Stable BBB ↑
Turkey Moody's F.C. L-T Outlook/Watch L.C. L-T Latest Change Direction
30.09.2004 B2 Stable B2
11.02.2005 B1 Positive B1
15.12.2005 Ba3 Stable Ba3
18.09.2009 Ba3 Positive Ba3
08.01.2010 Ba2 Stable Ba2
05.10.2010 Ba2 Positive Ba2 ↑
Turkey Fitch F.C. L-T Outlook/Watch L.C. L-T Latest Change Direction
09.02.2004 B+ Stable B+
25.08.2004 B+ Positive B+
13.01.2005 BB- Stable BB-
14.12.2005 BB- Positive BB-
10.05.2007 BB- Stable BB-
12.12.2007 BB- Stable BB
03.12.2009 BB+ Stable BB+
24.11.2010 BB+ Positive BB+
23.11.2011 BB+ Stable BB+
05.11.2012 BBB- Stable BBB ↑
Other Emerging Markets S&P F.C. L-T Outlook/Watch L.C. L-T Latest Change Direction
Russia 21.12.2009 BBB Stable BBB+ ↑
Hungary 23.11.2012 BB Stable BB ↓
Brazil 18.11.2011 BBB Stable A- ↑
Poland 27.10.2008 A- Stable A ↓
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