Concerns for the growth rate

The latest growth figures have revealed that Turkey is now face-to-face with a serious growth problem. Even though we are at the top in comparison to other countries, it looks as if we will be talking about the growth problem more in the next term. 

The seasonally-adjusted gross domestic product (GDP) figures from the first quarter to the second quarter are quite lower than expected; there was only a 0.3 percent increase. When viewed annually, in the second quarter of 2016, Turkey's economy was able to grow only 3.1 percent, a rather low rate. 

The two main items pulling the growth rate down have been net exports and private consumption. The exportation of goods and services declined at a high rate of 2.8 percent which, combined with the drop of 0.5 percent in private consumption, has negatively affected growth. The private investment item, which grew above expectations at a rate of 6 percent, as well as the increase of 3.5 percent in public expenditures, brought a limited increase to the GDP. 

This data disclosed at the end of June, as well as data for the months of July and August, is causing pessimistic interpretations about growth. As a result, despite the end of year target of 4.5 percent, if a growth rate of 3 percent is achieved, it would be regarded as a success. 

Industry production which slowed in June shrank at a very high rate of 8.4 percent in July. Since 2009, a monthly drop to this extent had not been seen. The calendar-adjusted industry production figure also declined 4.9 percent.

The picture for the data in the manufacturing industry in August does not look good either. Capacity usage rates show that weakness in production continued in August; the capacity usage rates for consumer goods in particular have...