Turkey's industrial growth loses momentum in April

Turkey’s industrial growth loses momentum in April

Turkey's State Institute of Statistics disclosed that the country's April industrial output fell short of expectations, rising only 5.1% year on year. A strong mining output increase of 26.9% contributed to the overall gain. On the other hand, manufacturing output saw a modest rise of 4.2%. A sharp contraction in textile and ready-to-wear output caused industrial output growth to come in below market expectations. April output of textiles dropped off 23.6%, while ready-to-wear output fell 15.2%. Strong competition from China was cited as a major reason for the decline. Furthermore, the automotive sector saw output rise 7.9%. While that is above the industry average for April, it is a significant drop from the 50% year-on-year increase experienced in April 2004. Other sectors recording gains in output include chemicals (10.5%), rubber (24.7%) and metallic goods (47%). As previously reported by SteelOrbis, 2005 first quarter industrial output was revised from 8.2% down to 6.2%. Thus, first quarter GDP (Gross Domestic Product) is expected to fall short of 5%. Furthermore, the benign domestic demand coupled with the moderation in export performance as a result of the economic slowdown in some of the Turkish export markets and sectoral difficulties like those in the textile sector may underpin the modest pace of economic growth.