Türkiye’s industrial production edges down slightly in May

Industrial production in Türkiye saw a slight annual decline in May but still jumped on a monthly basis, official data showed Wednesday.

The output edged down 0.2% year-over-year in May, the Turkish Statistical Institute (TurkStat) said. Month-over-month, the industrial production index jumped 1.1%. Industrial activity bounced back strongly after the initial COVID-19 wave in April 2020 and expanded for over two years.

The output dropped 8.2% in February after devastating earthquakes killed over 50,000 people, toppled hundreds of thousands of buildings and severely damaged the southeastern region’s infrastructure.

Annual growth has been slowing down as demand declined due to the wider global slowdown, especially in Türkiye’s main trading partners.

The May reading compared to a 1.2% year-over-year drop and a 0.9% monthly decline in April.

The TurkStat data showed two out of three subsectors declined on a yearly basis in May.

“Mining and quarrying index decreased by 7.1%, manufacturing index increased by 0.6% and electricity, gas, steam and air conditioning supply index decreased by 1.3% in May 2023,” it noted.

The production of low and medium-technology declined in the month while medium-high and high-technology increased.

On a monthly basis, all subsectors saw increases-mining and quarrying by 2.4%, manufacturing by 0.9% and electricity, gas, steam and air conditioning supply by 2.4%.

Türkiye changed course when President Recep Tayyip Erdoğan was reelected on May 28, overhauling policies after two years of monetary easing to boost growth, production, exports, investment and jobs.

A reshuffle in economy management since the vote and multiple steps were an initial sign Ankara would revamp policies centered on monetary stimulus and opt for interest rate hikes to combat stubborn inflation, stabilize the volatility in the Turkish lira and rebuild foreign exchange reserves.

Since then, the central bank has hiked its policy rate to 15% from 8.5% and pledged further tightening to fight inflation, while the government has introduced tax and fee hikes to ramp up budget income.