Turkey’s economy shrinks by 9.9 percent in the second quarter

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According to the Second Quarterly Gross Domestic Product (GDP) figures announced by the Turkish Statistical Institute (TurkStat) on its website today (August 31), Turkey's economy contracted by 9.9 percent in the April-May-June 2020 period when compared to the same period last year.

Economists were expecting that Turkey's economy would shrink by 11 percent on average in the second quarter of 2020.

Other highlights from the TurkStat statistics are as follows:

When the activities which constitute the GDP were analyzed; the value added increased by 4 percent in agriculture, by 11 percent in information and communication, by 27.8 percent in financial and insurance activities and by 1.7 percent in real estate activities.

A decrease was observed in the value added of the following sectors: 16.5 percent in industry, 2.7 percent in construction sector, 25 percent in services, 16.5 percent in professional, administrative and support service activities, 2.4 percent in public administration, education, human health and social work activities and 18 percent in other service activities.

GDP increased by 1.3 percent and reached 1 trillion 041 billion 643 million Turkish Lira (TRY) at current prices. GDP realized 153 billion 180 million US Dollars in the second quarter of 2020.

Consumption expenditures decreased

According to the TurkStat figures, the government final consumption decreased by 0.8 percent, final consumption expenditure of resident households decreased by 8.6 percent and gross fixed capital formation decreased by 6.1 percent in the second quarter of 2020 compared with the same quarter of the previous year in the chained linked volume index.

Imports of goods and services also decreased by 6.3 percent in the second quarter of 2020 compared with the same quarter of the previous year in the chained linked volume index, exports of goods and services decreased by 35.3 percent in the same period. 

Compensation of employees increased by 0.5 percent and net operating surplus/mixed income decreased by 2.4 percent in the second quarter compared with the same quarter of the previous year, respectively.

The share of compensation of employees in the Gross Value Added at current prices was 36.8 percent in the second quarter of 2020 while it was 36.7 percent in 2019. The share of net operating surplus/mixed income was 43.9 percent while it was 45 percent in the same quarter last year.

The growth rate of Turkey were as follows in the first, second, third and fourth quarters in the 2010-2020 period:

(HA/SD)