ECONOMIC OUTLOOK TURKEY

EMBASSY OF THE REPUBLIC OF TURKEY Office of the Commercial Counsellor

TURKEY-SPAIN COMPARATIVE ECONOMIC

INDICATORSTURKEY SPAIN (Euro)

POPULATION 70 Million 44,4 Million

GNP 658,8 Billion $ 1.049 Billion Euro

GROWTH RATE % 4,5 % 3,8

GNP PER CAPITA 9.330 $ 23.486 Euro

INFLATION % 8,4 % 4,2

UNEMPLOYMENT % 9,9 % 8,6

FOREIGN TRADE VOL. 277,3 Billion $ 461,9 Billion Euro

FDI INFLOW 22 Billion $ 40 Billion Euro

INTREST RATES % 21,5 % 3,28

MACRO ECONOMIC PERFORMANCE Average GNP growth rate : 6.9 %. Very

successfull performance for the economy for the last 5 years.

Turkey ranked 15th largest economy of the world and 6th largest compared to EU 27 in 2007.

Turkey showed very succesfull performance in all important macro indicators such as unemployment and inflation.

Very similar to Spain; FDI and Tourism revenues are vital for the economy.

Export revenues are increasing but high current account deficit is major problem.

GNP BY SECTORS Automotive, textile-clothing,

electronics, food, iron-steel and chemicals are the main industry divisions.

Agricultural production is still very important and competitive.

Turkey has almost all natural mineral resources except oil and gas.

City of İstanbul and Marmara region are the main contributor to the GNP.

TURKISH CONTRACTING SECTOR

Turkish contracting sector operating abroad enhanced their activities in 2006 and 2007. Total amount of the projects undertaken by the Turkish companies reached 12,7 and 15 billion $ in these years respectively.

There are 18 Turkish Construction companies in the ENR Top 225 International Contractors 2007 list. Leading Turkish contractors ; ENKA, GAMA, TEKFEN, YUKSEL, BAYTUR are the front runners in the ENR list.

PRIVATIZATION IMPLEMENTATIONS (Billion $)

From 1985 to the end of 2002 ; 8.1 billion $ revenue was realized from the privatization. After 2002 there is significant succes in privatization process of the state companies. In 2005, Turkey reached its maximum with revenue of 8.2 billion $ from privatization. Between 2003-2007, gross revenue was recorded 22 billion $.

FDI INFLOWS (Billion $)

Turkey is the 13th highest FDI inflow in the world and 3rd among the emerging countries in 2006.

At the end of 2007 cumulative FDI in Turkey reached 70 billion $.

52 billion of total has been realized for the last 3 years.

Trade, manufacturing, real estate, telecomunication, construction and tourism are the main areas that FDI in Turkey concentrated.

COMPETITIVE ECONOMIC STRUCTURE World Economic Forum Global Competitiveness Report 2006-2007

TURKEY-SPAIN TRADE AND ECONOMIC RELATIONS

EMBASSY OF THE REPUBLIC OF TURKEY Office of the Commercial Counsellor

IMPORTANT FACTS Spain is the member of the E.U., there is Custums Union between Turkey

and E.U. (Free circulation of goods between Turkey and E.U./Spain.)

Spanish Government supports Turkey’s full membership to the E.U.

Alliance of Civilization Project

Strategic Partnership

Expansion of trade and economic relations in a short term period.

Spanish Government identified Turkey as one of the “target emerging market” for Spanish investors and companies. A strategic plan was prepared for Turkey. Similar plans also exist for India, China, Brazil etc.

TURKEY FOREIGN TRADE I

Million $ EXPORT IMPORT BALANCE

VOLUME

2004 63.167 97.540 -34.373 160.707

2005 73.476 116.774 -43.298 190.251

2006 85.535 139.576 -54.041 225.111

2007 107.184 170.048 -62.864 277.233

TURKEY FOREIGN TRADE II

Export %

Clothing-Textile 15,7

Vehicles-Automotives/Parts 14,8

Machinery and Mechanical Appliances

8,2

Iron and Steel 7,8

Electrical Machinery-Equipment

6,9

Mineral Fuels – Oils 4,8

Import %

Mineral Fuels-Oils 19,9

Machinery and Mechanical Appliances

13,2

Iron and Steel 9,5

Electrical Machinery-Equipment

7,8

Vehicles-Automotives/Parts 7,3

Plastics and Articles 5,1

TURKEY FOREIGN TRADE IIITOP EXPORT DESTINATIONS İİİİİ

Germany : % 11,2

U.K. : % 8

Italy : % 7

France : % 5,6

Russian Fed. : % 4,4

Spain : % 4,3

USA : % 3,9

Romania : % 3,4

E.U. 27 : % 56,3

TOP IMPORT ORIGINSRussian Fed. : % 13,9

Germany : % 10,3

China : % 7,8

Italy : % 6

USA : % 4,8

France : % 4,6

Iran : % 3,9

U.K. : % 3,2

E.U. 27 : % 40,3

TURKEY-SPAIN FOREIGN TRADE – 2007/Euro

EXPORT to Spain

4.212.100

Vehicles-Automotives/Parts Iron and Steel

1.033.164

442.584

Clothing (61-62)Electrical Machinery-Equipment

855.726

259.426

Machinery and Mechanical AppliancesMineral Fuels – Oils

245.554

173.116

Iron and Steel Products

143.622

IMPORT from Spain

2.961.500

Vehicles-Automotives/Parts Machinery and Mechanical Appliances

785.145

415.168

Plastics and articles there ofElectrical Machinery-Equipment

199.491

184.812

Iron and Steel Organic ChemicalsMineral Fuels – Oils

184.364

147.038

68.860

ECONOMIC COOPERATION Ankara-Eskisehir High-Speed Train Project (OHL-CAF/Alarko)

Borusan’s Investment in Spain : Investment of Turkish companies in Spain is very weak. On the other hand some Turkish companies have export offices in Spain.

Asociacion Foro Empresarial Hispano Turco was founded in 2007 by several Spanish and Turkish Businessmen in Madrid.

Mapfre’s Investment in Turkey : Total investments of Spanish companies in Turkey has reached aprox. 1 billion Euro in 2007.

Spanish investments in Turkey are mainly on trade, finance, tourism, cement production, real estate sectors.

La Caixa, Bank Sabadel have opened branch offices in İstanbul.

POTENTIAL AREAS FOR TRADE AND INVESTMENT

Renewable Energies Construction and

Contracting Sector Tourism Consulting Real Estate Banking Tecnology Development Agriculture (Southern

Anatolian Project-GAP) Privization Process in

Turkey offers new opportunities

Cement Iron and steel Agricultural Machinery Plastics Chemical Products Fishery Pharmacy Aluminium products Vehicles-Automotives/

Parts Electrical Machinery-

Equipment Machinery

TURKEY-SPAIN TRADE AND ECONOMIC RELATIONS

Hakan KarabalıkEMBASSY OF THE REPUBLIC OF TURKEY

Commercial Counsellor