Euromoney Country Risk

EUROMONEY COUNTRY RISK

Read the latest analysis on sovereign, geo-political and structural risk

 
Get up to date country risk ratings in 186 countries

Member login



Lost your password?

Euromoney Country Risk

Euromoney Country Risk
List of countries.

Turkey Turkey

Overview Change score Analyses Experts
 
Sponsored section
Turkey – Quick View
ECR score57.07 (Mar 2011)
ECR rank55 (Mar 2011)
Economic
GDP Q3 2010USD 18.95 billion
GNI per capita PPPUSD 13,359
FDI inflow December 2010USD 1,848 million
Inflation January 20110.41%
Central bank assetsUSD 85,224,002.34
Unemployment rate November 201011.2%
Government deficit4.9% of GDP
Tax revenue18.8% of GDP
Political
Government typeParliamentary Democracy
Recent political crisis2008 domestic political crisis
Economic freedom score67th
Freedom of information score138th
Corruption perception index56th
Structural
Birth rate18 per ‘000
Population balanceUnder 14 - 51.72%
Population balanceOver 65 - 13.94%
Life expectancy yearsMales - 71.6 years
Life expectancy yearsFemales - 76.3 years
Mortality rate 20086 per ‘000
Literacy rateMales - 97.03%
Literacy rateFemales - 87.88%
Internet access45%

[Top] Economic Overview

Gross domestic product (GDP)

The GDP for the fourth quarter of 2011 amounted to TRY 29.51 billion, as compared to TRY 28.05 billion in the corresponding period of 2010.

Gross domestic product (GDP)

(Source: turkstat.gov)

 

The GDP growth rate declined from 12.6% in Q1 2010 to 11.9% in Q1 2011 and it continued declining to 5.2% in Q4 2011.

 

Gross national income (GNI) per capita at PPP

Gross national income (GNI) per capita at PPP

(Source: UNDP)

 

The GNI per capita (at 2005 PPP$) has increased from USD 10,840 in 2005 to USD 12,246 in 2011. Turkey’s GNI per capita increased by about 59.4% between 1990 and 2011.

 

Income tax rate

Turkey follows a progressive taxation method. The personal income tax rates vary from 15% - 35%.

 

Taxable Income

Tax on Lower Amount

Tax Rate on Excess (%)

TRY 0 - 8,800

0

15

TRY 8,801 - 22,000

1,320

20

TRY 22,001 - 50,000

3,960

27

Over TRY 50,000

11,520

35

(Source:taxrates.cc)

Corporate tax rate

The corporate tax for both resident and non resident companies is levied at 20%.

(Source:taxrates.cc)

Inflation rate

Inflation rate 

(Source: Central Bank)

FDI inflow

FDI inflow

(Source: Central Bank)

 

The foreign direct investment reflected an increase from USD 462 million in January 2011 to USD 3,498 million in December 2011.

 

Banking sector assets

The table below displays the assets of the Central Bank of the Republic of Turkey:


ASSETS (TRY)

December 2011

December 2010

Total Asset

146,213,614

128,425,176

Foreign Assets

173,108,774

135,575,254

Domestic Assets

-26,895,161

-7,111,727

Cash Operations

6,696,446

134,123

Treasury Dept

7,741,330

7,924,719

CBRT Portfolio

7,816,532

8,022,978

Government Domestic Debt Inst.Prior Nov.5, 2001

0

0

Government Domestic Debt Inst.Purchased from secondary market

7,816,532

8,022,978

Other

-75,202

-98,259

Credits to banking sector

3,049,858

689,345

Other items

-17,487,633

-8,479,942

Revaluation account

-20,198,714

-7,245,849

(Source: Central Bank)

[Top] Financial Indicators & Government Financial

Consumer price index (CPI)

Consumer price index (CPI)

Base year 2003 = 100

(Source: Central Bank)

 

The consumer price index has risen from 182.6 in January 2011 to 201.98 in January 2012. The increase in consumer price index reflects an increase in the prices of consumer goods in the country.

 

Producer price index

Producer price index

(Source: Central Bank)

Interest rates on saving deposits / time deposits

Weighted average interest rates on saving deposits and time deposits:


Saving deposits

Time deposits

Months

Interest rate (%)

Months

Interest rate (%)

Jan-12

0.25

Jan-12

15.95

Dec-11

0.25

Dec-11

15.90

Nov-11

0.25

Nov-11

15.33

Oct-11

0.25

Oct-11

15.13

Sep-11

0.25

Sep-11

14.92

Aug-11

0.25

Aug-11

14.90

Jul-11

0.25

Jul-11

14.99

Jun-11

0.25

Jun-11

14.81

May-11

0.25

May-11

14.74

Apr-11

0.25

Apr-11

13.27

Mar-11

0.25

Mar-11

12.16

Feb-11

0.25

Feb-11

12.01

Jan-111

0.25

Jan-11

12.07

(Source: Central Bank)

During the year 2011, the interest rate on saving deposits remained constant at the level 0.25%.

 

Money supply


Money supply

27-01-2012

30-12-2011

06-01-2012

M1

137,223,226

148,455,145

136,236,864

Currency in circulation

48,341,006

49,347,189

49,408,347

M2

653,688,669

665,642,351

655,522,524

M3

690,214,301

700,491,311

693,068,891

(Source: Central Bank)

 

Central Government Budget Balance and EU-Defined Debt Stock (% of GDP)


 

2009

2010

2011*

2012**

Budget Revenues

22.5

23.0

22.7

23.1

Budget Expenditures

28.0

26.6

24.4

24.6

Budget Balance

-5.5

-3.6

-1.7

-1.5

Budget Revenues (Program-Defined)

21.0

21.8

22.0

22.1

Non-Interest Expenditures (Program-Defined)

22.5

22.2

21.1

21.1

  Primary Balance (Program-Defined)

-1.5

-0.5

0.9

1.0

Total Public Primary Balance (Program-Defined)

-1.0

0.8

1.2

1.1

EU-Defined Nominal Central Government Debt Stock 

46.1 

42.2 

 39.8

 37.0

 

 

 

 

 

 

 

 

 

 

* = Estimate. ; ** = Target.

(Source: Central Bank; 2011 Annual Report)

 

Central Government Budget Deficit and EU-Defined Nominal CentralGovernment Debt Stock (% of GDP)

Budget Deficit Debt Stock (% of GDP)

 (Source: Central Bank; 2011 Annual Report)

 

Public debt levels

Public debt levels
(Source: Central Bank)

The public debt rose from TRY 353,285.64 million in January 2011 to 372,190.71 million in January 2012.

Official exchange rate

 

TRY/USD

2011

2010

2009

Buying

1.670000

1.500364

1.547065

Selling

1.678055

1.507603

1.554529

(Source:Central Bank)

Government finances

Sovereign debt dynamics

Fiscal balance

Fiscal balance

* = Estimate. ; ** = Target.

(Source: Central Bank; 2011 Annual Report)

 

Fiscal deficit for the year 2011 is estimated at -1.7% of the GDP.

 

Total revenue


Revenue (% of GDP)

2011*

2010

2009

2008

Tax Revenues

19.6

19.2

18.1

17.7

Non-Tax Revenues

2.5

3.2

3.8

3.7

* = Estimate.

(Source: Central Bank; 2011 Annual Report)

Tax revenue

Tax revenue

(E)- Estimated target

(Source: Central Bank; 2011 Annual Report)

Current Account Balance - surplus/deficit

 

In recent years, Turkey’s current account balance has registered a constant rate of deficit. In 2009, a positive decline in the current account deficit was observed. In 2010, due to the widening foreign trade deficit and the rapid increase in service expenditures, causing the current account deficit to expand, and in 2011 the deficit reached its widest level, at 77.2 billion USD.

Current Account Balance

(Source; Central Bank)

Balance of payments


Indicators (USD million)

2011

2010

2009

2008

Current Account

-77,238

-46,643

-13,370

-41,524

Capital Account

-30

-51

-51

-61

Financial Account

66,370

58,929

10,065

34,707

Net Errors And Omissions

11,912

2,733

4,147

4,120

Global Balance

1,014

14,968

791

-2,758

 

 

 

 

 

(Source; Central Bank)

[Top] Labour Force and Employment Overview

Labour force

In 2011, the country had a labour force of 26.73 million, of which 24.11 million are employed and the remaining 2.62 million are unemployed. Specifically, of the total labour force, 19.07 million were males and 7.66 million females.

From the total labour force, 17.59 million were from urban areas, of which 15.50 million were employed and 2.09 million were unemployed. Furthermore, a total of 9.13 million individuals in the labour force were from rural areas, of which 8.60 million were employed and 0.53 million unemployed.

(Source:turkstat.gov)

Labour force participation rate

Labour force participation rate (LFPR) realized as 49.9 % with 1.1 percentage points increase compared to the previous year for Turkey in 2011. LFPR was 47.6 % with a 0.8 percentage point increase in urban areas and 54.9 % with a 1.4 percentage point increase in rural areas in this period.

(Source:turkstat.gov)

Unemployment rate

 

Unemployment rate

(Source:turkstat.gov)

The unemployment rate has declined from 10.9% in November 2010 to 9.3% in November 2011.

Unemployment rate (%)

2011

2010

2009

Urban

11.9

14.2

16.6

Rural

5.8

7.3

8.9

Males

9.2

11.4

13.9

Females

11.3

13.0

14.3

(Source: turkstat.gov)

Employment in agriculture


Employment in Agriculture (‘000)

 

2011

2010

2009

Age Group

Male

Female

Male

Female

Male

Female

1-16

292

520

276

443

255

421

17-35

905

1,256

772

1,093

720

992

36-39

127

97

114

105

81

76

40

100

70

80

76

95

77

41-49

428

326

422

352

426

368

50-59

425

311

386

303

362

240

60-71

491

270

462

259

407

186

Above 72

150

48

141

45

127

41

(Source: turkstat.gov)

The number of males employed in the agriculture sector in 2011 was 3.20 million, as compared to 2.96 million in 2010. Furthermore, the number of females employed in agriculture sector also increased from 2.72 million in 2010 to 2.94 million in 2011.

 

(Source: turkstat.gov)

Employment in industries


Employment in Industries (‘000)

 

2011

2010

2009

Age Group

Male

Female

Male

Female

Male

Female

1-16

84

72

88

80

63

59

17-35

424

166

385

157

170

96

36-39

79

13

57

9

39

8

40

375

89

341

91

360

89

41-49

1,416

274

1,374

270

1,355

260

50-59

1,147

241

1,006

207

935

193

60-71

1,279

130

1,165

134

1,100

136

Above 72

416

32

397

40

368

30

(Source: turkstat.gov)

 

The male employee population in the industrial sector in 2011 was 5.32 million, as compared to 4.9 million in the previous year. The female employment in the industrial sector was recorded at 1.02 million in 2010, which increased to 1.06 million in 2011.

 

(Source: turkstat.gov)

Employment in services


Employment in Services (‘000)

 

2011

2010

2009

Age Group

Male

Female

Male

Female

Male

Female

1-16

272

238

157

163

111

133

17-35

660

412

684

444

407

322

36-39

138

36

139

40

95

28

40

1,532

773

1,443

686

1,444

711

41-49

1,442

500

1,459

476

1,513

495

50-59

1,130

330

1,095

290

1,107

280

60-71

2,036

379

1,960

325

2,080

322

Above 72

1,198

152

1,170

118

1,193

126

(Source: turkstat.gov)

 

In 2011, 8.61 million males were employed in the services sector as compared to 8.3 million in the previous year. The female employment in the services sector was recorded at 2.68 million in 2010, which increased to 2.97 million in 2011.

 

(Source: turkstat.gov)

Minimum wage

The minimum wage rate in Turkey is TRY 701.10. This wage rate is a net of tax and social charges for employees aged 16 years and above.

(Source:fedee.com)

Level of unionisation

The trade unions in Turkey include:

·         Confederation of Progressive Trade Unions of Turkey

·         Confederation of Public Workers' Unions

·         Confederation of Turkish Real Trade Unions

·         Confederation of Turkish Trade Unions

The Confederation of Progressive Trade Unions was founded in Istanbul in 1967. The Confederation of Turkish Real Trade Unions was set up at Ankara in 1976 and has about 9-affiliate trade unions. The Confederation of Turkish Trade Unions was established in 1952.

(Source: hakis.org.tr, disk.org.tr, havais.org.tr, turkis.org.tr)

[Top] Political Stability

Turkey is a republican parliamentary democracy. The President is the head of country and is chosen by the parliament. The Grand National Assembly of Turkey is the parliament of the country and is unicameral. The parliament is comprised of 550 statutory members, who are directly elected for a term of four years. The Prime Minister is the head of the government, and he maintains the power to dissolve the parliament.

Currently, Abdullah Gul is the President and Recep Tayyip Erdogan is the Prime Minister of the country.

(Source: fco.gov.uk, bbc.co.uk)

The major political parties in the country include:

·            AKP (Justice and Development Party)

·            CHP (Republican People's Party)

·            MHP (National Movement Party)

·            BDP (Peace and Democracy Party)

(Source: elections.de)

In 2008, the judiciary ruled that the governing party in the country, the AKP, be shut down. The political party was accused of trying to impose Sharia law in the country and affecting the country’s secularism. This incident, termed as the judicial coup d’etat, affected the country’s image as well as its financial markets.

 

Regulatory environment

Turkey is the 67th freest economy in 2011 Index of Economic Freedom. Its economic freedom score is 64.2 which is 0.4 point higher than the previous year. Out of the 43 countries in the European region, Turkey is ranked 30th and its overall score is higher than the world average.

 Economic Freedom

(Source:Heritage.org)

 

Corruption perception

In the 2011 Corruption Perceptions Index (CPI), the country is ranked 61st with a score of 4.2, worsening from its ranking of 56th in the previous year. 

(Source:transparency.org)


Freedom of information

Turkey is ranked 148th in the Press Freedom Index 2011-2012, with a score of 70.00. Turkey took a big step backwards and lost 10 places, Turkey was ranked in the Press Freedom Index 2010 with a score of 49.25. This indicates that the media services in the country are restricted; the judicial system launched a wave of arrests of journalists that was without precedent since the military dictatorship, 1980.

(Source: rsf.org)

 

Istanbul is the media capital which hosts the main press outlets. The various newspapers circulating in the country include:

·         Today's Zaman

·         Hurriyet

·         Sabah

·         Sozcu

·         Haberturk

·         Milliyet

·         Cumhuriyet

(Source: bbc.co.uk; gazeteciler.com)


Judicial system

The country’s judicial powers are exercised through various courts in the judicial system. The country’s laws are based on the constitution.

The various courts in the country include courts of justice, administrative courts, military courts and the constitutional court. Other than the constitutional court, other courts are divided into lower and higher courts.

(Source: yargitay.gov.tr)

 

The Supreme Court

The Supreme Court is in charge of reviewing decisions and judgements given by the other courts of justice. Its formation and manner of working is under the regulations of the special code.The court is divided into civil and criminal chambers, with 23 civil and 15 criminal chambers.

There are about 387 judges, 38 head of chamber and other judges, 812 judge-rapporteur and 200 prosecutors of the court in the Supreme Court.

(Source: yargitay.gov.tr)

[Top] Demographic Overview

Total population

In 2011, Turkey’s total population was 74,724,269, with an annual growth rate of 13.49%. In 2010, the nation had a population of 73,722,988, with a growth rate of 15.88%.

(Source: turkstat.gov)        

 

Of the total population in 2011, 37,532,954 were males and 37,191,315 were females. Additionally, the population density of the nation in 2009 was 97.

 

Population

 

In 2011, the country had 100.9 males per 100 females, indicating a balanced gender ratio in the country.

(Source: turkstat.gov

 

In 2011, of the total population, 18,886,575 were in the age group 0-14 years; 50,346,979 were in the age group 15-64 years and the remaining 5,490,715 individuals were aged 65 and above. The total age dependency ratio was 48.42; of which the youth dependency ratio was 37.51 and the elderly dependency ratio (age group over 65) was 10.91.

(Source: turkstat.gov)

 

Mortality rate

The infant mortality rate in 2010 was 13.7 per 1,000 live births. In the same year, the mortality rate for age group below five years was 17.6 per 1,000 live births. The crude death rate in 2010 was recorded at 5.5 deaths per 1,000 people.

(Source: World Bank)


Birth rate 

In 2010, the birth rate was recorded at 17.9 per 1,000 people.

(Source: World Bank)

 

Life expectancy

In 2011, the life expectancy for males was 72.0 years and for females it was 77.1 years. The median age of the Turkish people is 29.7 years.

(Source: turkstat.gov)


Migration and Urbanisation

The number of international migrants in mid-2010 was 1,411,000 or 1.9% of the total population.

(Source: data.un.org)

 

The average urban population growth rate in 2010-2015 was 1.7%, and the average rural population growth rate was -0.4%. In 2007, 68.44% of the population lived in urban areas.

(Source: data.un.org)

 

Racial/ethnic environment

Turks are the major ethnic group in the country. Other minority ethnic groups recognised by the Turkish Constitution include Jews, Armenians and Greeks. The country also has individuals belonging to ethnic groups such as Kurds, Circassians and Bosnians.

(Source: fco.gov.uk)

 

Human development index (HDI)

Turkey is ranked 92nd out of 187 countries in Human Development Index with a value of 0.699 in 2011. It indicates that the level of human development in the country is high. During the same year, the country’s non-income Human development index value was 0.704.

(Source: UNDP)

[Top] Soft Infrastructure

Education/literacy rate

Of the total population in 2011, the male literate population was recorded at 32,013,033 and female literates were recorded at 29,876,706. Thus thee literacy rate of female population in 2011 was 91.94% as compared to the literacy rate of 90.13% in the previous year. 

(Source: turkstat.gov)

 

Education resources

For the academic year of 2011-12, the number of students enrolled for pre-school (including both private and public) were 1,169,556. About 28,625 schools were available for pre-school education, with 55,883 teachers. The students enrolled for primary education was recorded at 10,979,301, for which 32,108 schools and 515,852 teachers were available.

(Source: turkstat.gov)

 

literacy

(Source: turkstat.gov)

 

About 2,666,066 students were enrolled in 2011-12 for high schools, with an availability of 122,716 teachers and 4,171 schools. The enrolments recorded during the academic year of 2011-12 for vocational and technical high schools were 2,090,220, for which 5,501 schools and 94,966 teachers were available. There are about 1,756 higher educational institutions during the academic year 2010-11 with 111,495 teachers.

(Source: turkstat.gov)

 

Healthcare resources

As per 2010 records, the country had about 1,439 hospitals which included 1,266 general hospitals, 2 emergency and traumatology hospitals, 7 child diseases hospitals, 5 dental hospitals, 2 diabetes hospitals, 14 physical treatment and rehabilitation centres, 18 chest diseases hospital, 11 chest and cardiovascular diseases centres, 26 ophthalmology hospitals, 63 obstetric and child hospitals, 1 cardiology hospitals, 3 bone diseases hospitals, 1 lepra hospitals, 2 occupational diseases hospitals, 5 oncology hospitals, 12 psychiatry hospitals and a veneral diseases hospital. A total of 199,950 beds are available for the 1,439 hospitals in the country.  

 

The nation has about 123,447 physicians including, 63,563 specialist physicians, 38,818 general practitioners, 21,066 medical residents, 116,979 nurses, 51,293 midwifes, 21,432 dentists, 26,506 pharmacists and 94,900 health officers.

 

(Source: turkstat.gov)