Turkish manufacturing contracted for the thirty-first month as the Purchasing Managers’ Index slipped to 47.3, prompting economist Mahfi Eğilmez to warn that severe structural deterioration in industry risks major long-term economic damage.
The manufacturing PMI declined from 47.9 to 47.3, showing an extended contraction in operating conditions across the sector, Ekonomim reported. Industrial production figures reveal deep deterioration in sub-items, while shrinking shares of industry within Gross Domestic Product highlight a broader contraction in national output.
- Manufacturing PMI dropped to 47.3, marking 31 months of contraction in factory operating conditions.
- Industry's share of GDP fell from 23 percent to 17 percent.
- Turkey’s manufacturing lacks cost competitiveness against lower-wage nations and imported energy expenses.
Sanayi üretim endeksine baktığımız zaman orada çok ciddi görünüyor, diyen Mahfi Eğilmez pointed to falling investment appetite during an appearance on CNBC-e. “Alt kalemlere indiğimizde özellikle imalat sanayiinde ciddi bir bozulma, ciddi bir gerileme söz konusu üretimde,” Eğilmez stated, adding that worsening future expectations have paralyzed corporate capital expenditures.
The contraction extends far beyond domestic sales and touches export channels constrained by external stagnation. “Çünkü bizim esas ihracat alanımız olan Avrupa’da işler iyi gitmiyor, çok kötü gitmiyor hatta. Dolayısıyla oralarda da daralmalar var,” Eğilmez said regarding weakening demand in European markets.
Eğilmez criticized the overreliance on interest rate adjustments to fix macroeconomic imbalances, arguing that policymakers attribute excessive powers to monetary levers. Past rate cuts and current rate hikes are frequently treated as universal remedies by authorities.
“Ya biz bir şeyleri kaçırıyoruz. Yani faize çok anlam yükledik baştan beri,” Eğilmez noted, rejecting the notion that monetary policy alone can correct complex structural deficits. “Böyle bir dünya yok.”
| Metric | Previous Period | Current Period |
|---|---|---|
| Manufacturing PMI | 47.9 | 47.3 |
| Industry Share of GDP | yüzde 23 | yüzde 17 |
Resolving Turkey’s economic bottlenecks requires addressing non-monetary pillars such as the legal system, educational framework, and governance standards. Expectations remain distorted by institutional weaknesses rather than interest rates alone.
“Bizde insanların gelecekle ilgili ve eğitimle ilgili, hukukla ilgili, demokrasiyle ilgili bu beklentileri bozuk,” Eğilmez explained. “Bunları düzeltmeden biz tek başına faize bu kadar anlam yükletmemizin bir anlamı yok.”
Turkey faces a dual squeeze from cyclical global downturns and permanent losses in manufacturing cost advantages. Heavy reliance on imported energy eliminates raw material cost advantages for local producers.
At the same time, lower labor costs in competing economies like India, Bangladesh, Pakistan, and Far Eastern nations have eroded Turkey’s traditional export edge. “Dolayısıyla buralarla yarışamaz hale de geldik biz de. Çünkü onlar kadar düşük değil. Dolayısıyla o da elimizden gitti,” Eğilmez concluded.
