Commercial Magazine


By Victor Whitman

As an ally of the United States and a NATO member, the Republic of Turkey has long been considered one of the most Western-oriented nations in the Middle East. The nation of 82 million people, however, has been tested recently by an economic downturn, as well as political tension both internally and with its Western allies.

Founded out of the remnants of the Ottoman Empire, Turkey is strategically located between Europe and the Middle East. It shares borders with Bulgaria and Greece to the northwest; Armenia and Iran to the east; and Iraq and Syria to the south. Istanbul, formerly known as Constantinople, has a history that extends more than 2,700 years and remains the nation’s largest city with 15 million residents.

Turkey, a predominantly Islamic country with a secular tradition, developed a largely free-market economy and multiparty democracy after World War II. The regime under Turkish President Recep Tayyip Erdogan, however, has been increasingly labeled authoritarian and pro-Islamist in its outlook.

Erdogan, the former prime minister and leader of the dominant Justice and Development Party, assumed a largely ceremonial position as president in 2014. A 2017 referendum made the office an executive post with heightened judicial and executive powers.

Turkey recently wrangled with the U.S. over an announced deal to purchase an advanced missile system from Russia. Turkey has been embroiled in Syria’s civil war and Turkish forces fought alongside non-Kurdish factions in the Syrian opposition to the Assad government. Turkey also has had decades-long internal strive with Kurdish separatists in the southeast part of the country.

Turkey has the 27th-largest export economy in the world and the 52nd-most complex economy, according to the Observatory of Economic Complexity. Top export products include cars, gold, delivery trucks, vehicle parts and jewelry. Major export destinations include Germany, the U.K., Italy, the United Arab Emirates and Iraq.

Last year, Turkey’s economy entered its first recession in a decade, with gross domestic product (GDP) posting negative growth for two consecutive quarters to end 2018. The Turkish lira also lost some 30% of its value last year and another 14% in the first few months of 2019, The Hill reported. According to Trading Economics, the unemployment rate soared to 14.7% in first-quarter 2019 after averaging about 10% since 2005, and Turkey’s economy grew by 1.3% in the first quarter of this year after GDP contracted by 2.4% in fourth-quarter 2018.

The Turkish economy also is notable for ballooning debt and extraordinarily high inflation, the latter of which was hovering around 16% this past June, although it has fluctuated wildly since 1965. Turkey’s currency was battered last year when the Trump administration doubled tariffs on steel and aluminum exports to the U.S. In announcing the tariffs in August 2018, President Donald Trump tweeted that “relations with Turkey are not good at this time.”


You might also like...