On other estimates, Türkiye’s medium-term economic programme targets a higher GDP (at current prices) growth of 3.5 per cent in 2025, 4.5 per cent in 2026 and 5 per cent in 2027 to Tl 83.1 trillion or $1.77 trillion, on the back of same economic reforms and structural adjustments. The programme also targets a per capita GDP of $20,420 in 2027. The 2024 GDP at current prices is expected to rise to Tl 44.2 trillion or $1.33 trillion – up from Tl 26.5 trillion ($1.13 trillion) in 2023.
Türkiye’s economy was cautiously optimistic in 2024, with a 2.7 per cent growth forecast.
The country remains a key EU textile supplier but faces challenges, including a decline in apparel exports.
Manufacturing slows due to weak demand, and the textile sector saw job losses.
Initiatives like the ‘Eco Dyeing and Printing Workshop’ promote sustainable textiles and job creation.
Ties with Europe
The country continued to be the second-largest textile and third-largest clothing supplier to the European Union, with Germany, the Netherlands and Spain being the top three European buyers of Türkiye-made textiles and apparel. On the bilateral trade side, Türkiye agreed to start talks, paused during the elections, with the UK to revise their FTA (Free Trade Agreement) as both sides want to strengthen economic ties. The talks are expected to extend the FTA’s scope to include services and investments. Both sides discussed ways to surpass $20 billion in bilateral trade in 2024.
January-April trade
In January to April period of 2024, Türkiye’s apparel exports, totalling to $5.638 billion, declined 11.2 per cent, compared to $6.344 billion in the corresponding period of 2023. During this period, exports of knitted and crocheted clothing and accessories (HS Chapter 61) amounted $3,098.316 million, decreasing 8.9 per cent against $3,400.237 million in the previous year. For the non-knitted apparel and accessories (HS Chapter 62), the decline was even higher at 13.7 per cent from $2,944.030 million to $2,540.350 million. Exports in April alone was of $1,200.974 million that registered a drop of 16.08 per cent, inclusive of a 11.2 per cent fall in exports of knitted and crocheted clothing and accessories which totalled to $689.624 million compared to $776.663 million in April 2023. During the same month, the shipments of non-knitted apparel and accessories also declined by 21.8 per cent, from $654.030 million to $511.350 million. In 2023, the country’s total apparel exports had eased by 5.86 per cent to $18.321 billion from $19.463 billion in 2022, while country’s apparel exports in 2021 were recorded at $18.294 billion.
On the import side, the imports of cotton, cotton yarn and cotton textiles (HS Chapter 65) dropped 14.4 per cent to $813.214 million from $950.032 million in first four months of the last year. However, the imports in the month of April increased 5.5 per cent to $267.945 million from $253.446 million in April 2023. Cotton is the only textile product that featured in imports of Türkiye’s top 20 chapters in the month of April.
Half-yearly exports
Between January and June, while Turkish textile & raw materials export declined by 5 per cent compared to the same period of 2023, decreasing from $5.8 billion to $5.6 billion, the export of apparel & garments, worth $8.8 billion in 2023, decreased by 13.6 per cent to $7.6 billion. In Türkiye’s general export that reached a value of $125.4 billion, up 2 per cent, the share of textile & raw materials and the apparel & garments were 4.4 per cent and 6.1 per cent, respectively.
Country wise, Türkiye exported the most textiles to Italy, Germany and the US. However, export of $436 million to Italy and $363 million to Germany respectively declined 6.5 per cent and 11.1 per cent from $467 million and $408 million in 2023. Only the export to the US increased by 7.6 per cent, from $336 million to $361 million.
In terms of the first 3 most exported product groups in the January-June period, the woven fabric export decreased by 7.3 per cent compared to the previous year, decreasing from $1,242 billion to $1,152 billion; technical textile exports decreased by 2.5 per cent from $1,126 billion to $1,098 billion; and yarn exports decreased by 0.7 per cent from $1,058 billion to $1,051 billion. Among the product groups, the highest declines of 12 per cent and 13.6 per cent were observed in the knitted fabrics and home textiles, respectively. Only product group of fibre increased by 4.7 per cent.
During the same period, the capacity utilisation rate improved from 69.5 per cent in January to 73.3 per cent in June.
Exports in August
In August, RTW (ready-to-wear) and garments export accounted for 7.6 per cent of Türkiye’s total exports in the month, maintaining its third position after the automotive industry and chemicals sector. Cumulatively for the period from January to August, the sector’s export decreased by 8.9 per cent, amounting to ~$12 billion compared to the same period last year. The decrease was the result of overall negative export trend caused by high costs, global recession, political uncertainties in target countries, and the ongoing war environment.
Among the product groups, women’s outerwear products ranked first (50 per cent share), followed by men’s outerwear (23 per cent share) and clothing accessories (8 per cent share) in the month of August. For the seven-month (January to August) period, women’s outerwear products contributed 47 per cent share, men’s outerwear contributed 20 per cent share, and clothing accessories contributed 7 per cent share.
Germany, with market share of 17 per cent, remained Türkiye’s largest export market; followed by the Netherlands and Spain with respective market shares of 12 per cent and 10 per cent. During August, Istanbul ranked first among all provinces with $1.2 billion worth of exports; followed by Izmir with $121 million and Denizli with $100 million exports. From January to August, Istanbul’s total exports reached $8.1 billion, Izmir had $924 million and Denizli had $708 million.
Manufacturing struggled in September
The Turkish manufacturing sector signalled a marked slowdown amid challenging demand conditions, with headline manufacturing PMI (Purchasing Managers’ Index) dropping to 44.3 in September from 47.8 in August. This slowdown in the sector was the most pronounced one since May 2020. Business conditions moderated in six successive months amidst softened output, new orders, employment and purchasing when compared to previous (PMI) survey period. Rates of inflation of both input costs and output prices eased marginally, but still remained remarkable. The weakened demand in September caused the sharpest slowdown in new orders in almost four and a half years, while the subdued demand in international markets also signalled a renewed moderation in new export orders, as reported by S&P Global compiled PMI data. Consequently, production also eased and output scaled back to the largest extent since May 2020. This, in turn, made manufacturers to scale back their employment and purchasing activity in the month of September. As the stocks of both inputs and finished goods reduced and low demand for inputs relieved pressure on supply chains, the lead times got shortened for the first time in nine months. During September, currency weakness and higher raw material prices led to a further increase in input costs. The inflation rate remained another concern, despite easing to a three-month low, inflating output prices.
Employment remained a concern
The Turkish textile sector suffered from loss of employment in 2024. As of June 2024, RTW sector saw a decrease of 77,835 people with total employment also falling below 1 million. This was caused by the company closures and layoffs in the sector. According to Turkish Statistical Institute (TUIK) data, there was an employment decrease of 12 per cent in the RTW manufacturing.
While Türkiye’s overall employment index increased by 4.2 per cent y-o-y, and 0.7 per cent q-o-q in the second quarter of 2024, the index for industrial sector increased by 0.6 per cent y-o-y and 0.3 per cent q-o-q. The hours worked index increased by 0.3 per cent y-o-y but decreased by 0.2 per cent q-o-q. This index decreased by 3.4 per cent y-o-y and 1.5 per cent q-o-q for the industrial sector. The gross wages-salaries index for industrial sector increased by 113.9 per cent y-o-y and 14.9 per cent q-o-q, and the hourly earnings index for the sector increased by 121.6 per cent y-o-y and 16.7 per cent q-o-q.
The number of unemployed in the country, aged 15 and above, decreased by 112,000 to 3.167 million in July compared to same month of 2023, as per the Household Labour Force Survey. The youth unemployment rate in the 15-24 age group was 16.6 per cent – a decrease of 1 pp compared to the June. The seasonally-adjusted unemployment rate of 8.8 per cent in July was a marginal decrease of 0.4 percentage point (pp) over July 2023. It was an estimated 7 per cent for men and 12.4 per cent for women. The number of persons in the labour force was 35.879 million in the month – an increase of 123,000 compared to the previous month. The labour force participation rate of 54.4 per cent was a rise of 0.1 pp, including 72.4 per cent for men and 36.8 per cent for women.
Industry events
The ITM 2024 Exhibition was held at the Tüyap Fair and Congress Center from June 4 to 8, 2024, in partnership with Tüyap Tüm Fuarcilik Yapim Inc. and Teknik Fairs Inc., and in cooperation with the Textile Machinery and Accessories Industrialists Association (TEMSAD). One of the most important meeting points for leaders in textile technology, ITM 2024 concluded with great success despite getting organised after the pause experienced all over the world since September 2022. The event provided vital support to the textile industry over the five day-period by attracting 66,200 professional visitors and investors from 99 countries. It revitalised the industry through machine sales and generated a business volume of billions of euros.
Simultaneously, Türkiye began marketing activities and exhibitor registrations for the Carpet and Flooring Expo 2025 (CFE), scheduled for January 7-10, 2025, at the Istanbul Expo Centre, building on the success of its inaugural event in December 2023 which attracted over 21,000 visitors from 103 countries. The 2025 event will feature three additional halls. Carpet exports from Türkiye, already exceeding $2.8 billion, are expected to grow further through connections made at the global event.
Started in 2017, Viptex Fashion B2B meetings between the largest Turkish factories producing fabrics and accessories and global brands, were held from October 21 to 24, 2024 at Antalya. The participation included representation of 15 factories visited by 90 companies. While the first meetings were focused on the CIS countries, the one in 2024 were attended by representatives of more than 15 countries, including France, Morocco, the UK, Poland, Germany, Denmark, Spain, Kazakhstan, among many others.
Key initiative
On August 3, 2024, the ILO (International Labour Organisation) office for Türkiye in partnership with EkoDoku Women Sustainable Living Cooperative kicked off an initiative to promote eco-friendly textiles and raise awareness about the detrimental effects of fast fashion in the country, by launching ‘Eco Dyeing and Printing Workshop’. The workshop offered training to co-operative members in natural dyeing techniques using pigments from various plants. Participants also learned woodblock printing, natural patterning and batik dyeing on linen and hemp fabrics. Funded by the US government, the initiative promotes sustainable textiles, and aims to create formal job opportunities. The ILO is expanding the implementation of Nature-Based Solutions (NbS) at EkoDoku to tackle issues related to decent work like informal employment, low wages and low productivity. The pilot project aimed to stimulate green job creation and inclusiveness for all, including Syrians under temporary protection, international protection applicants and status holders and host communities.
Fibre2Fashion News Desk (SB – WE)
