Manufacturing PMI Improved in November, but Challenges Persist

According to Turkey's Manufacturing PMI data, the headline PMI, which stood at 45.8 in October, increased to 48.3 in November. This indicator, which remains below the threshold level, appears to be at its weakest level since May.

PLASFED Chairman Ömer Karadeniz stated that manufacturing indicators have shown contraction since the beginning of the year. He noted that the notable signs of improvement visible in the PMI data of Turkey's manufacturing sector in November are encouraging. However, Karadeniz pointed out that overall weakness in manufacturing continues and cautioned that without necessary measures, manufacturers would postpone investment plans, leading to a general slowdown. 

Due to ongoing challenging market conditions both globally and domestically, manufacturing performance has shown a declining trend since the start of the year. Successive declines in manufacturing output have resulted in deterioration in employment and purchasing activities. Weakness in the Turkish lira and inflationary pressures are also causing increases in input costs. 

According to ISO Turkey Manufacturing PMI survey results, considered a leading indicator of economic growth, the headline PMI, which stood at 45.8 in October, increased to 48.3 in November. According to survey results where all figures measured above the threshold of 50 signal sector improvement, the November Manufacturing PMI Index at 48.3 remained low, indicating that signals of deteriorating operating conditions continue.

Plastic Manufacturers Federation (PLASFED) Chairman Ömer Karadeniz said that the notable signs of improvement visible in Turkey's manufacturing sector PMI data in November are encouraging. However, Chairman Karadeniz reported that based on PMI data, manufacturing has entered a contraction zone and pointed out that weakness in manufacturing is one of the biggest reasons for the slowdown in growth. Noting that factors such as tight financing conditions, geopolitical tensions and trade protectionism are negatively affecting manufacturing, Karadeniz stated that without necessary measures, manufacturers could postpone investment plans. Explaining that companies have shelved investment and growth plans to preserve existing resources and minimize costs, Karadeniz called for increased support to the industry. 

"Turkish manufacturers' greatest strength is production"

Karadeniz said that Turkish manufacturers have the capability to write new stories under all circumstances and that their greatest strength is production, which they fulfill with great dedication, but noted that high prices are paid while carrying out production. Noting that this situation is not sustainable, Karadeniz stated, "Manufacturers are losing their competitive advantage with each passing day. The public sector first, then the private sector, civil society organizations and all stakeholders in the economy must show the necessary commitment."

"Progress in fighting inflation is encouraging"

Karadeniz, drawing attention to the fact that progress has been made in combating inflation as a result of economic policies pursued over the past two years, stated, "As a result of the measures taken, the country risk premium has fallen, Central Bank reserves have increased and current account deficit has declined. With the Central Bank's determined efforts, we can anticipate that inflation will fall further. The full materialization of the downward trend in inflation is our greatest wish."

PLASFED Chairman, noting that macroeconomic stability is important but insufficient for intensifying global competition, stated that we can take a place in the international arena by supporting our manufacturing with high-tech products and the green economic transition. 

Pointing out that we need to increase the share and exports of high-tech production to boost our competitive strength and increase growth performance, Karadeniz said, "Steps taken for industry will first go to production and then to employment. The winning outcome will be a stronger Turkish economy."