Economy
Türkiye’s jobless rate inches up to 8.6% in April
The unemployment rate in Türkiye rose by 0.6 percentage points month-over-month in April to 8.6%, the country’s statistical authority announced on Friday.
The number of unemployed persons – aged 15 years old and over – increased by 203,000 to 3.06 million in April compared to the previous month.
The unemployment rates were 7.1% for men and 11.5% for women, the Turkish Statistical Institute (TurkStat) said.
The number of employed persons decreased by 316,000 to 32.36 million in April.
The employment rate was 48.8%, dropping 0.5 percentage points, while the rate was 65.8% for men and 32.2% for women.
There were 35.42 million people in the labor force, down by 114,000, with the labor force participation rate at 53.4%.
The data showed the labor force participation rate dipped 0.2 percentage points to 53.4% while a seasonally adjusted measure of labor under-utilization increased 3.4 percentage points to 32.2%.
Türkiye is emerging as a notable player in efforts to diversify global critical minerals supply chains, backed by its resource base and strategic location, according to a senior official from the Organisation for Economic Co-operation and Development (OECD).
“Türkiye is already an important player in critical minerals,” Marion Jansen, the director of the Trade and Agriculture Directorate at OECD, told Anadolu Agency (AA) on the sidelines of the OECD Critical Minerals Forum in Istanbul.
Jansen highlighted Türkiye’s strength in borates as a major global supplier and noted that the country also holds significant reserves of rare earth elements (REEs). “So this is one of the countries where more investment could take place.”
She noted that Türkiye could play an important role in diversifying critical minerals supply chains and added that its geographic position makes it well placed to facilitate the logistics and transit of critical minerals from different regions.
“Türkiye is situated between Asia, Africa and Europe. This is a fantastic trading hub,” she said.
The country established the Rare Earth Elements Research Institute in 2020 to explore the potential of critical minerals and, in 2022, discovered the world’s second-largest rare earth element reserve in the central province of Eskişehir, giving further momentum to its development in this area.
Risks drive push for diversification
As Türkiye is part of the OECD’s export credit arrangement, it has a role in coordinated international financing efforts. “Türkiye has a voice in this joint collaboration around export credit financing,” Jansen said.
She noted that Türkiye is well integrated into global markets and has the potential to expand its role further. “The potential for Türkiye to play an even bigger role definitely exists,” she added.
Jansen said rising interest in financing the green transition has brought structural risks in critical minerals markets into sharper focus. “The key aspect is diversification.”
As demand for minerals critical to the energy transition, digitalization and defense industries rises, supply remains concentrated among a limited number of countries.
Many critical mineral markets are highly concentrated, with some cases where a single country accounts for up to 90% of global supply, either in extraction or processing.
“This is not good,” she said, warning that excessive concentration distorts markets and prevents normal price formation.
She added that high entry barriers limit new participants, while dominant players may restrict access to materials. “So diversification is important,” she noted.
Jansen stressed that financing mining and processing projects will be essential to improving supply diversity, pointing to OECD’s work in this area, including through export credit mechanisms.
Export restrictions threaten multilateral trade system
Jansen also warned about the increasing use of export restrictions globally.
According to OECD data, export restrictions have increased steadily over the past 15 years, with a notable rise in the most severe measures. The use of such measures increased nearly fivefold between 2009 and 2024 and remains at historically high levels.
“It becomes nearly acceptable to use it and that’s not good news for the multilateral trading system at all,” she said.
Export prohibitions are “used more and more frequently, and this is the third piece of bad news for the trading system of critical raw materials,” she explained.
Investment faces long-term uncertainty
Investment in critical minerals remains challenging due to long project timelines and market uncertainty, Jansen said.
“Investing in this sector is a long-term project … the money has to be invested for the long run,” she said.
She noted that investors seek clarity on returns and price conditions, but risks are higher in concentrated markets.
“If market conditions are not competitive … the risk that prices will be volatile is real,” she said.
Jansen added that addressing these challenges will be key to unlocking more investment in the sector.
Central Bank of the Republic of Türkiye (CBRT) said on Tuesday that the pricing pressures due to the Iran war are weighing on disinflation, but do not alter policy commitment.
The conflict is dealing a huge shock to the global economy after it triggered the closure of the Strait of Hormuz, the key waterway through which around 20% of the world’s oil formerly passed.
The surge in energy prices poses a challenge for import-heavy economies like Türkiye, where inflation rose to 32.37% in April, the highest measure since October 2025.
“We are feeling the effects of the war, especially in energy and transportation service prices. In April, we also clearly saw the effects of this situation on inflation,” CBRT Governor Fatih Karahan told the Parliament’s Planning and Budget Commission.
“We think that the energy-related impacts will continue in the short term.”
Annual energy inflation rose by 19 percentage points over the last two months, Karahan said.
He added that the duration of geopolitical tensions remained a critical risk factor for the inflation outlook.
“The effects on the medium-term inflation outlook will be shaped by our monetary policy stance, and we will take these factors into account in our upcoming policy decisions,” he said.
The jump in costs and the resulting inflationary pressures have curbed central banks’ room to cut interest rates.
CBRT flagged rising risks in its monetary policy committee statement last month, when it kept its benchmark policy rate steady, saying it was closely monitoring fallout from the Iran war and potential second-round effects.
Before the conflict began shifting expectations, the CBRT had been expected to continue a rate-cutting cycle that began in late 2024.
Although inflation has fallen significantly compared with its peak reached in May 2024, Karahan said price growth remains elevated.
He also said inflation expectations had not declined to the extent desired and remained above the central bank’s forecasts.
In February, the bank raised its year‑end inflation forecast range by two percentage points to 15%-21%, while keeping its interim 16% target unchanged.
It is due to present its second inflation report of the year next week. Analysts say it will likely feature a revision of both the target and forecasts.
Karahan reiterated that the central bank would continue using all monetary policy tools in line with its primary objective of price stability.
Looking at growth, Karahan said global economic expansion was expected to slow markedly in 2026, likely weakening external demand for Türkiye.
On credit trends, he said commercial loan growth had accelerated somewhat over the last two quarters, with the recent increase in overall lending mainly driven by business loans.
Oil prices eased early on Wednesday to extend losses from the previous session on fresh hopes for an end to the war between the U.S., Israel and Iran, while South Korean tech giant Samsung eclipsed the $1 trillion valuation mark in an equity market rally stoked by the continued artificial intelligence euphoria.
Investors welcomed U.S. President Donald Trump’s decision to pause efforts to help stranded ships through the crucial Strait of Hormuz, which drew Iranian attacks, threatening an already fragile cease-fire.
The U.S. president, who had been quoted as warning that Iran would be “blown off the face of the Earth” if it attacked U.S. ships, appeared to take a more conciliatory tone Tuesday.
“Project Freedom (The Movement of Ships through the Strait of Hormuz) will be paused for a short period of time to see whether or not the Agreement can be finalized and signed,” he wrote in a social media post.
He cited “the fact that Great Progress has been made toward a Complete and Final Agreement with Representatives of Iran” for the decision, adding that it came at the request of mediator Pakistan.
The U.S. blockade of Iranian ports remained, however.
The announcement came hours after U.S. Secretary of State Marco Rubio said the offensive side of the U.S. campaign, called “Operation Epic Fury,” had concluded.
Operation Epic Fury ‘over’
“The operation is over – Epic Fury – as the president notified Congress. We’re done with that stage of it,” Rubio told reporters at the White House.
Pentagon chief Pete Hegseth had said the United States was “not looking for a fight,” but warned attacks would face “overwhelming and devastating” force.
Oil prices sank around 4% on Tuesday, and on Wednesday, they continued to fall, with West Texas Intermediate (WTI) briefly dipping below $100 a barrel.
The cheaper oil prices provided support to equities, with investors taking their cue from another record day for the S&P 500 and Nasdaq, fuelled again by tech firms.
Hong Kong, Shanghai, Sydney, Singapore, Wellington, Taipei, Bangkok, Manila and Jakarta were all up with London, Paris and Frankfurt.
“Investors found some reassurance in comments from President Donald Trump … despite ongoing disruption to shipping routes,” said Fiona Cincotta, a senior market analyst at City Index.
‘Push to resolve conflict continues’
“Investors are also finding some reassurance in the fact that the diplomatic push to resolve the conflict continues.”
She added that strong U.S. earnings were also boosting risk appetite as they had largely been in line with forecasts.
However, she added, “Sentiment remains vulnerable. Even US entities could face serious headwinds should the Strait of Hormuz remain closed for an extended period.”
The standout performer was Seoul’s Kospi index, which piled on more than 5% to pass 7,000 points for the first time.
Samsung tops $1 trillion in valuation
That came on the back of an eye-watering surge by Samsung, which rocketed 14.4% to hit a market capitalization above $1 trillion thanks to huge demand for its AI chips.
That makes it just the second Asian firm after Taiwan’s TSMC to reach the figure.
Rival SK hynix soared more than 10%.
Samsung’s shares have risen around 300% over the past year as the AI boom boosts South Korean growth.
The more risk-on atmosphere also weighed on the dollar, which has been a safe haven from turmoil during the Middle East crisis.
The yen continued to hold its gains after surging last week on what is thought to have been an intervention by Japanese authorities to support the struggling currency.
Central Bank of the Republic of Türkiye (CBRT) said on Tuesday that the pricing pressures due to the Iran war are weighing on disinflation, but do not alter policy commitment.
The conflict is dealing a huge shock to the global economy after it triggered the closure of the Strait of Hormuz, the key waterway through which around 20% of the world’s oil formerly passed.
The surge in energy prices poses a challenge for import-heavy economies like Türkiye, where inflation rose to 32.37% in April, the highest measure since October 2025.
“We are feeling the effects of the war, especially in energy and transportation service prices. In April, we also clearly saw the effects of this situation on inflation,” CBRT Governor Fatih Karahan told the Parliament’s Planning and Budget Commission.
“We think that the energy-related impacts will continue in the short term.”
Annual energy inflation rose by 19 percentage points over the last two months, Karahan said.
He added that the duration of geopolitical tensions remained a critical risk factor for the inflation outlook.
“The effects on the medium-term inflation outlook will be shaped by our monetary policy stance, and we will take these factors into account in our upcoming policy decisions,” he said.
The jump in costs and the resulting inflationary pressures have curbed central banks’ room to cut interest rates.
CBRT flagged rising risks in its monetary policy committee statement last month, when it kept its benchmark policy rate steady, saying it was closely monitoring fallout from the Iran war and potential second-round effects.
Before the conflict began shifting expectations, the CBRT had been expected to continue a rate-cutting cycle that began in late 2024.
Although inflation has fallen significantly compared with its peak reached in May 2024, Karahan said price growth remains elevated.
He also said inflation expectations had not declined to the extent desired and remained above the central bank’s forecasts.
In February, the bank raised its year‑end inflation forecast range by two percentage points to 15%-21%, while keeping its interim 16% target unchanged.
It is due to present its second inflation report of the year next week. Analysts say it will likely feature a revision of both the target and forecasts.
Karahan reiterated that the central bank would continue using all monetary policy tools in line with its primary objective of price stability.
Looking at growth, Karahan said global economic expansion was expected to slow markedly in 2026, likely weakening external demand for Türkiye.
On credit trends, he said commercial loan growth had accelerated somewhat over the last two quarters, with the recent increase in overall lending mainly driven by business loans.
Turkish Aerospace Industries (TAI) and U.S. aircraft engine supplier GE Aerospace have signed an agreement for engines to power Türkiye’s advanced jet trainer and light combat aircraft Hürjet, a joint statement said Tuesday.
The companies said the deal on the supply of F404 engines strengthens their long-standing strategic partnership and supports Hürjet’s development as the platform expands its operational scope and future variants.
The deal also reinforces GE Aerospace’s role as a propulsion partner for advanced military aircraft programs, while ensuring continued technical and operational support for Hürjet.
“Hürjet jet trainer aircraft represents a major step forward for Turkish Aerospace’s aviation and defense capabilities, and this agreement marks a critical milestone for the program,” TAI President and CEO Mehmet Demiroğlu said.
He said the company’s long-standing cooperation with GE Aerospace continues to provide critical propulsion capabilities that support Hürjet’s success as a modern, reliable and globally competitive training platform.
“This agreement further strengthens our vision and industrial capabilities,” Demiroglu added.
The Hürjet project was initiated in 2017. The first domestically developed jet trainer aircraft performed its maiden flight in April 2023.
It features a single-engine, tandem cockpit and modern avionics suite. It sought to replace the T-38 aircraft used for advanced jet training and the F-5 jet used in aerobatic displays within the Turkish Air Force inventory.
The aircraft is 13.6 meters long with a wingspan of 9.5 meters. Its maximum altitude is said to be 45,000 feet, and the jet features a 3,400-kilogram (7,500-pound) payload capacity and a maximum speed of Mach 1.4.
Rita Flaherty, GE Aerospace vice president for global sales and business development for defense and systems, said the company was honored by TAI’s trust in GE Aerospace as a propulsion partner for its advanced military aircraft.
Flaherty stated that they are proud to support Turkish Aerospace as Hürjet takes its place on the global stage and to contribute to Türkiye’s continued rise as a key player in the defense and aviation ecosystem.
The F404 engine is a combat-proven turbofan widely used in advanced training and fighter aircraft worldwide.
Hürjet is designed to meet modern training mission requirements with advanced avionics, high performance and operational flexibility for air forces seeking next-generation solutions.
The latest agreement builds on decades of cooperation between GE Aerospace and TAI, including their joint venture Turkish Engine Industries, known as TEI, which was established in 1985 and has become one of the region’s leading aerospace partnerships.
The companies’ partnerships also include F110 engines powering the Turkish Air Force’s F-16 fleet and the F110-powered Türkiye’s locally made fifth-generation stealth fighter jet Kaan.
Türkiye expects a deal volume of around $8 billion to be signed on the sidelines of one of the most significant international defense and aerospace exhibitions that kicked off on Tuesday, according to top officials.
SAHA EXPO serves as a primary platform for showcasing Türkiye’s domestic defense capabilities and has, over the years, seen billions of dollars added to the country’s defense exports.
“During this fair, we expect contracts worth around $8 billion to be signed,” Haluk Görgün, head of the Defense Industries Presidency (SSB), said. That would mark an increase from $6.2 billion sealed during the last edition.
Türkiye has injected billions of dollars to transform from a nation heavily reliant on equipment from abroad to one that is a major exporter and where homegrown systems now meet almost all of its defense industry needs.
For much of the past two decades, Ankara has expressed frustration over its Western allies’ failure to provide adequate defense systems against missile threats despite Türkiye being a major NATO member.
The country currently exports more than 230 defense systems to 185 countries, Görgün said, adding that repeated demand shows satisfaction with Turkish products and services.
Türkiye’s defense exports rose about 48% year-over-year in 2025 to a record of more than $10 billion. The goal for 2028 is to lift the full-year figure to $11 billion, placing Türkiye among the world’s top 10 biggest defense exporters, according to officials.
Contracts signed in the first four months of this year approached $7 billion, according to Görgün.
‘Partner Europe needs is Türkiye’
Wars and geopolitical tensions lifted global military spending to nearly $2.9 trillion in 2025, a 2.9% year-over-year increase, marking an 11th consecutive year of growth, according to the Stockholm International Peace Research Institute (SIPRI).
That brought the growth over the past decade to 41% and took spending as a share of GDP to 2.5% – its highest level since 2009.
The main contributor to higher global spending was a 14% rise in Europe to $864 billion, as concerns over the reliability of the U.S. as a NATO partner contributed to higher budgets.
Türkiye increased its expenditure by 7.2% from 2024 to $30 billion, making it the 18th biggest spender in the world.
The figure accounted for 1.9% of Türkiye’s GDP, and the growth rate lifted the increase over the past decade to 94%.
Addressing the fair in Istanbul, Industry and Technology Minister Mehmet Fatih Kacır said Türkiye is well-positioned to meet Europe’s growing defense needs.
Europe remains around 80% dependent on foreign products while accelerating efforts to bolster its defense capacity, Kacır noted.
“The solution partner Europe needs is Türkiye,” he noted.
“Our sector is in a position to provide the solutions required by the European defense ecosystem with a broad portfolio of high-technology, cost-effective products that have proven their game-changing role in the field.”
He warned that excluding Türkiye from European defense programs would leave the continent facing “irreversible strategic losses.”
“Our NATO-standard production infrastructure allows Turkish defense products to be rapidly integrated into allied platforms,” he said.
2 out of 3 drones are Türkiye-made
Türkiye has built an integrated defense ecosystem covering research and development, testing infrastructure, serial production capabilities and human capital, according to Kacır.
He also said Turkish firms now produce two out of every three military drones sold globally and that Türkiye is among 10 countries capable of designing, developing and producing their own warships.
Kacır cited platforms including the Kaan fifth-generation fighter jet, Bayraktar TB3 drone, Gökdoğan and Bozdoğan air-to-air missiles, the Bayraktar Kızılelma unmanned fighter aircraft, Altay tank, Hürjet trainer jet and elements of the Steel Dome air defense architecture as examples of Türkiye’s defense progress.
The fair, organized by SAHA Istanbul, Türkiye’s and Europe’s largest defense, aviation and space industry cluster, was launched in 2018 when it hosted 180 companies from 12 countries.
The trade show has since expanded to host more than 120 countries and over 100,000 visitors.
This year’s edition will run through Saturday and be attended by nearly 200 delegations, Görgün said.
Haluk Bayraktar, chair of SAHA Istanbul and CEO of drone powerhouse Baykar, described the expo as more than a trade fair that he says has become a meeting point for technology leaders shaping future industries.
He said this year’s event was hosting 263 international companies from more than 120 countries. A total of 203 new products will be introduced, and 164 signing ceremonies are scheduled to be held during the fair.
Bayraktar said the world was moving from trade wars toward technological sovereignty struggles, with protectionism, supply chain disruptions and energy market volatility exposing vulnerabilities in industrial systems.
“In this new era, national production capacity is no longer just an economic choice but a vital resilience test and strategic necessity for states,” he said.
Rewriting military doctrines
Defense Minister Yaşar Güler said Türkiye had transformed from a country largely dependent on foreign suppliers until the 1980s into one capable of designing, producing and exporting its own defense systems.
He said Turkish unmanned aerial vehicles represented the country’s most significant defense breakthrough.
“The real revolution of the Turkish defense industry has been achieved with our drones, which have rewritten military doctrines worldwide,” Güler said.
He added that Türkiye’s unmanned systems had demonstrated the capabilities of Turkish engineering globally through artificial intelligence integration, precision strike capacity and high-altitude performance.
Debut of new technologies
A wide range of high-tech products are making their debuts at SAHA 2026.
They included Türkiye’s first intercontinental ballistic missile (ICBM). Named “Yıldırımhan,” the missile is said to feature a range of 6,000 kilometers (3,728 miles) and a speed of Mach 9 to Mach 25.
Baykar is showcasing Mızrak, a smart loitering munition featuring a range of more than 1,000 kilometers and AI-supported autonomous capabilities.
Baykar’s K2 Kamikaze drone and Sivrisinek (Mosquito) loitering munition are also making their debuts.
Another defense giant, Aselsan, is presenting five new products and six upgraded versions of existing platforms.
The Alka-Kaplan Hybrid Directed Energy Weapon System Platform, developed through cooperation between Roketsan and FNSS and widely known as a “laser weapon,” will also appear at the fair with additional capabilities.
Major weapons manufacturer and defense contractor Roketsan’s newest and most advanced technology products will also be introduced, while STM will display air and naval systems developed for the needs of the modern battlefield for the first time.
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