Manufacturing sector in Türkiye neared stabilization midway through the second quarter, as output returned to growth in May and export orders rose for the first ​time in 21 months, a closely-watched business survey showed on Monday.

The ‌Istanbul Chamber of Industry (ISO) Türkiye Manufacturing Purchasing Managers’ Index (PMI), compiled by S&P Global, rose to 49.8 in May from 45.7 in April, a survey by ​S&P Global showed. The 50-mark separates growth from contraction.

The May ​reading was the highest since March 2024.

“The Turkish manufacturing ⁠sector moved in a more positive direction in May as renewed ​growth of exports helped to support a slight rise in production,” ​said Andrew Harker, economics director at S&P Global Market Intelligence.

Production increased in May after a sharp slowdown in April. The survey said panelists reported signs of improving demand, particularly internationally.

New export orders rose, ending a 20-month ​run of decline, while total new business still eased slightly as ​firms cited uncertainty, higher prices and the war in the Middle East.

Where new orders moderated, the survey said, panelists linked this to uncertainty, higher prices and the Iran war.

Employment fell ‌again, ⁠but at the slowest pace so far in 2026.

Firms also increased purchasing activity for the first time in just over two years, partly to build safety stocks as prices rose and supply ​chains were disrupted.

“Despite this, stocks of purchases continued to soften, albeit at a much slower pace than in April,” the survey said.

Input costs ​continued to ⁠rise sharply, with firms citing higher fuel, oil, metals and transportation prices, though both input cost and ​output price inflation eased.

Suppliers’ delivery times lengthened ​for a ⁠seventh consecutive month.

“There is some question therefore as to whether the expansions seen in May can be sustained given ongoing sharp rises in ⁠input ​costs and supply-chain delays,” Harker said.

“Much will likely ​depend on whether total new orders can join exports in growth territory in the ​months ahead.”

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Turkish economy expanded 2.5% on a yearly basis in the first quarter, official data showed on Monday, with growth slowing for a third consecutive quarter but staying positive despite tighter monetary conditions and the recent Iran war.

The slowdown in growth in the January-March period partially coincided with the start of the U.S.-Israel-Iran war, which sent energy prices soaring and revived inflationary pressures.

The strongest branch of economic activity during the first quarter was information and technology, which grew 9.5%, while agriculture, forestry and fishing grew 4.6%, Turkish Statistical Institute (TurkStat) data showed. Industry shrank 0.8%.

The lira was little changed at 45.9160 against the dollar after the data.

TurkStat said first-quarter gross domestic product (GDP) grew 0.1% from the previous quarter on a seasonally and calendar-adjusted basis,

In a Reuters poll, economic growth was estimated to have slowed to 2.7% in the first quarter, while in 2026 as a whole the economy is expected to expand by 3.15%.

There was no revision to the 2025 growth rate of 3.6%, the data showed. After growing 4.7% in the second quarter last year, growth slowed to 3.8% and then 3.4% in the following two quarters.

Economists are closely monitoring the central bank’s response to the inflation, which surged to 4.18% month-over-month in April for an annual rate of 32.87%. In its second inflation report of the year, the central bank raised its year-end inflation interim target from 16% to 24%, while signalling that all options remain on the table for its next interest rate decision.

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The largest Turkish metropolis, Istanbul, is gearing up to host international economic and finance actors for the third edition of Global Islamic Economy Summit, set to take place this week.

Decision-makers shaping the future of the Islamic economy, international leaders, economic authorities, investors, financial institutions, academics and sector representatives will descend into the city between June 3-6 for the summit.

Held this year under the theme “Capital in Islamic Economics: Structuring Wealth for Sustainable Development,” the summit will host important global discussions on ethical finance, the real economy, sustainable development and inclusive economic growth.

The 3rd Global Islamic Economy Summit, organized by the AlBaraka Forum for Islamic Economy under the AlBaraka Summits Türkiye framework, is being held in strategic partnership with the Presidency’s Investment and Finance Office, the Türkiye Wealth Fund (TWF), the Istanbul Financial Center (IFC), the Islamic Cooperation Youth Forum (ICYF) and Ibn Haldun University.

The summit, held at Halkbank’s headquarters in IFC, aims to further strengthen Türkiye’s strategic position in the global Islamic finance and economy ecosystem.

New dimensions of global economic transformation

As transformations in global economic and financial systems reshape the structure and use of capital, the Islamic economic approach treats capital not only as a financial instrument but as a value integrated with ethical responsibility, social benefit and productive economic activity.

Within this perspective, the 3rd Global Islamic Economy Summit aims to comprehensively examine the role of capital in Islamic economics through its core principles, strategic approaches and sectoral applications.

The summit will also highlight topics such as strengthening productive capital circulation, increasing inclusive economic participation and expanding ethical finance models that support sustainable development.

In an evaluation regarding the summit, Abdullah Saleh Kamel, chairperson of the board of trustees of the AlBaraka Forum for Islamic Economy, stated that the summit reflects their belief that capital should serve a higher purpose.

“Productive growth, social balance and sustainable development. Türkiye provides a strong foundation to advance this global dialogue on wealth, responsibility and real economic value,” he told Anadolu Agency (AA).

Finance, technology, sustainability

The summit is expected to host a number of prominent names in the sector and top Turkish finance officials, including Treasury and Finance Minister Mehmet Şimşek.

The attendees also include Burak Dağlıoğlu, the head of the Presidential Investment and Finance Office; Arda Ermut, general manager of the Türkiye Wealth Fund; Ahmet Ihsan Erdem, general manager of the Istanbul Financial Center; and Bilal Erdoğan, chairperson of the board of trustees of the Ilim Yayma Foundation.

Over the four-day summit, numerous panels, sessions and strategic meetings will be held with the participation of central banks, economic administrations, international investment organizations, global banking groups, academics and financial technology leaders.

Topics to be discussed include global economic and capital flows, Islamic banking and participation finance, Islamic capital markets and sukuk, waqf systems and social finance, artificial intelligence and digital financial technologies, fintech and Islamic digital investment tools, sustainable development and ethical investment models, entrepreneurship and SME financing, and international economic integration models.

One of the most notable highlights of the summit is set to be the launch of the AlBaraka Strategic Islamic Economy Report. The event also features the 1 million Saudi riyals ($270,000) Saleh Kamel award.

Moreover, beyond academic and sectoral discussions, the summit also aims to serve as a strategic meeting point where international economic cooperation can be developed.

New collaborations are expected to be established through memorandum of understanding signing ceremonies during the program, while special networking meetings, receptions and gala events will also bring international participants together.

Previously held in major cities such as Istanbul, London and Medina, the AlBaraka Summits are regarded as one of the world’s leading international platforms in Islamic economics and participation finance.

Each year, the summit brings together senior public officials, central banks, financial institutions, investment funds, academics, and media organizations from around the world, aiming to further increase the visibility of Islamic economics in global economic transformation processes.

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China’s factory activity flatlined in May following two months of expansion, official data showed Sunday, as weaker demand and soaring energy costs due to the war in the Middle East weighed on growth and output.

The manufacturing purchasing manager’s index (PMI) – a key measure of industrial activity – was 50.0 in May, according to the National Bureau of Statistics (NBS).

The 50.0 mark separates expansion from contraction. Economists surveyed by Bloomberg had predicted a reading of 50.0 as well.

The figure slipped from 50.3 in April and 50.4 in March.

The new orders sub-index dropped to 49.9 from 50.6 in April, while the sub-index on production edged down to 51.2 from April’s 51.5. The sub-index for raw material stockpiles fell to 48.6 from 49.3 in April.

China has been less affected by the global energy shock from the Iran war than many other countries, which face inflationary pressures as oil prices have surged due to the closure of the Strait of Hormuz, through which a fifth of the world’s oil is shipped in peacetime.

Analysts say China’s ample oil reserves and diversified sources of energy have helped the world’s second-largest economy weather the war nearly unscathed.

However, Chinese factories are facing higher costs with the prices of raw materials rising, particularly in the energy and chemical sectors.

Both supply and demand in industries including petroleum, rubber and plastics showed “continued weakness,” said NBS statistician Huo Lihui.

Meanwhile, exports remain crucial for China’s broader economy, according to banking giant HSBC.

While China’s exports to the U.S. have dropped on an annual basis during most months in the past year, its global exports have been robust, particularly to Europe and Southeast Asia.

Hopes for a recovery in exports to the U.S. have risen following President Donald Trump’s summit with Chinese leader Xi Jinping in Beijing in mid-May, and after the two countries agreed to set up separate boards of trade and investment.

Autos, technology and artificial intelligence-related exports have been helping to drive export growth, but some economists also point to concerns over the broader economy. Domestic demand remains sluggish in the wake of a years-long property sector slump that has clobbered consumer confidence and investment.

“Domestic demand is lagging, but high-end manufacturing and exports are holding the line,” Robin Xing, Chief China Economist at Morgan Stanley, wrote in a research note last week.

Chinese leaders have set an annual economic growth target of 4.5% to 5% for this year. That’s the lowest target since 1991, albeit only slightly lower than the “around 5%” target set in 2025.

Morgan Stanley said China will still likely meet its 2026 target, but oil prices and the easing of uncertainties around global oil supplies would be key factors determining where things might be heading.

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China’s foreign minister said Friday that Canada could surpass its goal of increasing exports to China by 50% by 2030, signaling potential for deeper trade ties during talks with Canadian Foreign Minister Anita Anand.

Wang said he thought Canada’s exports to China could increase by 100%, building on the momentum between the countries.

“Canada is focused on growing our economy and diversifying our trading relationships,” Anand said during the meeting. “The Canada-China economic relationship is significant,” she said.

Wang is on a three-day visit to Canada, the first visit by a Chinese foreign minister in a decade and the latest step to improve ties. On Friday afternoon, he shook hands with Prime Minister Mark Carney ahead of a ⁠private ⁠meeting. Canada and China struck an initial trade deal in January to slash tariffs on electric vehicles and canola, when Carney became the first Canadian prime minister to visit China since 2017. China is Canada’s second-largest trading partner, and Carney has sought to reduce his country’s overwhelming reliance on the United States after U.S. President Donald Trump imposed tariffs on Canada, a longtime ally. Amid an ongoing trade war with the U.S., Carney has vowed to double Canadian exports to ⁠other markets in the next decade and signed more than 20 economic and security deals in the last year.

On Thursday, Carney delivered a speech in New York calling for a “new partnership” with the ​U.S., saying that a stronger Canada would “help make America great again.”

The Chinese ​foreign minister’s Ottawa visit comes after the Canadian warship HMCS Charlottetown completed a routine transit through the Taiwan Strait on May 23. China said ⁠on Friday it ‌firmly ‌opposes any attempt by any country to undermine its sovereignty ⁠and security “under the pretext of freedom of navigation.”

Earlier this ‌month, Conservative lawmaker Michael Chong travelled to Taiwan, where he met with Taiwanese President Dr. Lai Ching-te ​and other senior officials. Chong said ⁠in a statement his visit was intended to “show solidarity with ⁠a democracy at the front lines of intimidation from the People’s Republic of ⁠China” and to ​assert Canada’s sovereignty, after a warning from the Chinese ambassador to Canada regarding politicians visiting Taiwan.

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The top tourism body said on Friday that Turkish applicants were being effectively “shut out” of the Schengen visa application system, citing persistent appointment shortages and alleged technical manipulation of booking platforms.

The remarks by the Turkish Travel Agencies Association (TÜRSAB) came after data showed Türkiye was the second-largest source of Schengen visa applications worldwide in 2025.

According to statistics published by the European Commission, applications to Schengen Area countries reached 11.93 million last year, an increase of 1.8% from 2024.

Türkiye accounted for nearly 1.27 million applications, ranking second after China. The figure compared to 1.17 million in 2024 and just over 1 million in 2023.

The rejection rate for Turkish applicants stood at 14.6% last year, up 0.1 percentage points from 2024.

The TÜRSAB said in a statement that the data confirms a structural access problem rather than a lack of demand.

Its Chair Firuz Bağlıkaya said Turkish citizens are often unable to even enter the application process because of limited appointment availability.

He argued that the system itself has become a barrier.

For years, Turkish citizens and businesses have complained about the EU’s visa system, including long appointment wait times, the issuance of very short-term visas and high rejection rates.

Bağlıkaya pointed to sharp declines in applications to key destinations such as Italy and France, which are among the most popular countries for organized tour programs.

According to EU data, applications to Italy fell by 32.3% year-over-year, while France recorded a 6% decline.

Bağlıkaya attributed the drop to reduced access to visa appointments, rather than weakening travel interest.

“Due to current practices, our citizens are shut out of the system before they even get a chance to submit a visa application,” he noted.

He further claimed that the appointment system is being exploited, alleging that limited time slots are rapidly captured by automated bot accounts and later resold at significantly higher prices.

Bağlıkaya said figures reportedly were reaching up to 1,000 euros ($1,165) per appointment in urgent cases.

“A stop must be put to this situation,” he stressed.

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