Economy
‘Israeli-provoked conflicts exert pressure on global energy prices’
Wars triggered by Israeli provocations are exerting increased pressure on global energy prices and national economies, Vice President Cevdet Yılmaz said Monday.
“As a result of the wars that started with Israel’s provocations, we are witnessing the pressure that world energy prices create on our economies,” Yılmaz said at the opening session of the 42nd Ministerial Meeting of the Standing Committee for Economic and Commercial Cooperation of the Organization of Islamic Cooperation (COMCEC) held in Istanbul.
“This situation has once again demonstrated the importance of diversifying sources and routes, and strengthening regional cooperation, particularly in ensuring energy security,” he added.
Yılmaz emphasized that COMCEC constitutes an important pillar of the Organization of Islamic Cooperation (OIC), one of the most significant global cooperation platforms, with 57 members, a population exceeding 2.1 billion and a gross domestic product approaching $10 trillion.
Underlining that COMCEC’s agenda makes valuable contributions to the Islamic world and humanity amid challenging regional and global conditions, he said the occupation, settler violence, forced displacement and systematic oppression that Palestinians have endured for years, particularly in Gaza, have opened wounds that cannot heal in the common conscience of humanity.
He expressed deep sorrow over the continued loss of life in Gaza despite the cease-fire achieved through diplomatic efforts led by President Recep Tayyip Erdoğan and joint initiatives by regional countries.
“Israel’s ongoing occupation and attacks in Palestine threaten the security of the Palestinian people and regional stability,” Yilmaz said.
“At this stage, taking concrete steps that will pave the way for the reconstruction of Gaza, stop the genocide in occupied Palestinian territories, and sustain international efforts regardless of who comes to government in Israel is the primary responsibility of us all,” he said.
Yılmaz also noted that COMCEC is implementing the Al-Quds Program developed specifically for Palestinians, adding that work is advancing through 10 new projects launched this year alongside 28 completed projects.
Expressing satisfaction with steps taken toward ensuring Syria’s unity and territorial integrity in the new era that began following the fall of the Assad regime, Yılmaz said Türkiye strongly supports building a future in which the Syrian people live in peace, tranquility and prosperity.
In this regard, he noted that projects have started under the COMCEC Syria Program in the fields of halal standards, trade, vocational training, planning and strategy management, with findings shared during Sunday’s panel session. He pledged continued support for projects next year.
Turning to regional hostilities, Yilmaz warned that attacks targeting Iran through Israeli provocations and tensions in the Strait of Hormuz continue to threaten regional stability and global prosperity.
“Here, too, the key to the solution is clear: diplomacy and dialogue must never be abandoned,” he said, adding that Türkiye supports mediators’ efforts, contributes at the highest level to a negotiated solution and believes OIC nations must strongly support a peaceful resolution.
Turning to Yemen, Yılmaz condemned Houthi attacks against civilians and civilian infrastructure as unacceptable on any grounds, affirming that Türkiye will continue supporting its ally, Saudi Arabia.
He added that Türkiye will continue to work closely with international partners to ensure freedom of navigation in the Red Sea and the Bab al-Mandeb Strait.
Yılmaz voiced strong support for efforts to enhance stability in the Caucasus and the functionality of the Middle Corridor, particularly the ongoing peace and normalization process between Azerbaijan and Armenia, while emphasizing that relations with Africa remain an important pillar of Turkish foreign policy.
Africa relations
He announced that bilateral ties, deepened on the basis of mutual respect, equal partnership and win-win principles, will be further strengthened at the Fourth Türkiye-Africa Partnership Summit, scheduled to be held in Libya on Dec. 8-9, 2026.
Yılmaz expressed deep sadness over the conflict that has continued for 3.5 years in Sudan, emphasizing that Muslims cannot allow the humanitarian crisis facing the Sudanese people to be ignored. He pledged continued humanitarian aid and support for peace, territorial integrity, sovereignty and independence.
While significant progress has been made in Somalia over the past 15 years, Yilmaz stressed that Türkiye closely monitors steps aimed at destabilizing the region.
“We will continue to support the sovereignty and territorial integrity of Somalia against Israel’s illegitimate and unlawful decision to recognize Somaliland,” he said.
In North Africa, Yılmaz observed that developing bilateral relations contributes directly to regional peace, stability and prosperity, noting that Türkiye continues its efforts to ensure Libya’s stability and security through a dialogue process led and owned by Libyans.
He also pointed out that global food insecurity, exacerbated by climate change, geopolitical tensions and conflicts, has left more than 260 million people worldwide facing severe hunger.
Economic outlook
Addressing the global economic outlook, Yılmaz suggested that the world economy has shifted toward protectionism amid successive crises, with both economic growth and global trade projected to remain below historical averages at around 3% in 2026.
He said the resulting pressures have driven countries to reduce external dependence in critical sectors and strengthen domestic production capacity.
“In this period of increasing global uncertainties, one of the most important steps we must take as Islamic countries is to strengthen trade among ourselves,” the vice president said, pointing to the Trade Preferential System among the Member States of the OIC, implemented in 2022, as an essential instrument.
Welcoming ongoing work within the Trade Negotiating Committee to expand the system, he urged countries not to settle for tariff reductions alone but to focus on a comprehensive framework facilitating customs procedures, supporting digital trade and paving the way for trade in services and investment.
He called on countries that are not yet party to the preferential system to take the necessary steps swiftly and urged existing member states to actively contribute to resolving implementation issues.
Moreover, he emphasized that difficulties faced by small and medium-sized enterprises (SMEs) in accessing finance prevent OIC nations from fully realizing their vast potential.
Need for stronger cooperation
“There is a need to establish stronger cooperation between our banks, export credit agencies, development finance institutions, and relevant OIC bodies so that SMEs can benefit from foreign trade opportunities despite insufficient collateral, high financing costs, and a lack of information,” he said.
He urged ministers to adopt measures to make trade finance more accessible and affordable while calling on countries that have not yet joined the COMCEC SME Program to participate.
Underlining mutual recognition of halal certification as another key issue for trade, Yilmaz said he believes member states will provide the necessary support to operationalize the Islamic Forum for Halal Accreditation Bodies, founded in 2023, without further delay.
He encouraged the business community and professional organizations to make greater use of the OIC Arbitration Center and praised the B57+ platform for enhancing public-private dialogue and facilitating joint investments across the Islamic world.
Yılmaz noted that COMCEC working groups have held productive consultations, with Türkiye providing financial backing to 31 projects, raising the total number of supported projects to 209 since the program’s inception in 2013.
Turning to climate action, he said it is time to translate climate commitments into concrete steps, noting that Türkiye strives to remain at the forefront of combating climate impacts in vulnerable regions, including the Mediterranean Basin and OIC countries.
“We have planned COP31, whose presidency we will assume, with an understanding of climate justice, sustainable development, poverty reduction, and human-oriented transformation,” Yılmaz said.
“On this occasion, I would like to express once again that we expect the highest level of participation from Organization of Islamic Cooperation members at the COP31 Leaders Summit in Antalya on Nov. 11-12,” he added.
Global manufacturing activity remained relatively solid in October, but factories are beginning to show strain from rising energy costs while supply-chain disruptions squeezed margins, surveys showed on Monday.
The data point to growing pain for export-led economies as prolonged conflict in the Middle East keeps fuel and food prices high, hitting consumption and business confidence.
S&P Global’s Eurozone Manufacturing Purchasing Managers’ Index (PMI) eased to 52.7 last month from 52.9 in September – which was the highest reading since May 2022 – but was above a preliminary estimate of 52.4.
Readings above 50.0 indicate growth in activity.
This suggests manufacturers are holding up despite tariffs, conflicts and surging energy costs, but rising input prices add to pressure on the European Central Bank (ECB) to raise interest rates again.
“October’s final manufacturing PMIs confirmed the resilience of the eurozone’s industrial sector,” said Leo Barincou at Oxford Economics.
“Meanwhile, price pressures continue to intensify as robust demand meets constrained supply, with euro zone input prices rising at their fastest pace since May and output prices also increasing rapidly, reinforcing our view that inflationary pressures will remain elevated over the coming months.”
Preliminary data on Wednesday is expected to show inflation in the currency union nudged up to 4.0% in October, according to a Reuters poll, keeping pressure on the European Central Bank to raise interest rates.
The ECB left rates on hold last week as expected, but economists polled by Reuters last month said it would hike again in December.
Germany’s manufacturing industry expanded solidly in October, but France’s slipped back into contraction.
British manufacturers started the final quarter of 2026 with the strongest output growth in more than two years, although fast-rising costs may worry the Bank of England (BoE), which looks set to raise interest rates this week.
Chip demand
Factory activity across Asia continued to expand in October, but growth slowed in China, Japan, South Korea and Taiwan, surveys showed, indicating the drag from the U.S.-Israeli war with Iran may be offsetting robust global demand for chips and AI-related goods.
“Strong chip and AI demand had masked soft spots in Asian and global economies. But that’s becoming hard to sustain with the Middle East war dragging on for so long, pushing up fuel and food prices,” said Toru Nishihama, chief emerging market economist at Dai-ichi Life Research Institute in Tokyo.
“High inflation is hurting Asian consumption. Intensifying price competition from China is also weighing on rival exporters like Japan and South Korea,” he said.
The RatingDog China General Manufacturing PMI, compiled by S&P Global, stood at 52.0 in October, just below September’s 52.1.
Japan’s PMI eased, marking the slowest expansion in seven months as output and new orders lost momentum, while South Korean factory activity grew at the slowest pace in eight months on weaker output and demand. Taiwan’s PMI continued to show solid growth in activity, albeit slowing down from the previous month.
India’s manufacturing growth slowed as domestic demand and hiring weakened, although a surge in export orders helped cushion the blow.
The International Monetary Fund (IMF) has projected that Asia’s economic growth will moderate next year, and it warned of heightening risks from the Iran war-induced energy shock and a potential correction in the AI boom.
Türkiye’s manufacturing sector’s activity contracted in October at the fastest pace since June as declines in output and new orders weighed on performance, a closely watched business survey showed on Monday.
The headline Istanbul Chamber of Industry (ISO) Türkiye Manufacturing PMI, compiled by S&P Global, fell to 47.3 in October from 47.9 in September.
The 50 mark separates growth from contraction.
Output was cut for a fifth straight month and at the fastest pace in four months, while new orders fell for a 40th consecutive month. The decline in new business was the sharpest since July, with export orders also continuing to soften.
Input costs and output prices both rose, although their inflation rates eased from September. S&P Global said 29% of respondents reported higher input prices, citing oil, raw materials and exchange rate weakness.
Manufacturers still expected output to rise over the coming year, but confidence slipped to a three-month low.
“The economic environment facing Turkish manufacturers is such that they continued to find it difficult to generate growth as the final quarter of the year began,” said Andrew Harker, economics director at S&P Global Market Intelligence.
“There was some better news on employment, which eased only modestly, and this should hopefully help to limit the extent to which output moderates in the months ahead,” he added.
Members of Germany’s powerful IG Metall trade union launched warning strikes in the metalworking and electrical sectors in the early hours of Sunday, seeking better pay and job guarantees.
Around 300 employees of Thyssenkrupp’s Rasselstein unit as well as workers from surrounding companies joined the first walkout at midnight, the union said.
The union has rejected an offer made by employers during a second round of wage negotiations, describing it as a “minus offer.”
Employers have offered 1% of annual gross pay as a one-off payment in the summer of 2027 and an additional 1.3% increase from July 2028.
The union seeks a 5% pay raise over 12 months, as well as guarantees for jobs. The strike action at industrial sites is expected to spread across Germany next week.
IG Metall, Germany’s largest union, aims to increase pressure during collective bargaining negotiations on behalf of approximately 3.7 million employees.
“The midnight warning strike at thyssenkrupp Rasselstein is merely the start of a massive phase of warning strikes,” Jorg Kohlinger, head of IG Metall’s central district, said.
The union said further warning strikes would follow in the coming days across the bargaining region covering the states of Hesse, Rhineland-Palatinate and Saarland as well as in Thuringia.
South Korean exports nearly doubled in October, marking the sharpest jump in more than 50 years, as continued demand for AI products propelled shipments of the country’s chips, government data showed on Sunday.
Exports from Asia’s fourth-largest economy, a bellwether for global trade, rose 93.7% from the same month last year to $115.28 billion, slightly higher than a median 93.2% rise forecast in a Reuters poll of economists.
The surge, boosted by having more working days than a year earlier due to the timing difference in the Chuseok holidays, exceeded September’s 83.7% gain and was the strongest since January 1974.
Riding the global boom in AI investment, South Korea’s economy grew faster than expected in the third quarter on strong semiconductor exports and investments, with chipmakers Samsung Electronics and SK Hynix posting surging profits.
“With exports continuing solid growth of more than $110 billion in October, it is becoming certain that annual exports of $1 trillion will be reached within November,” said Kim Jung-kwan, the minister of trade, industry and resources.
South Korea’s exports for the January-October period totaled $930 billion. Annual exports of more than $1 trillion will make South Korea the fourth country in the world to reach the milestone, after the U.S., China and Germany.
Overseas sales of semiconductors jumped 259.4% in October to $56.44 billion, as prices and volume remained high on continued facility investment by global big tech firms in the competition for AI industry leadership, the trade ministry said.
Computer sales spiked 496.6% on increasing server demand for AI services.
Shipments to China rose 133.6%, while those to the U.S. grew by 185.8%, to Europe by 56.4% and to Southeast Asia by 128.0%.
South Korea’s imports rose 36.0% to $72.78 billion, after rising 26.0% in September, to post the biggest annual increase since January 2022 on higher crude oil prices, as well as demand for semiconductor manufacturing equipment and automobiles.
The nation posted a monthly trade surplus of $42.50 billion, narrower than a record $49.97 billion surplus in the previous month.
Türkiye and Kazakhstan are deepening defense cooperation through ongoing initiatives and steps taken by the leading companies, as the two countries also aim to increase trade volume to $15 billion (TL 749.01 billion).
Türkiye is known for contributing to the defense needs of friendly and allied countries, while its approach to defense cooperation with Turkic states goes beyond simply selling products. Lasting partnerships are being established through local production, technology sharing, maintenance and repair capabilities, and long-term institutional cooperation.
Defense industry cooperation is a key pillar of bilateral ties with Kazakhstan, a top Turkish defense official said recently, as President Recep Tayyip Erdoğan hosted Kazakh President Kassym-Jomart Tokayev and his delegation prior to the Turkic states summit.
“We will diversify and deepen our areas of cooperation with friendly and brotherly Kazakhstan within the framework of a win-win approach,” Haluk Görgün, the head of the Presidency of Defense Industries (SSB), said.
Accordingly, a series of concrete steps have been taken in defense industry cooperation with Kazakhstan, building on ties that date back many years.
Projects in Kazakhstan
Leading Turkish defense companies such as Aselsan, Turkish Aerospace Industries (TAI) and Otokar have investments and major projects underway in Kazakhstan.
One of the most tangible examples of Türkiye’s defense industry investments in Kazakhstan is the Kazakhstan Aselsan Engineering (KAE) joint venture, established between Aselsan and Kazakhstan Engineering, Kazakhstan’s state-owned defense industry company.
KAE manufactures day and night vision systems, thermal imaging sights, electro-optical reconnaissance and surveillance systems, remote-controlled weapon systems, professional radio and communication systems, as well as electronic board assemblies and infrared lenses.
Through this partnership, cooperation has moved beyond the sale of ready-made defense products from Türkiye, contributing instead to the development of production infrastructure, technical expertise and local industrial capabilities in Kazakhstan.
Kazakhstan to be new home for Anka drones
Another major area of defense industry cooperation between the two countries involves unmanned aerial vehicles (UAVs).
Kazakhstan, which has strengthened its air force with Anka unmanned aerial vehicles, developed by TAI, is preparing to become the platform’s new production base abroad, according to the report by Anadolu Agency (AA) on Saturday.
A memorandum of understanding (MoU) was signed between TAI and Kazakhstan Engineering on the production, maintenance and repair of Anka stealth drones in Kazakhstan.
Most recently, in May, an agreement on establishing a joint venture (JV) for the production and maintenance of Anka UAVs was implemented.
In line with this, to support the goal of local production, TAI and Kazakh Civil Aircraft Repair Plant No. 406 established a partnership under the name TA-406.
The two sides are said to be continuing their work on joint production. Mutual site visits have been conducted, while discussions on the feasibility study are ongoing, according to AA.
Once this process is completed, Kazakhstan will become the first country outside Türkiye to manufacture Anka UAVs.
Similarly, Otokar, one of Türkiye’s leading land vehicle manufacturers, has also expanded its presence in Kazakhstan beyond the sale and export of armored vehicles.
Establishing a permanent presence through its Otokar Central Asia company, Otokar has positioned Kazakhstan as a hub for its operations in the Central Asian market.
Lifting trade with Kazakhstan
At the same time, Türkiye and Kazakhstan aim to reach $15 billion in bilateral trade volume, for which they need to diversify the products traded, facilitate mutual market access and involve more companies in trade, a head of a business council said.
“To achieve this target, we need to diversify the products traded, facilitate mutual market access and involve more companies in bilateral trade. While increasing Türkiye’s share in the Kazakhstan market, we also attach importance to the balanced development of two-way trade,” said Selçuk Yüce, head of the Türkiye-Kazakhstan Business Council at the Foreign Economic Relations Board (DEIK).
Yüce noted that manufacturing, mining, agriculture and food processing stood out among the key sectors.
“I also consider health care, chemicals, pharmaceuticals and medical equipment manufacturing among the priority areas. We can bring Türkiye’s expertise in these fields together with Kazakhstan’s needs,” he told AA, in remarks published on Sunday.
“Energy, logistics and digital technologies are other sectors that could provide a broader foundation for our economic partnership,” he added.
He also recalled that the bilateral trade volume reached approximately $10 billion based on the 2025 figure and added that the priority was to make this growth stable and sustainable.
Middle Corridor
Yüce, also noting the strategic importance of the Middle Corridor, said: “Extending from China through Kazakhstan, the Caspian Sea and the South Caucasus to Türkiye, this route contributes to the diversification of trade corridors.”
However, he argued that geographical advantages alone are not enough for a corridor to become a preferred route.
“Regular services, predictable delivery times and competitive transportation costs are also necessary. Therefore, it is important for investments in ports, railways and logistics centers to go hand in hand with the digitalization of customs procedures,” he noted.
Linking China and Europe via the Caucasus, the Middle Corridor trade route is gaining in geopolitical and economic importance, especially following the escalation of the conflict in the Middle East.
Türkiye and Kazakhstan stand among the key players and the countries along the corridor route.
Monthly inflation in Istanbul accelerated in October compared to the reading a month earlier, data from the Istanbul Chamber of Commerce (ITO) showed on Sunday, although the annual increase in prices slowed down.
As the indicator of retail price movements, the monthly index rose 2.47% in October, ITO said in a news bulletin. This compared to 2.11% registered in September.
On an annual basis, the ITO-measured Istanbul Consumer Price Index eased to 32.47% compared to 33.55% a month earlier.
Seen as a barometer of price tendencies in Türkiye’s most populous city, the index provides an insight in a change of prices affecting close to a quarter of the country’s population.
The nationwide data for October inflation will be released by the Turkish Statistical Institute (TurkStat) on Tuesday.
In September, inflation dropped below 30% range, cooling to 29.73% on a yearly basis.
According to ITO, the largest contributor to the monthly increase in prices was clothing and footwear (10.6%), followed by communication services (5.05%) and entertainment and culture (5.32%).
On a yearly basis, the surge in consumer prices in Istanbul was led by education, health services and housing, the chamber said.
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