Economy
Turkish manufacturing sector lost further pace in July: PMI
Türkiye’s manufacturing sector continued to lose momentum in July, a survey showed Friday, as weak demand caused significant slowdowns in both new orders and output.
The Türkiye Manufacturing Purchasing Managers’ Index (PMI) fell to 45.9 in July from 46.7 in June, the Istanbul Chamber of Industry (ISO) said.
That marked the third consecutive monthly decline and the most pronounced moderation since October 2024.
PMI readings above 50.0 indicate growth in activity, while those below point to a contraction. Business conditions have now eased for 16 consecutive months, underscoring persistent challenges in the sector.
A key theme of the latest survey was subdued customer demand and, in turn, new orders easing the most since March, the survey showed, while international demand also remained weak.
Consequently, manufacturers scaled back production while employment and purchasing activity were reduced, and efforts were made to limit inventory holdings, the panel showed.
Stocks of purchases eased to the largest degree since October 2024, while stocks of finished goods were markedly depleted following a slight rise in June.
Currency weakness continued to drive sharp increases in input costs while selling prices rose at a slightly faster pace than in June.
“There was little in the way of positive news from the latest Turkey manufacturing PMI as the challenges for firms in securing new orders percolated through the sector,” said Andrew Harker, Economics Director at S&P Global Market Intelligence.
“Manufacturers will be hoping to see some pick-up in demand conditions as the second half of the year progresses.”
Türkiye aims to see 100,000 startups founded by 2030 and to raise the combined valuation of its “Turcorns,” the country’s billion-dollar startups, to $100 billion, Industry and Technology Minister Mehmet Fatih Kacır said on Friday.
“We aim to have 100,000 startups established in Türkiye by 2030 and to raise the total valuation of our Turcorns to $100 billion,” Kacır told the GO! GLOBAL Türkiye Summit 2026.
The event was organized by the Türkiye-U.S. Business Council’s Digital Working Group at the Foreign Economic Relations Board (DEIK) with Endeavor Türkiye. It focused on Türkiye’s technology entrepreneurship ecosystem, global investment opportunities and goals in advanced technology.
Kacır said Türkiye is working to become a global center for technology, entrepreneurship and investment. He said annual research and development spending has risen over the past 20 years from $1.2 billion to about $20 billion, and R&D’s share of national income from 0.5% to 1.46%.
He said advances in artificial intelligence, biotechnology, semiconductors and quantum technologies are reshaping global competition, value chains and traditional sources of competitive advantage.
Kacır said more than 13,000 technology companies operate in Türkiye’s 115 technology parks, and thousands of researchers and engineers work in more than 1,700 R&D and design centers. He added that Türkiye is the world’s 11th-largest defense exporter.
Startup support, data centers
Kacır pointed to Togg, Türkiye’s national electric carmaker, as a concrete example of this vision. He said more than 120,000 Togg vehicles have been put on the road so far.
He said the BiGG program is Türkiye’s largest public support mechanism for pre-seed and seed-stage technology startups, and has helped set up about 2,700 technology ventures.
Kacır said artificial intelligence is among the government’s highest priorities, and that Türkiye wants to be a country that develops AI technologies and exports them to global markets.
The Türkiye AI Action Plan has 16 priority actions, he said. Within two years, the government aims to train 10,000 advanced AI specialists and 100,000 AI application professionals, and to give AI literacy training to 5 million citizens.
On data centers, he said the goal is to raise installed capacity to at least 1 gigawatt by 2030, which would require mobilising at least $10 billion of investment.
He said $3 billion in public support has been set aside for data center and AI investments under HIT-30, the government’s high-technology investment program.
Kacır said Türkiye offers global investors its strategic location, growth, large domestic market and skilled workforce. The economy has grown by more than 5% a year on average over the past 20 years, he said, and the country has more than 86 million people and about 23 million primary, secondary and university students.
He said Türkiye added about 8 gigawatts of electricity generation capacity last year, and aims to add 8 to 10 gigawatts of renewable capacity each year for the next decade.
Canadian engineering company AtkinsRealis is in the running to help build Türkiye’s third nuclear power plant, Prime Minister Mark Carney said Friday.
NATO allies Canada and Türkiye upgraded their relations to a “strategic partnership” during the first bilateral visit by a Canadian prime minister on Thursday, as Carney seeks new global trade partners to reduce reliance on the U.S.
The new partnership signed in Ankara following talks between Carney and President Recep Tayyip Erdoğan focuses on trade and investment, defense, security and energy. It aims to create jobs and opportunities for Canadian and Turkish companies to do more business together.
Carney arrived in Istanbul on Friday to meet with Turkish business leaders in strategic sectors such as energy, aerospace and critical minerals.
Canada and Türkiye announced a partnership agreement in the defense industry and have also identified potential for cooperation in nuclear energy.
Asked about talks on Canadian involvement in Türkiye’s planned third nuclear power plant, over which Ankara has also held talks with South Korea, Russia, China and Japan, Carney said the decision would ultimately be made by the Turkish government, but he believed Canada had better odds now.
“If you would have asked us a year ago how we would have pegged the chances, they would have been very low. Now there are good chances. There’s real competition, of course,” Carney told reporters in Istanbul, adding that there may be a decision on the issue before the end of the year.
He said the strength of Canada’s CANDU technology, partnership with some Turkish businesses, including on the construction side, and the ability to build out elements of the supply chain make it “quite a compelling proposition.”
Rosatom, Russia’s state nuclear energy company, is building Türkiye’s first nuclear power station at Akkuyu in the Mediterranean province of Mersin under a $20 billion accord from 2010. It said last week that it expected a year-end nuclear startup at the site.
Türkiye plans to build a second nuclear power plant in the Black Sea region of Sinop, with the third planned in the northwestern region of Thrace.
Reports before Carney’s visit said allies would discuss potential purchases by Türkiye of liquefied natural gas (LNG) from Canada, as well as critical minerals.
On Thursday, they said they had agreed to significantly increase collaboration across the energy sector, including in LNG, civil nuclear energy and renewable energy.
Turkish expertise in defense
Carney meanwhile also said Friday that Ottawa is “in need of Turkish expertise” to strengthen its defenses and reduce reliance on foreign military systems.
He said Canada was interested in both Turkish military technology and joint industrial partnerships, with an emphasis on developing capabilities together.
“I would lean toward the partnership end of the spectrum, where we’re providing complementary technology and we’re building up together,” Carney said.
He was more direct when asked whether Canadian companies could benefit from closer ties with Türkiye’s established defense industry, particularly its expertise in drones and autonomous systems.
“Candidly, we’re in a position where we’re more in need of Turkish expertise in terms of reinforcing what we need to do to protect Canadians and to serve as a full NATO ally at this stage,” he said.
Deal to strengthen export credit cooperation
Separately, Türkiye and Canada signed a memorandum of understanding to strengthen export credit cooperation and support joint projects in third-country markets, Trade Minister Ömer Bolat said Friday.
The agreement between Türk Eximbank and Export Development Canada (EDC) followed Bolat’s meeting with Canadian Foreign Minister Anita Anand in Istanbul.
In a statement on Turkish social media platform NSosyal, Bolat said the two discussed expanding bilateral trade and economic relations, alongside negotiations on a Türkiye-Canada free trade agreement.
Canadian and Turkish negotiators will kick off the first round of free trade talks next month in Ankara.
The memorandum aims to support Turkish and Canadian companies in developing joint projects in third-country markets, particularly in Africa, the Middle East, North Africa and Central Asia.
“We will continue our efforts to deepen trade and economic cooperation between our two countries and create new opportunities for our companies,” Bolat said.
Apple’s first folding phone, the iPhone Duo, hit stores around the world on Friday with a price tag of about $2,000 and less of the fanfare that accompanied previous launches.
From Singapore and Shanghai to London and Berlin, demand was strong, but with sales rationed, there were fewer of the round-the-block queues and overnight camp-outs that once marked new iPhone days.
Competitors such as Samsung Electronics and Huawei Technologies have sold premium foldable phones for years, and the Duo is a test of whether Apple can reinvent the small foldable mobile market the way the iPhone did for smartphones.
It is also an early challenge for Apple’s new CEO John Ternus, the former hardware chief who unveiled the phone barely a week after taking charge in September.
Apple’s estimated delivery dates for the Duo had slipped to late January within minutes of pre-orders opening a week ago, as demand outpaced supply. The U.S. company called the response “nothing short of extraordinary.”
Apple capped pre-orders at two handsets per customer and limited sales to walk-in shoppers. In China, France, Hong Kong, India and Japan, they were only available to those who had ordered online.
In Sydney, which was the first Apple store to sell the new passport-shaped phones on Friday, a queue formed outside before opening at 8 a.m. local time (2100 GMT).
“This is a bit of a luxury item for me, because it’s so expensive, but I just think, you know what? Life’s too short,” said Simon Krishnan, a 48-year-old engineer who paid A$3,899 ($2,734) for a 512GB Duo.
In China, a soft consumer market and rising memory costs have led to six straight quarters of declining smartphone shipments, although Apple’s market share has rebounded as some buyers trade up to premium devices.
Liu Wei, a 26-year-old healthcare professional, already has a foldable phone from Xiaomi, but still queued outside a Shanghai store from 6 a.m. for Apple’s first foldable.
“I’ve used Apple products for many years and I have more trust (in the brand), so I bought one on launch day to try it out,” he said.
Many queued to pick up pre-orders, while others hoped for limited stock or to browse display models.
Others were resellers.
In Hong Kong, May, 38, who declined to give his full name, bought a 256GB iPhone Duo, priced at HK$17,499 ($2,231.73), in an online pre-sale and planned to resell it for a profit of around HK$4,000. “A few meals’ worth of money,” he joked.
Paul Francis, 53, was one of several dozen fans who queued overnight outside London’s Regent Street store in pouring rain.
“Some people think it was mad. Including myself,” the charity manager said.
Mixed reviews
Early reviews have praised the Duo’s design as well as its sturdy and barely visible hinge, a major feat for phones whose prominent creased screen has long been a drawback and potential deterrent for buyers.
But reviewers said camera compromises, including no telephoto lens, and third-party apps still to be reworked for the new display size could disappoint some buyers.
They also said the folded Duo is less handy for the quick tasks most users do daily and several prominent reviewers recommended against it for many Apple customers.
“It’s been a lot of fun trying the Duo out for a week, but it feels like I’ve gotten to use an extraordinarily polished prototype – not a finished product that I’d want to buy and carry,” wrote longtime Apple commentator John Gruber.
Tech commentator Marques Brownlee said in a YouTube review that for a regular person who mostly texts and browses, “it is probably a no. But if the $2,000 doesn’t mean much to you, and you like the idea, after the learning curve and getting used to not having facial identification, it is a really fun phone.”
In Berlin, YouTube content creator Patrick Wolter was impressed that the Duo works as a phone and an iPad in one.
“I’ve always found it a hassle to carry around a separate tablet, especially since I already have a laptop and other gear,” he said. “In the long run, this will likely end up replacing those other devices.”
Tough to find
Apple’s entry into the relatively niche foldables market could bring the format to a much broader audience, said Francisco Jeronimo, vice president at market researcher IDC.
IDC expects Apple will take 44% of the foldable market value in 2026 on 31% of units. By 2027, it will become the market leader both in value and units shipped, IDC forecasts.
“Apple has made a convincing case for this form factor,” Jeronimo said after spending a week with the Duo.
“Now comes the next test: turning excitement into availability, adoption and a lasting new chapter for the smartphone market,” Jeronimo said.
Türkiye’s tight monetary stance and its shift to more conventional economic policies underpin its sovereign rating, according to S&P Global Ratings. Slower disinflation and the run-up to elections will test the central bank’s commitment to discipline, while the banking sector faces significant but manageable risks.
Karen Vartapetov, S&P Global’s director and sovereign lead analyst for Central and Eastern Europe and Türkiye, said the country’s BB- sovereign rating with a stable outlook reflects significant progress since 2023. That was when Ankara began reversing years of ultra-loose monetary policy aimed at boosting growth despite surging inflation.
Disinflation regained pace recently after higher energy prices and a succession of shocks halted the momentum following the start of the Iran war. Annual inflation last cooled to below 30% in September.
Weakening domestic demand, slowing retail sales and lower credit growth show that tight policy is feeding through to the economy, and Vartapetov said this will let the central bank keep focusing on disinflation.
“Disinflation has been delayed, but we believe not derailed,” he told Reuters.
The central bank cut its key interest rate to 36% on Thursday after lower-than-expected September month-over-month inflation data. It had held the rate at 37% for its previous five policy meetings.
Vartapetov said the new economic team has gained credibility but needs more. “It’s still not clear how sustainable these tight monetary and macroeconomic policies are in light of the upcoming electoral effects. That’s what we’re monitoring,” he said.
Presidential and parliamentary elections are scheduled for May 2028, though officials have said they could be held a few months early. S&P, whose assessment broadly mirrors those of Fitch and Moody’s, will review Türkiye’s rating in April next year.
Significant risks, but manageable
Regina Argenio, director of financial institutions at S&P Global Ratings, said the agency has just affirmed its Banking Industry Country Risk Assessment (BICRA) for Türkiye.
Argenio said the risks that the banking system faces are significant, but they consider the situation manageable given the progress in reducing inflation and a better economic outlook than expected at the start of the war in the Middle East.
S&P is closely watching banks’ ability to keep rolling over their sizeable external debt, and any disruption there could be problematic, she told Anadolu Agency (AA).
Credit, profitability
Argenio said credit volumes are shrinking because it is very hard for banks to expand lending at current high real interest rates. She said “next year could be better” if easing in monetary policy is reflected in pricing and lending.
SMEs and retail customers struggle with such extreme financing costs, and this is where S&P sees a potential basket of asset-quality risks for banks, said Argenio.
S&P expects net interest margins to improve next year, since lower rates would translate fairly quickly into cheaper Turkish lira funding. Foreign-currency funding costs could rise because of interest rate dynamics abroad. The outcome, Argenio said, depends on the timing and size of rate cuts and on the success of the disinflation program.
Fund crisis
Both analysts addressed the investment fund crisis, which erupted last month when regulators ordered the liquidation of more than 100 funds over allegations that assets had been manipulated and inflated in value.
Vartapetov said S&P views it primarily as a governance and supervision issue rather than a threat to financial stability. Most money withdrawn from the sector moved into lira deposits rather than foreign currency or gold, and policymakers responded quickly to contain the fallout.
“We treat that story as a governance story rather than a broad-based financial crisis,” he said. “What would be important is what sort of lessons the authorities learned and what sort of improvement in supervision is going to take place.”
Argenio said the impact should be limited if the problem proves isolated, and she called the policy response quite strong. Liquidity provided to the banking sector helped contain the effects.
It is still too early to judge the impact on external borrowing costs, she said, and S&P expects those to rise anyway because of global rate dynamics. Turkish borrowers could also face a higher risk premium, depending on how well the situation is contained and how quickly it is managed domestically.
A tanker carrying 40,000 metric tons of Russian diesel is heading toward New York, ship-tracking data showed on Friday, following an agreement reached this month between Moscow and U.S. President Donald Trump.
Trump announced the surprise dealto import Russian diesel as part of his efforts to bring down soaring diesel prices ahead of Nov. 3 U.S. mid-term elections.
Trump also waived parts of a new U.S. sanctions law against Russia and threatened Europe with a U.S. diesel export ban unless countries released more from their emergency reserves to help ease prices.
The Malta-flagged medium-sized tanker Agioi Fanendes was loaded with 40,000 metric tons of ultra-low sulphur diesel in the Russian Baltic port of Primorsk on Oct. 22, according to LSEG shipping data. It is expected to arrive in the United States on Nov. 7.
The identity of the buyer and seller was not immediately known. The cargo will be the first imported by the U.S. since former President Joe Biden announced a ban on imports of Russian oil and petroleum products in 2022.
Russian Deputy Prime Minister Alexander Novak has said that additional shipments will follow as Russian and U.S. companies work out contracts for the deliveries.
President Vladimir Putin’s envoy Kirill Dmitriev, who also heads Russia’s sovereign wealth fund, said last week that the U.S. Treasury had asked the fund to help sort out tricky payment issues relating to the agreement.
The deal also involved Russia agreeing to lift a self-imposed ban on diesel exports.
Trump announced on Oct. 9 that Russia would immediately export 300,000 metric tons, or 2.25 million barrels, to the US and global markets, followed by 500,000 tons in November and 1 million tons “immediately thereafter.”
Novak has said that Russia would be able to increase its diesel exports to its usual levels of 3-3.5 million tons per month by the end of the year.
Last week, export cargoes were loaded in the Russian Baltic port of Primorsk, but their final destinations are not clear, with most tankers signalling Gibraltar, the Atlantic Coast or Port Said, LSEG shipping data showed.
Since the EU imposed a full embargo on imports of Russian oil products in February 2023 over the war in Ukraine, Russia has exported diesel mainly to Brazil and Türkiye, as well as to African countries.
Shares in Swedish carmaker Volvo Cars plunged Friday after it said U.S. tariffs and strong competition from local brands in China pushed it into a third-quarter loss.
The company also said it would cut about 2,500 jobs worldwide.
Volvo Cars, controlled by Chinese group Geely, reported revenue of 66.9 billion kronor ($6.7 billion) for the third quarter, down nearly 23% from the same period last year.
It swung to a net loss of 5.7 billion kronor for the quarter from a net profit of 4.5 billion kronor a year earlier.
Volvo delivered about 141,300 vehicles globally in the three months to the end of September, 11% fewer than a year earlier.
Shortly after 0800 GMT, its shares were down almost 3%.
“We continue to operate in a very tough environment with strong external challenges: de-globalization, hypercompetition and climate change,” chief executive Hakan Samuelsson said in a statement.
In response, the company announced a new five-billion-kronor savings plan it said would lead to about 2,000 job cuts in Sweden and 500 more globally, “through natural attrition and by targeted exit packages to employees.”
Samuelsson cut jobs at the firm last year, leaving the company with an average of about 39,300 staff on board in the first nine months of 2026, compared with 43,000 in the same period a year earlier.
The company, which had bet heavily on electric vehicles, said the removal of consumer incentives for EVs in the United States under President Donald Trump had also hit its margins.
In 2024, Volvo Cars dropped a plan to transition to exclusively EV sales by the end of the decade.
“We are convinced that we have the right long-term strategy addressing these challenges,” Samuelsson said.
“However, in the short term, with severely challenged volumes, we need to reinforce our turnaround plan with additional decisive actions, lowering our break-even point and improving cash flows to make us more resilient.”
Struggling along with other European auto companies in the face of a difficult global landscape, Volvo Cars last year announced an 18-billion-kronor cost-cutting plan.
The company said in September that Samuelsson would resign when his contract ends, with Skoda Auto CEO Klaus Zellmer set to replace him “no later” than October next year.
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