Economy
German ‘chemical town’ last to feel impact of industrial decline
German industrial decline is slowly starting to inflict pain on communities that have long relied on major manufacturers for employment, prosperity and a sense of stability.
Among the places affected by the downturn is Ludwigshafen, a company town of chemical giant BASF, which has shed thousands of jobs while shifting its focus to China.
“The mood is obviously not good,” Sinischa Horvat, chairperson of BASF’s works council, which represents staff interests, told Agence France-Presse (AFP) during a visit to the city of about 175,000 people.
“The entire market is currently so weak. When you watch the news, you hardly hear any positive messages.”
BASF is among Germany’s manufacturing heavyweights in sectors ranging from autos to steel and factory equipment that have been cutting back in their domestic markets.
They are battling surging energy costs, fierce competition from China, and weak demand at a time when Europe’s biggest economy is mired in a long stagnation.
Some 2,500 jobs have been axed since 2022 in Ludwigshafen, which is dominated by sprawling chemical plants that stretch along the Rhine River, and more cuts are set to come.
A recent decision to sell off thousands of company-owned apartments, many occupied by current and former workers, has added to unease.
“The sale of these apartments sends a signal to the city and to the people who live here and, in some cases, work at BASF – BASF is scaling back its operations,” Patrick Thiel, who lives in one of the apartments and works at the firm, told AFP.
“There is growing concern that this won’t stop at the apartments but will also affect the main plant,” added the 29-year-old, who also ran as a candidate in recent local polls for far-left party Die Linke.
China push
Horvat said having BASF staff in the properties helped create a “symbiosis” between the company and community.
“This has fostered an understanding of chemistry and shaped the relationship with BASF in the city,” he said.
BASF – a supplier of base inputs to the agricultural, automotive and pharmaceutical sectors – says the proceeds will go to bolstering its core businesses, but acknowledged that the sale had “raised uncertainties.”
A company spokesperson, however, insisted that it would handle the sale responsibly, adding: “No one has to fear losing their home.”
“We will continue to see ourselves as an integral part of the local community in the future,” she said.
Underlining its commitment to Ludwigshafen, where the group has over 30,000 employees – around a third of its global workforce – BASF has agreed to hold off on compulsory redundancies there until at least 2028 and continue investing.
But, as it cuts back at home, the world’s biggest chemical firm is investing heavily overseas, last month inaugurating a vast 8.7 billion euro ($10 billion) complex in China, its biggest ever single investment project.
It insists that building up its presence in China, the world’s biggest chemical market, is crucial.
Job losses
BASF is far from the only German company suffering.
Last year industrial companies cut 124,000 jobs, around double the figure in 2024, with hefty losses in particular found in the struggling auto sector, a study by consultancy EY showed.
Germany’s manufacturing sector contracted to hold a share of 19.5% of the country’s economy in 2025, according to official figures – its lowest level for many years.
“The loss of industrial jobs in Germany has accelerated in the past two years,” Marcel Fratzscher, president of the DIW economic institute told AFP.
“Companies that used to be the pride of Germany are suffering.”
Areas that have already suffered industrial job losses see greater social problems and offer fertile ground for fringe parties, such as the far-right Alternative for Germany (AfD), to pick up support, experts warn.
Still, Fratzscher said that Germany had undergone economic upheavals before, and urged politicians and companies to try to ensure the economy emerges stronger.
The current economic transformation should be seen “as an opportunity to move into sectors that have better margins, better jobs,” he said.
“The biggest mistake we can make is to try to cement the status quo, to keep all companies exactly the same. That would lead to a much bigger deindustrialization.”
KazanForum, which brings together Russia and the Islamic world, offers significant opportunities for Türkiye in the fields of investment, finance, and participation finance, and contributes to the development of regional economic cooperation, a Turkish official said, according to a report published Sunday.
Speaking to Anadolu Agency (AA) during the forum, Burak Dağlıoğlu, the head of the Investment and Finance Office, said that the event has gradually evolved into a multi-dimensional platform that goes beyond economic topics.
This year’s forum, which is seen as the main platform for economic cooperation between Russia and the countries of the Islamic world, took place between May 12 and May 17.
Drawing attention to the cultural dimension of the forum, Dağlıoğlu pointed out that many sessions are also organized in cultural areas, especially under the halal theme.
“It has become a comprehensive platform where participants come together, fairs are held, and meetings take place,” he added.
Türkiye’s focus on investment, finance
Emphasizing that Türkiye’s priority at the forum is investment and finance, Dağlıoğlu noted that there is a strong trade volume between Türkiye and Russia.
He also stated that within the scope of regional economic relations, economic ties between Türkiye and various regions of Russia, starting from Tatarstan, have been diversifying, adding that they see “a wide range of trade diversity, from industrial goods to non-natural-resource products.”
Moreover, explaining that participation finance is an important agenda item for Türkiye and that Russia is also taking new steps in this field through legal regulations, he added: “We see that participation finance instruments are being implemented in regions with dense Muslim populations. We are also carrying out mutual efforts and organizing delegations to grow this ecosystem.”
At the same time, Dağlıoğlu noted that trade ties between Türkiye and Russia are increasing, stating that the total investment value of Russian-capital companies operating in Türkiye has exceeded $6 billion.
He also pointed out that investments from Tatarstan into Türkiye are at a notable level, emphasizing that Türkiye has become an important hub for international investors.
Forum lays groundwork for new cooperation
In addition, Dağlıoğlu said they expect the contacts made during the forum to produce concrete economic outcomes and that Turkish companies have significant market access opportunities in the region.
He noted that there are strong companies in sectors such as industry, petrochemicals, machinery, metal processing and food, adding that the goal is to increase mutual investment and cooperation in these areas.
He also stated that Türkiye would become an attractive center for international companies with its new incentive model.
“We aim to create a trade ecosystem where access to broader geographies can be achieved via Istanbul,” he said.
Eight years ago, when Jerome Powell became Chair of the Federal Reserve (Fed), economists worried that inflation and interest rates were too low and not enough Americans were employed.
Now, as Powell steps down from the post after eight tumultuous years, the U.S. economy is transformed: Inflation soared after the COVID-19 pandemic and has remained above the Fed’s 2% target for more than five years, angering voters and making rents, cars, and groceries harder to afford.
The Fed’s key short-term rate rose to a two-decade high in 2023, even as unemployment fell to a half-century low.
Along the way, Powell shrugged off relentless personal attacks from President Donald Trump that began just months after his appointment. But in January, he pushed back against an unprecedented legal investigation by the Justice Department, becoming one of the few top officials in Washington to stand up to the Trump White House.
Powell, who was named chair pro tempore on Friday until his successor Kevin Warsh is sworn in, said he will continue serving on the governing board until he is confident the Fed’s independence is truly restored. His success at protecting the central bank from day-to-day politics will be a key part of his legacy.
“It is not an unblemished record, but in an extremely challenging context, he’s performed exceedingly well,” said David Wilcox, a senior fellow at the Peterson Institute for International Economics and director of research at Bloomberg Economics.
“And my overall assessment is that the country has been lucky indeed to have him as chair.”
Unlike many of his predecessors, Powell, 73, is not a trained economist, but a lawyer who also worked in finance before joining the Fed’s board of governors in 2012. Unassuming in public and private, Powell often introduces himself as “Jay” and would display his guitar-playing skills, honed as a student busking through Europe, at the Fed’s holiday parties.
An inescapable part of Powell’s legacy will be the post-pandemic inflation surge, when consumer prices rose by a four-decade high of 9.1% in June 2022.
Overall prices are now 27% higher than just before the pandemic six years ago, a staggering change for a country that had experienced little inflation for generations. Prices rose just 10% in the six years before the pandemic. Groceries are 30% more expensive than six years ago, after they rose just 3.6% in the six years preceding the COVID-19 pandemic.
‘Transitory’ inflation legacy
Powell and other Fed officials, and indeed most economists, initially said the inflationary surge was “transitory,” a result of supply chain snarls brought about by the pandemic, as COVID shut down factories and slowed ports around the world.
Their immediate priority was supporting the economy in a crisis.
In two moves in March 2020, they slashed their benchmark interest rate by 1.5 percentage points to near zero. The Fed also bought large amounts of Treasury debt and government-backed mortgage securities to reduce longer-term interest rates and took other steps to pour money into the financial system to keep credit markets functioning during pandemic chaos.
In April 2020, Powell said that the Fed would “continue to use these powers forcefully, proactively, and aggressively until we are confident that we are solidly on the road to recovery.”
Even as inflation zoomed past the Fed’s 2% target in 2021, the central bank kept its key interest rate near zero until March 2022, when inflation hit 6.9%, according to the Fed’s preferred measure.
The Fed’s delay in raising rates was largely informed by a traditional economic view that inflation, stemming from a supply shock, would be temporary and if a central bank cranked up borrowing costs to fight it, the higher rates would just harm the economy and lift unemployment even as the supply crunch faded.
Meanwhile, the Trump and Biden administrations pumped about $5 trillion in government spending into the economy, in the form of multiple stimulus checks, support for small businesses, and other aid. The flow of dollars fueled a spending spike just as supply chains were unable to deliver on the demand.
By keeping its key rate near zero for so long, Powell’s critics charge, the Fed contributed to that excess spending and worsened inflation.
“Even though there was all the evidence there in the data that aggregate demand was going through the roof, they still said it was a transitory supply shock,” said Mickey Levy, a former top economist at Bank of America and a visiting fellow at the Hoover Institution. “The Fed contributed to that inflation and completely misread the tea leaves.”
As inflation began to spread into items such as apartment rents and surveys showed Americans increasingly worried it would last, Powell pivoted and oversaw the sharpest increase in interest rates since the early 1980s to combat the price spike.
Still, many leading economists, including former Treasury Secretary Larry Summers, worried that defeating inflation would require a recession and a sharp increase in unemployment. Instead, inflation dropped to 2.3% by September 2024, according to the Fed’s preferred measure, nearly reaching its 2% target.
By reducing inflation without a sharp economic downturn, Powell largely achieved an elusive “soft landing.” Inflation then moved higher after Trump imposed sweeping tariffs last April.
Fighting inflation was a sharp shift for a Fed chair that began his term more focused on the Fed’s mandate to pursue maximum employment. Before the pandemic, Powell often lauded the benefits of a strong job market for disadvantaged workers, winning plaudits from many progressive economists.
Yet some economists argue the Fed’s focus on employment contributed to its delayed response to post-COVID inflation. In an August 2021 speech, Powell said the then-elevated unemployment rate of 5.4% was a reason to avoid hiking rates too early.
Still, many analysts defend Powell’s support for the maximum employment mandate. Julia Coronado, president of MacroPolicy Perspectives and a former Fed economist, said Powell was right to keep rates low before the pandemic, even as unemployment steadily declined, because there were no signs inflation was worsening.
“If you can actually push a little harder for a little longer with no consequences for inflation, then you should damn well do it,” she said. “He was absolutely right about that. He’s still right about that.”
For his part, Powell said in late April that “overweighting the employment market” had nothing to do with the inflation spike.
“It was a global shock that happened essentially very, very similarly all over the world,” he said.
Trump dispute
Last July, in an image that will likely prove the most enduring of his time as Fed chair, Powell and Trump stood before cameras in hard hats at the site of the Fed’s extensive $2.5 billion building renovation, which Trump had criticized as excessive.
Trump claimed the project would cost even more, about $3.1 billion, and showed Powell a paper listing the costs. Powell took out his reading glasses and corrected the president, on camera, by noting that he had included a third building that had already been renovated.
It was emblematic of Powell’s willingness to push back against Trump’s unprecedented attacks. Economists have long supported an independent Fed because it allows the central bank to take difficult steps, such as sharply raising interest rates to combat inflation, which politicians often oppose because they can be painful.
Powell benefited from a strong relationship-building with Congress. Research by University of Maryland economist Thomas Drechsel has found that Powell met with senators more than twice as often as his two predecessors, with the meetings evenly split between both parties.
During one visit, Powell even endeared himself to North Carolina Republican Sen. Thom Tillis’ dog, a move that paid huge dividends. Tillis essentially blocked Senate approval of Kevin Warsh, Trump’s pick to replace Powell, until the investigation of the building project was dropped. The Justice Department eventually gave up on its probe.
Even those who fault Powell on some policy decisions credit him for defending the Fed.
“The big plus is the way he has protected central bank independence,” said Don Kohn, a former vice chair of the Fed. “That is the most important thing for the future of the Federal Reserve and for protecting the public interest in having an independent central bank.”
Powell hasn’t said when he may leave the Fed, though he could remain on the governing board until January 2028.
“You want people to … set interest rates to benefit the general public,” Powell said at his last news conference, “and focus only on that and ignore political considerations. This isn’t bipartisan, this is nonpartisan.”
Syria has appointed Safwat Raslan, head of the Syrian Development Fund, as the country’s new central bank governor, while former governor Abdelkader Husriyeh has been named ambassador to Canada, state media reported Friday.
Reuters reported earlier on Friday, citing two people in the Syrian banking sector, that Raslan was expected to be appointed central bank governor.
Raslan, a former banker who fled Syria to Germany as a refugee during the country’s civil war and obtained citizenship there, did not respond to a message seeking comment.
Husriyeh also did not respond to a request for comment. State media cited the foreign ministry in reporting his appointment.
Syria’s banking sector has been seeking to reconnect with global finance after the fall of former dictator Bashar Assad, whose crackdown on protests in 2011 triggered a 14-year civil war and sweeping Western sanctions that isolated Syrian banks and the central bank.
Most of those sanctions have since been lifted, but the country’s banks remain relatively isolated from the global financial system, hampering efforts to attract funds to boost the economy and support post-war reconstruction.
Husriyeh was appointed central bank governor by President Ahmed al-Sharaa in April 2025. During his tenure, Syria carried out its first international bank transfer via the SWIFT system since the start of the war.
Raslan was appointed director-general of the Syrian Development Fund in 2025. The fund, launched after Assad’s ouster, was set up as a state-backed vehicle to mobilize money for reconstruction and development projects.
Inflation expectations among market participants in Türkiye worsened in May, with forecasts rising for both year-end inflation and the 12-month outlook, a survey showed on Friday.
The deterioration comes amid pricing pressures from the Iran war, which has shut the key Strait of Hormuz, causing what the International Energy Agency (IEA) has described as the biggest energy supply crisis ever.
The higher energy prices and transportation prices were among the main drivers behind an increase in Türkiye’s inflation in April, when it reached 32.37%, compared to 30.9% in March.
Market participants see inflation in 12 months time at 23.82%, a May survey by the Central Bank of the Republic of Türkiye (CBRT) said on Friday. That’s up from 23.39% in the previous survey period.
Participants also raised their year-end forecast to 28.94%, compared with 27.53% in the previous month.
On Thursday, CBRT raised its year-end inflation forecast to 26% from 16% and warned of risks linked to the Middle East conflict, sparked by the U.S. and Israeli strikes on Iran.
The central bank policymakers said there would be no compromise on their determination to bring down inflation and it will continue to use all available tools for disinflation.
The bank kept its key interest rate at 37% last month, holding steady for the second successive policy meeting due to war-related disruptions.
Market participants see the bank keeping the benchmark policy rate unchanged again in June.
Participants also slightly increased their expectations regarding the foreign exchange rate. The year-end U.S. dollar/Turkish lira forecast rose to 51.57, up from 51.23 in the previous survey period.
The 12-month expectation increased more sharply, reaching 54.69, compared with 53.62 previously.
The survey also showed a modest deterioration in growth expectations.
Türkiye’s GDP growth forecast for 2026 fell to 3.3%, down from 3.5% in the previous survey. The 2027 expectation remained unchanged at 4.1%.
Türkiye’s newest deep-sea drilling vessel has departed a northern port for its first operational assignment in the Black Sea, the Energy and Natural Resources Ministry said on Friday.
Named Yıldırım, the vessel will begin work at the Türkali-16 well, where it is expected to carry out lower completion operations as part of ongoing offshore natural gas development efforts in the region.
The latest addition to Türkiye’s growing energy fleet, Yıldırım arrived late last year as part of efforts to expand the country’s energy independence through domestic offshore exploration and production.
It was one of the two new vessels that increased the number of Türkiye’s drillships to six, making it the fourth in the world in terms of deep-sea energy fleet.
After arriving in the southern port of Mersin’s Taşucu terminal, Yıldırım was decorated with Turkish flags before departing for Filyos on Jan. 21. It transited through the Çanakkale and Bosporus straits and reached Filyos Port a week later.
Following its arrival, the vessel’s 1,010-ton drilling tower, previously dismantled to allow passage through the straits, was reinstalled at the port. Subsequent testing and commissioning operations were conducted on drilling, vessel and subsea systems, after which the ship was declared ready for operations.
With the deployment of Yıldırım, the number of Turkish deep-sea drilling vessels operating in the Black Sea has increased to five, including Fatih, Yavuz, Kanuni and Abdülhamid Han.
The expanded fleet is expected to further strengthen Türkiye’s exploration and production capabilities in the Black Sea, where the country is continuing offshore natural gas development efforts.
The fleet also includes 11 support vessels, one construction ship and one floating production platform.
Yıldırım is scheduled to begin its first active operation on May 20, focusing on completion works at the Türkali-16 well.
Built in South Korea in 2024, the vessel is classified as a seventh-generation ultra-deepwater drilling ship capable of operating at depths of up to 12,000 meters. It measures 228 meters in length and 42 meters in width, and includes a helicopter landing pad and accommodation facilities for up to 200 personnel.
The Black Sea is home to the Sakarya field, estimated to contain 710 billion cubic meters (bcm) of natural gas.
The reserve was gradually discovered between 2020 and 2022. It will meet approximately 30% of Türkiye’s annual gas needs once the production reaches total capacity. The Sakarya field accounted for about 6.6% of Türkiye’s 53 bcm gas consumption last year, according to calculations.
In mid-May, Türkiye announced the discovery of a new reserve of 75 bcm in the Black Sea.
Daily output at the Sakarya field stands at around 10 million cubic meters (mcm), enough to supply 4 million households. Production is expected to double in 2026, when Türkiye’s first floating gas production platform, Osman Gazi, becomes operational in the second half of the year.
A second, higher-capacity floating production platform is scheduled to come online in 2028, allowing Türkiye to complete the first three phases of the Sakarya project and meet the gas needs of 17 million households. The output is expected to eventually reach 40 mcm a day.
Türkiye, which imports over 90% of its energy needs, is pushing to cut its import bill and boost supply security by developing domestic resources and expanding international partnerships in oil and gas exploration.
Türkiye and China have agreed to deepen cooperation on climate change, resilient cities, clean energy and sustainable infrastructure, Environment, Urbanization and Climate Change Minister Murat Kurum said on Friday following a visit to Beijing.
Kurum said the two countries also agreed to establish a joint working group focused on climate-related cooperation in the run-up to the United Nations COP31 climate summit, which Türkiye will co-host with Australia in Antalya in November.
Speaking after his May 12-14 visit, Kurum said he held meetings in Beijing with his Chinese counterparts, including Housing and Urban-Rural Development Minister Ni Hong and Ecology and Environment Minister Huang Runqiu, as well as representatives of major international financial institutions.
Those included the Asian Infrastructure Investment Bank, the Silk Road Fund and the China Energy Investment Corporation.
Kurum said discussions focused on expanding cooperation in housing, urban development and climate policy, while also advancing Türkiye’s COP31 agenda that he said will center on implementation-oriented climate action.
“Our goal is for COP31 in Antalya to be an implementation-focused summit that delivers concrete outcomes,” Kurum told Anadolu Agency (AA). “We are conducting international engagement based on dialogue, cooperation and consensus-building.”
He said COP31 priorities include resilient cities, clean energy transition, sustainable infrastructure and climate finance.
Similar climate goals
Kurum said Türkiye and China share similar long-term climate goals, noting that both countries have announced net-zero targets for mid-century – Türkiye by 2053 and China by 2060.
He added that both countries already generate around 60% of their energy from renewable sources, underscoring what he described as a shared commitment to implementation rather than rhetoric.
“While many countries are still discussing climate action, Türkiye and China stand out with concrete implementation,” he said.
Urban resilience, post-earthquake reconstruction
Kurum said one of the key areas of cooperation discussed with Chinese Housing Minister Ni Hong was urban resilience and construction.
He noted that Türkiye completed and delivered 455,000 housing units within two years following the devastating 2023 earthquakes, describing the effort as a large-scale national reconstruction program.
“We shared Türkiye’s experience from the earthquake reconstruction process and the political will demonstrated by President Recep Tayyip Erdoğan,” Kurum said. “We agreed to explore strategic cooperation in this area.”
He said both sides agreed to collaborate on building resilient cities, improving earthquake preparedness and developing sustainable urban projects.
Türkiye also plans to share its technical expertise and regulatory experience with the international community through COP31, Kurum added.
Climate finance, investment cooperation
Kurum said financing remains the most critical component of climate and sustainability projects, noting that without financial mechanisms, implementation remains limited.
As part of Türkiye’s COP31 presidency, he said meetings were held with international investment funds and financial institutions in China to explore funding mechanisms for climate-related projects.
He said the Asian Infrastructure Investment Bank (AIIB) agreed to cooperate on sustainable cities, clean energy access and climate adaptation projects. Specific financing proposals are expected to be announced at COP31 in Antalya.
Kurum also said cooperation with Türkiye’s Iller Bank would support local governments in areas including earthquake risk reduction, clean energy, water treatment facilities, waste management and climate adaptation projects.
He added that discussions with the Silk Road Fund included proposals to ensure that Belt and Road Initiative projects align with zero-emission targets.
Talks with China Energy Investment Corporation focused on renewable energy investments and public-private partnership models, including build-operate-transfer schemes.
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