Despite the negative expectations of a group of pessimist economists, the Turkish economy continues to yield outcomes. These positive outcomes are directly related to effective economic management by the government, which has been active since the coronavirus pandemic severely hit the global financial and economic system.
This management involves the use of monetary and direct control policies, tools that have been used very effectively in a multidirectional way.
On Tuesday, the Istanbul Chamber of Industry (ISO) announced that Turkey’s Purchasing Managers' Index (PMI) rose to 56.9 points in July and reached its highest level since February 2011. This data proved that the V-shaped recovery, which has been emphasized by Treasury and Finance Minister Berat Albayrak, has been strengthening.
The answers to the PMI survey indicate that the Turkish manufacturing industry has been receiving very strong orders for the last two months. This, as we mentioned last week, confirms the estimate that the world's leading companies will meet at least 10% to 15% of their global supply needs out of China and Asia.
This will also redirect them toward countries that have proven themselves in the manufacturing industry, such as Turkey.
As a matter of fact, according to the data shared by the Ministry of Trade and Turkish Exporters Assembly (TIM), the importance of once again exceeding $15 billion a month in exports during the global pandemic is now substantial. For 16 of the 26 exporting sectors and for exports to 77 countries, Turkey's exports have reached their highest level compared to pre-COVID-19 times.
One of the most important details is that companies in the manufacturing industry have used their accumulated stocks to meet their orders. Thus, we have seen the most significant decline in the stocks of finished products in the last four months.
The decline in stocks, naturally, rapidly reflected on employment and purchasing activities related to the need for new production.
This recovery in production is inevitably reflected in input costs, logistics and transportation costs. The strong V-shaped recovery, in relation to the cost inflation, is reflected in both the producer and consumer prices index on a monthly basis. Having said that, there is also a relative decline in input costs in July.
As a matter of fact, the cumulative, annualized consumer inflation in the Consumer Price Index (CPI) has decreased to 11.76% in July from 12.62% in June, confirming this picture.
Technology war
For the first time in its history, the global mobile app market will exceed $100 billion in 2020. Considering the success of Turkey’s local and national entrepreneurs in the global mobile applications market and in the global digital games market as part of the digital space, it is critically important that Turkey bolster its claim and competitiveness in this field.
Especially when we consider the fact that with COVID-19, human beings have become more dependent on smart devices and mobile applications – with a world that spent $30.6 billion in mobile apps in the first half of 2019 and $50.1 billion in the first half of 2020, $32 billion of that in Apple's App Store and $17.3 billion through Google Play – Turkey is sitting on potentially billions of dollars of revenue through software exports.
However, the technology war is intensifying. In 2010, in a world where 305 million users used operating systems on smart devices, the Android operating system had a share of 23.3%, the BlackBerry operating system had 16%, the iOS operating system had 15.6%, the Windows operating system had 4.9%, and other operating systems had a share of 40.2%.
In just nine years, the tech war has wiped out most of the operating systems from the market, and as of 2019, 86.1% of the 1.37 billion operating system users are using the Android operating system and only 13.9% are using the iOS operating system.
It is striking that the operating systems that existed just nine years ago and dominated 40.2% of all users have all disappeared today.
The latest developments are very interesting in the technology war raging over smart devices, operating systems and mobile applications.
Last Saturday, Apple removed more than 30,000 apps from its App Store installed on devices in China. Apple has removed apps after sending a reminder note to game developers that the app will be removed if regulatory conditions for end-of-month payments are not met. It is stated that Microsoft is aspiring to run the U.S. operation for TikTok, the Chinese digital application that the U.S. administration is determined to ban.
As the global war in the world of digital platforms and mobile applications gains momentum, another war is waging in the global health care industry. The latest development is that Siemens Healthineers is conducting advanced negotiations to acquire Varian Medical Sytems in a deal that could exceed $15 billion.
The market value of the medical equipment manufacturer is around $13 billion. Turkey’s moves to strengthen its claims in the national and local health equipment, medical software, digital platforms and mobile application in this field would hike up our high value-added exports.