MESSAGE FROM THE CHAIRMAN
Considering the modest progress of global economic growth in 2015, high volatility exchange rate with the dollar throughout the year, the US rate hike after a decade’s hiatus, 2 consecutive general elections, the fight against terrorism, and Turkey’s relations with Russia and Syria, we can see that we have overcome a significantly testing year for Turkey.
When we look deeper into the world, we see that the global outlook sustained its uncertainty in 2015. Gradual recovery observed in advanced economies, as well as the slowdown in emerging economies’ growth, were the main reasons for this uncertainty. Accordingly, global growth in 2015 remained below estimates, and came in at around 3%. It is projected that economic growth will decelerate in the coming period, with the expectation that labor force participation in the USA and Europe will shrink.
One of the eye-catching developments of this last year has been the sharp decline in the barrel price of Brent oil. The barrel price of Brent oil lost approximately 35% of its value in one year, due to the sharp decline observed throughout the year, bringing it to the lowest level of the past 11 years. Abolishment of the economic and financial sanctions imposed on Iran, China’s decelerating economic growth, tension among OPEC countries, and the record high level of US oil stocks are among the factors exerting downward pressure on Brent oil prices.
On the other hand, the US economy closed 2015 with growth of 2.4%, which lay parallel with expectations. We may regard the FED’s rate hike in December as the last economic development to hit the headlines in 2015. The USA hiked rates for the first time since 2006, raising the benchmark interest rate by 0.25 percentage points to a range of 0.25-0.50.
As for the Chinese economy, we see that China had the lowest economic growth of the last 25 years at 6.9% in 2015. The Chinese economy is expected to be supported by monetary and financial policies in 2016. It is projected that China’s focus will be on reducing capacity abundance in industry, cutting real estate stocks, and minimizing financial risks.
Since 2011, the Eurozone has registered modest progress, growing by 1.5% in general. Similar growth is expected in the Eurozone for 2016. Behind these expectations, there lies the continuation of conditions conducive to growth. Additionally, we note that low oil prices, inflation below expectations, and climbing consumption due to developing workforce market also have an impact. In spite of this modest atmosphere, it can be said that the Eurozone countries are still dealing with some economic problems owing to different tax and spending approaches. Banks’ non-performing loans could not be eliminated, and governments started to take radical steps. Moreover, the recent immigrant problem has led to high political tension in the Eurozone.
While 2015 was dominated by uncertainty in the markets as much as fluctuation, both economically and socially around the world, the Turkish economy closed the year with growth of 4%, exceeding expectations. The main components of this were modest demand growth in domestic consumption, the recovery trend in exports to the EU, and the positive contribution of net exports. As a result of the low trend in oil prices, which is one of our main import items, the cumulative current account deficit in 2015 reached US$ 32.192 billion, the lowest level for the past 5 years. Industrial production rose by 4.5% in December 2015 compared to the same period of the previous year, again surpassing expectations.
Despite all these economic fluctuations, uncertainties and various adverse issues, both in Turkey and worldwide, we at Akkök Holding closed another year successfully. We added value to the sectors we operate in by means of our investments and projects, and we had a fruitful and productive year. We carry on our operations without compromising our principles, such as contribution to the national economy and employment, transparency, social responsibility, sustainability and environmental consciousness, the key values for our holding. In 2016, we aim to maintain the investments we made during the previous year. I would like to extend my gratitude on behalf of Akkök Holding, which maintains its operations with particular emphasis on social development as well as sustainable growth in the chemicals, energy and real estate sectors, to our devoted employees, esteemed executives, and all of our stakeholders who rely on us.
Ali Raif DİNÇKÖK