Turkey'S Pillar Industries Have Been Hit Hard: Clothing Exports Have Dropped By 40%, Domestic Demand Has Decreased By 64%.

As the most important sector in Turkey's output, exports and employment, the garment and textile industry has become the most serious industrial sector in the country, with no signs of recovery.

Industrial production data released recently by the Turkey Bureau of statistics showed that clothing and textile production contracted 20% and 14% in the same month compared with the first time in Turkey in March, while the overall decline in manufacturing industry was 7.5%. Since then, this downward trend has been continuing, and the outlook for June is still not optimistic.

Clothing and textiles rank among the global consumers' priority giving up during the pandemic, leading to a sharp decline in global consumer demand and a large number of unemployment in the industry, especially in Asia. The entire industry chain from cotton and fiber suppliers to retail outlets has been affected.

The clothing and textile industry in Turkey is one of the manufacturing branches in the country. The country has grown vigorously from 83 million domestic demand and foreign demand mainly from Europe, and has become a pillar industry in Turkey's economy. According to the Statistics Bureau of Turkey, transport equipment, textiles and raw materials and mechanical and electrical products were the main export commodities in Turkey in 2019, accounting for 16.6%, 16.3% and 14.7% of the total export volume of Turkey, respectively, at 28 billion 390 million US dollars, 27 billion 900 million US dollars and 25 billion 180 million US dollars.

Today, Turkey has become one of the major producers in the global garment and textile industry. The production of the industry is mainly concentrated in emerging economies, especially in Asia, while developed countries are the major consumer countries. China, India, Pakistan, Indonesia and Bangladesh are the largest producers in the industry. At present, Turkey is the world's sixth largest textile exporter and the eighth largest garment exporter. In the EU market, Turkey's clothing sales are second only to China and Bangladesh, ranking third, and its textiles are second only to China.

Under the impact of the pandemic, the shrinkage of Turkey's clothing and textile industry is particularly interesting, because the industry is crucial to Turkey's employment. According to statistics, the industry employs about 1 million 300 thousand people in the manufacturing sector, including unregistered workers, and employs the same huge labor force in the distribution and marketing sectors. Cotton growers also account for a large proportion of the country's agricultural population, though the number has decreased in recent years.

According to data from the Central Bank of Turkey, in the eight weeks since Turkey confirmed the first new crown case in March 11th, credit card spending on clothing has been reduced by 64% over the eight weeks before the outbreak, while the total credit card expenditure has declined by 30% over the same period. As a result, the share of clothing expenditure dropped from 7.5% before the pandemic to 3.5% of total expenditure, and consumer demand mainly focused on food, health care and cleaning products.

Not only the domestic market has shrunk, but also the export of clothing and textile industry in Turkey is decreasing, and export is an important source of Turkey's hard currency. Before the pandemic hit, the official currency lira exchange rate of the country did not recover completely from the 2018 currency crisis.

Clothing and textiles account for 15% of Turkey's total exports, almost as much as the country's auto industry. The automobile industry accounts for 8% of imports, while the share of clothing and textile industry is 3%, making it one of the few net export industries in Turkey. The net export volume is the highest in the food industry. In recent years, as the main raw material of the industry, the import of cotton has increased, but local cotton producers are still providing some raw materials for the industry. Therefore, the garment and textile industry can be called a "rooted" industry in China. For all these reasons, the turmoil in the industry has far-reaching implications.

In January and February this year, Turkey clothing exporters sold $3 billion worth of merchandise to foreign markets, which also benefited from the depreciation of Turkey's lira. With the spread of the pandemic around the world, especially in Europe, the main market for clothing in Turkey, in March and April, Turkey's clothing exports dropped by 40% to $1 billion 800 million.