The number of newly established companies in Turkey during the first seven months of this year, reduced by 1.8% on a yearly basis. Azerbaijan's export decreased by 8 percent during Jan-July 2023. After long negotiations with the Directorate-General for Health and Food Safety of the European Commission, the latter has included the Republic of Armenia in the list of third countries authorized by the European Union, which means Armenia starts export of its confectionery products the European Union countries.
Here is a rundown of the latest economic and business developments around Georgia's neighboring Turkey, Azerbaijan and Armenia during the last week.
Turkey
The number of newly established companies in Turkey reached 73,001 during the first seven months of this year, down by 1.8% on a yearly basis. The figure included 7,648 foreign-partnered companies. In July, 9,326 firms were established, down 1.1% on a yearly basis, while 2,067 firms closed, up 10.7%. The number of launches of foreign-partnered companies was 975 in July. In total, 11,559 companies liquidated in the January-July period, up by 0.1%.
Turkey's external assets stood at $293.5 billion in June, down 4.8% versus the end of 2022. The country's net international investment position, defined as the difference between external assets and liabilities, was at minus $252.9 billion at the end of June, versus minus $301.6 billion at the end of the last year. Liabilities against non-residents decreased 10.4% to $546.5 billion over the same period.
Turkey's indigenous electric car firm Togg will produce 28,000 units of its SUV model T10X by the end of this year, the Turkish industry and technology minister said.Visiting the firm's factory in the country's industrial province of Bursa on Thursday, Fatih Kacir said the number of Togg cars on roads has exceeded 2,000. He said the production capacity will increase by two-and-half times by next year.
A Turkish private lender and the U.S. government's development finance institution announced they had signed a $100 million loan agreement aimed at supporting Turkey’s earthquake region. The seven-year loan deal between Şekerbank and U.S. International Development Finance Corporation (DFC) will be used primarily to support the development of the southeastern provinces devastated by the earthquakes in early February.
Turkey’s unemployment rate fell to 9.7% in the second quarter of this year, down to 0.3% compared to the quarter before, the country's statistical authority said. The number of unemployed individuals in this period fell to 3.4 million. The number of unemployed individuals aged 15 and above, in the April-June period, decreased by 73,000 when compared to the quarter earlier.
Turkey's budget balance registered a TL 48.6 billion (around $1.8 billion) surplus in July, after the government unveiled tax hikes on an array of goods to boost income. It followed a nearly TL 220 billion ($8.1 billion) deficit in June, seven times the deficit a year earlier. The government has instructed institutions to review their expenditures. Turkey last month raised taxes on petrol and hiked value-added taxes (VAT) as part of moves to boost revenues after the sharp rise in spending related to the devastating earthquakes in February and May presidential and parliamentary elections.
Housing sales in Turkey rebounded in July after five consecutive back-to-back declines, according to official data that also showed purchases by foreigners maintained a downward trend. Some 109,548 residential properties exchanged hands last month, marking a 16.7% year-over-year increase, driven in part by the low base effect. Property sales had dipped as much as 44.4% in June on an annual basis, the steepest decline this year, as residents struggled to find affordable homes due to soaring prices. July mortgaged sales fell 24.1% from a year earlier to 14,533 houses, accounting for 13.3% of total sales.
Azerbaijan
Azerbaijan’s foreign trade turnover increased by $275m or 1 percent, amounting to $30bn in January-July 2023 compared to the same period of 2022. Legal entities and individual entrepreneurs in Azerbaijan conducted trade operations with partners in 190 countries. During the reporting period, Azerbaijan's export decreased by 8 percent or $1.8bn amounting to $20.8bn. Since the bulk of Azerbaijan’s export made up of oil and gas, the decrease in the export relates to the volatility in the energy market. Azerbaijan’s oil export decreased by 23.8 percent, amounting to $9.4bn.
Azerbaijan’s oil exports via the Baku-Tbilisi-Ceyhan (BTC) pipeline, which runs through Georgia and Turkey, surged by 6% year-over-year in the first seven months of this year. The exports via BTC reached a total of 17.6 million metric tons. The BTC pipeline is used to export oil from the Azeri, Chirag and Gunashli oilfields, operated by BP. Azerbaijan’s total oil exports in January-July 2023 stood at 23.1 million tons, of which 76.3% flowed through the BTC. The volume of transit oil from other countries such as Kazakhstan and Turkmenistan through the BTC increased to 2.9 million metric tons in January-July 2023, from 2.6 million tons a year earlier.
The export of gas volumes from Azerbaijan in January-June 2023 amounted to 11 billion cubic meters, which is 3.6% lower than in the first 6 months of 2022. The proceeds from the export of declared gas from Azerbaijan amounted to $8 billion (an increase of 7.9%). Gas supplies in the reporting period accounted for 44.69% of Azerbaijan's total exports (40.26% in January-June 2022). In the first half of 2023, the largest volume of declared gas exports went to Italy (40.5%) and Turkey (36.3%).
The volume of money transfers to Azerbaijan in the first half of 2023, amounted to $890 million, which is 44.5% less than in the first six months of 2022. At the same time, in the first quarter, the volume of money transfers to Azerbaijan amounted to $442.1 million, in the second quarter - $447.9 million. Remittances from individuals to Azerbaijan in 2022 amounted to $3.6 billion, which is 3.2 times more than in 2021.
In January-July 2023, Azerbaijan’s budget revenues stood at 18,766.6 million manats ($11 billion) and expenditures at 17,620.5 million manats ($10.4 billion), respectively, up 4.8% and 14.9% from the previous year. The surplus amounted to 1,146.1 million manats ($674.2 million), 2.2 times more than the previous year.
Azerbaijan imported 16,931.4 tons of AI-92 motor gasoline in January-June 2023, which is 88.8% lower than the same period last year. The cost of gasoline imported during this period amounted to $12 780 018 (a decrease of 92.6%). In the first half of 2023, the largest volume of imports (71.2%) fell on deliveries from Turkmenistan - 12 589 tons for $10 187 690. From Russia 4, 873 tons were imported for $2 592 049. The import of AI-92 motor gasoline to Azerbaijan in 2022 amounted to 198, 790.13 tons for $ 223 456 800. In 2021, gasoline of this brand was not imported. In Azerbaijan, automobile gasoline AI-92 is produced only at the Baku Oil Refinery.
Armenia
Armenian confectionery products will be exported to the European Union countries, Armenian Food Safety Inspectorate reported. It said after long negotiations with the Directorate-General for Health and Food Safety of the European Commission, the latter has included the Republic of Armenia in the list of third countries authorized by the European Union. It means that from now on composite products made of milk and/or eggs produced in Armenia can be exported to the EU countries, the agency said.
One of the world's largest diamond processing companies, India's KGK Diamonds Private Limited, has launched a diamond-cutting plant in Armenia’s Abovyan, a town 20 km north of the Armenian capital Yerevan. The technical opening of the plant has already taken place and the official opening is scheduled for September. The plant will employ about 400 workers, of whom about half will be from India and the rest will be locals.
At the end of June 2023 the Armenian dram's appreciation was 40% compared to the beginning of 2022. In terms of real effective exchange rate, the Armenian dram appreciated by 33.6% in 2022.
