2016 was a year of momentous events in Turkey and around the world. While political developments made the global agenda, many events in the economy also came to the forefront. 2016 was an important test year for the Turkish economy. The July 15 coup attempt, international credit rating agencies degrading our country’s rating, and negative events such as terrorist attacks, the US election and the FED’s interest rate hike, all led to the Turkish Lira becoming one of the hardest hit currencies against the Dollar in 2016.

When we look at the major events in 2016, it is evident that the biggest global event was the US presidential elections that ended with Trump’s election in November. If President Trump can uphold his promises, the American economy will cause the cards to be re-dealt in the global economy. If the US puts the world economy’s globalization approach to one side and focuses on raising internal growth from 1.9% by cutting taxes and enhancing investments in the building sector, this will lead to higher interest rates in the US, thus accelerating US Dollar appreciation. This will cause investments in developing countries to repatriate to the US.

On the other hand, the FED, which started interest rate hikes in December 2015 by 25 basis points, also raised the rates in its last meeting in 2016, again by 25 basis points, and, declaring its hand, amended two hikes targeted for 2017 to three. For countries that are financing growth through foreign resources, and which were already suffering in 2016, such a course means more hardship to come.

Furthermore, the Chinese economy, which experienced its lowest growth for the last 25 years at 6.9% in 2015, has made amendments to its monetary and financial policies, and aimed at reducing local stocks and financial risks in 2016. Although 2016 growth at 6.7% was even lower than the previous year, China did manage to exceed the set growth target for 2016.

The European Region has seen moderate growth since 2011, but still faces certain economic problems due to varied tax and spending approaches. The Union received a serious shock with the UK Brexit referendum on June 23, 2016. In addition, general elections in some European countries make 2017 a significant year for the Eurozone.

Along with these developments around the world, the price per barrel of Brent oil, which hit an 11-year low after a harsh drop in 2015, is on the rise again with production cuts in OPEC countries and countries outside of OPEC. At 50% price hikes, crude oil became one of the highest climbing commodities. Oil exporting countries, which grew more than expected due to the drop in oil prices in 2015, couldn’t reach their growth targets in 2016 with the rising trend in oil prices.

Having managed to bring its current account deficit to the lowest level for the past five years thanks to declining oil prices, unfortunately Turkey couldn’t reach its current account deficit target in 2016 due to rebounding crude oil prices and collapsing tourism, which was adversely affected by all the uncertainties. At $32.6 billion, Turkey’s current account deficit for 2016 was higher than that of 2015. The hardest hit stocks in the Istanbul Stock Exchange Market were in the transportation and service sectors, reflecting the decline in tourism, one of the life-bloods of the Turkish economy, and its effect on the current account deficit.

Despite such domestic and international instability, the Turkish economy grew by 2.9% in 2016, and net export figures played a key role in this growth rate. Turkey, again sending most of its exports to the EU, improved its commercial relations with Iran in 2016, and boosted trade volume by 40%. The automotive, ready-to-wear and chemical industries lead the way in rising net export figures.

At Akkök Holding, we are proud to have contributed to our country’s exports, especially in the chemical sector, and helped reduce imports in the chemical industry by producing certain products locally and distributing them on the domestic market. With TL 704 million investment, and TL 1.1 billion exports in 2016, we have once again contributed to our country’s economy and employment without compromising our principles of transparency, honesty, social responsibility, sustainability and environmental-friendliness. We will continue our investments at full speed, remaining loyal to these values in 2017 as well.

I’d like to sincerely thank all of our valuable employees, our executives and all our esteemed stakeholders who have maintained faith in us, and therefore contributed to our growth in line with our target of creating added value for our country and stakeholders in our main business branches; chemical, energy and real estate, and who have played a key part in carrying the Akkök name proudly towards the future.