Chinese Economy to Challenge Turkey

Lardy predicts that some sectors in Turkey will be affected by China’s improvement, but Turkey could stay internationally competitive through factors like its qualified labor force and geographical location.

Lardy was speaking as a guest in the third "Wide Angle" meeting organized by Is Yatirim Stocks and Shares, and said that China’s high growth rate has reached peak levels. According to Lardy, though, the growth would slow down in the following years. In the long term, China’s economy will continue its eight or nine percent growth trend for the next 10 or 15 years. Lardy indicated the reasons for this growth rate include the high proportion of savings from national incomes, the ability to invest these savings and the success of directly attracting investors. The American expert explained the contribution of the population of 1.3 billion to the labor force and economy, saying: "While the share of agricultural workers in the labor force is rapidly reducing, the shares of industry and services are increasing. About 150-200 million people, of 350 million in the agricultural sector at present, are expected to switch to industry and service sectors in the future 10 years." China’s share of world trade was 0. 5 percent in 1970’s and has now reached seven percent. China’s contribution to the growth of world economy was about three times bigger than that of the US between 2001 and 2004.

"Neither Turkey nor any other country has a chance to compete with the Chinese economy at producing cheap goods," Lardy said, but Turkey has advantages of proximity to Europe and established and improving commercial relations. "These relations become better stabilized through the Customs Union," Lardy continued, "Which can produce integrated, diversified and high added-value products."