The 58th Agenda Meetings organized by Türkiye İMSAD were held online under the title "Expectations for the Economy and Construction Sector in the Second Half of the Year." Tayfun Küçükoğlu, Chairman of the Board of Türkiye İMSAD, stated during the event, "In the first quarter of 2024, the general economy grew by 5.7%, and the construction sector grew by 11.1%. The growth in the construction sector is not equally distributed across the material industry. Rebuilding activities in the earthquake zone have led to increases in cement, ready-mixed concrete, and steel products. However, there is a decline in renovation products. Additionally, high interest rates are also contributing to a decrease in housing sales."
The 58th Agenda Meetings, organized by Türkiye İMSAD for the 58th time, were held online on Wednesday, June 26, 2024, with contributions from Assan Panel, Çuhadaroğlu, Demirdöküm, and GF Hakan Plastik. The meeting, which was opened by Tayfun Küçükoğlu, Chairman of Türkiye İMSAD, was followed with interest by construction material manufacturers, business representatives, and industry professionals. The meeting, held under the title "Expectations for the Economy and Construction Sector in the Second Half of the Year," was moderated by Ferdi Erdoğan, Vice Chairman of Türkiye İMSAD, while Dr. Can Fuat Gürlesel, Türkiye İMSAD Economic Advisor, shared expectations for the construction sector and the construction materials industry in the context of developments in the Turkish and global economies.
“The construction sector grew by 11.1% in the first quarter of the year”
In his opening speech, Tayfun Küçükoğlu provided an assessment of the first quarter of 2024, stating, "In the first quarter of 2024, the general economy grew by 5.7%, and the construction sector grew by 11.1%. As such, the sector continues to show growth above the national economy, similar to the end of last year. Factors such as rebuilding activities in the earthquake zone, urban transformation before local elections, and increased activity in other construction areas are among the primary factors affecting growth. Our construction sector continues to grow at an increasing rate for six quarters and has achieved the fastest quarterly growth since the third quarter of 2017. The production of our construction materials industry also saw an increase in the first quarter of 2024, with a 10.9% increase compared to the same period last year. Production in 16 sub-sectors of the construction materials industry increased compared to the first quarter of the previous year, while six sub-sectors remained lower. The value of our exports decreased by 4.0 percentage points compared to April of the previous year, while our imports were 0.7 percentage points higher than in April of last year."
High interest rates impact housing sales
Ferdi Erdoğan, Vice Chairman of Türkiye İMSAD, highlighted the potential effects of developments in the Turkish economy in the second half of 2024 on the construction materials industry, noting: "The impact of growth in the construction sector on the material industry is not evenly distributed across sectors. There has been an increase in cement, ready-mixed concrete, and steel products due to rebuilding activities in the earthquake zone. However, there is a decline in renovation products, reflecting the impact of rising costs. Additionally, high interest rates are contributing to a decrease in housing sales."
US and EU elections may lead to new balances
Dr. Can Fuat Gürlesel, Türkiye İMSAD Economic Advisor, provided a detailed assessment of the global developments' impact on the Turkish economy, stating, "While regional conflicts continue to have an impact in 2024, we will witness significant political changes in the second half of the year. Critical election processes that will determine the future of the world are ahead. Elections in the US and Europe may lead to new balances. The Turkish economy is experiencing the effects of both conflicts and elections. Conflicts have a restrictive effect on exports and growth. If we can achieve the desired inflation figures in the coming period, we might see improvement effects in 2025."
“We predict growth in the construction materials industry by the end of the year”
Sharing expectations for the construction sector and material industry, Gürlesel stated, “The construction sector showed significant growth in the first quarter of the year. Rebuilding efforts in the earthquake zone, urban transformation, public investments, and private sector activities contributed to this growth. The construction materials industry also saw increased production, particularly in cement, ready-mixed concrete, steel bars, profiles, and construction glass. Activities in the earthquake zone and urban transformation projects carried out by municipalities will continue to impact growth in the remainder of the year. On the other hand, ongoing regional conflicts may delay expectations for improvement in construction materials exports. The European market places great importance on the green deal. To achieve an increase in exports to Europe, the material industry needs to rapidly adapt to the process and transition to renewable energy. In light of all developments, we predict a growth of 4-5% in the construction materials industry by the end of 2024.”
