Mall investments to see decline especially in first quarter
Posted by meb at January 2nd, 2009
As Turkish retailers bid farewell to 2008 amid quarrels over high rent prices in shopping malls, the first quarter of 2009 is poised to see a remarkable decline in the amount of new shopping mall investments.
The Turkish retailing sector expects a serious stagnation in the first quarter of the new year. Currently 267 new shopping malls in Turkey are either operating, under construction or are planned. Of these, 89 are in İstanbul.
United Brands Association (BMD) Chairman Ekrem Akyiğit told Today’s Zaman that he expects 80 percent of new shopping malls to delay opening in 2009. According to Akyiğit, shopping mall managers now understand that opening a new mall in every single city will not bring profit.
The total turnover of the retailing sector in Turkey was TL 192 billion in 2007, with 2.8 million people employed. Despite the negative effects of the ongoing financial turmoil on global markets, the whole retail sector’s overall turnover is TL 221 billion, a 15 percent increase over 2007. Employment in the retail sector in 2008 also exceeded 3 million, a 17 percent increase compared to 2007.
“There will be fluctuation in the retail sector in 2009. Incomes are expected to decline,” he said, adding, however, that many retailers are hopeful the adverse effects of the crisis will disperse in the last quarter of 2009. “The majority of retailers are going to revise their targets for 2009. The first quarter of 2009 will bring additional burdens to the sector,” he noted, underlining that current discouraging instances such as production cuts, dismissal of employees and the closures of factories all affect the populace negatively.
“A possible loan deal with the International Monetary Fund [IMF] would increase the morale in the domestic market to some extent,” Akyiğit added. He stated that it is possible that the government could fail to realize its inflation and growth targets in the new year in such a volatile atmosphere. “From now on, the majority of Turkish companies will produce a big part of their goods in Turkey instead of in the Far East. This fact may lead to a decline in Turkey’s imports,” he added.
source: Today’s Zaman
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