By Emre G├╝rkan Abay
Russia letter, week beginning Sept. 5

 - Turkey–Russia relations improving

Russia, being one of the most important countries for Turkey’s tourism sector along with Germany, lifted the ban on charter flights to Turkey last week.

Upon the removal of restrictions, the first charter flight from Russia to Turkey arrived at Turkey’s city of Antalya on Friday.

Considered as a critical step towards the normalization of relations between the two countries, the lifting of restrictions for charter flights came when the summer holiday season is almost over. Therefore the increase in the flow of Russian tourists to Turkey is expected to be limited.

Meanwhile, Turkey’s President Recep Tayyip Erdogan met with Russian President Vladimir Putin on the sidelines of the G20 meeting in China this weekend.

The two leaders discussed the Turkish Stream natural gas pipeline project, the progress on the Akkuyu Nuclear Power Plant, a possible agreement on free trade between the countries and the Turkish-Russian joint investment fund.

Russian Energy Minister Alexander Novak also announced that an agreement for a “roadmap” for the Turkish Stream project could be signed in October.

- Trends in Russian economy

The Russian Central Bank downgraded its forecast for the growth of the Russian economy this year.

According to the report called “What do trends show?” released by the Central Bank, the Russian economy revised its estimate and said the economy will shrink by between 0.3 and 0.7 percent by the end of this year. The bank previously estimated that the economy would contract by 0.2 to 0.4 percent.

Finally, according to the seasonally-adjusted Russian Purchasing Managers’ Index for manufacturers, a surprise jump in August was seen after contracting in July.

The index posted 50.8 points in August, a positive sentiment as any number above 50 is seen as an expansion, after putting in a disappointing 49.5 contraction in July.

The manufacturing index has been lagging behind the services PMI which has seen strong growth over the last six months and hit a yearly-high of 55 in July.

05 Sep,2016