The FINANCIAL — According to figures released by the Turkish Exporters Assembly (TİM) on August 1 in Denizli, Turkish exports declined 27.1 percent in July compared to the same period last year.
The figures, nonetheless, represent an increase of 9.6 percent over the dollar volume of exports for the month of June and a 1.9 percentage point improvement over the rate of decline experienced the previous month.
This marks the second consecutive month that exports have continued to improve. According to TİM, the total rate amount of exports for the month of July was $8.8 billion.
The Turkish Statistics Institute (TurkStat), the official statistics agency of the government, on Friday released its official figures for the month of June, also revealing that the rate of export contraction slowed during the month of June. According to TurkStat, exports for June stood at $8.332 billion, representing a contraction of 29.2 percent for the month.
These bleak figures are however an improvement over the figures for May, which totaled $7.359 billion, representing a contraction of 41 percent over the previous year's figures.
According to Turkstat, Turkish imports declined 35.9 percent to $12.48 billion during the same period.
"TurkStat's figures also spell good news for the current account deficit, which has continued to narrow as a result of plummeting consumption rates within the country and which has served to reduce Turkey's appetite for imports. In June, Turkey's current account deficit narrowed by 46.1 percent, from $7.706 billion in 2008 to $4.152 billion in 2009," Today's Zaman informs.
Domestic consumption, which accounts for 74.7 percent of Turkish gross domestic product (GDP), shrank 9.2 percent in May.
According to TİM figures, cumulative exports reached $52.75 billion in the first seven months of the year, a 33.4 percent fall over the same period of 2008. Meanwhile, annual exports as of the end of July were down 20.3 percent over the same period a year ago, at $101.6 billion.
Pundits are interpreting the latest figures as further evidence that the worst economic crisis since World War II has hit bottom and has begun to ease.
“In my view the latest figures regarding not only the last month's export figures but also the other components of aggregate demand factors, such as final consumption demand, should be seen as a clear indication of improvement in the sense that the worst of the situation is over,” Dr. İbrahim Öztürk, associate professor of economics at Marmara University, told Today's Zaman. “Capacity utilization rates and industrial production figures are also relatively improving as compared with the previous months of this year.”
Citing the importance of psychological factors in influencing confidence and hence consumption, he pointed to parallel developments in the US with respect to GDP illustrating the same positive trend.
His comments did not come without reservations, however: “What I wonder is whether a recent surge in tax rates in many sectors that have low price elasticity will negatively affect this positive trend. Let's wait and see.”
Turkey's manufacturing industry, which accounted for 85.9 percent of all exports, logged $7.64 billion in sales in July, marking a 29.6 percent decline over the same month of 2008. Agriculture, on the other hand, earned 1.26 percent more in the given period, making $996 million from its overseas sales. Mining, too, sustained a heavy loss of 29.94 percent, coming in at $256.7 million.
In regards to industry sub-sectors, auto manufacturing and the auto parts industry made up the largest export sector with 19.28 percent. It was followed by the ready-wear and textile business with a 14.2 percent share, and iron and steel with a 10.64 percent share. Meanwhile, revenue from the export of iron and steel products experienced a sharp drop of 57.79 percent in July. Only four sectors enjoyed an increase in their exports last month: dehydrated produce (53.9 percent), fresh fruit (43.73 percent), fisheries and animal products (5.6 percent), and hazelnuts (2.6 percent).
The latest figures reveal that while trade to a number of Turkey's smaller neighboring countries in Central Asia and the Middle East have in fact increased, these figures are dwarfed by the contraction in appetite for imported goods in Turkey's main export markets.
The TurkStat statistics for June revealed that exports to the EU, which now accounts for 47.7 percent of Turkey's total exports, plunged 30.4 percent in June, amounting to $3.978 billion. Last year exports to the EU made up 48.6 percent of total trade.
The top 10 countries importing from Turkey in June were Germany, France, the UK, Italy, Iraq, the US, Spain, Egypt, Russia and the United Arab Emirates.
In terms of companies, the list was topped by Oyak-Renault Otomotiv, the Turkish Petroleum Refineries Corporation (TÜPRAŞ), TOFAŞ, Toyota, Vestel, Ford Otomotiv, Arçelik, HABAS, Çolakoğlu and GSD.
Discussion about this post