Current account gap widens due to export fall

ISTANBUL

Turkey recorded a current account deficit of $24.3 billion in the first four months, indicating a 17.2 percent increase over the same period of the previous year, the balance of payment results unveiled by the Turkish Central Bank showed yesterday.

The current account deficit reached $8.17 billion in April, exceeding market expectations, which had been around $8 billion.

Commenting on the current account gap, Turkish Economy Minister Zafer Çağlayan said the higher-than-expected deficit might come in May as well, but added that he did not expect the ratio of current account deficit to GDP to pass the 7.1 percent level by year-end.

“Even though the rise in April is higher than April last year, it won’t be problem regarding the midterm program target,” he said in a statement issued after the data release.

According to the midterm program of the Turkish government, the current account deficit is expected to be $60.7 billion, 7.1 percent of GDP, by the end of 2013.

Moody’s warning

The Central Bank said the quarterly deficit is mainly attributable to a $3.6 billion rise in foreign trade deficit, totaling $25.6 billion.

Moody’s rating agency had warned Turkey in a statement that antigovernment protests in the country had heightened the country’s balance of payment risks.

The report also showed nonresidents’ net direct investment in Turkey, which totaled $3.1 billion with an almost 50 percent fall from last year’s levels, while residents’ net direct investment abroad decreased by $1.6 billion to $925 million.