High costs hampering export performance: Association

İSTANBUL

High costs are hurting exports, putting achieving the export target set for 2024 at risk, says Mustafa Gültepe, the head of the Türkiye Exporters’ Assembly (TİM).

Speaking at a press conference, Gültepe recalled that Türkiye’s merchandise and service exports for this year are $267 billion and $110 billion, respectively.

“We fell short of those targets in the first half of the year,” he said.

In the first six months exports were $125.4 billion, up 2 percent annually, while the 12-month trailing exports stood at $257.8 billion, rising 2.5 percent from a year ago, according to Gültepe.

The current situation suggests that the targets set for 2024 may not be reached, he added.

In some industries, costs have spiked as high as 120 percent, while the U.S. dollar/Turkish Liras exchange rate has only increased 25 percent, Gültepe explained.

Despite some ups and downs, monthly exports have almost remained flat over the past one and a half years due to regional conflicts, including the wars in Ukraine and Gaza, and weak demand from large markets such as the European Union and the U.S., he furthered.

Turkish goods are at least 40 percent more expensive in dollar terms than its Asian competitors and 15-20 percent more expensive than many countries in Europe, according to Gültepe.

“Our 2024 target of $267 billion is in the grip of high costs and low exchange rates,” he said, adding that some of the exporting sectors are losing their markets to their competitors.

Exports of the textile sector, for instance, fell 12.8 percent in the first half of 2024 to $8.7 billion and this is the case with other sectors, according to Gültepe.