Turkey suffers another sharp drop in exports

Hurriyet Daily News with wires

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Turkey’s exports in March declined 34.92 percent year-on-year to nearly $7.13 billion, according to data revealed by the Turkish Exporters’ Assembly, or TİM. 

The country’s exports during the first three months of the year totaled $21.9 billion, down from $31.33 billion in the same 2008 quarter, said TİM Chairman Mehmet Büyükekşi. The country’s retrospective annual exports as of February rose 2.71 percent to nearly $117.22 billion, Büyükekşi told the members of the press who attended the press meeting held in Aydın yesterday.

The TİM figures come almost a month ahead of official data, which they tend to match. Official data showed Tuesday exports fell 24.9 percent to $8.3 billion in February.

The TİM data showed exports of industrial goods fell to $6.01 billion in March from $9.73 billion in the same period last year. Automotive exports, which constitute nearly 18 percent of total exports, fell 50.15 percent in March, according to Reuters.

Measures fail to help recovery

The government’s measures seem to have failed to help the automotive industry hit the breaks to prevent a further decline in exports. During the first quarter of the year auto export dropped 53.8 percent, according to a report by Bursa-based Uludağ Exporters’ Association, or UİB.

Auto exports, which stood at nearly $6.66 billion during the first three months of 2008, deteriorated to $3.73 billion during the same period this year.

The exports in Turkey’s automotive industry had begun its decline with 24 percent in October. The industry’s exports deteriorated 40 percent in November, 45 percent in December and 56 percent in January and February, reported Anatolia News Agency, citing the UİB report.

Besides the 12 free trade zones, the auto industry has also exported to 149 countries and autonomous regions, during the first three months of this year. As exports to European countries weighed heavier among others, France ranked at top with its automotive industry related imports from Turkey worth $508.15 million during the period. France was followed by Germany, Italy, Britain and Brussels respectively.

Turkey's economy grew by just 1.1 percent in 2008, after posting stellar growth rates near 7 percent for several years.

The share of exports to the Middle East and Africa increased as Turkey's traditional markets in the European Union suffered from a steep downturn. "The volume of exports to Africa reached a high rate, at one-fourth of exports to the European Union," TİM said. Consumer demand in Europe has been hit by the global crisis as some of the region's largest economies are expected to shrink this year.

February trade gap narrowest since 1994

Meanwhile, Turkey posted its smallest trade deficit since 1994 in February as imports halved during an economic contraction that has slashed industrial output and curbed consumer spending.

The trade gap contracted to $81 million, the narrowest since July 1994, from $5 billion in the year-earlier period, Turkish Statistical Institute in Ankara said on its Web site Tuesday. The deficit was forecast at $1.3 billion, according to the median estimate of 13 economists surveyed by Bloomberg.

The narrowing comes after the economy shrank 6.2 percent in the fourth quarter, the first contraction in seven years, undermining demand for imports. That contraction makes Turkey the worse performer among G20 members. Turkey also ranked four among the OECD countries that saw the biggest contraction in their economies.

Falling global energy prices are also reducing the current-account balance, the widest measure of trade, which posted its first surplus since 2004 in January.

"This is the direct result of a very serious economic slowdown," said Şengül Dağdeviren, chief economist at ING Bank in Istanbul. "Imports are falling very sharply."

Imports tumbled 48 percent to $8.4 billion, the lowest since January 2006, the agency said today. Exports fell 25 percent to $8.3 billion from a year earlier. "The improvement is being driven by the deflation in domestic demand, plus lower energy and commodity prices," Tim Ash, head of emerging-market economics in London at Royal Bank of Scotland Group, wrote in a note to investors. The downside "is that as external imbalances are narrowing, the cost is a huge recession."