Türkiye’s foreign trade deficit plunges 42 percent in July

ANKARA

Türkiye’s foreign trade deficit declined by 41.8 percent year-on-year in July to $7.3 billion as exports rose and imports dwindled, data from the Turkish Statistical Institute (TÜİK) have shown.

Exports amounted to $22.5 billion last month, increasing 13.8 percent from July 2023, but imports plunged 7.8 percent annually to $29.8 billion, TÜİK said on Aug. 28.

“We have made significant progress in reducing the high current account deficit, which is one of the macroeconomic imbalances,” Finance Minister Mehmet Şimşek wrote on X, commenting on the latest trade data.

The annual foreign trade deficit in July decreased by $38.7 billion compared to the same period of the previous year, said Şimşek, adding that this indicates an annual current account deficit of less than $20 billion for July.

"The decreasing current account deficit and external financing need to contribute significantly to the disinflation processi,” the minister said.

The export/import coverage ratio improved from 61.2 percent in July 2023 to 75.5 percent last month, showed TÜİK data.

Excluding gold and energy imports, the foreign trade deficit was $2.98 billion, and the export/import coverage was 87.3 percent, said TÜİK.

Germany was the largest export market for Türkiye, followed by the United Kingdom and the United States.

Exports to Germany and the United Kingdom amounted to $1.75 billion and $1.6 billion, respectively. Shipments of goods to the United States generated $1.44 billion in export revenues.

Exports to Italy stood at $1 billion. The top five countries’ share in Türkiye’s total export revenues was 30.6 percent.

Some 40 percent of exports — $9.1 billion — went to the European Union, rising 6.2 percent year-on-year. In the first eight months of 2024, the bloc absorbed 42 percent — $62.5 billion — of Türkiye’s exports.

TÜİK data also showed that Türkiye’s imports from China and Russia were $4.16 billion and $3.77 billion, respectively. Germany followed those two countries at $2.5 billion, while imports from Italy amounted to $1.4 billion.

Türkiye’s capital goods imports fell by 7.7 percent last month from a year ago to $4.7 billion, while the annual decline in intermediate goods imports was 8.9 percent to $20.45 billion.

Türkiye spent $4.56 billion on imported consumption goods in July, down 3.2 percent from the same month of 2023.

From January to July, the country’s export revenues amounted to $148.7 billion, marking a year-on-year increase of 4.1 percent.

Imports, however, fell 8.3 percent from a year earlier to $198.7 billion.

Consequently, Türkiye’s foreign trade deficit plunged 32.4 percent compared with the first eight months of 2023 to $49.9 billion.

The Turkish government targets $267 billion in export revenues in 2024, while its projection for imports is $372.8 billion.

The government’s foreign trade deficit estimate for this year is $105.8 billion.