Turkey’s exports drop 8.7 percent in 2015: Association
AP PhotoTurkey’s exports decreased by around 8.7 percent to $143.7 billion in 2015 compared to 2014 due to fluctuations in parity, a plunge in commodity prices and escalating geopolitical risks, according to data from the Exporters’ Assembly of Turkey (TİM).
The developments caused around $30 billion in losses in Turkey’s exports in 2015, Economy Minister Mustafa Elitaş said at a meeting on Jan. 4 to release the TİM data, while adding that the government would retain its $150 billion target in 2016 even if there is no recovery from the problems.
“While our exports on the euro basis were around 48.3 billion euros in 2014, this figure rose to $53 billion euros in 2015. As we announce our final figures on the U.S. dollar, our exports have, however, seen a decrease. Turkey saw around $12.9 billion in losses in its exports due to this parity effect in 2015. If such an effect had not been the case, we would have posted the same export figures as 2014,” he was quoted as saying by Reuters.
The dramatic rise in the U.S. dollar against other currencies has had a huge negative effect over the country’s exports. Under normal conditions, the loss of the Turkish Lira’s value against the dollar would be expected to be good for Turkey’s exports, but it is not. As Turkey mainly makes its imports on a dollar and exports on a euro basis (to its largest market, the European Union), the plummeting value of the euro against the dollar has hit Turkey’s exports. Turkey’s manufacturing activities are mainly based on imported raw materials and semi-products, which are bought on the more expensive dollar, but are sold on the cheaper euro abroad.
According to data from the Turkish Statistics Institute (TÜİK), Turkey conducted around $157.6 billion in exports in 2014. But according to temporary data from the Customs and Trade Ministry, the country’s exports fell 8.5 percent to $143.9 billion in 2015.
Elitaş said the continuing plunge in oil and other commodity prices also negatively affected Turkey’s exports in 2015.
“Although the losses in Turkey’s exports due to the plunge in commodity prices slowed down in the last quarter of 2015 due to base effect, our loss was around $11 billion due to the global slump in commodity prices,” he added.
Losses in Russia, Iraq
The losses in Turkey’s exports due to escalating geopolitical risks were estimated at around $6 billion, according to the minister.
“We have seen that Syria and Iraq are still suffering from domestic tensions and conflicts. The crisis between Russia and Ukraine has not yet been resolved. In addition to the problems with Ukraine, the purchasing power of Russia has also declined due to the oil plunge and a sharp loss in the ruble’s value. Our exports to Russia declined in 2015 in light of these developments,” he said.
Turkey’s exports to Russia decreased by $2.4 billion, to Iraq by $2.3 billion and by $620 million to both Ukraine and Libya, according to TİM data.
Elitaş said Turkey’s exports to Russia decreased to $280 million between Nov. 24 and Dec. 31, 2015, after Russia began to impose sanctions against Turkish products, adding that the drop in exports were much steeper in the first days of the crisis.
The minister added that Turkey’s losses in fresh fruit and vegetable exports to Russia had been compensated by the expansion into new markets.
The European Union was again the largest market for Turkey with an approximately 46.4 percent share in total exports totaling $62 billion in value, although the exports to the bloc saw a decrease of roughly 8.3 percent in 2015 compared to 2014 due to parity.
The EU was followed by the Middle East with a 19.5 percent share at $26.1 billion. Exports to this market, however, dropped by 10.4 percent in 2015 compared to 2014 due to sharp losses in the Iraqi market.
Turkey’s exports to the Commonwealth of Independent States (CIS) also declined by 31.6 percent in 2015 compared to the previous year, according to TİM data.
The automotive sector was the biggest exporter market in 2015 with around $21.3 billion in exports despite a 4.8 percent drop compared to 2014. The second largest exporting sector, clothing, also witnessed a roughly 9.3 percent decline in exports in 2015 compared to the previous year, closing 2015 at around $17 billion.