Turkish foreign trade gap grows above projections
DHA PhotoTurkey’s foreign trade deficit widened far beyond expectations in August, as the country’s imports rose for the first time in seven months amid pressure on exports due to the crisis in Iraq.
The country's foreign trade deficit rose to $8.03 billion in August, from $7.08 billion in July, marking a 13.65 percent rise, according to figures released by the Turkish Statistical Institute (TÜİK) on Sept. 30.
Analysts had expected the trade deficit to remain flat in August, remaining at around $7 billion.
The foreign trade deficit contracted by 34.8 percent on an annual basis in July, due to a steep decline in gold and automotive imports. Analysts had warned that the July recovery may be temporary due to seasonal effects, and August’s figures indicate that these warnings may have been correct.
While exports rose only 2.9 percent to become $11.44 billion in August, imports into the country have surged for the first time since January, reaching $19.48 billion with a 7 percent rise.
The foreign trade deficit for the eight month period was $54.17 billion, marking a 20 percent decline from the same period of last year, according to TÜİK data.
Decreases in Turkey’s exports to its second largest trade partner, Iraq, have also caused the deficit to grow in August.
Exports to Iraq, which has been gripped by fierce violence due to the offensive of Islamic State of Iraq and the Levant (ISIL) militants, have fallen to $646.7 billion, the TÜİK data shows.
Mainly due to concerns over transportation security, Turkey’s exports to Iraq have contracted by around 40 percent since June, when ISIL militants took control of northern Iraq’s largest city, Mosul.
Amid the decline in the Iraqi market, the European Union’s share as the receiver of Turkish goods rose to 44.3 percent, from 41.4 percent last year.
The biggest export country has once again become Germany, importing $1.14 billion in Turkish goods during the month. The United Kingdom and Iraq followed Germany, with $647 million and $530 million, respectively.