$250B export target reachable despite global headwinds

Türkiye is aiming for $250 billion (TL 4.55ntrillion) in exports this year, Trade Minister Mehmet Muş said, stressing that the country maintains the goal despite signs of a global slowdown and inflationary pressures. Muş was speaking at the 4th Türkiye Export Mobilization summit. The event was organized by Türkiye’s leading media group and Daily Sabah’s parent company, Turkuvaz Media, in the southeastern province of Gaziantep.

The minister separately wrote on Twitter that exports in August hit an all-time monthly high yet again, reaffirming the views that the annual target would be achieved even before the year-end. Foreign sales jumped 13.1% year-over-year to $21.3 billion, Muş said. Imports rose at a much faster pace, jumping 40.7% to $32.6 billion Exporters have managed to achieve record sales in each month so far this year and in 22 of the last 24 months. The trade deficit surged by 162% to a ecord $11.3 billion in August, data from the Turkish Exporters Assembly (TIM) showed.

The shortfall in the first eight months jumped by 146.4% to $73.4 billion, mainly due to rising energy import costs. Deteriorating global conditions, exacerbated by the war in Ukraine, have raised concerns for the rest of the year. Russia’s invasion of its neighbor has sent global commodity prices soaring, endangering Türkiye’s economic program that aims to tackle high inflation with a current account surplus. Exports had ended 2021 at $225.4 billion, a figure that government and economists expected to reach $250 billion this year.

Muş said that they want to diversify the regions that Turkish businesses export to, focusing on North and South America and East Asia, not just Europe. More than half of Türkiye’s export isdestined for Europe, he said, however, the uncertainty in the region produces obstacles. “Compared to the 2021 period, our exports to this region increased by 17.2% in the January-August period,” the minister said, but this increase “is in a moderate trend compared to months.

The uncertainty and slowdown in Europe weaken demand. For example, while our exports to the EU increased by 17.8% in June compared to the previous year, the increase was 5.2% in July and 2.7% in August.” “We are trying to diversify the market. We want to focus not only on Europe but also on North America, then on Latin America, some countries in the Far East. This will take some time, and expectations such as the slowdown in the world, the uncertainty in Europe and whether there will be a power cut or not inevitably pull down demand.” “The slowing demand there is pushing down our exports here,” he said.