According to the foreign trade data of the GTS (General trade system) for June, which was announced by TURKSTAT in cooperation with the Ministry of Commerce; Turkey's exports increased by 18.7% to 23.43 billion USD in June 2022 compared to the same period of the previous year, while imports increased by 39.7% to 31.60 billion USD in the same period. Thus, the foreign trade deficit increased by 184.5% between June 2021 and June 2022 and became 8.17 billion USD. The ratio of exports to imports decreased from 87.3% to 74.1% in the said period.
In June, the country we exported to the most was Germany, followed by the US, England and Iraq. Exports to 27 countries that make up the European Union increased by 18.2% and reached 9.74 billion USD, while the share of the EU in our total exports decreased from 41.7% to 41.6%. In import items; Russia took the first place in June 2022, followed by China, Germany and Italy. While the share of intermediate goods (raw materials) in total imports increased in June, the share of capital and consumption goods decreased. While the share of exports of high-tech products in our total exports was 2.8%, the share of the same group's imports in our total imports was 8.5%. While the ratio of exports to imports dropped sharply in June, the widening in the foreign trade deficit continued. In this period, both the energy deficit and the high deficit in non-energy balance played a role in the increase in the total foreign trade deficit.
According to STS (Private trade system), Turkey's exports increased by 15.9% to 21.76 billion USD in June 2022 compared to the same period of the previous year, while imports increased by 33.3% to 29.18 billion USD in the same period. has taken place. The ratio of exports to imports was 74.6% in the said period.
In June, unlike the previous month, exports accelerated again, while imports slowed down a bit. Despite the fluctuation observed on a monthly basis, quarterly averages confirm that the strong increase in imports continues, while exports slow down gradually. The trade deficit in June nearly tripled from last year as the cost of energy imports rose. The January-June deficit increased by 142.7% compared to the previous year and became 51.4 billion dollars. Mineral oil imports, an indicator of Turkey's energy bill, increased by 122.5% to 8.1 billion dollars. Steel and iron imports rose 26.9 percent year on year to $2.8 billion in June. Motor vehicle exports increased by 21.2% and reached 2.4 billion dollars.
On the import side, the effects of global inflationary effects and the cooling of domestic demand remained moderate. In the short term, we can observe the export-limiting effect of the decline in EURUSD parity. Downside risks on foreign demand will increase in the medium term, and export growth may also follow a slower pace. Due to the global inflationary pressure, the widening in the import and foreign trade deficit will continue. In imports, the slowdown in core factors may gain weight due to the slowdown in domestic demand. However, we expect high commodity prices to continue to drive the foreign trade deficit and increase in imports.
The Turkish authorities embarked on a transformation in the economy that prioritized exports. Central Bank Governor Mr. Şahap Kavcıoğlu said on Thursday that high energy prices resulting from Russia's invasion of Ukraine are making imports more costly for Turkey. The Central Bank of the Republic of Turkey raised its year-end forecast for 2022 in its quarterly Inflation Report. The preliminary forecast of 42.8% made in April was now very low considering the actual price increases, weak lira and stable expectations and was revised to 60.4%. Inflation reached the highest level in 24 years with 78.6% in June. In the Market Participants Survey conducted by the central bank, the year-end inflation expectations are at the level of 69.9%. The central bank's resistance to raising interest rates weakened the lira and worsened inflation expectations. Recently, we have been observing the upward trend on the exchange rate and inflation.
In April, the CBRT assumed that the average oil price would be $102.2 per barrel this year in line with the current Brent futures, lowering this assumption to $99.6. However, with the lira losing half its value in the last 12 months and annual food costs nearly doubling in June, assumptions about imports and food prices had to be heavily marked upwards. TurkStat will release inflation data for July on 3 August.
Kaynak Enver Erkan / Tera Yatırım
Hibya Haber Ajansı
