BALANCE OF PAYMENTS DEVELOPMENTS

IN JANUARY-SEPTEMBER 2008

 

 

• Detailed tables related to balance of payments developments can be found at the internet address: http://www.tcmb.gov.tr/ under the heading “Publications/Periodic Publications/Balance of Payments Statistics and International Investment Position”.

 

 

 

I- CURRENT ACCOUNT

 

The current account deficit decreased by 60,1 percent to USD 914 million in September 2008 in comparison with a deficit of USD 2.288 million in the same month of the previous year. As regards the sub-items in September 2008, it is observed that foreign trade deficit in the balance of payments presentation decreased by 15,1 percent to USD 3.404 million and net outflows in income item decreased by 25,4 percent to USD 680 million, while services surplus rose by 16,3 percent to USD 2.847 million and net inflows in current transfers item recorded USD 323 million with a 75,5 percent decrease over the same month of 2007.

As a result, in January-September 2008, the current account deficit posted a growth by 35,6 percent as compared to the same period of 2007, from USD 26.074 million to USD 35.362 million.

Foreign Trade

The foreign trade deficit, according to the balance of payments presentation, reached to USD 44.773 million in January-September 2008 showing an expansion of 32,4 percent over the same period of the previous year. As regards the sub-items for January-September 2008, imports (CIF) including gold imports rose by 34,4 percent to USD 163.518, while exports (FOB) increased by 38 percent to USD 105.349 million and shuttle trade revenues increased by 5,3 percent to USD 4.625 million.

 Services

The related survey results for January-September 2008 conducted by the Turkish Statistical Institute indicate that the travel revenues increased by 19,4 percent to USD 17.457 million, while the travel expenditures increased by 9,3 percent to USD 2.605 million in comparison with the same period of 2007. As a result, the net travel revenues increased by 21,4 percent to USD 14.852 million in the aforementioned period of 2008.

The other important item of this category, transportation balance, which had recorded a net inflow of USD 31 million during the nine-month period in 2007, recorded a net outflow of USD 165 million in the same period of this year. As regards to sub-items in this period of 2008, freight expenditures recorded a net deficit of USD 2.479 million corresponding to 32,4 percent increase, whereas other transportation showed a net surplus of USD 2.314 million reflecting 21,5 percent increase over the first nine months of 2007.

Revenues from construction services performed abroad by the resident construction companies increased by 26 percent to USD 702 million in January-September 2008 in comparison with the same period of 2007.

Insurance services account, which consists of the data on insurance and reinsurance transactions with non-residents, showed net outflow of USD 554 million in January-September 2008 corresponding to 16,7 percent decrease over the same period of 2007.

As a result of these developments, trade in services, which had shown a surplus of USD 11.618 million during the nine-month period in 2007, also generated a surplus of USD 14.001 million in the same period of 2008 reflecting 20,5 percent increase.

Income

Income account consisting of compensation of employees and investment income recorded a net outflow of USD 6.180 million in January-September 2008, reflecting 12,9 percent increase over the same period of 2007. The two main sub-items under investment income, namely direct investment mainly consisting of profit transfers and other investment consisting of the interest income and expenditures, recorded net outflow of USD 2.087 million with 39,1 percent increase and 4.445 million with 22,7 percent increase respectively, whereas net income flow of portfolio investments recorded a net inflow of USD 433 million in January-September 2008.

In comparison with the nine-month period in 2007, the interest expenditures of long and short-term loans increased by 14,7 percent, realizing as USD 6.014 million in the same period of 2008.

Current Transfers

Current transfers recorded an inflow of USD 1.590 million in January-September 2008 decreasing 0,7 percent over the same period of the previous year. Specifically, General Government item recorded a net surplus of USD 600 million and the revenues from workers’ remittances under other sectors recorded an income of USD 961 million in January-September 2008.

II- CAPITAL AND FINANCIAL ACCOUNTS

The financial account recorded a net capital inflow of USD 40.698 million in January-September 2008, reflecting 57,4 percent growth over the same period of 2007. The main developments under financial account during this period are summarized as follows:

Direct Investment

As regards to non-residents’ net direct investment in Turkey, which includes the inter-company loans received from parent companies abroad and real estate purchases of non-residents in Turkey, it reached to USD 12.311 million in January-September 2008 decreasing by 28 percent in comparison with USD 17.096 million observed in the same period of 2007. As regards the sub-items during the nine-month period in 2008, net real estate purchases of nonresidents in Turkey increased by 8,5 percent realizing as USD 2.226 million and net loans received from parent companies abroad recorded a net disbursement of USD 44 million in January-September 2008.

Residents’ net direct investment abroad recorded a net outflow of USD 2.272 million in January-September 2008, increasing from USD 1.790 million in the same period of 2007. As a result of these developments, direct investment indicated a net inflow of USD 10.039 million during the nine months in 2008, a decline by 34,4 percent over the same period of 2007.

Portfolio Investment

Portfolio investment, which had resulted in a net inflow of USD 4.082 million in January-September 2007, also showed a net inflow of USD 158 million in the same period of 2008.

As for the developments in portfolio investments’ assets side, it is observed that residents’ security transactions abroad recorded net purchases of USD 2.335 million in January-September 2007, and USD 1.770 million in the same period of 2008 as well.

As for the developments in portfolio investments’ liabilities side, on September 2008, General Government borrowed USD 1,5 billion in the form of bond issues in international capital markets. As a result, net borrowing of USD 1.134 million was observed in January-September 2008.

Non-residents’ security transactions associated with equity securities recorded net sales of USD 260 million in September 2008 resulting in net purchases of USD 2.081 million in January-September 2008. Furthermore, government debt securities issued in the domestic capital market recorded net sales of USD 1.287 million in January-September 2008 including USD 1.050 million net sales observed in September of this year.

Other Investment

 

The other investment account, which is composed of trade credits, loans and foreign exchange deposit accounts, recorded a net inflow of USD 34.697 million in January-September 2008, in comparison with USD 14.409 million observed in the same period of 2007.

a. Assets

 

As regards the trade credits extended in return for exports, USD 1.231 million were extended to non-residents on net basis in January-September 2008, increasing from USD 776 million observed in the same period of the previous year. With regard to the loans, USD 33 million were extended to non-residents on net basis during the nine-month period in 2008 compared to USD 125 million net repayment observed in the same period of 2007.

Banks’ foreign exchange holdings with foreign correspondents, which had increased by USD 3.025 million in January-September 2007, also recorded an increase of USD 5.017 million in the same period of 2008.

 

b. Liabilities

 

The liabilities of other investment indicated an expansion of USD 40.978 million in January-September 2008, increasing from USD 18.085 million posted in the same period of 2007. 

As regards to the subcategories of liabilities, trade credits, which are provided for imports, indicated a net disbursement of USD 5.333 million in January-September 2008 compared with USD 3.391 million in the same period of 2007.

With regard to the sub-categories of the loans, due to the International Monetary Fund loans, the General Government realized a net disbursement of USD 2.243 million in January-September 2008 including the repayment figure of USD 213 million in September 2008. For the long-term loans received from international capital markets and other international organizations, the General Government materialized a net repayment of USD 590 million in January-September 2008. In comparison with the nine-month period of 2007, the net credit disbursement of banking sector increased by 50,1 percent to USD 6.227 million and of other sectors rose by 25,8 percent to USD 23.143 million in the same period of 2008. 

         Currency and deposits item, which is composed of the deposits of nonresidents held with the Central Bank and the resident banks, indicated an increase by USD 4.209 million in January-September 2008, in contrast to USD 4.937 million decrease posted in the same period of 2007. Specifically, nonresident banks’ net deposit holdings in Turkey increased by USD 5.021 million in the nine months of 2008.

Reserve Assets

Official reserves, a sub-item under reserve assets, which had recorded an increase of USD 7.934 million in January-September 2007, also recorded an increase of USD 4.196 million in the same period of 2008. 

 

  

 

DETAILED PRESENTATION (*)

2007

2008

2008

2008

2008

2008

2008

2008

2008

2008

2008

 

 (Million US Dollars)

Jan.-Sept.

January

February

March

April

May

June

July

August

September

Jan.-Sept.

I -

CURRENT ACCOUNT

-26074

-4087

-3824

-4202

-5065

-4695

-5520

-4002

-3053

-914

-35362

 

                 Goods, Services and Income (A+B+C)

-27676

-4242

-3979

-4383

-5178

-4857

-5669

-4209

-3198

-1237

-36952

 

                 Goods and Services (A+B)

-22204

-4074

-3279

-3341

-4528

-4009

-4672

-3741

-2571

-557

-30772

A.

GOODS

-33822

-4573

-3404

-4074

-4999

-5335

-6278

-6348

-6358

-3404

-44773

 

Exports

82257

11230

11762

12245

12055

13245

12440

13350

11995

13687

112009

 

Imports

-116079

-15803

-15166

-16319

-17054

-18580

-18718

-19698

-18353

-17091

-156782

1.

   General Merchandise

-29683

-4981

-3732

-4373

-4978

-4721

-5539

-5938

-4799

-2543

-41604

1.1.

       Exports f.o.b.

81689

10259

10997

11842

11939

13187

12399

13308

11966

13637

109534

1.1.1.

           Exports f.o.b.

76334

10642

11094

11457

11401

12509

11770

12602

11043

12831

105349

1.1.2.

           Shuttle trade

4394

441

485

522

462

503

441

490

704

577

4625

1.1.3.

           Adjustment: Coverage

961

-824

-582

-137

76

175

188

216

219

229

-440

1.2.

        Imports f.o.b.

-111372

-15240

-14729

-16215

-16917

-17908

-17938

-19246

-16765

-16180

-151138

1.2.1.

            Imports c.i.f.

-121684

-16339

-16027

-16812

-17889

-19305

-19472

-20552

-19249

-17873

-163518

1.2.2.

           Adjustment: Classification

7022

782

1061

773

1074

952

1018

1148

1120

953

8881

1.2.3.

           Adjustment: Coverage

3290

317

237

-176

-102

445

516

158

1364

740

3499

2.

    Non Monetary Gold (net)

-3782

448

364

363

49

-528

-658

-310

-1449

-759

-2480

 

Exports

518

967

761

399

111

52

32

36

22

43

2423