A country’s, particularly emerging countries’, performance in improving its institutional structure will be decisive in the economy’s potential to grow and benefit from international trade, regardless of an increase or weakening in the trend of protectionism in the world economy.
Projections based on World Trade Organization (WTO) data suggest that the uptrend in world trade volume will remain strong in 2018 and Turkey’s foreign trade partners will show a better growth performance than they did in 2017. These projections indicate that the momentum achieved in Turkey’s exports in 2017 will be sustained in 2018.
Even if firms’ decisions about exports are stable, it can be asserted that crises can lead to some dramatic changes in export behaviors of firms. In this context, it is very important to take into account the peculiarities of the period while determining incentives and measures to be introduced during economic fluctuations.
In this blog post, we will examine the relationship between domestic sales and exports of manufacturing firms and how much this relationship is affected by domestic demand conditions. The results showed a pattern of substitution between domestic sales and exports of manufacturing firms.
Due to Turkey’s prolonged EU membership process, which has lasted for over twenty years, and also due to a series of conjunctural and technical reasons, a need for an enhancement of the Customs Union has emerged in recent years.
The consistency of the productive capacity revealed in the form of foreign trade performance with the sectoral real effective exchange rate supports the interpretation of the decline in real effective exchange rate indices as competitive advantages. On the other hand, the strong medium-term relation between sectoral real effective exchange rate series and productivity points to the potential importance of productivity in the translation of nominal exchange rate advantages into international competitive advantages.
The real exchange rate has a larger impact on imports than on exports, whereas aggregate demand is more likely to determine imports. Compared to previous periods, the effect of real exchange rate was more pronounced in the recent improvement of the external balance.
In this study, we summarize our findings regarding the exporting potential of firms included in the Central Bank of the Republic of Turkey Sectoral Balance Sheet data-set, and the sector, size and provincial breakdown of non-exporting firms with high potential.
Abdullah Kazdal,Süleyman Kutalmış Özcan,Muhammed Hasan Yılmaz
Product, activity and country-based diversification in the Turkish foreign trade witnessed a significant upswing in the last 15 years. On the other hand, diversification has come to a halt in recent years. In this context, steps to be taken to improve diversification in exports are considered vital.
It seems hard to decide whether the use of imported inputs is at an optimum by merely looking at figures or making cross-country comparisons. However, if we evaluate the use of imported inputs in a breakdown by sectors and in light of its change over time, the existence of some structural problems can be seen clearly.
Our findings suggest that rediscount credits support exports. Yet, it should be underlined that a number of factors should be taken into account in the design of such financing instruments and the funds should be distributed in a target-oriented and efficient way.