Turkey's February foreign trade data

Turkey’s February foreign trade data

Turkey's State Institute of Statistics (DIE) disclosed that the country's foreign trade deficit rose 9.1% year on year to $2.7 billion in February 2005. Consequently, Turkey's total trade deficit amounted to $4.93 billion for the first two months of 2005, up 18.5% year on year. Exports rose 49.1% year on year to $5.46 billion in February while imports soared 32.9% to $8.16 billion. Moreover, imports of consumption goods, capital goods and intermediate goods show a strong increase of 42%, 22.5% and 14% in February respectively. The increase in intermediate goods imports is also a good sign since such goods are production-oriented imports. The growth in capital and consumption goods imports reflect that the demand for consumption and investment is strong and that Turkey's economic revival continues. The flexibility of the labor market, efficiency increases and aggressive marketing strategies contributed to the increase in exports. Furthermore, the decline in interest rates and the strong TRY are expected to add steam to the economic revival after the second quarter of 2005. If the efficiency increases and labor market flexibility continue, exports will likely maintain their strong performance. Meanwhile, a continuance of tight financial and money policies is on the cards for Turkey's government as it works to prevent the current account deficit from increasing further.