Turkish Exports Boomed in 2007

UNCLAS ANKARA 000023 SIPDIS TREASURY FOR INTERNATIONAL AFFAIRS - JROSE USTR SENSITIVE SIPDIS REF: ANKARA 2052 E.O. 12958: N/A TAGS: EFIN TU SUBJECT: Turkish Exports Boomed in 2007 ¶1. Summary: Turkish exports reached USD 105.9 billion in 2007, enjoying a 23.5 percent increase from 2006 and surpassing the official target of USD 100 billion. Turkish State Minister for Trade, Kursad Tuzmen, said 2008 exports would continue to be the locomotive for Turkey's economic growth. The GOT has set a 2008 target of USD 117 billion in export revenue, while Minister Tuzmen uses a figure of USD 125 billion in his public remarks. End Summary. ¶2. According to January 2 data released by the Turkish Exporters Association (TIM),Turkish exports jumped 23.5 percent in 2007, reaching USD 105.9 billion. Even though official Turkstat numbers for 2007 will not be released until the end of January, TIM's data generally tracks closely with Turkstat figures. ¶3. Trade Minister Tuzmen has long been critical of the free floating exchange rate regime used by the Central Bank since 2001, claiming the free float hampers Turkey's competitiveness in foreign markets. According to TIM data, the machinery sector lead with a 43 percent increase over 2006, automotive and automotive spare parts increased 35 percent, and iron/steel increased 31.3 percent. The total industrial sector share was 86.7 percent in 2007, reaching USD 91.9 billion. In 2007, most of Turkey's exports were made to Germany (USD 11.9 billion),the United Kingdom (USD 8.3 billion),Italy (USD 7.4 billion),France (USD 5.9) and Russia (USD 4.8 billion). Turkish exports to the U.S. were USD 4.0 billion, or 3.7 percent of total Turkish exports. ¶4. Comment: Turkey imports many raw material components that it exports as finished goods. While the increase in exports is good news, Turkey's heavy dependence on imports contributes to the high current account deficit, which is now eight percent of GDP. End Comment. McEldowney