According to the GTS (General trade system) foreign trade data of August announced by TURKSTAT with the cooperation of the Ministry of Trade; Turkey's exports in August 2020 decreased by 5.7% compared to the same period of the previous year to 12.46 billion USD, while imports increased by 20.4% in the same period amounted to 18.74 billion USD. Thus, the foreign trade deficit increased by 168.2% between the periods of August 2019 - August 2020 and reached 6.28 billion USD. The ratio of exports to imports decreased from 85% to 66.5% in the said period.
Germany is the country to which we export the most in August, followed by the UK, USA and Iraq. While exports to the 27 countries that make up the European Union decreased by 2.8% to 5.15 billion USD, it is seen that the share of the EU in our total exports increased from 40.1% to 41.3%. In import items; China took the first place in August 2020, followed by Germany, Iraq and Russia. In August, the share of capital goods in total imports increased, while the share of intermediate (raw materials) goods decreased, the share of consumer goods remained the same. While the share of high technology products in our total exports was 3.2%, the share of imports of the same group in our total imports was 10.4%.
According to STS (special trading system) data, Turkey's exports in August 2020 decreased by 5.9% compared to the same period of the previous year USD 11.76 billion, while imports increased by 20.4% in the same period in USD 18.15 billion has been realized. The ratio of exports to imports was 64.8% in the said period.
Earlier this month, the leading data of the Ministry of Commerce also showed the slowdown in exports and the increase in imports in August. The upward trend in the foreign trade deficit continues and is affected by the loss of momentum of the economic recovery both locally and globally. The impact of the sharp decline in exports due to the pandemic throughout the year continues, although not at the level of April and May. In this period, the fact that the increase in imports was due to the high demand effect in the economy in the 3Q20 period and the increasing import costs was effective in the growth of the foreign trade deficit. In the last quarter, this effect on domestic demand will fade along with the increasing loan rates. The factor affecting such an increase in imports is gold imports, which showed an extraordinary increase in the August period. The increase in physical gold demand due to the uncertainty of the pandemic period explains such an increase in gold imports.
The degree of recovery in our export partners, especially in Europe, will be decisive for the recovery of our exports in the upcoming period, and the slowdown in global economies before the last quarter may indicate a slow recovery in terms of the export outlook. In terms of the level of demand in the domestic economy and its impact on imports, financial conditions and how long the impact of the pandemic will last will be important.
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