Türkiye achieved its highest monthly exports ever in May, its trade minister announced on Monday, with momentum in outbound shipments and a downward trend in imports driving a nearly 48% decrease in the foreign trade deficit.
Exports rose 11% year-over-year to nearly $24.1 billion last month, marking "a new record in the history of our Republic," Trade Minister Ömer Bolat said.
Imports dropped 10.3% from a year ago to $30.6 billion, Bolat told an event in Istanbul to announce the preliminary trade figures.
"With the increase in exports and the decrease in imports, our foreign trade deficit decreased by 47.8% on an annual basis (33.9% month-over-month) and fell to $6.5 billion," he added.
From January through May, the shortfall plunged about 34.4% from a year ago to $36.8 billion, the Turkish Exporters Assembly (TIM) data showed.
Exports rose by 4.5% to $106.9 billion in the five-month period, while imports fell 9.3% to $143.7 billion.
Treasury and Finance Minister Mehmet Şimşek highlighted the continued improvement and said there has been an annual $6 billion improvement in the foreign trade balance.
"Following the temporary deterioration in April, the improvement in the foreign trade balance continued in line with our projections," Şimşek wrote on social media platform X, formerly Twitter, shortly after the data release.
Flipping the chronic current account and trade deficits into surpluses has been among the top priorities for the government since it started reversing years of loose monetary policy after last May's presidential and parliamentary elections.
It seeks to rebalance the growth composition and rely more on exports, production, and foreign investment to ensure a sustainable expansion.
Şimşek emphasized that they expect the ratio of the current account deficit to national income, which has averaged 3.8% over the last 20 years, to be around 2.5% by the end of the year.
"The narrowing of the deficit will reduce our need for external resources, enabling permanent reserve accumulation," the minister noted.
"We are entering a period where disinflation will accompany stabilization," he said.
The current account gap in 2023 stood at $45.2 billion, down from $48.8 billion in 2022. The annualized shortfall reached as high as $57 billion last May. It narrowed to $31.2 billion as of this March, according to the official data.
The current account is the most complete measure of trade because it includes investment flows and trade in merchandise and services. A deficit means Türkiye is consuming more from overseas than it is selling abroad.
Citing what he says was another encouraging development last month, Bolat underscored that the ratio of exports covering imports rose 15.3 points to 78.7%.
He said annualized exports also reached a new all-time high at $260.1 billion, marking an increase of 2.3% compared to the previous year.
Despite multiple challenges, including a devastating earthquake, the nation's exports reached a third straight annual peak, totaling nearly $256 billion in 2023, compared to $254 billion in 2022.
Last year's shipments took Türkiye's share in global exports from 1.02% in 2022 to 1.08% in 2023, marking the highest level in history.
Bolat said the annualized foreign trade deficit stood at $87 billion as of the end of May, compared to $122.2 billion last year.
"We saved $35.2 billion," he noted, highlighting the decrease in imports.
Bolat estimated that service exports in the first five months of the year would increase by 8% compared to the same period last year, reaching $36.2 billion.
Türkiye exceeded the $100 billion mark in services exports for the first time ever in 2023.
"We are now entering the golden era of tourism and logistics. June, July, August, September and October are very important months in terms of tourism and logistics revenues. These figures will rise rapidly," Bolat noted.
"Hopefully, we will achieve our target of $110 billion (in service exports) by the end of the year. We will reach a high momentum in exports in the second half of the year."
The minister said they will strive to ensure that monthly export averages do not fall below $22.5 billion to $23 billion.
The Turkish government sees the exports reaching $267 billion by the end of 2024.
"Next year, we aim for monthly export averages of $24 billion, and by 2026, with monthly averages of $25 billion, we will reach the medium-term program's end-2026 target of $302 billion in goods exports," Bolat said.
