TURKISH FIRMS HAVE STILL A LONG WAY TO GO TO BRIDGE THE TRADE DEFICIT GAP
hand, the percentage changes in the indices are apparently different in these two types of assessment method, hence it can be argued that seasonal impacts matter for Turkey’s trade and services sectors.
Firms and entrepreneurs are required to be successful in Turkey’s domestic markets in order to survive. To be able to expand and extend their business interests and gains, they have to develop relations with the outer world, which is materialized under the rubrics of either exports or imports. The current statistics shown in Figure 3 imply that Turkish firms have still a long way to go to bridge the trade deficit gap, although there is an optimistic trend during the last three months. Whereas the trade deficit was around $8 billion in August 2014, it was approaching $6 billion by January 2015. However, in order to get a clear picture, Turkey needs some time to check whether this trend is sustainable or whether it is a temporary development due to the impact of currency exchange rates. There is no doubt that firms are trying to their best to raise their exports, and that has had an evident impact narrowing the current account deficit. Export-friendly policies and institutions are indispensible to achieve this target.
Firms and entrepreneurs have a significant function in the economic welfare of a country. Their choices have an influence over the trade volume and production levels of nearly all sectors and the financial system. In a similar vein, their positioning in the market is essentially correlated with the strength of microeconomic as well as macroeconomic institutions in a very common sense. Turkey’s political actors should take the psychology of entrepreneurs and firm owners into account to alleviate the structural and institutional weaknesses of the economy.
This piece focuses on a number of firm/entrepreneur-related statistics recently announced by Turk Stat, comprising economic confidence indices, industrial production and trade and services statistics and finally foreign trade figures. The conclusions coming out of the abovementioned discussions are summarized as follows:
• The overall economic confidence index began at 95 in September 2014 and ended at almost 87 in February 2015 -- an 8 percent reduction during the last six months.
• Monthly industrial production faced ebbs and flows throughout 2014, during which values ranged from 119 to 123.
• The apparent increase in the turnover index from 137 to 172 puts forward a clear statement that trade and service sectors do perform well concerning the value of their overall amounts of provision of goods and services, which is line with the first economic confidence index for the services sector in Figure 1.
• The current statistics shown in Figure 3 implies that Turkish firms still have a long way to go to bridge the trade deficit gap, although there has been an optimistic trend during the last three months. Whereas the trade deficit was around $8 billion in August 2014, it was approaching $6 billion by January 2015.