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Russia sanctions, Iraq conflict slow Turkish exports

Meanwhile, the defense and aviation industry was the exporting sector that increased the most, with a 76.3 percent increase.

Source : Hurriyet Daily News / 01 Jul 2014

Turkey’s exports were $12.54 billion in July, remaining flat compared to the same month of last year, the Turkish Exporters’ Assembly has said, as political fallout and the Iraq conflict have taken their toll on the country’s trading partners.

Turkey’s top exporters’ union on Aug. 1 said total exports reached $92.7 billion in the January to July period in 2014, marking a 5.7 percent increase, while exports over the last 12 months were $156.32 billion, a 2.2 percent rise.

But the union said the recent drag in Turkish exports were due to the economic effects of EU sanctions on Russia and a decrease in exports to the conflict-ridden Iraq, Turkey’s second-largest export market, which fell by 21 percent in June and 46 percent in July.

The automotive industry was the best-performing sector in July, with $2 billion in exports. 

The ready-to-wear fashion sector came second with $1.7 billion in exports and chemical products were third with $1.6 billion.

Meanwhile, the defense and aviation industry was the exporting sector that increased the most, with a 76.3 percent increase.

Setbacks in Iraq

Iraq, which had become Turkey’s second biggest trade partner after Europe, has been gripped by a whirlwind of violence and political turmoil since the Islamic State of Iraq and the Levant (ISIL) seized the second largest Iraqi province, Mosul, on the night of June 9.

According to the figures released on Aug. 1, Iraq has dropped down to fifth place among Turkey’s top export markets.

The top five countries that Turkey exported to in July were Germany, the United Kingdom, Italy, France and Iraq.

The absence of a powerful political authority and fears for the safety of Turkish transporters that escalated after militants took dozens of Turkish nationals hostage have taken a great toll on trade between the countries.

ISIL stormed the Turkish Consulate on June 10, taking all 49 there hostage, including Consul-General Öztürk Yılmaz.

A separate group of 41 truck drivers who were taken hostage in the country were released at the beginning of the month, but the hostages at the consulate remain in jihadist captivity, keeping tensions high.

In his remarks on July 22, Economy Minister Nihat Zeybekci said the continuing decline in exports to Iraq would create a $2.5 billion loss by the end of the year, but stressed that “we foresee this retreat to slow by the year-end.”

“We expect and foresee exports to northern Iraq to begin recovering and the delayed orders will continue to grow [by the end of the year],” he said.

 

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