Automotive Exports December 2019

Annualized current account widens to highest surplus ever
Having dropped dramatically since
last year before recording a monthly
surplus two times in a row in June and
July, Turkey’s current account balance
has also posted a surplus in August and
led to the annualized current account
surplus widening to a record in the
month.
The balance posted a surplus of $2.6
billion in the month, the Central Bank
of the Republic of Turkey (CBRT)
announced. The increase brought the
12-month rolling surplus to $5.1 billion,
the highest surplus ever. The surplus
was up $554 million year-on-year, the
bank said in a statement. The balance
posted a surplus of $1.01 billion in the
January-August period, the bank said.
“We will protect our gains with export
and value-added production priority
policies and ensure that our resources
remain in our country,” was the first
evaluation of the data by Treasury
and Finance Minister Berat Albayrak,
who underscored that the successful
performance in the current account
balance continues.
“We have recorded a surplus of $5.1
billion in August with another record,
after the record in July,” Albayrak said
over his social media account.
The central bank said the development
in the current account is mainly
attributable to an $848 million increase
in the services item recording net
inflow of $5.2 billion, as well as a $73
million increase in secondary income
surplus to $100 million.
A survey showed economists’ current
account surplus estimates range for
August stood at $2.76 billion. A group
of 14 economists’ surplus estimated
the end-2019 current account balance
to show a deficit of $700 million. The
median of 10 estimates in a Bloomberg
survey was for a monthly surplus of
$2.85 billion.
Gold and energy excluded current
account surplus was $5.7 billion, rising
$1.1 billion from August 2018. Travel
items under services saw a net inflow
of $4.1 billion in the month, up $737
million year-on-year.
The country’s new economy program
unveiled last month expects a currentaccount-surplus-to-GDP
ratio of
0.1% for 2019. It forecasts the current
account to post a deficit of 1.2% next
year and 0.8% in 2021 before reaching
0% in 2022.
In 2010 and 2011, when the Turkish
economy was seeing a high growth,
the annualized current account deficit
had increased gradually and reached
its historic peak in October 2011 with
$76.1 billion. It went on to fall below
$50 billion in November 2012 with
the measures taken by the economic
administration.
The annualized deficit climbed to $57.9
billion in May 2018 before it kicked
off a dramatic decline along with
the rebalancing period in the Turkish
economy that started after Treasury and
Finance Minister Albayrak announced
the new economic program (NEP) in
September last year. Measures taken
in this scope led to narrowing in the
foreign trade deficit, while a high
increase was observed in the rate of
exports meeting imports.
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