Turkey's Forex revenues do not suffice to meet imports

ANKA Review
Unable to generate enough foreign exchange earnings to meet imports, Turkey is increasingly dependent on inflows of foreign capital in order to finance a growing current account deficit. 

A widening gap between forex income and expenditures heralds difficulties for Turkey in the period ahead, as inflows of foreign capital slow down.

Earns $100, spends $129

During the first four months of the year Turkey secured $57.96bn worth of foreign exchange earnings of which $47.36bn through exports.

However, over the same period it spent $74.85bn worth of foreign currency, of which $64.27bn in import financing.

Accordingly, exports only sufficed to meet 73.7 percent of imports in the given four months.

More, the total of forex earnings in the same period only equalled 90.2 percent of imports.

The ratio of total forex earnings to forex expenditures realized at 77.4 percent.

In other words, for each $100 worth of foreign exchange earnings, Turkey has spent $129 in imports.

Breakdown of forex income, spending

In addition to $47.36bn worth of exports, Turkey raised $3.75bn on tourism and $1.94bn on international transportation.

A further $795m stemmed from interest earnings, $283m from Turkish contractors’s orders abroad and $189m from workers’ remittances.

Some $3.6bn was raised from other forex-generating items.

As for forex outlays, $74.8bn should be traced to imports, $4.22bn to interest payments $2.3bn to transportation, $1.09bn to foreign travel and $2.95bn to other forex expenditures.

Compared to the same period of 2007, imports  have grown by $18.04bn, transportation expenditures by $844m, interest payments  by $683m, foreign travel by $152m and other forex expenditures by $377m.