Turkey has begun to reap the fruits of the Central Bank's decision to withdraw the 'high interest-low exchange rate' policy and drop interest rates, bringing the Turkish lira to a competitive level and resulting in a growth in exports. While Turkey's economy saw 3.2 percent growth in the first quarter of the year, the highest contribution to this development came from the nation's export figures.
Net export figures from the same period last year contributed negatively by 5.3 points, due to excessive imports, while this year export figures from the same period contributed by 4.5 points. Turkey's export figures alone have provided a strong sign that sustainable development is possible, despite the drop in imports and the current account deficit.
Turkey's Statistics Institute (TÜİK) recently announced economic growth figures for the first quarter of the year. Contrary to economist's expectations of 2.8 percent, economic growth came out to 3.2 percent for the first quarter. The increase in foreign trade was a significant factor in growth being realized at higher than expected levels. National income was calculated for the first quarter as 329 billion liras (182.7 billion dollars) while the GDP for the past year, as of the first quarter, was announced as 335 billion liras (772 billion dollars).
A SOFT LANDING HAS BEGUN
According to the data, exports grew by 13.2 percent in the first quarter while imports dropped by five percent. As a result, foreign trade provided a positive contribution to overall economic growth. There has been however an indescribable slow down when it comes to domestic demand. Citizen's consumption expenditures, which are a locomotive for growth, did not show a ratio-based growth. The 5.5 percent growth in public consumption spending and the fact that investments have continued, albeit low, resulted in securing a 0.9 percent contribution in internal demand. As a result, the soft landing, which has been perpetuated by economic administrators, has succeeded in the first quarter.
According to figures, the 3.2 percent growth based on stock has brought the growth rate down by 2.3 percent, while the 3.2 percent increase in exports has brought the growth rate up to 4.5 points. In 2011, net export figures brought the nation's growth figures down by 5.3 percent in the first quarter and by 1.4 percent throughout the year.
WE SPENT 135 BILLION DOLLARS
In the first quarter of 2011, the Turkish public spent 222 billion liras, whereas in the first quarter of this year, that figure went up to 243 billion liras. However, when evaluating the data from a dollar basis, the 140.8 billion dollar consumption spending dropped by 5.7 billion dollars, to 135 billion dollars. This is due to the fact that during this time the dollar gained approximately 14 percent in value. Therefore, the first quarter of this year came out to 135 billion dollars in spending, the majority of which, 37.2 billion dollars, went to food and beverages. This category was followed by spending on property, rental, electricity and other amenities at 26.9 billion dollars, while transportation and communication came in third at 22.7 billion dollars.