Türkiye managed to end 2022 with the highest export figures ever despite global challenges that clouded the trade outlook, the country's president announced on Monday.

Outbound shipments reached $254.2 billion (TL 4.75 trillion) in 2022, marking a 12.9% year-over-year increase, President Recep Tayyip Erdoğan told a meeting in Istanbul to announce the preliminary trade figures. "This is the highest ever level recorded in the history of the Republic. Our goal is to ensure that Türkiye assumes its place among the top 10 countries with the highest exports in the world," said Erdoğan.

Exports in 2021 ended at a record $225.4 billion, mainly driven by high foreign demand and orders that stemmed from supply bottlenecks and soaring freight costs during the coronavirus pandemic. Government and economists expected the figure to reach $250 billion in 2022. "We increased our exports exactly sevenfold from $36 billion when we set out 20 years ago," Erdoğan said.

On the other hand, Türkiye’s imports rose 34.3% year-over-year in 2022 to $364.4 billion, revealed Trade Ministry data. The primary reason has been soaring energy costs. The country’s trade deficit thus widened 138.4% from the previous year to $110.19 billion in 2022. The export-import coverage ratio decreased to nearly 70% in 2022 from 83% in 2021.

In December, the trade shortfall widened 52% from a year earlier to $10.381 billion, with exports up 3.1% to $22.92 billion and imports rising 14.6% to $33.30 billion, according to the data.

Exports have been one of the main drivers of Türkiye’s economic growth and hit record-high volumes throughout 2022. Yet, a global slowdown has affected foreign demand, notably among Türkiye’s largest trade partners, spearheaded by Europe.

Germany top market

Germany was the top export market in December as it received about $1.81 billion worth of Turkish goods, a 1.6% year-over-year increase, the data showed. The United States followed with $1.38 billion, an increase of 9% versus a year ago. Russia stood third with $1.31 billion, with shipments rocketing by 122.3% from December 2021.

Most of the imports last month came in from Russia at nearly $5.3 billion, a rise of 56.3% from a year ago. Imports from China rose 15.5% to $3.64 billion, while those from Switzerland jumped by a whopping 1,245% on annual basis to $2.52 billion, according to the data.

Erdoğan said shipments to the European Union increased by 12% in 2022, while some 10,000 companies completed their first exports in the same period.

Trade Minister Mehmet Muş hailed what he said was a historic success that came at a time of unprecedented global challenges, led by disruptions in supply chains, inflation, Russia’s invasion of Ukraine and soaring energy and commodity prices.

$14B FX parity loss

Muş stressed that exporters managed to achieve double-digit growth despite the negative effects of the foreign exchange parity. He said exporters suffered around $700 million in losses in December and about $14 billion overall in 2022 due to the euro/dollar parity. "In other words, despite the parity effect, a great export success has been achieved," he remarked.

Muş also stressed that the steep increase in energy and commodity prices maintained their negative impact on Türkiye’s imports and trade deficit. "I would like to underline here and express once again that the increase in imports is largely due to global energy prices. On the other hand, the recent increase in gold imports has also been effective in increasing our imports," the minister noted.

The chemicals industry unseated automotive to top the list among sectors with $33.52 billion worth of exports in 2022. Automotive followed with nearly $31 billion, while ready-to-wear reported $21.2 billion in sales.

Erdoğan underlined that exports made using the Turkish lira reached nearly TL 350 billion last year. "The number of countries and regions to which we export with our national currency has reached 197," he added.

Also addressing the meeting, Turkish Exporters Assembly (TIM) Chair Mustafa Gültepe said the country managed to increase exports to 162 countries and broke records in sales to 108 nations. Gültepe also said the number of countries receiving at least $1 billion worth of Turkish goods reached 52.

"Germany, the United States, Iraq, the United Kingdom and Italy have been the top five countries we exported to the most. While 16 of our sectors achieved record exports, the sales of 23 of our sectors exceeded the $1 billion limit," said Gültepe.