The unfavorable trend in the external term of trade, which shows the ratio of the unit value of goods exported by Turkey to the unit value of goods imported by Turkey, continues.
Turkey’s external term of trade improved by 9.2 points in 2023 compared to the previous year and reached 84.9. However, this value has been below the index value, which has been above 90 and occasionally above 100 since 2013.
The external term of trade, which is measured as the ratio of the unit value of goods exported by Turkey to the unit value of goods imported by Turkey, has recovered after falling below historical averages, but Turkey has not been able to benefit sufficiently from the price increases despite the increases in global inflation.
Although there was a recovery in 2023 compared to the previous year, the prices of Turkey’s imported products increased at a higher rate, while the value of exports increased at a lower rate. An external term of trade index above 100 indicates that the value of exports is generally higher, and an increase in the index in this direction indicates an upward momentum in export prices.
As of September 2023, Turkey’s share of global exports is 1.06. This is likely to be slightly higher when the data are released. On the other hand, at a time of global inflation and rising prices, Turkey has failed to achieve an overall improvement in the total value of its exports. Moreover, the external terms of trade remained low due to the rising prices of imported goods.
