Turkey’s exports increased by 12% y/y to $14bn in May, data from the Turkish Exporters’ Assembly (TIM) showed on June 1.

In the first five months of the year, the country’s export revenues gained 14% y/y to $68bn.

The automotive industry’s exports rose by 17% y/y to $13.9bn, ready-wear exports were up 10% y/y to $7.47bn and steel exports increased by 20% y/y to $5.9bn in the first five months.

The association also reported that exports in the last 12 months rose by 13% to $155bn.

TIM forecasts that the country’s total exports will exceed $170bn this year.

Escalating tensions in Syria, as well as Turkey’s military moves in Kurdish-controlled areas of its neighbour, threaten to undermine Turkey’s strong export performance, S&P Global Ratings said on May 1 when it cut Turkey’s credit rating deeper into junk.

US-led protectionism is the biggest threat to global economic recovery, Turkish Deputy Prime Minister Mehmet Simsek said on May 31 in a response to Washington’s decision to introduce tariffs on aluminium and steel imports from Canada, Mexico and the European Union.

On May 7, it was reported that US steel tariffs had pushed up volumes of Russian and Turkish steel on the European market with some manufacturers diverting their exports to the EU.

According to the latest national statistics institute TUIK data released on May 31, the foreign trade deficit grew 56% y/y to $27.4bn in January-April.

Exports were up 9% y/y to $55bn in the first four months of 2018 but imports rose at the higher pace of 21% y/y to reach $82bn.

Anxieties over Turkey's overheating economy are strengthening with the growing imports and widening current account deficit. Turkey's economic health is patently dangerously reliant on hot inflows of foreign external financing to enable growth. The political and economic outlook in Turkey is not secure enough to attract sufficient longer-term, stabler foreign investment capital.

The foreign trade deficit rose by 37% y/y to $77bn in 2017. Exports were up 10% y/y to $157bn but imports rose at the quicker pace of 18% y/y to reach $234bn.

The government is forecasting a foreign trade deficit of $68bn for 2018 with exports reaching $169bn and imports amounting to $237bn.

On  May 25, it announced that repayments of rediscount credits for export and foreign exchange earning services, due by July 31, can be made in Turkish lira at a fixed exchange rate of 4.2000 to the USD, 4.9000 to the euro, and 5.6000 to the pound sterling.