Page 39 - TURKRptFeb22

5.0 External Sector & Trade 5.1 External sector overview
The problem is that the Erdogan regime believes in its own fake data and then wonders how its currency is wildly depreciating while the economy is producing a current account surplus.
Turkey’s export performance depends on demand conditions in the EU, not on the value of Turkish lira.
The story across 2021 suggested that Turkey’s exports were breaking records. That was correct in USD-terms, with imports also breaking records. It is called inflation.
Financial flows stopped; as a result, they are stable. There is not much hot money left. The game is played out only among locals.
External financing needs for 2022 remain high but it can be assumed that external debts will be rolled over in 2022 as well. Next stop is the spring season for Turkish banks’ syndicated loan renewals.
Creditors seek higher rates, but it is their problem to avoid a huge Turkey default.
Despite the ‘switching off’ of much industrial production, saving on energy bills, the trade deficit came in at a record high of $10.4bn in January.
39 TURKEY Country Report February 2022 www.intellinews.com