Participation Banks Support Exporters

The activity of export of goods and services in foreign trade for a country reveals the necessity of maintaining the balance in foreign exchange transactions. In this sense, the most important concept we face is the balance of payments, which we can call the balance sheet of a country’s foreign trade. A country must establish the balance of foreign payments by considering the import/export balance or, in other words, the balance of foreign trade. In order to finance economic development in developing economies, policies to prevent imports by increasing exports have seeked rather than using foreign debt. We can show examples such as China, South Korea, Japan and Germany as countries that develop by having a foreign trade surplus. Turkey, especially in recent years, has focused on exporting by working in areas such as industrialisation, new technology production, technology-oriented and value-added products. Turkey has achieved such success in this framework. Since the foreign exchange rate has not  been repressed much in recent years, foreign demand is more advantagoues in the sales of goods that are manufactured in Turkey. If Turkey maintains this policy and establishes the current account surplus mechanism, it can bring its growth levels to a reasonable level in the upcoming period. When we observe the figures for 2021, we can state that there has been a significant improvement in foreign trade and our performance in exports is on track. This progress is expected to improve even further by the end of the year. At this point, achieving growth without a current account deficit is an important way out for Turkey. Sustainable growth of 5% to 6% is required without a current account deficit. If the current account surplus can be extended for at least three years, it is possible to maintain it. Therefore, it is necessary to encourage exports by prioritising the industry to develop the manufacturing industry on a foreign exchange earning basis.

Achieving economic growth without a current account deficit is an important way out for

Export incentive point in foreign trade is the point in question. In particular, through the re-discount credits of the Central Bank of Turkey, loans are provided to exporters who bring in foreign currency into the country at meagre costs. Exports stood at $140 billion in August, with a target of $210 billion by year-end. We realise that the Ministry of Trade and other governmental institutions are also trying to address this objective. Participation banks have been able to finance exporters like our customers in domestic markets in recent years. While our relations with Türk Eximbank were on a narrow ground in previous years, especially in the last two years, we have improved our relations and formed a working group. We have reached an agreement on the services to be provided to our export customers through Türk Eximbank. As participation finance institutions, we do our utmost to contribute to Turkey's export volume.

Osman Akyüz

Secretary General of TKBB