Central Bank Releases Balance Of Payments Developments In January - August 2003

ANKARA - ANKARA (A.A) - 27.10.2003 - The current account balance recorded a deficit of 4 billion 87 million U.S. dollars in January-May of 2003.
The current account balance deficit was 840 million U.S. dollars in the same period of the previous year.
The main points related to the balance of payments developments in January-August 2003 are summarized below:
I- CURRENT ACCOUNT
The first remarkable development in August 2003 for the current account balance would be the surplus of 328 million U.S. dollars during the January-August 2003, mainly owing to the increase in net tourism revenues which compensated the import expenditures exceeding the export revenues.
However, the current account balance, which had realized as 840 million U.S. dollars in the same period of 2002, increased by 386,5 percent realizing as 4.087 million U.S. dollars in January-August 2003.
Foreign Trade:
In comparison with the same period of the previous year, the foreign trade balance recorded a deficit of 8.260 million U.S. dollars increasing by 70,1 percent in January-August 2003. The key factors underlying this development are:
- the increase of export (FOB) revenues by 30,4 percent, realizing as 29.325 million U.S. dollars
- the decrease of shuttle trade by 5,5 percent, realizing as 2.388 million U.S. dollars,
- the increase of import (CIF) expenditures including gold imports by 33,5 percent, realizing as 42.408 million U.S. dollars.
Services :
When compared to the same period in 2002, services surplus amounted to 5.630 million U.S. dollars by a 18,6 percent increase in January-August 2003, as the tourism revenues increased. The increase in the tourism revenues has been driven, respectively, by 2,2 and 5,2 percent increase both in the number of the foreign visitors in Turkey, and their average expenditures. The relatively high share of Euro area visitors in total and the appreciation of Euro relative to U.S. dollars are the main reasons for the increase in the average expenditures.
Over the same period, the net tourism revenues amounted to 4.499 million U.S. dollars by an 8,2 percent increase, and in line with the increasing trade volume, transportation revenues and expenditures, the other important item of this category, indicated an increase of 19,4 percent and 28,7 percent, respectively. Thus, compared to the same period of the previous year, net transportation revenues recorded a decrease of 1,5 percent amounting to 514 million U.S. dollars in 2003.
Income:
Investment income, which had shown a net outflow of 2.968 million U.S. dollars in January-August 2002, also recorded a net outflow of 3.760 million U.S. dollars in the same period of 2003. The main components of investment income, direct investment income, portfolio investment income, and other investment income consisting of the interest income and expenditures had shown a net outflow of 151, 980 and 2.629 million U.S. dollars in January-August 2003, respectively.
In January-August 2003, interest expenditures of long-term loans increased by 6,9 percent, realizing as 2.854 million U.S. dollars. Interest payments of 44 million U.S. dollars and 156 million U.S. dollars on the credits extended by International Monetary Fund (IMF) to the Monetary Authority and General Government, and 40 percent increase in interest payments for deposit accounts opened with the Central Bank, realizing as 157 million U.S. dollars are main developments in August 2003.
Current Transfers:
In comparison with the same period in 2002, there is negligible increase in the current transfers, which realized as 2.303 million U.S. dollars in January-August of 2003. Meanwhile, workers' remittances, one of the main sub-items of current transfers, realized as 1.433 U.S. dollars in the same period of 2003. Imports with waiver, the other significant sub-item, also recorded a rise of 3 percent, realizing as 649 million U.S. dollars.
II- CAPITAL AND FINANCIAL ACCOUNTS:
In January-August 2003, while there is no transaction recorded in the migrants' transfers, which is the sub-item of capital account, the main developments in financial account are summarized below:
Direct Investment:
With regard to the direct investments, non-residents' net direct investment in Turkey, which includes the loans received from foreign direct investors abroad, realized as 67 million U.S. dollars in August 2003. However, in comparison with the same period of 2002, a 47,3 percent decrease amounting to 328 million U.S. dollars was observed in January-August 2003. 77 million U.S. dollars of this amount belongs to the loans received from foreign direct investors abroad.
Residents' net direct investment abroad, which had shown an increase of 9 million U.S. dollars in January-August 2002, also resulted in an increase of 265 million U.S. dollars in January-August 2003.
As a result, direct investments had shown an inflow of 63 million U.S. dollars in net terms in January-August 2003.
Portfolio Investment:
Portfolio investment resulted in a net inflow of 631 million U.S. dollars in August 2003 while a net outflow of 919 million U.S. dollars and a net inflow of 1.248 million U.S. dollars realized in January-August of 2002 and 2003, respectively.
As for the developments in portfolio investments' assets side, it is observed that residents' security transactions abroad recorded net purchases of 1.721 million U.S. dollars, and of 364 million U.S. dollars in January-August 2002 and 2003, respectively.
As for the developments in portfolio investments' liabilities side, there were no new bond issues or repayments by the general government to the international capital markets while a net borrowing of 930 million U.S. dollars has been observed in January-August 2003.
Besides, relative to the same period in 2002, non-residents' net purchases of both equity securities and government debt securities issued in the domestic capital markets grew by 206.7 percent to 319 million U.S. dollars, and by 37,8 percent to 540 million U.S. dollars in January-August 2003, respectively.
Other Investments:
The other investment account, which is composed of trade credits, other credit items and foreign exchange deposit accounts, recorded a net inflow of 7.138 million U.S. dollars in January-August 2002, and of 2.808 million U.S. dollars in January-August 2003.
a. Assets: While trade credits, which are extended in return for export-related transactions, realized in net terms as 617 and 953 million U.S. dollars while other credits extended realized in net terms as 261 and 409 million U.S. dollars in January-August of 2002 and 2003, respectively.
Banks' foreign exchange holdings with foreign correspondents, which decreased by 1.549 million U.S. dollars in January-August 2002, also decreased by 1.624 million U.S. dollars in the same period of 2003.
b. Liabilities: The liabilities side of other investment indicates that trade credits, which are mainly received in return for import-related transactions, realized a net disbursement of 1.468 million U.S. dollars in January-August 2002. Over the same period in 2003, a net disbursement of 972 million U.S. dollars, of which 580 million U.S. dollars consists of long-term and 392 million U.S. dollars consists of short-term, was observed.
With regard to the sub-categories of the other credits, due to the IMF loans, a net repayment of 6.138 million U.S. dollars, and of 617 million U.S. dollars were realized by the central bank and a net disbursement of 12.503 million U.S. dollars, and a net repayment of 991 million U.S. dollars were realized by general government in January-August of 2002 and 2003, respectively. For the same periods of 2002 and 2003, net repayments of 244 million U.S. dollars and of 1.255 million U.S. dollars were materialized respectively by the general government for the loans used from international capital markets and other international organizations. Moreover, a net repayment of 1.155 million U.S. dollars and a net disbursement of 636 million U.S. dollars were realized in the banking sector; a net disbursement of 340 million U.S. dollars and of 352 million U.S. dollars were also realized in the other sectors in January-August of 2002 and 2003, respectively.
FX deposit accounts, which had decreased by 95 million U.S. dollars in January-August 2002, increased in the amount of 1.665 million U.S. dollars in January-August 2003, owing to the increase of 370 million U.S. dollars in deposit accounts opened with the Central Bank and an increase of 1.295 million U.S. dollars in deposit accounts opened with the resident banks.
Reserve Assets:
Official reserves, which is the last item of financial account, had increased by 5.239 million U.S. dollars in January-August 2002, and also increased by 2.446 million U.S. dollars in January-August 2003.
(UK-AÖ) 27.10.2003