|Turkey’s exports to Iran reach $8.5b in 8 months||
Turkey’s exports to Iran for the first eight months of 2012 totaled $8.5 billion, Turkish central bank governor has said.
Erdem Basci told the Financial Times that the income was due to large-scale Iranian purchases of gold. This level of exports to Iran is widely considered unsustainable due to U.S. misgivings and limits in Turkey’s stock of gold.
However, in August Turkey’s gold exports switched sharply to the UAE, with almost $2 billion in sales, making the country Turkey’s leading export destination for the month - a more than eightfold increase on the month before.
Basci said his expectations about Turkey’s growing trade with the Middle East excluded gold sales.
His remarks also signal Ankara’s growing confidence in its own economic management, after the country managed to bring growth down from unsustainable levels without a recession.
“We have shown the first successful example of doing that in Turkish history,” he said.
As a result, he said, Turkey’s $800 billion economy was a different case from other emerging markets, which have slowed in recent months.
He added that the extraordinary global liquidity unleashed to deal with the financial crisis enabled the country to run a current account deficit of 7 percent of GDP, although its longer term goal was to reduce the level to 5 percent.
He also emphasized his goal of bringing inflation down to 5 percent, compared to about 9 percent now, which he said would allow long term domestic capital markets to develop and diminish Turkish companies’ reliance on foreign lenders.
However, at a meeting on Wednesday launching the central bank’s inflation report, several analysts questioned the bank’s ability to reach its inflation goals in a growing economy.
In a note titled “Wishful thinking or what?”, Burcu Unuvar of Is Investment noted that the bank on Wednesday revised its inflation expectation this year to 7.4 percent, up from 6.2 percent, owing to higher than expected energy prices, while it forecast only a “mild recovery” in domestic demand for the last quarter of the year.
She described the bank as “aggressively hopeful” in its inflation and growth expectations for next year.
(Source: Financial Times)
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