TEPAV reported that Turkiye is one of the six leading economies in the world in terms of product diversity and the leading country in the world in terms of market diversity.
TEPAV examined the development of Turkiye’s shares in global trade and the diversity of its exports.
Accordingly, analyzes measuring diversity by taking into account the competitiveness dimension showed that Turkiye is one of the six leading economies in the world in terms of product diversity and the leading country in the world in terms of market diversity.
The evaluation note titled “Turkiye’s Foreign Trade Performance: Diversity of Exports” prepared by TEPAV Development Program Director Huseyin Ekrem Cunedioglu was published. The study is the first of a series of notes on Turkiye’s foreign trade performance.
In the evaluation note the following was stated, “The analysis shows that Turkiye is among the leading countries in the world in terms of product and market diversity in exports. Its high diversification structure makes it easier for Turkiye to quickly recover its exports in times of global crisis and reduces its vulnerability to sector or market shocks. On the other hand, it is also considered that there should be no further delay in utilizing the country’s diversity advantage with a correct specialization strategy in order to increase the contribution of foreign trade to growth under production capacity constraints.”
DIVERSITY OF EXPORT
In TEPAV’s study, the BACI database, published by the French think tank CEPII and presenting the trade flows of 226 countries in approximately 5000 products, was used.
In the study, where product diversity was discussed through three indicators and market diversity through two indicators, all indicators showed that Turkiye’s export diversity has been on an increasing trend for the last twenty years.
When product and market diversity are evaluated together, it is noteworthy that Turkiye differs from all other countries, including China and India, in terms of the current state and change of diversity. Additionally, the note said about Turkiye’s global trade expansion:
“Turkiye, which exported to 17.1% of 725,517 country-product pairs in 2002 and with this performance, is the eighteenth country with the highest spread in global trade. Turkiye increased its spread rate from 2002 to 2022 by 2.33 times, that is, to 39.74%, and rose to seventh place in 2022 according to the spread index.”
In the conclusion of the note, it is stated that Turkiye’s high product diversity actually offers a great opportunity to specialize in new products that are more likely to increase its growth potential, but although it has had this potential for a long time, the country has not yet entered a specialization path.
Source: Patronlardunyasi / Prepared by Irem Yildiz