Turkey’s 12-month rolling current account balance moved into surplus in June 2019 – for the first time since November 2011 – and widened to +USD5.9bn in September. This reflects the strong economic rebalancing in the wake of the 2018/2019 currency crisis (the TRY lost on average -33% vs. the USD in 2018 and -17% in 2019 YTD). In the first three quarters of 2019, exports of goods and services gained +USD10bn y/y while imports lost
-USD23bn. However, we do not expect further significant export gains in 2020 (just +USD0.1bn) as the rebalancing should gradually fade next year. Instead Turkish exporters will be affected by lower external demand from the rest of the world. Notably exports to the EU and China will decline while shipments to the Gulf countries will see a moderate uptick. With regard to sectors, transport services (-USD2bn) as well as machinery & equipment, household equipment and chemicals (each about -USD1bn) will be the main losers, while metals (+USD2bn), textiles (+USD2bn) and energy (+USD1bn) should experience export gains in 2020.