Whither Axis Shift: A Perspective from Turkey’s Foreign Trade
By Mehmet Babacan
The ongoing debate on Turkey’s so-called axis shift could well be analyzed through a foreign trade perspective. Therefore, our analysis will discuss Turkey’s changing direction, if any, in terms of its trade orientation, i.e. trading partners, relative trade shares and changes in import-export volumes, and domestic structural changes in trading goods with regards to the global shifts in world trade. Foreign trade by itself does not possess full explanatory power in defining country-wide, regional or global economic orientation while international investments and financial movements have equally significant importance in that regard. Still, it accounts for an important portion of defining a country’s economic performance and orientation. Whether measured by total trade volume or exports only, the role of foreign trade in growth is evident for many countries. Changing patterns or direction in Turkey’s exports and imports could therefore serve as a well-qualified parameter in order to assess the so-called shift in the country’s orientation. With that regards, a more competitive and stronger industrial sector along with an increasingly effective commercial service sector indicate an upgrade in the foreign trade structure of countries. A more diversified trading pattern both in terms of goods and destinations is also elusive for an open economy.
