Turkey Exports to EU 10-1-25

Specific 2025 forecasts for total Turkey exports to the EU are not available, but the overall outlook suggests a widening trade deficit with the EU if modernization efforts are limited, with a potential 50% cut in the deficit to -€8.5 billion by 2025 under a "full modernization" scenario for the Customs Union. Key export sectors to the EU likely include automobiles, apparel, and chemicals, benefiting from ongoing economic growth in Turkey and potential benefits from a modernizing Customs Union and Turkey's role in European energy markets.  

Factors Influencing Turkey's Exports to the EU

·       Modernization of the Customs Union: 

Instituting full modernization could significantly increase export competitiveness and cut Turkey's trade deficit with the EU, with estimates suggesting a reduction from -€20 billion to -€8.5 billion by 2025 under a fully modernized scenario. 

·       Energy Security: 

Turkey is positioned to become a more significant energy exporter to the EU in 2025, with infrastructure projects and energy mediation efforts potentially providing new leverage and export opportunities for Turkey. 

·       Sectoral Performance: 

Major export sectors like automobiles, apparel, and chemicals are key to Turkey's performance in EU markets, with growth in these areas potentially boosted by broader economic growth in Turkey and initiatives like modernizing the Customs Union. 

·       Economic Growth & Competition: 

Turkey's economy is expected to grow, driven partly by more favorable financial conditions, but faces increased competition in export markets and risks from political tensions and global market volatility. 

Challenges and Risks

Trade Imbalance: Without modernization, Turkey's trade imbalance with the EU is projected to widen by 2025, driven by increasing imports into Turkey. 

 Political Tensions and Market Volatility: Political instability and volatile global financial markets could negatively impact Turkey's export growth and overall economic stability. 

Limited Fiscal Space: Turkey faces challenges in terms of limited fiscal space, which can impact its ability to support economic growth and export activities. 

In the first five months of 2025, the European Union (EU) accounted for 43.5% of Turkey's total exports. Turkey's merchandise exports totaled $269.4 billion in the 12 months ending July 2025. While specific forecasts for the total value of Turkey's exports to the EU in 2025 were not found, the European Bank for Reconstruction and Development (EBRD) recently raised its forecast for Turkey's overall economic growth to 3.1% in 2025, up from its previous projection of 2.8%. 

Trade Relations and Forecast Context

·       The relationship between Turkey and the EU remains crucial for trade, with bilateral trade reaching €210 billion in 2024.

·       Modernization of the existing Customs Union between Turkey and the EU could significantly enhance trade efficiency and competitiveness.

·       Despite recent dialogue and efforts to eliminate trade barriers, Turkey's EU accession process remains frozen due to concerns over democratic standards and the rule of law.

·       The EBRD's updated forecast highlights the importance of easing financial conditions for supporting growth in Turkey. 

https://www.google.com/search?q=turkey+exports+to+eu+2025

Comments

The EU could greatly reduce Turkey’s Exports by choosing different Trading Partners.

Norb Leahy, Dunwoody GA Tea Party Leader