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(Trade Terms)

The terms of foreign trade are calculated by comparing export prices to import prices, indicating how many units of imported goods can be purchased for each unit of export. A trade term above 100 signifies that the export prices of the goods involved are higher than the import prices. This indicator, calculated with index numbers, is based on the import and export prices of a specific year, analyzing changes from that year. The Turkish Statistical Institute (TÜİK) announces trade terms through monthly bulletins. An improvement in trade terms allows for the purchase of more imported goods with the same amount of exported goods. If these terms deteriorate, it becomes necessary to export more for the same quantity of imports, resulting in a greater outflow of resources to foreign countries. During recession periods in industrialized nations, there may be opportunities to purchase imported goods at lower prices. The stagnation in these countries’ domestic markets compels them to reduce the prices of goods they export. In times of significant price fluctuations in global markets, it is essential to examine the foreign trade price and quantity indices published by TÜİK. Quantity indices provide a clearer understanding of the status of exports and imports.