Yesterday, the balance of payments statistics for July were published.
Accordingly, we had a foreign trade deficit of 50.4 billion dollars in the January-July period.
In other words, we bought 50.4 billion dollars more products from abroad than we sold.
However, since we have a net income of 20 billion dollars from services, the total current account deficit account has given a deficit of 36.6 billion dollars.
This is a current account deficit that Turkey, which is experiencing a shortage of foreign currency, cannot sustain for a long time.
The reason why the current account deficit, which was 13.7 billion dollars in the January-July period last year, has increased so much this year is the rising imported energy prices.
In the January-July period last year, energy imports were 18.3 billion dollars, this year it increased to 46.6 billion dollars, so we paid 28 billion dollars more for energy this year than last year.
Well, with what money did we pay this $36.6 billion current account deficit?
We paid $24.3 billion of this current account deficit with money defined as “net errors and omissions” after entering Turkey.
The net source of errors and omissions is money whose source is not certain.
It is seen that the expressions “error”, “incompleteness” and “unknown source” in this sentence immediately connotations of “black money”, “informality” and “illegality”.
But this is not true.
I would say “don’t” make these associations to those who knowingly and willingly want to create a negative perception about Turkey, even though they know the truth.
Explaining the net error and omissions item as informality or illegality is “absolutely” not an accurate definition.
I will leave the definitions aside and try to explain the subject with examples.
Let’s assume that 56 million tourists will come to Turkey this year. According to the surveys, each tourist coming to Turkey spends an average of 650 dollars.
According to this survey, Turkey’s total tourism revenues would be 36.4 billion dollars. (56M*650)
So what happens if tourists spend $950 instead of $650?
Total revenue (56 M*950) rises to $53.2 billion.
As a result, tourism revenues are 16.8 billion dollars above surveys and expectations. (53.2 – 36.4) This is what we call “clear errors and omissions”.
I wish the authorities had a timely and accurate method of conducting a survey, and such question marks would not arise in their minds, but this is not possible anywhere in the world.
OWNERS OF NET ERRORS AND DEFICIENCIES
It is clear who the owners of these foreign currency amounts, which we define as net errors and omissions, are deposited in banks, that is, their clear identities.
Account holders are all confident that they have earned these funds through legal means and a trade that is in line with the nature of their business.
Otherwise, these funds cannot be deposited in the accounts of Turkish banks abroad. Because banks in Turkey and abroad certainly do not accept money that may be black money, or if they do, they are responsible for notifying organizations such as MASAK.
For example, there may be differences, for any reason, between the actual price of an exported good and the declared export price; knowingly and willfully or by mistake.
In imports, for any reason, less price may be paid for imported products, or vice versa, more.
Likewise, the balance sheet dates of the declared sales period and the collection period may be different, and such a periodicity error may cause net errors and omissions calculations.
As a result, net errors and omissions can be calculated because money coming from or going abroad is officially recorded; otherwise it could not be calculated.
According to the World Bank data, it is useful to examine the data of some countries that have net errors and omissions surplus and deficit in 2021; perhaps minds will become a little clearer.
Those who give clear errors and omissions. (Billion Dollars)
1) America: 137
2) Germany: 60
3) England: 25
4) Spain: 12
5) Turkey: 9
Those who give clear errors and omissions:
1) China: -167
2) France: -52
4) Italy: -19
It is normal for such question marks to arise and multiply in a country whose institutions and traditions are being worn out day by day.