EXPORT CLIMATE INDEX IN THE SHADOW OF THE COVID-19 PANDEMIC: IS IT A RELIABLE INDICATOR FOR EXPORT?

Abstract

COVID-19 pandemic is one of the biggest crises of this century. The uninterrupted continuation of economic activities and especially foreign trade is crucial to meet the needs, avoid supply problems, and not deepen the effects of the epidemic. In this study, it is aimed to examine the effects of the export climate, which allows measuring the demand conditions of the trading countries published by the Istanbul Chamber of Industry, on exports. It is found that in the first period of the epidemic, in March-April 2020, the export climate and foreign trade were negatively affected, but afterwards, with the normalization process, there was a positive change occurred. In the application part of the study, the effect of export climate on exports was examined using time series analysis techniques in the 2018 April-2021 February period. As a result of the analyzes taking into account the real effective exchange rate and the effects of the COVID-19 pandemic period, it is found that the export climate had a positive effect on exports. In line with these results, it can be argued that the export climate index is a leading indicator in foreign trade and that policies that take into account the export climate in the country's economy can contribute to foreign trade performance.