Online shopping from abroad doubles

High costs in Turkey have made shopping from abroad more advantageous. According to BKM data, online shopping transactions made from abroad with domestic cards in the first 11 months of 2023 increased by 138 percent compared to the same period of the previous year, rising from 42 billion TL to 102 billion TL. In the same period, the growth rate of transactions made from within Turkey remained at 40 percent.

Technological developments that accelerated after the pandemic have also reflected on the way trade is conducted. While rising costs worldwide have accelerated efficiency-focused efforts, online shopping has continued its growth with increasing momentum during this period. When the decrease in logistics costs was added to this development, not only was growth affected, but borders between countries also disappeared in a sense. So much so that high costs and taxes in some countries have made procurement from abroad easier and less costly. Turkey has emerged as one of these countries, and with Turkey remaining expensive compared to abroad on a Euro/dollar basis, online shopping from abroad has literally exploded. According to Interbank Card Center (BKM) data, the number of card payment transactions made via the internet from abroad with domestic cards in the January-November 2023 period increased by 36 percent, reaching 232 million from 170 million.

It had been made difficult with two steps

Again, according to BKM data, card payment transactions made via the internet from abroad with domestic cards in the January-November 2023 period increased by 138 percent compared to the same period of the previous year, rising from 43 billion TL to 102 billion TL. These developments occurred despite regulations in Turkey that made online trade from abroad more difficult. In 2022, while the customs duty on purchases made via the internet from outside EU countries was increased from 20 percent to 30 percent, the limit for duty-free shopping within this scope was reduced from 1,500 Euros to 150 Euros, narrowing the scope. The tax rate of 18 percent on imports from the EU was not changed. Despite all these developments, the increase in online trade from abroad with domestic cards continued, and the share, which was 4.5 percent of the total in 2022, approached the 5 percent threshold as of November 2023. Looking at the details of the expenditures, the service sector expenditures ranked first with 42 billion TL, followed by travel agencies with 16 billion TL and electronic goods shopping with 5.2 billion TL.

"E-commerce is now a global game"

Emre Ekmekçi, Vice President of the Electronic Commerce Operators Association (ETİD), stated that products coming from abroad arrive in Turkey after both logistics and taxes are paid, pointing out that Turkey does not suffer any loss in this sense. Ekmekçi said, "Logistics systems have now become very fast. This situation makes both our sales increase and online shopping from abroad attractive. I wish the balance had been established in reverse here. As e-commerce operators, we are currently working on how to reverse this balance by using the logistics advantage and how to sell Turkish products abroad. The rapid growth of the figures also shows that e-commerce is a global game." What is the reason why online foreign trade does not develop against Turkey despite the progress made in many areas? Ekmekçi explained this situation as follows: "There is a lot of variety abroad, and secondly, products that are not available in Turkey can also be purchased. Thirdly, despite tax and logistics costs, it can be cheaper abroad for many products."

"We need to get ahead in this race"

Sinan Öncel, President of the United Brands Association (BMD), stated that this situation has become a significant advantage for the consumer and said, "If you say 'let us sell abroad but let us not buy,' then other countries will put borders on you. In line with the principle of reciprocity in trade, we need to be fast, renew both our e-commerce and logistics infrastructure, and offer attractive opportunities to both domestic and foreign customers to get ahead in this race. In terms of retail, we need to open our brand diversity to abroad," he said.

INTERMEDIARY COMPANIES STEP IN

Another executive of an important trade association pointed out that borders in online trade have disappeared in the world. Explaining that intermediary companies from abroad are being formed in this regard, the industry representative said, "The Gulf, Azerbaijan, Europe, now Eastern Europe is starting. A cargo company says, 'Do your shopping, send the product to my warehouse in Istanbul. I will bring that product to you. If you want, I can also shop on your behalf.' The fact that our local online trade players are opening up to abroad also plays an important role in this. This is the reason for the increase in online shopping from Turkey. Currently, Turkey is relatively more expensive. There is a development in favor of abroad, but this trend can be reversed with the breakthroughs of private sector players. However, until then, no obstacles should be placed on trade. Because when we impose a tax, the other side does too, and in the end, the consumer suffers," he said.

A foreign trade deficit will also occur in online at the end of the year

So, what kind of trend did online spending made from Turkey via the internet with foreign cards follow? Statistics show that despite the exchange rate increasing by over 50 percent last year, Turkey has lost its former appeal in both online and offline shopping. According to BKM data, while online shopping from abroad increased by 138 percent to 102 billion TL, online spending from Turkey increased by 40 percent to 105 billion TL. At the end of the year, it is expected that online spending made from abroad with domestic cards will exceed online spending made from within the country with foreign cards, and a foreign trade deficit will be recorded in this area.

News Source: 12punto