Monetary policies of The Central Bank of the Republic of Turkey and their effects on foreign trade (after 2001)

The aim of this thesis is to consider the effect of the monetary policies of the Central Bank of the Republic of Turkey (CBRT) on foreign trade. The study was limited to the period after 2001. Within the framework of this aim and limitation, the study is divided into three sections. In the first section, monetary policies, objectives, and tools of the CBRT were discussed. First of all, the development of the CBRT was mentioned, and the monetary policies before 2001 were briefly explained. Afterward, monetary policies in the period after 2001 were presented in detail. Here, the instruments in monetary policies and the objectives of the monetary policy of the CBRT were explained. Finally, in this section, monetary policies of the CBRT after 2001 have been examined within the framework of purpose-result and cause-effect relations. The second section is the section that dealt with foreign trade in Turkey. Depending on the limitations of the study, change and development of foreign trade in Turkey are explained in two sub-sections, as before and after 2001. Foreign trade in terms of Incoterms and payment methods, non-tariff barriers and their applications, structural problems in the foreign trade of Turkey and their disadvantages were discussed in this section. The third section was the section, indicating the primary aim of the thesis and supported by the first two sections, where the effects of monetary policies of the CBRT on foreign trade were explained. Here, the current situation in developed and developing economies was evaluated using the studies conducted in the literature. Subsequently, the effects of the monetary policies of the CBRT on foreign trade were analyzed in two periods: 2001-2008 and 2008-2018. The adoption of the floating exchange rate system in the post-2000 period was a positive step towards the development of international trade and was influential in the stabilization of the exchange rate with the inflation targeting applications. This situation contributed to the development of exportation on the one hand and increased the capital inflow to our country on the other hand. The Central Bank tends to fill the financial blanks created by the export items that are dependent on investment and industrial goods imports by providing controlled interventions for liquidity and interest rates depending on the developments in the markets.