ENCOURAGEMENT OF EXPORT IN THEORY AND PRACTICE WITH SPECIAL REFERENCE TO TURKEY'S EXPERIMENT DURING PLANNED PERIOD OF 1963-1986

This thesis which attempted to search for Turkey's experiment of encouragement of export within a comparative framev/ork of theoretical and practical aspects reached following conclusions.

Encouragement of export which is a public policy mechanism to intervene operation of national economy in foreign trade regulations has to be evaluated within the theoretical context of free international trade and protectionism contradiction which is a valid argument since XVth century. Initial systematic considerations concerning international economic relations were articulated by Merchantilist thinkers in XVth century preferring protectionist version of international trade. Protectionist and interventionist practises of Merchantilism created its antithesis in the second half of XVIIIth century which is known as Physiocracy. Physiocrats were the first liberals of the history of economic doctrines. Theory of Free Foreign Trade was put forwarded firstly by Physiocrats and developed by Adam Smith who is the founder of classical school with the introduction of the concept of "absolute superiority" in XVIIIth century and opposed by an American economist Alexander Hamilton with protectionist views. It should be noted herein that American economists remarkably favoured protectionism first representative of who was Alexander Hamilton and continued by H.C.Carey, S.Patten, W.F.Stolper and P.A.Samuelson. Second half of XVIIIth century witnessed both versions of international trade. While free foreign trade theory coincides with economic interests of France and England, protectionism was a necessary policy for the U.S.A.

Theoretical contradiction was accelerated especially in XIXth century while free international trade view was enriched with contributions of David Ricardo, Stuart Mili, Manchesterianism, Alfred Marshall and Vilfredo Pareto, protectionism was developed by Friedrich List, H.C.Carey and Simon Patten. Contribution of David Ricardo into free international trade theory was especially critical. He widened volume of international trade with the concept of "comparative superiority". Theory of Free International Trade was based especially upon Ricardo's view's. English economists developed free international trade view with classical and neo-classical analyses and German and American economists opposed to these . views with neo-merchantilist thinkings considering interests of their own national economies.

Theory of free international trade developed by Classical School was accepted by Neo-Classical School with minör adjustments. However, although classical theory of free foreign trade was based upon theory of labour value, neo-classical theory substituted new value theories.

Classical School was composed entirely of English economists. However, Neo-Classical School has not such an uniformity relating to nationalities. Strengthening of capitalism in the other West European countries and the U.S.A. after England has caused neo-classical school to be formed by economists from heterogeneous nationalities.

While evaluating theories of XXth c_entury, period till mid XXth century, 1950s, 1960s, 197ûs and 1980s were analyzed under separate headings.

Till mid XXth century Eli F.Heckscher, F.W.Taussig, G.Haberler and Bertil Ohlin contributed to the free international trade theory with neo-classical views. Contribution of Bertil Ohlin was especially critical. He introduced the concept of "factor proportions" into theory. Successive contributions of neo-classicals were based on the unchanged basis of the theory: international specialization of production through comparative advantages. On the other hand M.Manoliescu, O.M.Keynes, V/.F.Stolper and P.A.Samuelson voiced protectionist views till mid XXth century. Rumanian economist M.Manoilescu was the first theorist defending protectionism for developing countries. Successive protectionist theories in 195ÛS were highly affected from M.Manoliescu.

Theories of 1950s were radical analyses concentrated upon the question of "why international trade harms to developing countries?". Theoretical resistanee against classical and neo-classical schools concerning free international trade had been voiced by neo-merehantilist theoreticians till 1950s. Neo-Merchantilist theoreticians -except M.Manoliescu - were critizing free international trade mechanisms and formulating protectionism in favour of their own developed countries. On the other hand, formulation of protectionist theories from the point of view of developing countries is coincided with post-war conditions in 1950s. Such theories were initially formulated by H.Singer, R.Prebisch and followed by R.Nurkse, G.Myrdal and J.Bhagwati. Though prior theories tried to explain how and why international trade works, these radical theorists tried to gîve meaningful answer to the question of "why international trade harms to developing countries?". Radical theorists introduced concept of "import substitution" into theory which may be defined as domestic market oriented industrialization in brief.

Theories of 1960s, which were based on factor of technology, modified the traditional basis of comparative advantage from factor density into the technological variable (technological density) and qualitative labour. Neo-Classical "Theory of Factor Proportions" developed by Heckscher and Ohlin had assumed labour factor to be homogeneous and technological knowledge to be identical for every country. Heterogeneous labour and technology had been completely neglected by this theory which are very real facts of economic life. These variables which were neglected by prior theoretical efforts were introduced into analysis with "The Theory of Neo-Technology" by D.B.Keesing, "The Theory of Technological Gap" by M.V.Posner, "The Theory of Production Cycles" by R.Vernon and "The Theory of Neo-Factor Proportions" by D.B.Keesing in 1960s. Import substitution policies implemented in 1950s and 1960s in developing countries also affected export activities in negative manner. Problems created by import substitution practises such as higher production costs which be'came a constant fact and relatedly decreasing economic performance of developing countries and high performance of some developing countries to export industrial products increasingly after mid 1960s caused neo classical theorists to formulate an antithesis of import substitution which is called as "Export Oriented Industrialization" in 1970s and 1980s and international foundations such as I.M.F., G.A.T.T., World Bank in which neo-classical theoreticians work, increasingly suggested this new strategy to developing countries. Export Oriented Industrialization was proposed as an alternative of import substitution claiming that it ensures rapid growth and solves problem of bottleneck of foreign exchange. Contrary to domestic oriented industrialization of "import substitution", "export oriented industrialization" was a preference for outv/ard oriented industrialization.

Second step in order to conceptualize encouragement of export phenomenon is to reveal endogenous characteristics of the subject considering practical implementation.

Conceptual framework of the subject is two folded: Concept of encouragement and concept of encouragement of export.

In regard to working system of economics, encouragement means to increase attractibility of certain business activities in order to force private entrepreneurs to do these activities. In other words, it is an intervening variable affecting spontaneous working of a national economy.

Such an intervening role is carried out by the State. State intervention into free market mechanisms aims at to affect and change resource allocation created by free market mechanisms. In general, state intervention will be carried out within a planned economic system and encouragement facilities will be used as the basic levers to ensure private sector organizations, to act within   the disciplinary framework of the plan. Encouragement facilities have to be thought as legal tools which make the plan applicable in the private sector. Encouragement policies are special measures of planning which are established in order to limit or orient private sector activities.

On the other hand, encouragement of export is one of the examples of state intervention into an economy which is based upon protectionism. It is a widely adopted choice for export promotion efforts. However, a paradoxical feature of encouragement of export has to be given clearly. In an economic model which implements export encouragement policies concepts of protectionism and free international trade exist simultaneously. While export oriented production is protected against domestic production, development of exports of a national economy through protective encouragement practises will integrate national economy to free international economic order. The aim of export encouragement policy is to   participate in free international trade operation within a   longer period by implementing protectionism in a short period.

Final step in building conceptual framework of encouragement of export is to classify tools of such a choice which make it applicable.

Tools for encouragement of export policy are classified under four categories. 1/ Trade Policy, 2/ Foreign Exchange Policy, 3/ State Assistance for Marketing, 4/ Miscellaneous incentives.

Trade Policy measures contain export subsidies which are necessary for compensating negative effect imposed on exports due to continuation of protectionism - although in gradual manner - implemented in import substitution period

Foreign Exchange Policy contains measures which prevent over-valuation of exchange rate which is a constant fact of import substitution. Over-valued exchange rate has a stimulative effect on imports and negative effect on exports.

State Assistance for Marketing contains service facilities given to exporters for an extensive marketing effort. Although trade policy measures are special to production - minimization of production costs - marketing policy measures are interested in sales of products, the costs of which are minimized by trade policy measures, to foreign markets.

Miscellaneous incentives contain various measures which cannot be classified in earlier categories.

Succeeding conceptual   characteristics of encouragement of export, an observation of the practical implementation process reveals fruitful results as well for a comprehensive understanding.

While searching for practical aspects of encouragement of export, countries were classified as developed versus developing countries. Because determining factor of various export encouragement measures is mostly the development level. Preferences between different kinds of export incentives will be affected by development level of a subj ect country.

Both of developed and developing countries give higher priority to encouragement of export measures. However the reasons behind these measures are different for these countries.

Most significant aspect of export incentives implemented by developed countries is marketing grants provided to exporters and followed by export credits and insurance. As opposed to developing countries fiscal incentives, such as tax rebates, tax reductions - exemptions and other tax related incentives are in lowest importance.

On the other hand, most significant aspect of export incentives implemented by developing countries is related to tax rebates and tax related exemptions. Although, the frequency of incentives related to "State Assistance for Marketing" is highest in developed countries, it is lowest in developing countries. 

Based upon theoretical and practical frameworks analyzed in earlier pages, results of the analysis of Turkey's experiment of encouragement of export policy during planned period of 1963-1986 are given as follows.

Systematic encouragement of export was initiated with the beginning of planned period in Turkey. Planning philosophy of the 1961 Constitution necessitated special mechanism for ensuring the operation of private sector activities to comply with plan's objectives: this special mechanism is named as "encouragement policy". 

Critical problem to be solved in early 1960s was to ensure rapid industrialization of Turkey. Regarding a meaningful solution to this problem, most promising way was seen as to increase foreign currency inputs through an increase in exports. Further, basic tool and mechanism to that end was given as encouragement of export policy by policy makers. Therefore encouragement of export policy was developed as consistent policy during planned period.

Based upon encouragement of export policy, statutes - laws, decrees, decrees in force of law - decided by politicians and policy outputs - communiques, declarations, circulars, regulations - of implementing agencies gradually began to be promulgated in Official Gazette since 1963 and so on. Therefore encouragement of export policy was decided and implemented through approximately seven hundred legal texts.

Turkey's experiment of encouragement of export policy during planned period of 1963-1986 was enlightened through analysis of the legal texts with comprehensive systems analytic paradigm (public policy analysis) which has emerged and proven its worth in organizing research on the various components of policy processes in the West.

Most developed way for analyzing various components of policy processes is known as policy systems paradigm. It is a generally accepted strategy of policy systems research in the West which concentrates upon the causes and consequences of public policies. Components of policy systems paradigm are social problem, policy formation, policy implementation and policy impacts. Focus of this paradigm is analysis of the components of any of a public policy. While social problem and policy formation constitute pre-policy processes, policy implementation and policy impacts constitute post-policy processes.

 Sources of a policy could be found out at a social problem which is defined as a deviation from social standard of a society. Gradually social problem is transferred into a social issue and that issue becomes subject of official (governmental) agenda. Therefore social problem will serve as a policy input which will be produced as a policy decision - policy output - by the government.

Policies - policy outputs - are decided by politicians - policy makers - in policy formation process. Public Policy may be defined as a response of a political system to forces brought to bear upon it from the environment or as an output of the political system in brief. Again public policy is whatever governments choose to do or not to do. Description and explanation of the causes and consequences of government activity is subject of public policy. Key factors of policy formation - decision making - process are politicians who take policy decisions in democratic societies. Within framework of subject thesis policy output has to be considered as a statute which could be defined as a fundamental policy decision to be implemented. A statute establishes the basic legal structure in which the politics of implementation take place. İn other words it is a backround, an input for policy implementation.

Policy formation process is in close relationship with "political penetrability". To the extent that political forces are independently relevant, we speak of the political penetrability" of the policy system. The political penetrability of policy making processes is inverse to the development level. İn other words the lower the socio-economic development means the higher the penetrability of political variables. Compared to the pattern in Western welfare states, there is a more obvious correlation between variance in policy "outputs" and "political" conditions in developing countries. To recapitulate, developing countries are seen as relatively politically penetrable, that is decision making systems are less constrained than in the West by socio-economic resources and more open to politically determined innovations. Policy implementation could be defined as the carrying out of a basic policy decision usually made in a statute, Policies formulated through statutes by decision makers who are on top in policy formation process are carried out by bureaucrats - implementing officials - who are on top and ready for command in policy implementation process through policy outputs. Therefore absolute and general statutes are transformed into concrete mechanisms of implementation. It is to be noted herein that literatüre of public policy analysis has been över emphasized upon policy formation process versus policy implementation process. Researches upon policy implementation are highly neglected. Very efficient policies could be formulated. However, while policies change in the implementation process on the one hand, questions of how can these policies be implemented and what facilitates implementation, to be satisfactorily answered on the other hand.

The concept of "administrative penetrability" will be given as a definition herein due to its close relationship with policy implementation process. It is devoted as the extent to which a statute or other policy output to be faithfully executed. Consistence of the policy outputs of implementing agencies with statutory objectives gives us administrative penetrabü ity. Administrative penetrability does not measure the extent to which a policy works (that is "social penetrability") but rather the extent to which it is given a fair shot. İt is positively related with level of economic development. Developing countries are "less administratively penetrable" than their industrialized or post-industrialized counterparts. Policy implementation is a very important topic in developing countries. Political institutions in developing countries have not developed satisfactorily and this gap was filled in by bureaucrats. Real bottleneck in developing countries is administrative impenetrability of decided policies, in other words bureaucratic resistance against policy decisions. Policy outputs of politicians in developing countries run into administrative barriers or at least are reshaped or changed substantially at the implementation stage, out of proportion to western experience. The administrative impenetrability of developing countries is the by-product of the "prematüre" evolution of large central bureaucracies in these countries.

Further, such an evaluation yields a control rather than a service orientation, relative to the western situation.

Latest stage of public policy analysis is overall evaluation of impacts of an implemented policy. Such an evaluation is done through applying researches and especially the quantitative researches upon observed policy consequences. Therefore success degree of a policy and its implementation could be found out.

Final penetrability concept of policy systems paradigm is "social penetrability". İt is the extent to which a policy "works". The social penetrability of policies is inverse with context's level of development; or rather programmatic goal attainment is positively correlated with basic need. Programs, once implemented, are more likely in a developing country to obtain their specific goals. This is in contrast to the common results of evaluation research in the West which frequently finds minimum direct, short-term positive program impact. Comparable programs would be likely to yield greater cost effectiveness in a developing country, where most indicators of social need are patently higher. As a function of more stark conditions of need, social penetrability of developing countries is seen as higher, that is amenable to treatment by services with a higher likelihood of marginal success, once delivered.

Succeeding the conceptualization of policy analysis, Turkey's experiment of encouragement of export policy during planned period of 1963-1986 was searched for in its policy components i.e. problem, policy formation, implementation, policy impacts through devoting special reference to legal texts of the policy choice. These legal texts were statutes -laws, decrees, decrees in force of law- which were decided by policy makers and policy outputs -communiques, declarations, circulars, regulations- which were decided by bureaucratic agencies, were promulgated in official Gazette, since 1963 and so on. Therefore encouragement of export policy was decided and implemented through approximately seven hundred legal texts.

The problem which motivated policy makers in early 1960s to decide upon encouragement of export policy choice was inefficiency of foreign currency inputs necessary for ensuring rapid industrialization objective of national economy.

Regarding a meaningful solution to this problem, most promising way for increasing foreign currency inputs was given as to increase exports. Further, basic tool and mechanism to that end was formulated as encouragement of export policy by policy makers. Therefore systematic encouragement of export policy was initiated and developed as consistent policy with the beginning of planned period in Turkey.

Closely relationship exists between encouragement and planning concepts. Planning philosophy of 1961 constitution was such that while the plan was obligatory instruction for public sector, it was only a useful guide for private sector. Public sector has to operate fully in compliance with the objectives of five year development plans and annual programs. There is no need for planning authority to develop and implement special mechanisms for forcing public sector institutions to coincide with the objectives of itself. Oppositely, planning activity has to develop special mechanism for ensuring the operation of private sector activities to comply with plan's objectives; this special mechanism is named as "Encouragement Policy".

Analysis of the policy formation process was five folded; legal texts (statutes), policy tools, policy tools as per year of initiation, political instability and policy objectives.

Regarding statutes, while the most general and absolute framework of the policy has been shaped by 24 laws which were formed at the level of Grand National Assembly, fundamental policy decisions of the policy should be nominated as decrees, considering 249 decrees which were formed at the level of Council of Ministers, Amongst statutes of policy formation process, lowest degree of promulgation was found in decrees in force of law with total 6 text, which were formed at the level of Council of Ministers. İn general totally 279 statutes were promulgated. Arithmetically, 11, 6 statutes were promulgated per year. Highest degrees for promulgation of statutes were seen in 1973 (24 statutes), 1980 (22 statutes), 1969 (19 statutes), and 1985 (19 statutes). Lowest degree was seen in 1963 with 2 statutes. General trend of promulgated statutes has fluctuations i.e. ups and downs. As per planned periods, IVth FYDP (70 statutes), 2nd FYDP (59 statutes) and 3rd FYDP (56 statutes) have the highest degrees.

Encouragement of export policy was handled through 31 types of tools the first of which was tax rebate which was initiated in 1963. These policy tools were classified under six categories;

1.      Trade Policy,

2.      Foreign Exchange Policy

3.      State Assistance For Marketing

4.      Encouragement of Exports of Special Nature

5.      Organization

6.      Other İncentives

Subventions of direct and indirect nature were evaluated within Trade Policy measures. While resource utilization support premium and additional payments from support (price stabilization fund constitute direct subvention, tax rebate and exemption, input subvention, export credits constituted indirect subvention. Tax Rebate and Exemption was divided as tax rebate and tax exemption/exception. Under tax exemption/exception below incentives were analyzed; exemption from customs tax and other taxes imposed on imports (customs exemption), production tax exemption, and corporation income tax exemption. Under input subvention below incentives were analyzed; customs exemption for raw materials, auxiliary materials and packaging materials in special cases (temporary admission and repayment in foreign currency of unguaranteed trade arrears through fason production), funds exemption and exception, export encouragement of forestry industry products. Finally, under export credits, export credit, seller credit and financial leasing incentives were analyzed. İn general 14 types of export incentives were reviewed in Trade Policy measures.

Foreign Exchange Policy measures were classified as devaluation, foreign exchange allocation, foreign exchange transfer priority and deduction of foreign exchange corresponding to export.

State Assistance for Marketing measures were classified as utilization right of a certain amount of net foreign exchange incomes brought into a country for marketing expenses,    foreign trade capital companies, export promotion research center, state assistance for participation into foreign fairs and rewards given to successful exporters.

Encouragement of Exports of Special Nature measures were classified as sales and deliveries regarded as exports, re-export, transit trade and credited export.

Organizationai measures were ciassified as tax rebate commission, bureau for promotion and encouragement of investments and exports, free trade zones directorate and the money and credit board.

Finally, other incentives were classified as liberal and elastic foreign exchanges, foreign capital policy, free trade zones, freight premium for long distance shipping.

Analysis of policy tools as per year of initiation revealed that 1st FYDP (1963-1967) and IVth FYDP (1979-1983) are the most significant periods regarding formulation of export incentives as a policy. During each of these periods 7 incentives were initiated. Lowest frequency was seen in 3rd FYDP (1973-1977) with only one incentive. On the other hand, irrespective of planned periods, 1971-1979 periods witnessed again lowest frequency with only one export incentive initiated in 1977.

Close relationship between political instability and encouragement of export policy is an obvious fact. The higher the degree of political instability means the higher the degree of diversification of encouragement at export policy. The highest degree of political instability during planned period of 1963-1986 is verified with 18 governmental changes within 24 years. Approximately in every 1, 3 year a new government was established. The highest degree of political instability was seen during 3rd FYDP (1973-1977) with 6 governmental changes. Till the end of 3rd FYDP trend for governmental change constantly increased.

Meaning of governmental changes from the point of view of export encouragement policy is such that encouragement policy developed under instable political framework which created higher degree of variation and instability upon subject policy. İnstability of encouragement of export policy which is a by-product of instable political conditions could be verified with highest number of 279 promulgated statutes i.e. ups and downs. Further significant evidence regarding relation between governmental changes and encouragement of export policy should be found in 1971. 1979 period with 11 governmental changes. However, effect of such a higher degree of political instability upon encouragement of export policy is such that the only one type of export incentive was initiated during that period. İn other words only one export incentive could be politically decided within 9 years. Therefore highest political instability and lowest development (initiation) of export incentives existed, simultaneously. As a conclusion, the "political instability" of policy making processes negatively affected development of encouragement of export policy.

Latest aspect of the analysis of the policy formation process was policy objectives. Main objectives of encouragement of export policy was to reach export figures of five year development plans and relative annual programs, to increase export figures year by year, to increase rate of exports within imports and finally to increase rate of industrial exports

Within product composition of exports. These objectives were formulated basicaliy in five year development plans as export projections and also re-examined and modified, if necessary, in the annual programs.

Analysis of the Policy İmplementation process was two folded; legal texts -policy outputs- and implementation of the policy tools.

Implementation of export encouragement policy -the framework of which was drawn by policy makers- by bureaucrats has been realized through policy outputs i.e. communiques, declarations, circulars and regulations of implementing agencies. Fundamental and most frequent policy outputs should be nominated as communiques considering 334 numbers of promulgated communiques within total $11 policy outputs of bureaucratic agencies. Therefore while decrees had been the fundamental policy decisions of policy formation process, communiques served similar function for policy implementation process. Remaining policy outputs i.e. Declarations, circulars and regulations were exceptional and had lowest frequency considering total 77 legal documents within total 411 policy outputs. İn detail, totally 35 regulations, 34 circulars and 8 declarations were promulgated. Declarations were the most searce type of policy outputs of implementing agencies. İn general, totally 411 policy outputs were promulgated. Arithmetically 17, 1 policy outputs were promulgated per year. Highest degrees for promulgation of policy outputs were seen in 1980 (38 policy outputs), 1982 (31 policy outputs), 1986 (30 policy outputs), 1973 (29 policy outputs), 1975 (25 policy outputs), 1984 (24 policy outputs). Lowest degrees were seen in 1963 (1 policy output), 1964 (2 policy outputs), 1966 (2 policy outputs), 1967 (4 policy outputs). As per planned periods IVth FYDP (125 policy outputs),    3rd FYDP (119 policy outputs) had the highest degrees.

Lowest degree of frequency was seen in 1 st FYDP with 15 policy outputs.

Encouragement of export policy was handled through implementation of policy tools which were designed by policy makers. Analysis of implementations process was done by using quantitative data special to policy incentives.

As a final step, encouragement of export policy was evaluated regarding the impacts of policy formation and policy implementation processes. Critical questions herein to be analyzed were whether or not export figures of Turkey increased and, if so, what the basic reason was; intervening policy or other variables. Therefore success degree of the policy and its implementation should be found out.

Impact analysis was three folded; analysis of the legal texts of encouragement of export policy as being the fundamental source of such policy, analysis of the realized export figures in detail and lately the cost of encouragement of export policy.

Analysis of the legal texts was two folded; regarding policy tools and statistical densities of legal texts. These analyses were done on the basis of years and planned periods.

Analysis of the legal texts regarding policy tools revealed relative results as follows;

Highest frequency of promulgation of legal texts was seen in tax rebate with 263 legal texts. Tax rebate was followed by export credit with 158 legal texts. While legal texts of tax rebate constituted 24,44 per cent of total 1076 legal texts, legal texts of export credit constituted 14.68 per cent of that total legal texts of tax rebate, export credit and foreign exchange allocation constituted 48,59 per cent. Further, legal texts of tax rebate, export credit, foreign exchange allocation, sales and deliveries regarded as exports, temporary admission, export encouragement of forestry industry products, tax duty and fee exemption, devaluation, foreign trade corporate companies constituted 76,82 per cent of total 1076 legal texts. Therefore while legal texts of 2 types of export incentives within total 25 type of export incentives constituted 39.12 per cent, 3 type of export incentives constituted 48.59 per cent and 9 type of export incentives constituted 76.82 per cent Clear meaning of those percentages is that legal texts were concentrated upon fewer number of export incentives. On the other hand, highest frequencies of promulgation of legal texts within export incentives themselves as per years and planned periods were separately revealed with tables. Analysis regarding statistical densities of legal texts revealed relative results as follows;

Totally 690 legal texts were promulgated regarding encouragement of export policy. İn average, approximately 29 legal texts were promulgated per month.

Highest frequencies of promulgation were seen in 1980 with 60 legal texts, in 1973 with 53 legal texts, in 1986 with 45 legal texts in 1982 with 43 legal texts. Legman texts of 8 years (1980, 1973, 1986, 1982, 1985, 1969, 1935, 1984) constituted 50, 69 per cent of total 690 legal texts of total 24 years. On the other hand, total legal texts of 1980-1986 years constituted 41, 57 per cent. Meaning of these higher densities was such that half of total legal texts were concentrated upon 2/3 of total 24 years and post 1980 period showed a critical increase. On the whole, general trend is full of ups and downs. However, steady increases were seen between 1963-1969, 1978-1980, 1983-1986 years. As per planned periods IVth FYDP (1979-1983J had the highest frequency. General trend steadily increased since the beginning of 1st FYDP.

Analysis of the realized export figures was four folded; realization of export projections of five year development plans, yearly increases of exports, rate of exports, within imports and finally product composition of exports. Most successful years with respect to realization programmes were 1973 with 146,3 per cent, 1981 with 134,4 per cent and 1972 with 128,2 per cent of programme realization. On the other hand, unsuccessful years were 1968-1970, 1975-1980 and 1982. Highest rates of failure were seen in 1975 and 1977 with 70.1 per cent of programme realization. Successful years with respect to programme realization were 1963-1967, 1971-1974 and 1981 .As per planned periods, rate of programme realization was 107, 9 per cent during 1 st FYDP, 103, 4 per cent during 2nd FYDP and 97, 8 per cent during 3rd FYDP.

Highest yearly increases of exports were seen in 1981 with 61, 6 per cent, in 1973 with 48, 8 per cent and in 1976 with 39, 9 per cent yearly increase. On the other hand, unsuccessful years were 1977 with -10,5 per cent, 1975 with -8,5 per cent, 1968 with -5 per cent, 1963 with -3,5 per cent, 1979 with -1,2 per cent and 1983 with -0,3 per cent decrease. As per planned periods, highest rate of average increase was seen in IVth FYDP with 22, 2 per cent. Average increases steadily increased since the beginning of 1st FYDP.

Highest rates of exports within imports were seen in 1965 with 81 per cent, in 1964 with 76, 5 per cent and in 1967 with 76, 3 per cent. On the other hand, lowest rates were seen in 1975 with 29, 7 per cent, in 1977 with 30, 2 per cent. On the other hand, average rate was 57, 9 per cent. These figures show that imports could not be compensated by exports at any of a year during planned period. İn other words, trade deficits continually existed in Turkish Economy. As per planned periods, highest rate of exports within imports was seen in 1st FYDP with 71, 1 per cent and succeeding planned periods could not reach that record again. Lowest rate was seen in 3rd FYDP with 40, 8 per cent.

Rate of industrial exports within total product composition of exports steadily increased since 1979 and reached up to 75, 3 per cent in 1985. Highest rates of industrial exports were 75,3 per cent in 1985, 72,1 per cent in 1984, 63,9 per cent in 1983, and 59,7 per cent in 1982. On the other hand, lowest rates of industrial exports were seen in 1968 with 13, 2 per cent, in 1967 with 15, 5 per cent and in 1970 with 17 per cent. As a whole, average rate of industrial exports within total exports was 34 per cent. As per planned periods, highest rate was seen in IVth FYDP with 48, 6 per cent. Lowest rate was seen in 1st FYDP with 18, 7 per cent. Since the beginning of 1st FYDP subject rate steadily increased.

As a final point, the cost of encouragement of export policy to the state was seen as a critically high with subsidy rate of 46, 6 per cent per one dollar export. Such a high rate of real cost has to be delicately considered while evaluating success degree and opportunity costs of export policy.