Identifying Sophisticated Product Groups to Focus on at the Regional Level in Türkiye: A Perspective for Sustainable Current Account Balance and Economic Growth

This study aims to address Türkiye's persistent current account deficit and regional imbalances by considering the competitiveness dynamics of the economy. The study seeks to identify sophisticated product groups that Türkiye's 26 economic regions could focus on to achieve sustainable economic growth without generating high current account deficits. For this purpose, the sophistication of regional exports was comparatively analyzed using the EXPY method. Subsequently, the PRODY index was used to identify sophisticated product groups, and the Revealed Symmetric Comparative Advantage (RSCA) index was used to identify product groups in which regions have an export advantage. The analyses revealed that the level of sophistication of regional exports is heterogeneous. For example, it was found that regions such as TR41, TR42, TR51, TR52, and TR83 stand out positively in terms of export sophistication, while regions such as TR32, TR90, TRB1, TRB2, and TRC3 lag behind. Furthermore, the study identified many sophisticated product groups in which each region has a production and export advantage. This finding indicates that Türkiye has significant potential to achieve a more sophisticated production and export structure. In this context, the implementation of regional policies aimed at increasing the export of these sophisticated products for each region would contribute to increasing the sophistication of Türkiye's overall exports.