The ongoing euro zone crisis has meant exporters in Turkey have continued to seek new markets away from the continent and Turkey's Central Bank Governor Erdem Basci told CNBC that Iraq is likely to replace Germany as its number one export market by the end of the year.
"Europe has been our main major trading partner. As of 2010 we had 60 percent of our exports heading to Europe but now there has been a big effort to diversify our markets," Basci said.
Iraq has already replaced Italy, which was once the second biggest receiver of Turkish goods, according to Basci. Around 30 percent of the Turkey's exports currently go to Iraq and that's likely to rise.
"Probably this year Iraq is going to replace Germany which has been our number one exports destination," he said. "Iraq will probably become number one by the end of next year."
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Turkish exports to Iraq rose to $10.83 billion in 2012 from $8.3 billion a year earlier, according to Reuters, while exports to Germany fell slightly to $13.13 billion from $13.95 billion.