Skyrocketing current trade deficit and a low domestic savings ratio in the growing economy raise concerns about the country’s dependency on import products and booming demand, according to professionals.

The trade deficit was $10.4 billion in September, the biggest gap recorded, compared with $6.7 billion on September last year and $8.2 billion the previous month, according to figures published by Turkey’s Statistical Institute (TÜİK). Measures taken by Turkey’s Central Bank have thus failed to reduce the trade gap in September, an economist told the Hürriyet Daily News.

Turkey might have already experienced the “peak” in its trade deficit by last month, and it might take a few months for the Central Bank’s steps to show their effect on the economy, Erol Katıcıoğlu, a professor at Istanbul Bilgi University, told the Daily News yesterday.

“Still, the Bank might be pushing the envelope regarding its moves between restrictive and expansionary monetary policies, he added.

More expensive imports

The Turkish Lira’s recent depreciation “might be seen as [a chance] to put the brake on booming consumption and imports in Turkey,” said Katırcıoğlu, adding that imports had not slowed down, although they have become more expensive, with the lira’s depreciation.

The trade gap grew faster than expected by markets, which estimated the deficit to be around $8.5 billion in September, mainly due to a considerable rise in imports, whichtotaled $21 billion in September – $2 billion higher than the markets’ expectation – thus marking an increase of 35 percent compared to the same month last year. Meanwhile, exports accrued in line with expectations at $10.8 billion. The gap for the first nine months of 2011 was $82 billion.

“It is obvious that the annual trade deficit will be way beyond expectations,” said Erdal Sağlam, an Istanbul-based economist.

Demand has not been reduced yet in line with expectations from the economy administration, he said, adding that low saving ratios in a country with strong demand could trigger further problems down the line.

“We expect to see an economic slowdown starting from November thanks to the Central Bank’s new policy that employs the interest rate corridor to increase overall interest rates in the economy,” he said in a statement emailed yesterday.

Domestic savings

Structural problems are still preventing Turkey from forging a sustainable economy, said Erdoğan Alkin, a Daily News columnist. The savings ratio problem still remains a key issue ahead of the country, mainly stemming from income injustice and a failing tax policy, he said. The ratio of domestic saving to gross domestic product in Turkey is currently at record-low levels and is expected to go down to 12 percent by yearend, compared to 12.6 pct it was in 2010.
source: hurriyet daily news

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According to the Foreign Trade Expectations Survey conducted by the Foreign Trade Undersecretariat (DTM) the Expectation Index both for exports and imports are up for the second quarter of this year. The Export Expectation index has gone up by 20.2 points, while the import expectation index climbed by 15.4 points quarter-on-quarter. Foreign Trade Minister Zafer Çağlayan shared the findings of the survey with the media on Monday in Ankara.

According to Çağlayan, the study showed that the first quarter’s export expectation index of 122.7 increased to 142.9 for the second quarter this year. Any value above, below or equal to 100 represents an upward expectation, lower expectation and neutral expectation, respectively. The export expectations for the coming three months of May, June and July, export orders expectations, the current level of registered export orders and the level of export orders in the previous quarter account for the upward value of the index, Çağlayan also said.

On a regional basis, in the second quarter of 2011, the export expectations for the Middle East and North Africa (MENA) went down, while the export expectation for all other regions have strongly gone up. “However, the situation in Egypt and Tunisia is going back to normal quickly, and once the situation in Libya is resolved the Turkish investments in this country will rebound strongly, too,” Çağlayan explained. When it comes to target markets, Germany takes the lead in export expectations followed by the US, Russia and France.

Çağlayan told the media that the current registered export orders display seasonal normality, which is a sign of a complete recovery from the global crisis. On the other hand, the import expectation index of 113.7 went up to 129.1 in the second quarter of the current year. Import expectations from all regions are up again with the exception of African countries, albeit by a small margin.

The survey also questions the problems firms face while trading internationally. The three main problems exporters face that the survey identified are the increase in the price of raw materials and intermediate goods, energy prices and the exchange rate. According to the survey, 72 percent of exporters name the exchange rate as negatively affecting the sector. About 23 percent of importers, on the other hand, said the high value of the exchange rate plays as an incentive to import goods.

Çağlayan drew attention to the exchange rate’s impact on the competitiveness of Turkish firms globally, underlining that a high-valued lira makes exports expensive for foreigners. He also stated that the Central Bank of Turkey’s latest policies have contributed to this fact. Commenting on Erdem Başçı, the incoming president of the central bank, Çağlayan says Başçı has grown into a fine economist and deserves the position. He believes that Erdem will focus not only on price stability but also on financial stability as well, taking up where his predecessor, Durmuş Yılmaz, left off. “Focusing on price stability itself is no longer enough,” Çağlayan said.
Effort to reduce foreign dependency a priority

Çağlayan said the current government has been working on several issues in order to reduce the foreign dependency of the sectors when it comes to input markets. According to the information he shared with media, his ministry and the Ministry of Agriculture plan to cooperate on increasing the domestic cotton harvest due to higher-than-normal global cotton prices. The textile sector imports close to 1 million tons of cotton a year, at a cost of $5 billion.

Çağlayan also mentioned efforts to reduce dependency on pesticides, fertilizers and other chemical products used in the agricultural sector, which are mainly imported. “The import of chemical sector products is another main contributor to the current account deficit [CAD] and we will continue to find solutions in order to address this issue,” he said.

Accusing the EU of becoming the most protective trade zone, Çağlayan says the former is setting up high barriers for Turkish goods, not allowing them to move freely in the EU zone. Touching on Turkish investments in Libya, he added that the government is doing everything in its power to help those firms and to protect investments in Libya. “According to the agreement encouraging and protecting investments in both countries that was signed between Libya and Turkey, investments in Libya are under full guarantee of the Libyan government,” Çağlayan says.
source: todays zaman

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“Our textile exports amounted to $15 billion in 2010 and organic textile exports reached $60 million. Turkey exports organic textile products to more than 30 countries. The world organic textile market reached $6.8 billion in 2010. We want to increase our share in this market in the coming years,” said Aegean Clothing Manufacturers’ Association, or EGSD, chairman Emre Kızılgüneşler at the event’s opening remarks. Turkey was the world’s fourth largest exporter of textiles, he said.

Organized by EGSD, the Organic Fashion İzmir, or OFI, started Thursday at İzmir’s Swiss Hotel Grand Efes 16.

Worldwide famous companies such as Adidas, H&M, Puma, Otto, Nike, Marks&Spencer, Nike and GAP, and textile firms from Germany, Belgium, Denmark, France, Spain, Poland, the Netherlands, the United Kingdom and Jordan are participating in the trade show.

On the sidelines of the fair, a seminar on “Sustainable Business Opportunities for the Turkish Textile Industry” was held with representatives from leading textiles companies.

The fair ends Saturday.

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Commenting on the electric version of the Fluence, Foreign Trade Minister Zafer Çağlayan, who also attended the auto show, said this would make Turkey a base for electric car production and investment. The two ministers evaluated the latest developments in the Turkish auto sector for members of the press.
Ergün said they aimed at increasing Turkey’s auto production to somewhere between 1.5 to 2 million cars annually, noting that Turkey was emerging as one of the most competitive countries in the world automotive sector. “We have set our target to turn Turkey into a high technology products manufacturing hub in its region, from Europe to the Middle East and Central Asia.” The minister said the government placed heavy emphasis on using better technology than Turkey’s current industrial manufacturing standards and had accelerated efforts to encourage more companies to commence research and development (R&D) studies to this end. “In Turkey some 56 firms have their own R&D centers, and eight of these belong to the automotive industry, while around 12,000 staff members work at these centers. We have a long way to go since Turkey still cannot utilize high technology in our industry at the desired level,” he said.

Ergün said the government followed the latest developments in the automotive industry closely and that his and Çağlayan’s presence at the auto show was a clear indicator of such a fact. Referring to the tax cuts on automotive sales which are due to end in late September, Ergün said they helped boost auto sales in the domestic market. He said they were assessing the contribution of the tax cuts to auto sales, hinting that they might extend the incentive for a few more months. “As of the end of September we will make a new decision. We will decide whether or not to extend the tax cuts and at which rates, based on an evaluation we will make at the Economic Coordination Board [EKK] meeting,” said Ergün.
source: Today’s Zaman

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The Turkish defense industry’s exports totaled $576 million last year. The balance comes from commercial sales by private and public defense companies.

The Undersecretariat for Defense Industries, or SSM, said in its “Strategic Document for Defense Industry, 2009-2016″ that it is implementing a plan to incentivize exports and aims to reach its $1 billion goal in 2011.

Sales of Turkish defense equipment and services are bolstered by offset agreements. Offsets are financial compensations provided by arms-exporting countries to purchasing nations. For example, if Country A exports weapons worth $100 million to Country B with an offset rate of 50 percent, then Country B’s defense industry exports back defense equipment worth $50 million to Country A.

Turkey has offset agreements with many foreign companies as part of ongoing procurement deals.

Tusaş Aerospace Industries, or TAI, and military-electronics company Aselsan lead Turkish firms in offset foreign sales, exporting goods worth hundreds of millions of dollars annually in recent years.

Armored-vehicle exports rise

The commercial exports of several other Turkish defense firms are rapidly increasing, particularly those operating in the field of armored vehicles.

Turkey’s privately owned armored-vehicle manufacturers exported vehicles worth $120 million in 2007. This figure is expected to rise to $300 million by the end of 2010, the SSM said in its strategy document.

Those private manufacturers include Otokar, FNSS, BMC, MAN Turkey, Mercedes Benz Turkey and Nurol Makina.

Additionally, the publicly owned military factories at Kayseri and Arifiye both produce and modernize vehicles.

Turkish-made armored vehicles find buyers mostly in the Middle East and Asia.
source: Hurriyet daily news

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Turkey ranks second in pomegranate production, and plantations cover nearly 45,000 dunams in Tarsus, which is on the sixth spot in terms of pomegranate cultivation, said Ali Ergezer, chairman of the Tarsus Chamber of Agriculture.

Due to high demand in domestic and foreign market, the pomegranate on a land of 500 dunams was sold while still on branch prior to harvest, said Ergezer. “But the producers that hear about the developments in Iran reject the merchants who offer prices between 80 kuruş and 1 Turkish Lira for a kilogram. The producers aim to keep the product and sell at or over 1.5 liras.”

The area of pomegranate plantations, which totaled 500 dunams 10 years ago, has reached 100,000 dunams with incentives, Ergezer said. “This year, 40 percent of the total planted area will be harvested in the middle of November. Due to climate conditions, the quality and yield will surpass expectations.”

Around 70 percent of the products are exported, mainly to Ukraine, Russia, Germany and Romania, he said. “According to latest data, this year’s aggregate yield is expected to be around 300,000 tons, with nearly 200,000 tons for exports.”

Adding new export markets

Last year, 115,000 tons of pomegranates were exported, Ergezer said, adding that the figure may double in case of getting efficiency in 60 percent of the planted area in Tarsus.

In case of harvesting all area, the yield will reach 1.5 million tons, making Tarsus number one in the world’s pomegranate production, according to Ergezer.

The seeds of the pomegranate of “hicaz” type produced in the region are consumed as a fruit while its trunk, root and branch bark as well as fruit rinds are used for medical purposes.

“The producers in the Mediterranean climate zone orient toward pomegranate in their search for alternative products. There are noteworthy efforts to increase pomegranate production area and yield. There is a high opportunities in the market and very low loss risk for pomegranate producers. We have initiatives to export to more countries the pomegranate, which is good for human health, particularly in terms of cardiovascular diseases.”

Meanwhile, Bedrullah Erçin, head of the provincial directorate of agriculture in the southern city of Antalya, said that the pomegranate plantation areas are rising recently.

The pomegranate production nationwide was 59,000 tons on 46,750 decares of land in 2000, and the figure rose to 127,760 tons on 176,000 decares, he said, adding that European countries have started to show great attention in pomegranates.

Some 10,840 tons of pomegranates were exported in 2006 but the figure climbed to 12,219 tons in 2007 and 28,788 tons last year. Within the first half of this year, Turkey’s pomegranate export totaled 5,596 tons, Erçin said.

The value of the exports amounted to $11.13 million in 2006, $15.05 million in 2007 and $27.67 million last year. For the first six months of this year, the export figure is $5.65 million, he said.

Erçin said cotton plantations have narrowed with the improvement in tourism and greenhouse cultivation, and pomegranate has started to loom large. “Being unable to earn anything from cotton, producers and investors have changed cotton plantations into pomegranate orchards. Antalya’s cotton plantation areas dropped from 400-500,000 decares to 50-60,000 decares in the last 10 years, as producers have oriented toward alternative products.”

Pomegranate cultivation rose 40 percent in Antalya, he said. “Last year, pomegranate cultivation totaled 55,739 tons. The city covers around 44 percent of Turkey’s pomegranate need. Pomegranate export has caught citrus exports.”

If the pomegranate plantation areas do not increase in Turkey’s rivals, Iran, Spain and Greece, Turkey may have voice in the world in terms of pomegranate exports, he said.
source: Hurriyet daily news

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The sale would include 13 Patriot “fire units,” 72 Patriot Advanced Capability-3 missiles and a range of associated hardware for ground-based air defense, the Pentagon’s Defense Security Cooperation Agency said in a notice made public on Friday, reported the Reuters news agency.

It estimated the cost at $7.8 billion, which would be one of the biggest US government-to-government arms sales in years and would mark the return of Turkey as a major US arms buyer.

Turkey would use the PAC-3 guided missiles to boost its missile defense capability, strengthen its homeland defense and deter regional threats, the defense agency said.

“Turkey is a partner of the United States in ensuring peace and stability in the region,” it said. “It is vital to the US national interest to assist our North Atlantic Treaty Organization ally in developing and maintaining a strong and ready self-defense capability that will contribute to an acceptable military balance in the area.”

At this stage it is unclear whether Turkey’s planned purchase of PAC 3 missiles is part of a procedure related to its ongoing international tender to acquire long-range air- and missile-defense systems (T-LORAMIDS) intended to counter both missiles and aircraft.

There is also speculation that the Turkish plan to buy US Patriots is part of the US’s missile shield program under which Turkey will be one of the sites to deter a possible missile threat from Iran, which has been accused by the international community of developing nuclear weapons.

But Turkish diplomatic sources speaking to Today’s Zaman said the purchase was part of efforts to modernize Turkey’s defense assets, dismissing any notion that it was for purposes of deterrence.

Turkey’s Undersecretariat for the Defense Industry (SSM) issued a request for proposal (RFP) quietly in mid-April for the direct purchase of T-LORAMIDS. It is envisaged that the project, valued at some $4 billion, will entail the purchase of about 12 systems.

Separately, the SSM sent a letter of request (LOR) to the US administration since possible purchase of long-range missiles from the US will take place under the Foreign Military Sales (FMS) credits. Local defense industry sources told Today’s Zaman that it is highly possible that the Obama administration’s notification to Congress of the possible $7.8 billion sale to Turkey is part of the procedure for US companies to compete for Turkey’s tender.

The US administration will set a higher price on the arms purchases that will take place during the negotiations with the countries concerned, said the same sources. The Pentagon’s Defense Security Cooperation Agency announcement stated that the primary contractors for the Turkish sale would be Raytheon Co. and Lockheed Martin Corp. The notice of a potential sale is required by law and does not mean a sale has been concluded.

That announcement falls in line with the Turkish tender since Lockheed Martin and Raytheon are teamed on the Turkish project.

The SSM issued a request for information (RFI) in March 2007 to find out the price and availability of the missile systems. US companies Lockheed Martin and Raytheon have jointly offered a combination of Patriot Advanced Capability-3 (PAC-3) and PAC-2 low to high-altitude SAMs purchased through US FMS credits. The China National Precision Machinery Import and Export Corporation (CPMIEC) has offered the HQ-9 (reported export designation FD-2000) air-defense system. Russia, meanwhile, has so far refrained from participating in the tender and instead offered for Turkey to start state-to-state negotiations with Moscow for the sale of missiles as a sole source.

Turkey, which asked Russia to compete in the tender with its more advanced S-400 missile systems instead of the vertically launched S-300 air-defense system, rejected the Russian offer of having direct talks without a tender. The RFPs have been issued to enable international competition in the T-LORAMIDS project. They involve, among other things, a request from the companies to offer some parts of the missiles to be produced in Turkey, said a local defense industrialist.

US sources who requested anonymity earlier told Today’s Zaman that there have not been big restrictions from the US on what Turkey wants to be produced domestically.

The SSM sent RFPs to the Lockheed Martin-Raytheon partnership and CPMIEC as well as to Russia’s Rosoboronexport, asking for them to respond by mid-July. However, Turkish sources said that the deadline for responses had been extended to the end of this year.
Missile umbrella speculation

In the meantime, the Obama administration’s notification to the US Congress for the missile sale to Turkey is also linked to a US project to build a missile shield to deter ballistic missile threats that may come from rogue states. Secretary of State Hillary Clinton warned Iran’s leaders on July 26 that if they were seeking nuclear weapons, “your pursuit is futile,” days after she raised the possibility of a US-built “defense umbrella” over the Middle East to counter Iranian clout.

In separate notices to Congress released Friday, the Obama administration announced a potential $220 million artillery rocket sale to Jordan and a possible $187 million sale of F-16 fighter-carried weapons to Morocco.

In the case of a NATO member such as Turkey, Congress has 15 days to block a proposed arms deal by passing a joint resolution of disapproval, though it never has stopped a sale once formally notified.

The proposed supply of the equipment to Turkey, along with US logistical support, would not alter the basic military balance in the region, the notice to Congress said. This would mark the first Turkish purchase of PAC-3 missiles, it said. It would reverse a Turkish trend away from US arms purchases in recent years, said Soner Cagaptay, an expert on Turkey at the Washington Institute for Near East Policy, a nonpartisan research group.

Such a purchase would represent “a big consolidation of US-Turkish military ties,” he said. The Patriot PAC-3 missile would provide Turkey with some capability to defend against short-range Iranian SCUD missiles with a range of 500 kilometers to more than 800 kilometers, said Steven Hildreth, a missile-defense expert at the nonpartisan Congressional Research Service.

Iranian missiles are currently capable of reaching all of Turkey, Hildreth said. Turkey’s geo-strategic importance for the United States depends partly on Incirlik Air Base, located near Adana in southeastern Turkey. KC-135 refueling planes operating out of Incirlik have delivered more than 35 million gallons of fuel to US warplanes on missions in Iraq and Afghanistan, the research service said in a report last year.

Carol Migdalovitz, an expert on the country at the research service, said the proposed sale showed Turkey was hedging its bets on improved ties with Iran. “While it has improved [bilateral] trade and energy ties, Turkey remains wary of Iran’s nuclear program,” she said.
source: Today’s Zaman

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The report explains that while Turkey has been the top gold-producing nation in Europe since 2006, its gold production could in fact rise to 38 tons in 2010, making it a global leader in gold production. Turkey’s gold production contracted from 5.3 tons in 2003 to 3.2 tons in 2004, it then proceeded to break new records in subsequent years.

In 2005, Turkey produced 4.1 tons of gold, in 2006 it produced 8.1 tons, in 2007 it produced 9.2 tons and in 2008 it produced 11.1 tons of gold. Experts believe that Turkey will produce 16 tons of gold this year.

The same report also states that while the current total global reserves of workable gold are 49,000 tons, a full 6.5 percent of this is currently being produced by the nations of China, South Africa, the US, Australia and Indonesia. These world leaders in gold production carry out 46 percent of annual global production.

Turkey has 700 tons of gold reserves, and the report notes that based on Turkey’s geological nature, modeling predicts that Turkey could actually have a gold potential of around 6,500 tons. The report further notes that with such reserves, Turkey could become second globally in terms of the volume of its reserves and that as such, important steps should be taken by 2010 in order to clearly determine the volume of the nation’s gold reserves. In addition to the gold production centers of Izmir Bergama Ovacık, Balıkesir-Havran, Gümüşhane-Mastra Altın and Uşak Altın, four new production centers are to be opened by the end of the year. In terms of Turkey’s own demand for gold, the report notes that Turkey imports some 200 tons annually, and that Turkey follows only India in terms of production of gold jewelry. Currently, the gold production sector in Turkey imports an average of $5 billion worth of gold a year. Turkey paid $5.14 billion in 2007 for 231 tons of imported unfinished gold, while in 2008 it paid $4.65 billion for 168 tons of unfinished gold.

It is expected that the amount of gold imported into Turkey this year will be around 180-190 tons, while the country is expected to sell around $1.5 billion of finished gold to other countries.

Though experts have already determined that Turkey has 700 tons of usable gold reserves, an investment of $10 billion is necessary in order to locate some 5,800 tons of potential reserves. But at this point, Turkey has allocated and can spend only $30 million annually to look for gold reserves. The report notes also that a $10 billion investment in Turkey would in fact place this nation among the world’s top gold-producing nations.

The report also notes that recent moves by Turkey on the gold production front have confirmed Turkey’s position within Europe as a top gold producer, and that as such, Turkey may also rise among global leaders of gold production.

The report from the Ministry of Energy and Natural Resources also points to the fact that Turkey’s own gold resources currently fulfill only 5 percent of its demand, the rest of which is filled by imported gold, but experts hope to see this percentage raised to 10 percent during 2010.

The report also notes that the use of public resources for the needed investment in the gold sector is not possible and that instead private capital should be attracted to Turkey to make the necessary investments in the search for further gold reserves.
source: Today’s Zaman

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The shortfall shrank to $1.4 billion from $5.4 billion in March 2008, according to the median estimate of 10 economists surveyed by Bloomberg. The Turkish Statistical Institute is due to report the data at 5 p.m. tomorrow.

Industrial production fell in February by the most since records began in 1986 as growth slowed and the global credit crunch forced the government to look to the International Monetary Fund, or IMF, for a loan. A slump in energy prices is also helping to reduce the cost of imports.

“We’re seeing a slowdown in domestic economic activity and a slowdown in imports, causing a clear narrowing in the deficit,” said Ayşegül Aykol Kocabaş, economist for Tekstilbank in Istanbul, who forecasts the current-account deficit will narrow to about $9 billion this year from $41.4 billion in 2008. “That is clearly good news from a financing perspective.”

The government seeeks a new IMFaccord to support the currency and supplement the budget as the slowdown reduces tax revenue. The economy shrank 6.2 percent in the last quarter of 2008, its first contraction in seven years.
source: Hurriyet daily news

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Speaking at the ceremony at the free zone, State Minister Kürşad Tüzmen said Turkey has become the third in yacht production, while standing at No. 7 in shipbuilding.

The 65-meter-long yacht is the biggest megayacht produced in Turkey. “We like to break records,” Tüzmen said. “With a new record, we will build a 75-meter-long yacht here next time.”

The Nourah of Riyadh was built at the shipyard of Yachtley, a company of Saudi, Lebanese and Turkish capital. Bader Fahad M. Al Athel, vice president of the company, said the firm was founded in 2005. Yachtley has invested in Turkey, “trusting in the quality of workforce and production,” he said. “I am sure that Yachtley yachts will rank among the best ones in the world.”

Designed by Starkey

The Nourah of Riyadh, whose construction started in January 2006, has six guest cabins, one VIP cabin, a king room, a theater and dining hall, a main hall, 21 cabins for the crew and a Jacuzzi. It also has two elevators and a helipad. It was designed by renowned designer Donald Starkey. It will first be sent to Cannes.
source: Hurriyet daily news

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In this way, both the government and entrepreneurs have intensified their quest to diversify export markets, a move that has a critical role in keeping the negative at bay.

Turkey’s exports to the West, especially to European markets, embarked a downward trend with the emergence of the crisis. Thus the government has accelerated work to enter new export markets with the contributions of Turkish entrepreneurs. Foreign Trade Minister Kürşad Tüzmen stepped up visits to a number of countries, particularly in the last two months, as an attempt to strengthen Turkey’s presence in alternate markets and reduce dependence on the country’s traditional trading partners.

Tüzmen’s trips, in which he was accompanied by large groups of Turkish businessmen, yielded fruits sooner than expected as Turkey guaranteed over $1 billion in new business deals and signed free-trade agreements with some countries through the visits. Turkey’s exports to Eastern markets boomed in the first two months of 2009. For instance, exports to Iraq increased by 75 percent in January and February combined over same months of 2008.

However, it will not be as easy for Turkey to return to its heyday in exports. The country’s exports in February dropped 35 percent when compared to the same month of last year, hitting only $6.8 billion. Following such news, Tüzmen said exceeding a figure of $100 billion in exports in 2009 would imply success for the Turkish economy. Turkey’s exports exceeded $130 billion in 2008.

Turkish Confederation of Businessmen and Industrialists (TUSKON) Chairman Rızanur Meral told Sunday’s Zaman that there was a sharp contraction in exports in the first two months of the year; however, Turkey’s exports to African countries increased by 31 percent compared to the same months of 2008 thanks to efforts to enter new markets. “We are not only working to strengthen trade relations with Africa but also concurrently trying to establish relations with entrepreneurs from four continents,” he noted. Meral said they began conducting research on African markets three years ago and see the benefits of their efforts today. “Trade with Africa is an elixir of life for ailing Turkish exports as exports to Africa increased to $9 million as of 2008 from $2.5 billion in 2005. In the past three years, around 6,500 small and medium-sized enterprises [SMEs] have exported to African countries. We choose them because African countries are less affected by the crisis than others,” he said.

Meral also said they have started meeting with entrepreneurs from Latin America. “In June, the government will send a trade commission to visit Paraguay and Uruguay and our members will accompany them,” he said. Underlining that TUSKON is continuing its research in parallel with that of the government on entering new markets, Meral said they appreciate the efforts of the government to this end. He recalled that Tüzmen had been to a number of countries with the aim of boosting trade relations and that such steps had helped Turkey weather the storm to some extent.

With regard to 2009 export and import figures, Meral said both will unavoidably drop due to a severe reduction in demand. He also said Turkey’s foreign trade deficit will fall for the same reason. “The Turkish economy is well integrated with global markets and we expect a recovery in foreign trade by 2010,” he added.

Süleyman Şensoy, the chairman of the Turkish-Asian Center for Strategic Studies (TASAM), said on Friday that Turkey aims to raise its trade volume with Latin America and the Caribbean to $30 billion. Speaking at a workshop in Ankara, Şensoy defined the region, home to 33 countries with a total gross national income of $4.5 trillion, as one of the emerging markets in the world but said Turkey engaged in minimal trade with the region due to the lack of proximity between the countries.

The government has not slowed down yet, continuing research on ways to increase exports. Türk Eximbank, a state-owned bank responsible for promoting Turkey’s exports through the diversification of exported goods and services, is expected to increase the amount of country loans it extends, Foreign Trade Minister Tüzmen said on Friday. Noting that Türk Eximbank plans to extend around $300 million in country loans in 2009, Tüzmen said they expect an increase in Eximbank loans would increase Turkey’s production and exports amid the ongoing financial turbulence. Eximbank extends country loans to foreign entrepreneurs who import goods from Turkey with the aim of boosting the country’s exports.

Provinces close to emerging markets benefit more

According to Turkish Exporters Assembly (TİM) data, three provinces from southeast Anatolia have boosted export revenue in one year, becoming the “shining stars” of Turkey’s exports despite the crisis. Thanks to the region’s geographical proximity to emerging markets and its superiority in delivering orders much faster to these markets, Şırnak, Mardin and Adıyaman recorded remarkable profit from export income.

Şırnak, a relatively poor province in southeastern Anatolia, doubled exports in February over the same month in 2008. The province’s exports increased to $38.5 million in February compared to $18.5 million in the same month of the previous year. Iraq was the main importer of goods from Şırnak.

Mardin, another province in southeast Anatolia, also established good trade relations in new export markets, with exports from Mardin rising to $28 million in February from $21 million in the same month of last year. The province primarily exports construction materials to neighbors.

Exports from Adıyaman skyrocketed. The province exported goods worth $2.3 million in February 2008, while this number increased to $6 million in the same month of this year. The province mainly exported textile products.
source: Today’s Zaman

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