A bastion of regional stability, Turkey is a key NATO

1
Tuesday 19 July 2011
Turkey
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The UK-Turkey entente
A bastion of
regional stability,
Turkey is a key
NATO ally and the
UK is a strong
advocate
of its EU
accession plans
Diplomatic relations span
more than 400 years and the
leaders of both the UK and
Turkey have pledged to work
hand-in-hand to further
strengthen political and
economic accords
FOR GENERATIONS,Turkey has
captured the imaginations ofWesterners with its history and stories of the
Ottoman Empire, its beautiful architecture characterised by pointy towered
mosques,crescent moons,narrow winding alleyways and intricate geometrical
patterns. For the business and political
world,Turkey has for several decades represented a bastion of democracy and stability in a region often racked by violence.
Indeed,this strong point has once again
come into focus as the political systems
in certain neighbouring countries are
near toppling.
Today,Turkey sits comfortably among
the top 20 economies of the world.
Come 2023, when the republic celebrates its centennial, the country’s political and business leaders expect the
economy to have moved into the top 10.
“Vision 2023 is a goal we believe is attainable,” says Dr Ibrahim Kalin, chief
advisor to Prime Minister Recep Tayyip
˘
Erdogan.
“If you look at Turkey’s rising
profile over the last 10 years or so and
over the successive AKP governments,
it becomes very clear that Turkey has
the potential and the ability to be a great
power in economy, politics, foreign policy and many other areas.”
˘
Mr Erdogan
was first elected Prime
Minister in 2003, two years after establishing the Justice and Development Party (AKP),which is described as the largest
publicly supported political movement in
Turkey. He was re-elected for a third
term last month, however his party no
longer enjoys parliamentary majority.
A dynamic, open and largely marketdriven economy is one important fea˘
ture of Mr Erdogan’s
eight-year run in
office.Although Turkey was not immune
to the global recession in 2008-09, the
˘
David Cameron greets Recep Tayyip Erdogan,
the recently re-elected prime minister of Turkey, outside No 10
economy is well on the mend,having expanded 8.9 per cent in 2010.The Economist Intelligence Unit forecasts slower
growth of 6 per cent in 2011 and 4.5 per
cent next year, before bouncing back to
between 5 and 5.5 per cent in 2014-15.
“The government has placed a lot of
effort on revitalising the economy, especially private-sector investment,” says
Deputy Prime Minister Besir Atalay.“As
a state we are trying to complete cer-
tain projects, including the costly and
comprehensive GAP (Southeastern Anatolia Project), which will really help the
agricultural sector.We are inviting the
private sector to fill in the infrastructure
gap we have, which not only comprises
irrigation projects, but also includes
roads, for example.”
˘
Mr Erdogan’s
administration is also
working tirelessly towards EU membership and towards bringing about pos-
itive change in the Middle East and the
Balkans. Its strategic geo-political position in the world – namely, its location
between the Middle East and Europe –
means it lies at the crossroads of different
cultures, ones whose friction or harmony can affect stability not only in the
region but in a large part of the world.
“Every minor or major contribution
we make to regional peace is also a contribution to global peace,” explains Dr
Kalin.“We lead by example. If you set a
good example with your foreign policy,
social policy and economy, you immediately become a centre of interaction
for others.This is why we believe Turkey
is joining the EU: having a Muslim country as a full member will send a very positive message to the rest of the Middle
East and the Arab and Muslim world.”
Turkey boasts a strong relationship
with the UK, one that endures changes
in political parties on both sides. Furthermore, the UK is Turkey’s strongest
supporter for its EU accession.
“The relationship betweenTurkey and
the United Kingdom is based on strong
bonds of alliance, friendship and mutual trust,” says Abdullah Gül,President of
Turkey.
Dr Kalin adds,“This chemistry is wonderful and helps tremendously with bilateral relations and many other areas.”
Additionally Turkey and the UK have
hundreds of companies doing business
with each other in both countries.
Straddling the line between the West
and the Muslim world,Turkey would like
to share its history, culture, politics, international relations and its sense of
identity and perception.
“There is a new Turkey emerging,”
says Dr Kalin. “From science to education, economy and foreign policy, and even popular culture events,
a new Turkey is becoming a reality.
This new Turkey has a new story that
needs to be heard.” ●
IFC Reports are solely responsible for the content
2
Tuesday 19 July 2011
Turkey
Turkey continues
to be an anchor of
stability in the region
The Turkish Minister of Foreign Affairs has had the opportunity to first develop a theory on international relations as an academic, and then put them
into practice as a politician, thus strengthening democracy in the country
˘
AHMET Davutoglu,appointed
Minister of
Foreign Affairs of the 60th Government
of the Republic of Turkey in May 2009, boasts
an educational and professional background
that puts him in a very unique position. Mr
˘ graduated from Bosphorus UniverDavutoglu
sity with a joint honours degree in Political Science and Economics. Later, he completed his
MA at the same university, in the Department
of Public Administration, and received his PhD
from the Department of Political Science and
International Relations.
As a result of his education and work experience teaching in various universities, Mr Davu˘ brings a wealth of experience to his curtoglu
rent position as Minister of Foreign Affairs. His
concepts, as explained in his articles Strategic
Depths and Zero Problems with Neighbours, are
the guiding principles of Turkish foreign policy
today.
“We have historical ties with all the important economies as well as ties with our neigh-
˘
bouring countries,” explains Mr Davutoglu.
“Turks are very well-educated people and they
are elite in terms of entrepreneurship and business,in politics and intellectual life.We have been
a dynamic population.”
As the Middle East undergoes historic transformation and upheaval,Turkey is quietly enjoying
levels of prosperity and stability. Even more,
Turkey is perceived as having successfully combined democracy and Islam.
“We wish to underline that a country that
has hosted different civilisations and has different
backgrounds can play an important role in the
world order. If we have ties with different countries and different cultures and civilisations, our
role must be that of a peace-building country
that deals with conflict resolution,” Mr Davu˘ says.“We are trying to show that it is postoglu
sible to have a dynamic democracy with an active foreign policy and economic development
in a very critical geopolitical environment.Turkey,
in this sense, is a source of stability.”
With the Mediterranean as their common
group, both Turkey and the UK have become
important players in terms of international
diplomacy over the past centuries. Moreover,
there are no troublesome political issues between them and the UK has excellent relations
with Turkey in terms of trade: it is Turkey’s third
largest export market.
“The United Kingdom is one of the few countries with which Turkey has a trade surplus.As
of 2009, the trade surplus reached £1.6 billion,”
says Ünal Çeviköz,Ambassador of Turkey to the
UK.
“British investors are also showing great interest in the Turkish market. We have over
2,200 British companies operating in Turkey.
Sectors of interest for UK investors include
energy, infrastructure and telecommunica-
tions. They are the main sectors that fuel
growth.”
In addition to the growing trade between the
two regions, they share a similar approach in
regards to many issues. “I believe the UK understands Turkey’s concerns and its perspective in the EU, and the UK is the main supporter of the Turkish-EU integration process,”
˘
Mr Davutoglu
says. “The UK’s policy regarding relations with Turkey has continued, because
with strong historical ties, Britain understands
Turkey and vice versa.”
Turkey aims to maintain a position that promotes harmony and helps solve global problems. “We want to create an image of Turkey
doing its best for humanity and supporting and
˘
contributing to world peace,” Mr Davutoglu
states. “Turkey can help create solutions.” ●
Investment climate heats up
The powerhouse of industry and regional finance centre has international investors ever more interested
LUCRATIVE investment opportunities for
global investors permeate a multitude of
Turkish sectors,ranging from energy to research
and development (R&D). The robust economic
performance, growing domestic market, skilled
workforce and strategic location of Turkey make
it one of the most attractive investment destinations in the world. As such, Turkey attracted
around £58 billion of foreign direct investment
(FDI) over the past eight years (2003-2010),
whereas it had attracted merely £9.4 billion of
FDI in the preceding three decades (1973-2002).
The Turkish economy has shown remarkable
performance, recording steady growth over the
past eight years.A sound macroeconomic strategy,combined with prudent fiscal policies and major structural reforms in effect since 2002, has
integrated the Turkish economy into the globalised
world, while transforming the country into one
of the major recipients of FDI in its region.
The structural reforms, hastened by Turkey’s
EU accession process, have paved the way for
changes in a number of areas.As these reforms
have strengthened the macroeconomic fundamentals of the country, inflation has decreased
to 3.9 per cent as of March 2011, down from 30
per cent in 2002, while the public debt stock ratio to GDP fell from 74 per cent to 42 per cent
between 2002 and 2010.
As GDP levels more than tripled to £463 billion in 2010, up from £145 billion in 2002, GDP
per capita also more than tripled, exceeding
£6,300 in the given period.The visible improvements in the Turkish economy have also boosted foreign trade,while exports reached £71.6 billion by the end of 2010, up from £22.6 billion in
2002.
Prior to the recent global recession, the Turkish economy sustained strong economic growth
for 27 consecutive quarters. However, the global financial crisis has challenged the macroeconomic and financial stability of many
economies by adversely affecting financing facilities and external demand, causing a significant slowdown in all global economic activities.
Nevertheless, the perceived positive developments in the economy showed signs of a fast
recovery as early as the last quarter of 2009,
with a growth rate of 5.9 per cent. This economic growth continued into 2010 with 12
per cent, 10.3 per cent, 5.2 per cent, and 9.2
per cent in the first, second, third and fourth
quarters of 2010 respectively, thus expanding
by 8.9 per cent in 2010.
Turkey’s recent economic performance has
created an optimistic environment, enabling international organisations to regard it as one
of the fastest growing economies in the world.
According to the OECD,Turkey is expected to
be the fastest growing economy of the OECD
members from 2011-2017, with an annual average growth rate of 6.7 per cent.
Turkey is the 17th largest economy in the
world and will likely become one of the top
10 economies in the next decade. It is also a
powerhouse in industry as the eighth largest
steel producer and the 16th largest automotive manufacturer in the world, as well as the
largest TV producer in Europe.
Turkey is the world’s
17th largest economy,
16th biggest
automobile maker and
eighth top steel
producer, as well as
Europe’s main TV
producer
Such a vast industrial production base is also augmented by the country’s strategic location. In order to utilise its advantages, such as
a young population, skilled workforce, economic performance and historical and cultural ties in the region, many global companies have
either established manufacturing bases in Turkey
or moved their regional headquarters to Istanbul. For example, HP has recently inaugurated a manufacturing facility in Turkey to produce and export more than two million desktop PCs. GE Healthcare moved its regional
headquarters from London to Istanbul to manage its operations in 80 countries in four major regions – Central Asia, the Middle East,
Russia and Africa. Finally, both Coca-Cola and
Microsoft have their regional headquarters in
Turkey, managing almost 100 countries from the
republic.
The profit of investing in Turkey is not limited to the opportunities in the domestic market. In addition to the growing local market,
there are plenty of opportunities in neighbouring countries. Turkey’s geostrategic location enables investors to access multiple markets in Europe, the Middle East, North Africa
and the Caucasus.Turkey has a customs union
with the EU and free trade agreements with
20 countries, providing investors with the opportunity to export their products there without customs duties or many other restrictions.
As an industrial powerhouse and a regional
business hub, Turkey offers enormous opportunities for British companies to penetrate the
growing economies of the region. Many British
companies are aware of this and are expanding in parallel with Turkey’s growth.There are
2,250 British companies in Turkey, which have
invested around £6.3 billion in the country
over the past seven years. For example, together
with the acquisition of Demirbank, HSBC has
successfully ridden the wave of economic development in Turkey and increased its total assets to more than £6.3 billion, up from £1.3
billion in 2002, which represents a cumulative
growth rate of 400 per cent. Similarly, Vodafone Turkey was the fastest growing unit within Vodafone Europe with £1.4 billion of net
revenues in 2010.
Britons are also investing in real estate in
Turkey, with around 35,000 British nationals
owning real estate there.The number of British
tourists visiting Turkey has almost tripled, reaching 2.7 million in 2010, which is why Turkey is
the seventh most visited holiday destination in
the world, offering exquisite touristic services
in health care, SPA, culture, historical sites and
seaside resorts. For Turkey, hospitality and accommodation matter; out of the world’s best
100 hotels, 20 are located in Turkey.
The abundant investment opportunities available here range from automotive, ICT, iron and
steel to energy, renewable energy and petrochemical sectors.The expertise of British companies in public-private partnership (PPP) projects provides them with a comparative advantage to benefit from the PPP opportunities in
Turkey. Both local and national authorities have
been implementing numerous investment projects
through PPPs and they are also realising further
opportunities in education,energy,defence,health,
transportation and other public services.
Similarly,opportunities are also widely available in
privatisation projects. While Turkey’s privatisation
efforts totalled £30.1 billion in the last eight years,
there are still several more areas to be opened up,
such as infrastructure and energy generation,which
is partly privatised.Turkey’s growing demand for energy requires more than £62.8 billion of investment
over the next decade.
Having been tested by the global economic crisis,Turkey has one of the most stable and profitable
financial sectors in its region.The Turkish Government’s Istanbul Finance Centre project offers global companies with an opportunity to run their financial operations in the region through Istanbul,
thanks to various incentives,a skilled workforce and
a global,cosmopolitan city with a vibrant local economy. Financial investors from the UK can also benefit from this facility.
Turkey is committed to attracting FDI.To this end,
the Investment Support and Promotion Agency of
Turkey (ISPAT) was established under the Prime
Ministry in 2006.
ISPAT is the official organisation for promoting
Turkey’s investment opportunities to the global business community and providing assistance to investors before, during and after their entry into
Turkey. ISPAT serves as a reference point for international investors and as a point of contact for all
institutions engaged in promoting and attracting investments at local, national and regional levels. ●
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Produced by: Laila Bastati and David Bayon
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Tuesday 19 July 2011
3
Turkey
Double or nothing: bilateral
trade to reach £12.6 billion
Turkey’s Minister of Economy
aims to double trade with the
UK by 2015 under the Strategic
Partnership Agreement
AS IN MANY other developing countries,the textile and clothing industries
have played an important role in the industrialisation of Turkey.Textile sectors are now the
driving force in the Turkish export industry,
and they have become one of the key players
over the years.Thanks to Turkey’s geographical location it enjoys economical relations with
countries all over the globe, with the UK being one of its biggest export markets.
It is a country that is truly growing in power, so much so, that last year Turkey’s exports
grew by some 12 per cent to reach £71.3 billion ($113.977 billion).
Turkey’s exports broke a record in the preglobal crisis period, rising to £82.7 billion in
2008. Even in 2009, when the crisis was at full
impact,Turkey managed to keep exports above
£62.7 billion.
The top performers last year include the textile sector, accounting for £13.5 billion in exports. Other driving forces include the automotive sector,with motor vehicle exports totalling £9.3 billion, and the basic metals sector, which registered £9.05 billion.
The workings of any economy can be an in˘
tricate affair but Mehmet Zafer Çaglayan,
Turkey’s newly appointed Minister of Economy, gives a detailed analysis of his country’s
economy.
Prior to his present appointment in 2007,
˘
Mr Çaglayan
was Minister of Foreign Trade,
president of the Ankara Chamber of Industry
and vice-president of the Union of Chambers
and Commodity Exchanges of Turkey, as well
as chairman of Akel Alüminyum A.S. and
˘
Çaglayanlar
Alüminyum Ltd.
“When I was first appointed as Foreign Trade
Minister, I gathered my staff in a meeting and
tried to explain my work philosophy,” says Mr
˘
Çaglayan.
“My instructions to them were to
have two goals: first, to sell Turkish goods
abroad; second, to attract investors to Turkey.
“Our first priority should be to attract
prominent investors and the biggest possible
investments to Turkey. I have certain advantages because I come from within the industry, and therefore, I am well versed in the
problems that exporters, investors and businessmen encounter every day.”
Attracting new investors is always a goal for
emerging economies and presently Turkey enjoys warm political, economic and cultural relations with the UK that go back 500 years.
In fact the UK has made it clear that it intends
to double its investments in Turkey in the next
five years. Today there are more than 2,200
British companies operating in Turkey which
˘
Mr Çaglayan
says is of huge importance to his
country.
“The UK constitutes a very important,if not
the most important, partner in the EU and in
the world for Turkey.We have very important
cooperation between us and we have a committee responsible for economic and com˘
mercial collaboration,” says Mr Çaglayan.
Alejandro Jimenez, President of Efes Beer Group
Quenching
Turkey’s thirst
for growth
‘In a radius of a four-hour flight there are
56 countries present. In other words,
we are at the centre of the world’
“The UK is a very important player in world;
it is a country that reached more than £501.5
billion in foreign trade in 2009. The GDP of
the UK and its income per capita is obviously very strong.And finally, the UK is the only
country we have a surplus of foreign trade with.”
˘
Mr Çaglayan
hopes that during his reign as
minister he can keep attracting foreign investment and make Turkey into a global player to be reckoned with.
“In a radius of a four-hour flight there are
56 countries present. In other words, we are
at the centre of the world,” he says.
“Turkey is a very important developing country and others should take advantage of it,considering that the share on the part of the developed countries is shrinking by the day, and
the share of the developing world is increasing.
“We are surrounded by seas on three sides
and this gives us huge logistical advantages.We
have 46 airports and we have more than 20,000
kilometres (12,427 miles) of developed roads.
If we take into account the accelerated train
project and our railway network, the travelling distances are diminished considerably.”
According to the
Minister,in the coming years the government will be rehabilitating more
than 620 miles of
railway network
and its assets include the greatest
fleet of land transporters in the EU.
“Last but not
least, I will refer to
our young and dynamic
population. Turkey has
150 universities that graduate more than 500,000 students every year. We have a
very good and industrious
workforce.Finally,this is a country that provides very good incentives for investment
and for research and
development,” con˘
cludes Mr Çaglayan.
●
ALTHOUGH Turkey is not officially a
part of the EU just yet, the country’s
culture and lifestyle have already shifted, becoming more like the West.There
is more disposable income and people
are socialising more.This has allowed
the beverage industries to significantly
grow. Efes Beer Group is the fifth
largest independent European brewer
and the second largest beer brand in
Europe, exporting to 65 countries, a
record in 2010 for their exports. “Very
few people know that the Efes brand in
particular is the second largest beer
brand in Europe. It sells more than
Heineken, so exporting to Europe is
very important,” says Alejandro
Jimenez, president of Efes Beer Group.
Efes produces and markets malt and
soft drinks, in addition to beer, in countries including Turkey, Russia, Kazakhstan, Moldova, Georgia, Southeastern
Europe and the Middle East. At the end
of 2009, Efes’ total annual brewing capacity was 35 million hectolitres with a
total malt capacity of 256,000. It has
become a global powerhouse with 16
breweries, six malthouses and 20 CocaCola bottling plants in 16 countries.
Turkey’s economic expansion
has given Efes an advantageous
position. Mr Jimenez explains,
“The increase of the wealthy
and middle class in Turkey,
along with new consumption
habits, has certainly had a
positive effect on us. People
go out more and sometimes they drink beer.We
are the dominant player
here in the beer market.”
Turkey only accounts
for 35 per cent of Efes’
total business volume,
making the international markets crucial.
The UK is especially
important.“Over two
million people from
the UK come to Turkey
on holiday.We want to
give people the opportunity to enjoy our
beers in Great Britain,”
says Mr Jimenez.
Turkish Airlines fuelled for sky-high growth
TURKISH Airlines, the national airline of Turkey,
has its geographical location to thank for the
company’s expansion. Ideally, the country is the
epicentre of a huge amount of air traffic, making it a
convenient place for transit passengers.“You can
reach up to 35 countries in a three-hour radius
from Istanbul,” says Hamdi Topçu, chairman of
the board and the executive committee.
Currently,Turkish Airlines operates scheduled
services to 127 international and 35 domestic cities,
serving more than 170 airports in Europe,Asia,Africa and
the Americas.The airline’s main base is at Atatürk International Airport, on Istanbul’s European side, and it has more
than 15,000 employees.Turkey’s flagship air carrier has been a
member of the Star Alliance network since April 2008.
The airline sector in Turkey is expected to significantly grow
in the coming years.“There are two main reasons why the
airline sector in Turkey is developing. Firstly, in the past, annual per capita GDP was £1,900 but now it is up to £6,300,” Mr
Topçu explains.“Turkey also has good relations with its neighbours and the rest of the world.Turkey is the number one European country with the most domestic destinations according to recent statistics.There are 46 airports currently in op-
According to 2010 data,Turkish Airlines is Europe’s third largest and
Southern Europe’s largest airline
eration and six more are being developed.The government
reduced taxes on the civil aviation sector and the airports
were privatised.These are some of the key factors which have
led to our rapid growth.”
Turkish Airlines statistics are steadily rising with an increase
of 17.3 per cent in 2010 of passengers carried.The total
reached 24.5 million from the 20.9 million recorded in 2009.
International business class and international-to-international transfer passengers increased by 29.6 per
cent and 17.6 per cent respectively for the same
period.
“Turkish Airlines continues to grow as a global
airline with the Boeing 777 helping us to expand into new markets in Asia and the Americas,” says Mr
Topçu.“The addition of the new Boeing 777-300ERs exemplifies our commitment to delivering high-quality service and comfort to our passengers, while enabling us to continue our profitable growth.”
Turkish Airlines is also following an aggressive marketing
strategy, associating its name overseas with some of the
world’s most recognised brands. For example, in January 2010
Turkish Airlines became a sponsor of Manchester Utd.The
airline will transport the club’s players to the tournaments
and training camps during its three-and-a-half-year sponsorship contract.“This sponsorship deal was very important and
this cooperation will provide big support for Turkish Airlines,”
Mr Topçu says.
This deal with Man Utd has helped Turkish Airlines move closer to completing its objective to become the preferred leading European air carrier with its growth and partnerships.
4
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Tuesday 19 July 2011
Tuesday19 July 2011
The flourishing construction industry is crucial toTurkey’s
Turkey, the world’s
second largest
contractor
development.More than 500 different materials supply
the sector, nearly all of which are produced locally
Local developers, infrastructure and construction firms, as well
as producers of construction materials, are powering forward
struction industry and helps the Turkish economy is Kardemir, a multi-faceted iron and steel
firm. It was established in 1937 and is currently
the only company that locally produces iron ore
as a raw material.
“Our competitors produce other products,but
they work with scrap. The quality of the steel
made from scrap is not as good as the steel made
from iron ore, so the quality of our steel is unparalleled,” comments Fadil Demirel,general manager of Kardemir.
Kardemir also produces various articles of mining equipment and is the only producer of steel
for rail production.Furthermore,there is no other rail producer in the Middle East or North
Africa, giving more business and opportunities to
Kardemir.
The company was privatised in 1995 and at this
time,£126 million was invested to modernise and
develop plants and to increase its force within the
market. Kardemir consists of blast furnaces, steel
plants, rolling mills, power plants, machinery factories, foundry plants, steel construction plants
and a lime and oxygen plant. The company employs 5,000 workers and provides products for
both the domestic and international markets.
Rail production capacity is 450,000 tonnes per year
and a new plant is being built with a 2.5-milliontonne capacity.
In addition to iron and steel,Kardemir is involved
in a hydraulic energy project with 22.5 megawatts
(MW) in capacity,which will be finished at the end
of the year.They also have a 50MW energy project to produce energy from its own waste gas
coming from its integrated plant. “We are going
to collect waste gases and turn them into energy,” Mr Demirel explains. “We will get a return
on our investment in just two and a half years.”
The main project Kardemir is involved in,however, is the building of its own harbour.
“Our biggest project is our harbour project,
which we are developing on our own. We have
conducted a feasible study for the underground
area and the bottom of the sea, working closely
with the government.This project is very important for Turkey [and will be] completed in three
years maximum.”
The Nata Group is anotherTurkish company that
has immersed itself in numerous sectors. While
operating in construction, infrastructure, real estate, investments, geothermal energy, mining and
aviation, Namik Tanik, chairman of the board, has
come a long way since launching his own company as a contractor at the age of 20.
“Currently we build roads,highways and bridges
at home and abroad.We also started the mall construction business in 2000.We are presently building our third shopping mall and also designing
our fourth and fifth projects. In 2008 we started
our international projects with a 1,800-kilometre
(1,118-mile) highway project in Turkmenistan.We
managed to complete 90 double-lane suspension
bridges.This made a total of 180 in 500 days,” Mr
Tanik says.
Affordable housing
prices through the
years have made
Turkey an attractive
destination for
British second home
buyers
5
Turkey
Turkey
TURKEY has become increasingly popular
as a second home location for British people. One major reason for this is the fact that its
real estate has remained inexpensive despite the
fact prices have dramatically risen in other parts
of Europe.
In 2010, the number of second homebuyers
rose in Turkey from 20,000 to 30,000,boosted by
the large international real estate companies that
have recently entered the market and which have
created a mortgage system that has also contributed to expanding Turkey’s economy. Owing
to this increase, the construction and real estate
sectors are additionally rising in importance.
Turkey’s economy is dynamic and continually
growing thanks to these sectors and it is home to
a number of globally competitive companies,all of
which currently do and will continue to serve as
the foundation of Turkey in years to come.
Alper Insaat, a construction company that has
carried out projects in South America, the Middle East,Turkey and its neighbouring countries, is
one of these companies.Alper Insaat has pursued
other industries,but keeps its focus mainly in construction.
“Construction is such an important sector because, like in any country, it impacts every other
sector in Turkey’s economy. Currently the annual demand for housing is about 150,000 and the
number of houses being built in Istanbul is less
than 30,000,” says Alper Ünsal, chairman of the
board.
Mr Ünsal was a key contributor in the Kartal
Project, the plan for a new, futuristic type of urban city environment that will be built in Istanbul.It is intended to be the world’s first fully green
city.This project was named among the top projects ever to be created by the Istanbul Metropolitan Planning Centre.Although Mr Ünsal would
like to expand into other sectors, construction is
so fruitful at this time in Turkey – and is his company’s field of expertise – his intention for the moment is to continue growing in construction.
“Our long-term plans are to expand into the
energy sector, yet we would like to become as
big as we can in the construction sector first.The
feasibility studies on Istanbul’s demand for housing and business centres reveal that the sector is
still promising to grow further,” Mr Ünsal explains.
Nevertheless, while the construction industry
is in high demand these days inTurkey,serving more
than 400 different industries and accelerating other sectors,Mr Ünsal claims working in the industry
is fulfilling in other ways, as well.
“Construction opens up many doors and helps
companies give back and commit to the social responsibility they have,” he explains.“Another distinctive feature for us is that in every project we
develop,we build part of a social area,such as cultural centres, small hospitals, parks, theatre halls,
mosques, etc.All of this, of course, is a part of our
social responsibility.”
Another company that benefits from the con-
IFC Reports are solely responsible for the content
Companies in
the construction
sector and its
related industries
enjoy a healthy
demand for building
projects
The success of Nata Group very much depends
on its fast pace.The company considers its Nata
Vega Shopping Centre to be its most prestigious
project currently under construction. In just 15
months, around 200 square metres of the development will have been completed.The complex
will include a 360-degree aquarium-restaurant and
the biggest Ikea and Metro Gross Markets inTurkey.
The Nata Group believes that the construction
sector is crucial to the nation’s development, especially since it escaped relatively unscathed from
the global financial crisis.In addition to opening up
a huge number of jobs – Nata employs 4,000 people – over 500 different types of materials are needed for the sector, easily making this industry the
locomotive of Turkey’s economy.
“Almost 95 per cent of the materials allocated
to the domestic construction market are produced in Turkey,” explains Mr Tanik.
While construction may be the engine of growth
now, Mr Tanik saw the importance of diversifying
his company early on and immersed the company into other sectors of the Turkish economy.“We
try to operate in areas where domestic and global needs are met. Our company has been growing in parallel with the Turkish economy. In addition to the activities mentioned, the production
of cement and concrete pipes are the current major sectors that we are a part of,” Mr Tanik says.
Aydiner Construction Co also believes in expanding its business into other sectors and demonstrates this through the abundance of services it
offers which, in addition to construction, include
energy, pump industry services, steel construction, tourism, agriculture, potable water, computer technologies,international mining and trade.
“We have some buildings under construction,
including hotels and three commercial buildings,
which we have sold already,” explains Ömer A
Aydiner, member of the board. “But Aydiner is
mainly involved in water-related infrastructure.
We do water transmission lines and distribution
lines, hydroelectric power plants, reservoirs and
dams,irrigation systems,sewage water and waste
water treatment plants and pipelines, etc.We also used to build bridges and roads.”
Aydiner Construction was one of the first companies to take a step toward investing in renewable energies when it was still unknown in what
direction this sector was headed.“The first projects here were not easy – it was an adventure
actually,” Mr Aydiner says.“Nobody, not even the
government, knew what was going to happen.”
The demand for energy in Turkey today is huge
and the more the sector is developed, the easier it will become to develop new industries.Aydiner Construction is also working on wind energy, having already completed one plant that is
in operation.Another two are being licenced and
prepared for construction.“The first one is about
30MW, the second will be 30MW and then the
third will be 25MW. We also have some other
plants outside of Turkey, like the gas plant running in partnership with the Ankara Organised
Industrial Trade Zone,” explains Mr Aydiner.
Mr Aydiner’s vision for the company is to always look ahead to see which industries are being expanded and to make sure his company is a
part of that.“We have three major international lines: energy, tourism and industry. Construction is always going to be there, whether we are
involved in energy, tourism and industry, or not.
For that reason, we are looking for opportunities for operational partnerships in tourism, as
well as examining several energy projects all over
the world.We are focusing on renewable sources
mainly, but we are taking other sectors into consideration as well,” Mr Aydiner says.
Another area where Aydiner Construction focuses its attention is in corporate social responsibility. It is currently undertaking a project through Ayen Enerji, engaging in a forestation plan in Kurthogazi to return a forest back
to its natural state. The company also offers
scholarships and builds schools and cultural
centres. ●
Aydiner
‘We are looking for
opportunities for
partnerships in tourism
and we are also looking
into several energy
projects’
ÖMER A AYDINER,
Member of the Board of Aydiner Construction Co
Nata Group
‘Almost 95 per cent
of the materials allocated
to the domestic
construction market are
produced
in Turkey’
NAMIK TANIK,
Chairman of the Board of Nata Group
Alper Insaat
‘Currently the annual
demand for housing is
about 150,000 and the
number of houses being
built in Istanbul is less
than 30,000’
ALPER ÜNSAL,
Chairman of the Board of Alper Insaat
Kardemir
‘Our harbour project is
our biggest project and is
very important for
Turkey. It will be
completed in three years
maximum’
FADIL DEMIREL,
General Manager of Kardemir
4
IFC Reports are solely responsible for the content
Tuesday 19 July 2011
Tuesday19 July 2011
The flourishing construction industry is crucial toTurkey’s
Turkey, the world’s
second largest
contractor
development.More than 500 different materials supply
the sector, nearly all of which are produced locally
Local developers, infrastructure and construction firms, as well
as producers of construction materials, are powering forward
struction industry and helps the Turkish economy is Kardemir, a multi-faceted iron and steel
firm. It was established in 1937 and is currently
the only company that locally produces iron ore
as a raw material.
“Our competitors produce other products,but
they work with scrap. The quality of the steel
made from scrap is not as good as the steel made
from iron ore, so the quality of our steel is unparalleled,” comments Fadil Demirel,general manager of Kardemir.
Kardemir also produces various articles of mining equipment and is the only producer of steel
for rail production.Furthermore,there is no other rail producer in the Middle East or North
Africa, giving more business and opportunities to
Kardemir.
The company was privatised in 1995 and at this
time,£126 million was invested to modernise and
develop plants and to increase its force within the
market. Kardemir consists of blast furnaces, steel
plants, rolling mills, power plants, machinery factories, foundry plants, steel construction plants
and a lime and oxygen plant. The company employs 5,000 workers and provides products for
both the domestic and international markets.
Rail production capacity is 450,000 tonnes per year
and a new plant is being built with a 2.5-milliontonne capacity.
In addition to iron and steel,Kardemir is involved
in a hydraulic energy project with 22.5 megawatts
(MW) in capacity,which will be finished at the end
of the year.They also have a 50MW energy project to produce energy from its own waste gas
coming from its integrated plant. “We are going
to collect waste gases and turn them into energy,” Mr Demirel explains. “We will get a return
on our investment in just two and a half years.”
The main project Kardemir is involved in,however, is the building of its own harbour.
“Our biggest project is our harbour project,
which we are developing on our own. We have
conducted a feasible study for the underground
area and the bottom of the sea, working closely
with the government.This project is very important for Turkey [and will be] completed in three
years maximum.”
The Nata Group is anotherTurkish company that
has immersed itself in numerous sectors. While
operating in construction, infrastructure, real estate, investments, geothermal energy, mining and
aviation, Namik Tanik, chairman of the board, has
come a long way since launching his own company as a contractor at the age of 20.
“Currently we build roads,highways and bridges
at home and abroad.We also started the mall construction business in 2000.We are presently building our third shopping mall and also designing
our fourth and fifth projects. In 2008 we started
our international projects with a 1,800-kilometre
(1,118-mile) highway project in Turkmenistan.We
managed to complete 90 double-lane suspension
bridges.This made a total of 180 in 500 days,” Mr
Tanik says.
Affordable housing
prices through the
years have made
Turkey an attractive
destination for
British second home
buyers
5
Turkey
Turkey
TURKEY has become increasingly popular
as a second home location for British people. One major reason for this is the fact that its
real estate has remained inexpensive despite the
fact prices have dramatically risen in other parts
of Europe.
In 2010, the number of second homebuyers
rose in Turkey from 20,000 to 30,000,boosted by
the large international real estate companies that
have recently entered the market and which have
created a mortgage system that has also contributed to expanding Turkey’s economy. Owing
to this increase, the construction and real estate
sectors are additionally rising in importance.
Turkey’s economy is dynamic and continually
growing thanks to these sectors and it is home to
a number of globally competitive companies,all of
which currently do and will continue to serve as
the foundation of Turkey in years to come.
Alper Insaat, a construction company that has
carried out projects in South America, the Middle East,Turkey and its neighbouring countries, is
one of these companies.Alper Insaat has pursued
other industries,but keeps its focus mainly in construction.
“Construction is such an important sector because, like in any country, it impacts every other
sector in Turkey’s economy. Currently the annual demand for housing is about 150,000 and the
number of houses being built in Istanbul is less
than 30,000,” says Alper Ünsal, chairman of the
board.
Mr Ünsal was a key contributor in the Kartal
Project, the plan for a new, futuristic type of urban city environment that will be built in Istanbul.It is intended to be the world’s first fully green
city.This project was named among the top projects ever to be created by the Istanbul Metropolitan Planning Centre.Although Mr Ünsal would
like to expand into other sectors, construction is
so fruitful at this time in Turkey – and is his company’s field of expertise – his intention for the moment is to continue growing in construction.
“Our long-term plans are to expand into the
energy sector, yet we would like to become as
big as we can in the construction sector first.The
feasibility studies on Istanbul’s demand for housing and business centres reveal that the sector is
still promising to grow further,” Mr Ünsal explains.
Nevertheless, while the construction industry
is in high demand these days inTurkey,serving more
than 400 different industries and accelerating other sectors,Mr Ünsal claims working in the industry
is fulfilling in other ways, as well.
“Construction opens up many doors and helps
companies give back and commit to the social responsibility they have,” he explains.“Another distinctive feature for us is that in every project we
develop,we build part of a social area,such as cultural centres, small hospitals, parks, theatre halls,
mosques, etc.All of this, of course, is a part of our
social responsibility.”
Another company that benefits from the con-
IFC Reports are solely responsible for the content
Companies in
the construction
sector and its
related industries
enjoy a healthy
demand for building
projects
The success of Nata Group very much depends
on its fast pace.The company considers its Nata
Vega Shopping Centre to be its most prestigious
project currently under construction. In just 15
months, around 200 square metres of the development will have been completed.The complex
will include a 360-degree aquarium-restaurant and
the biggest Ikea and Metro Gross Markets inTurkey.
The Nata Group believes that the construction
sector is crucial to the nation’s development, especially since it escaped relatively unscathed from
the global financial crisis.In addition to opening up
a huge number of jobs – Nata employs 4,000 people – over 500 different types of materials are needed for the sector, easily making this industry the
locomotive of Turkey’s economy.
“Almost 95 per cent of the materials allocated
to the domestic construction market are produced in Turkey,” explains Mr Tanik.
While construction may be the engine of growth
now, Mr Tanik saw the importance of diversifying
his company early on and immersed the company into other sectors of the Turkish economy.“We
try to operate in areas where domestic and global needs are met. Our company has been growing in parallel with the Turkish economy. In addition to the activities mentioned, the production
of cement and concrete pipes are the current major sectors that we are a part of,” Mr Tanik says.
Aydiner Construction Co also believes in expanding its business into other sectors and demonstrates this through the abundance of services it
offers which, in addition to construction, include
energy, pump industry services, steel construction, tourism, agriculture, potable water, computer technologies,international mining and trade.
“We have some buildings under construction,
including hotels and three commercial buildings,
which we have sold already,” explains Ömer A
Aydiner, member of the board. “But Aydiner is
mainly involved in water-related infrastructure.
We do water transmission lines and distribution
lines, hydroelectric power plants, reservoirs and
dams,irrigation systems,sewage water and waste
water treatment plants and pipelines, etc.We also used to build bridges and roads.”
Aydiner Construction was one of the first companies to take a step toward investing in renewable energies when it was still unknown in what
direction this sector was headed.“The first projects here were not easy – it was an adventure
actually,” Mr Aydiner says.“Nobody, not even the
government, knew what was going to happen.”
The demand for energy in Turkey today is huge
and the more the sector is developed, the easier it will become to develop new industries.Aydiner Construction is also working on wind energy, having already completed one plant that is
in operation.Another two are being licenced and
prepared for construction.“The first one is about
30MW, the second will be 30MW and then the
third will be 25MW. We also have some other
plants outside of Turkey, like the gas plant running in partnership with the Ankara Organised
Industrial Trade Zone,” explains Mr Aydiner.
Mr Aydiner’s vision for the company is to always look ahead to see which industries are being expanded and to make sure his company is a
part of that.“We have three major international lines: energy, tourism and industry. Construction is always going to be there, whether we are
involved in energy, tourism and industry, or not.
For that reason, we are looking for opportunities for operational partnerships in tourism, as
well as examining several energy projects all over
the world.We are focusing on renewable sources
mainly, but we are taking other sectors into consideration as well,” Mr Aydiner says.
Another area where Aydiner Construction focuses its attention is in corporate social responsibility. It is currently undertaking a project through Ayen Enerji, engaging in a forestation plan in Kurthogazi to return a forest back
to its natural state. The company also offers
scholarships and builds schools and cultural
centres. ●
Aydiner
‘We are looking for
opportunities for
partnerships in tourism
and we are also looking
into several energy
projects’
ÖMER A AYDINER,
Member of the Board of Aydiner Construction Co
Nata Group
‘Almost 95 per cent
of the materials allocated
to the domestic
construction market are
produced
in Turkey’
NAMIK TANIK,
Chairman of the Board of Nata Group
Alper Insaat
‘Currently the annual
demand for housing is
about 150,000 and the
number of houses being
built in Istanbul is less
than 30,000’
ALPER ÜNSAL,
Chairman of the Board of Alper Insaat
Kardemir
‘Our harbour project is
our biggest project and is
very important for
Turkey. It will be
completed in three years
maximum’
FADIL DEMIREL,
General Manager of Kardemir
6
IFC Reports are solely responsible for the content
Tuesday 19 July 2011
Turkey
“
THE TELECOM industry is one of the
very few industries that has witnessed
technological improvement during the worldwide recession, thanks to huge growth in highspeed mobile internet traffic and constant
technological advancement.And Türk Telekom,
Turkey’s leading communication and convergence technology group, has experienced this
growth at full capacity.
Turkey is one of the fastest growing
economies in the world and has one of the
largest telecoms markets in the EMEA (Europe,
the Middle East and Africa) region.
This comes down to a few key factors; the
youth of Turkey – 50 per cent of the population are under 25 years of age – followed by
heavy research and development investment
to keep the company abreast, if not ahead, of
its competitors and lastly, a dynamic workforce. Türk Telekom currently has more than
34,000 employees and is one of the biggest employers in Turkey.
Türk Telekom has been the major communication network in Turkey since 1840. The
fast growing company provides integrated
telecommunication services ranging from PSTN
and GSM to broadband internet. As of March
31 2011,Türk Telecom Group companies have
16.3 million fixed access lines, 6.5 million
ADSL connections and over 11.5 million mobile subscribers.
Türk Telekom has been listed on the Istanbul Stock Exchange since May 2008.Apart from
81.4 per cent shares in Avea – one of the three
GSM operators in Turkey – Türk Telekom owns
wholesale data and capacity service provider
company Pantel International AG and its subsidiaries, as well as online gaming company
Sobee. The group also holds 99.9 per cent of
broadband provider TTNET, convergence technologies company Argela, IT solution provider
Innov, online education company Sebit AS, and
call centre company AssisTT.
The 2008 public offering of 15 per cent
shares of Türk Telekom was the seventh biggest
public offering in the world and the largest ever
in Turkey.
Chief executive officer Gökhan Bozkurt talks
in depth about the company’s future plans, its
success so far and how the company aims to
keep striving forward in difficult economic
times.
How is Turkey’s young population pushing the market forward?
Turkey has a population of more than 70 million, with half being under 25 years old, so obviously a promising young generation brings
competitive advantages to Turkey’s IT industry.
In the last couple of years, the growth in demand for data and broadband services has
been significant.We expect this trend to continue as the PC penetration increases. Convergence is also one of the main trends in the
sector.
How will continuous investment transform the sector in Turkey and Türk
Telekom’s position at a regional and at
a global level?
Turkey’s geographical location offers a great
opportunity to the IT and telecommunication
sectors to become the new hub in between
the East and West. We believe the region is
very important for the new so-called ‘Digital
Silk Road’ connecting the Middle East, Europe
and Asia.
In the first half of 2010, the Türk Telekom
Group took a historic step for the Turkish
telecommunication sector by agreeing to acquire 100 per cent shares of Invitel International, which is one of the leading independent
wholesale data and capacity service providers
in Europe. It has 27,000 kilometres (16,777
miles) of fibre-optic network across 16 countries. Invitel International has been renamed
Pantel.
This acquisition has enabled Türk Telekom
to become a serious hub connecting the data/broadband traffic in Central and Eastern
Europe,Turkey, the Middle East and Asian markets to Western Europe and the US.
We also recently signed a network agree-
We believe the region
is very important for
the new so-called
‘Digital Silk Road’
connecting the
Middle East, Europe
and Asia
“
Do you see Vision 2023 (the Turkish National Technology Foresight Programme)
attainable for the country and what role
will the ICT sector play in achieving it?
Turkey, as one of the fastest growing emerging markets, has a young workforce and a resilient banking and financial sector, as well as
robust macroeconomic fundamentals. Hence,
with its thriving manufacturing, tourism, services and financial sectors,Turkey stands as one
of the most attractive emerging markets with
a fast growth potential.
The ICT sector will be one of the main driving forces behind this growth.We believe that
the telecommunication infrastructure and information technology are very critical elements for Turkey’s competitiveness. At Türk
Telekom we work very hard in all these areas.
With its thriving
manufacturing,
tourism, services,
and financial sectors,
Turkey stands as one
of the most attractive
emerging markets
with a fast growth
potential
In 2010, we came out
on top once again in
the Turkey’s Most
Valuable Brands
survey
Gökhan Bozkurt, CEO of Türk Telekom Group
At the crossroads
of the world’s
communications
Türk Telekom Group is very well positioned to sustain its
momentum and continue to build on its recent growth in 2011
ment called JADI Link which connects Jeddah,
Amman, Damascus and Istanbul.The fibre-optic
line that will pass through Turkey, Syria, Jordan
and Saudi Arabia respectively will offer an important alternative in providing internet, data
and partial voice communication via Turkey to
South Asia and the Middle East with Europe
and the US.
How would you define your innovation
philosophy in a sector where inspiration
is vital?
Innovation is everything, but not only for our
sector; this motto is valid for every sector. A
company that wants to differentiate itself from
its competitors and to create more value for
its customers and shareholders must embrace
an innovative culture in all aspects of business.Therefore, the role of management is to
create an ecosystem and tools to formalise
ideas into business values.
After the innovation culture, R&D (research
and development) is the second most important operation. We need R&D in order to be
in a position to follow the technology but also to lead it. In line with our vision to export
Turkish technology all over the world, we attach great importance to our R&D activities.
We conduct our R&D activities both in Türk
Telekom and also through the group’s technology companies. Group companies including Argela, Innova, Sebit and Sobee are operating as R&D units of the Türk Telekom Group.
These companies play a significant role in the
development of Turkish technological power
and the export of convergence technologies.
Is there potential for selling Turkish telecom technology outside of Turkey?
In addition to contributing to the development
of local technologies, we operate with the vision
of contributing to a country which not only imports technology, but also produces and exports
technology.At Türk Telekom, our aim is to produce and export worldwide convergence technologies developed by Turkish engineers and we
continue our operations accordingly.
What isTürkTelekom’s contribution to developing Turkey’s ‘intelligence capital’?
We believe education, telecommunication infrastructure and IT are very critical elements for
Turkey’s competitiveness.We work very hard in
all these areas. In today’s information-driven society, we focus on making the internet available
for everybody as we believe this is critical for the
modern world.
Türk Telekom supports education with Türk
Telekom schools and its education products.
Thousands of students and teachers use Vitamin,
the online education software developed by one
of our group companies.Türk Telekom Group invested about TL 9 billion (£3.45 billion) in the
last five years to improve Turkey’s fixed and mobile networks,which are fundamental for high quality and reliable communication and IT services.
In terms of brand value, what associations would you like come to people’s
minds when they see the name Türk
Telekom and how does it add value to
Turkey?
In 2010, we succeeded in coming out on top
once again in the Turkey’s Most Valuable Brands
survey organised by Brand Finance, one of
the UK’s leading brand valuation companies.
We joined the survey for the first time in
2009 and came out on top with our brand value of £1 billion. We continued this achievement in 2010 and became Turkey’s Most Valuable Brand once more with our brand value
of £1.06 billion.
In the Digital Lovemark 2010 survey conducted by Ipsos KMG, a leading company in
sample-based market research,Türk Telekom
was selected as the most popular brand among
consumers, now for two years in a row. We
have also won the Best Innovation Award in
the Best Business Awards, one of the most
prestigious awards in the UK.
Can you share with us your expectations for 2011 and possible opportunities for institutional and UK investors?
This year Turkey is expected to continue with
its success story by displaying sustainable
growth and lowering its fiscal deficit and debt
burden even further.
In addition,Turkey stands as a candidate for
becoming an investment-grade country by
2012 at the latest. However, there are certain
outside risk factors. Oil and other commodity prices may pose some risk to Turkey’s external balances and inflation along with the economic recovery.
Nevertheless, Turkey’s proactive central
bank, which has committed to contain the
risks regarding price stability and financial stability, may help alleviate these risk factors.
We have a sustained dividend policy and
our robust revenue and strong cash flow capacity enables investment in promising segments and continuous growth.
Our shareholder base includes about 200
institutional investors from all around the
world.We follow best-in-class corporate governance and investor relations practices, and
we continue to attract significant interest
from the global investment community. ●
Tuesday 19 July 2011
IFC Reports are solely responsible for the content
7
Turkey
Betek Boya adds a splash
of colour to Turkey’s
economy
Consistently high standards
from the Steel Exporters’
Association keep Turkey ahead
CONSTRUCTION paint specialist Betek
Boya has managed to complete a growth
of 5,000 per cent in a very short time
thanks to a specific vision.
“First of all, we have had high ideals and
long-term goals rather than short-term
plans and aims. Our vision included a global perspective from the start,” says Tayfun
˘
Küçükoglu,
Betek Boya’s general manager.
“Secondly we firmly believed in the
growth of the Turkish economy and as
Betek grew, we shared our success with
those that had a stake in the company:
namely the distributors, retailers and
painters.We believed in the significance of
team spirit.”
Betek Boya started in 1988 making premade plasters and water isolation supplies.
In 1993, it moved into the constructionpainting sector through technological collaboration with the biggest paint brand in
Europe: Caparol.This was a turning point
for Turkey’s paint sector.
“The owner of Caparol believed in us and
has contributed considerably to our current success.They had negotiated with
many companies in Turkey, but realised a
local partner was absolutely key,” says Mr
˘
Küçükoglu.
Betek Boya became the market leader in
2001 and since then has maintained its
lead for 10 consecutive years. In 2004 it
completed its high-tech Gabze factory,
which now employs over 1,000 people.
˘
Mr Küçükoglu
attributes the company’s
success to its innovative philosophy.
“Innovation is a trendy term, but we believe
in realistic and innovative aims and our philosophy is to follow realistic ambitions.We
have learned very much about paint technology from our partner, but our success
lies in the fact that we have not just copied
the technology and applied them to our different settings. Rather, we have adapted
those elements to the specific countries
˘
where we operate,” explains Mr Küçükoglu.
TODAY, the iron and steel industry has become one of the most developed sectors of
Turkey.Whereas 10 years ago,Turkey
ranked sixth in Europe and 17th in the
world, today the industry stands second in
Europe and 10th worldwide. Namik Ekinci,
chairman of the board of the Steel Exporters’ Association and CEO of Ekinciler,
one the largest Turkish producers and exporters of long steel products, believes that
the iron and steel industry’s contributions
to the economy may play a vital role in
helping Turkey achieve its Vision 2023 of becoming a top 10 global economy.
The iron and steel industry was liberalised
nearly 30 years ago, along with the majority
of Turkey’s economic sectors, and has witnessed both tremendous growth and a
change in philosophy.
“Turkey was hungry for success,” recalls Mr
Ekinci. “Increased production capacity created a momentum for foreign trade and for
opening up to the other markets.”
The country’s total steel export value is expected to reach $16 billion (£10 billion) this
year, up 20 per cent compared with 2010,
owing in large part to an apparent growth
in crude steel production capacity, recovery
in international markets, and increasing
product prices triggered by the rising cost
of raw materials.
All members of the Steel Exporters’ Association boast ISO9001 certification and
their steel products are renowned throughout Europe for their high quality. Mr Ekinci
explains that producers buy scrap from the
US and Europe.They then transform it and
send it back as exports to the same countries. Not having the natural resources at
their disposal may appear to be a disadvantage, but through the stability of trade and
commerce with countries that demand
such high standards in iron and steel products, the association’s members have continuously and confidently produced high
quality products.
Tayfun Küçükoglu,
General Manager
˘
of Betek Boya
‘Innovation is a
trendy term, but we
believe in realistic
and innovative aims’
Betek Boya exports to many of its neighbouring countries and some countries in Europe. It
currently owns a production facility in Egypt
from where they sell to the North African,
Arabic and the Middle Eastern countries.
Enjoying such a strong brand name in
Turkey, Betek Boya is looking for other
investors and to possibly expand into the
food and beverage industry, where Mr
˘
Küçükoglu
hopes to have similar growth.
Namik Ekinci, Chairman of the Board of the Steel
Exporters’ Association and CEO of Ekinciler
‘Our capacity created
a momentum for
foreign trade and
opening new markets’
Maintaining high standards does not come
cheap, however; of the 25 million tonnes of scrap
iron consumed in Turkey, just 6 million come
from Turkey while the rest is imported.“This
means we lag behind our competitors in terms
of cost,” says Mr Ekinci.“In order to deal with
this disadvantage we try to concentrate more
on high technology and produce low-cost products at high quality.To be able to achieve this we
have to keep our profit margins quite low.”
8
IFC Reports are solely responsible for the content
Tuesday 19 July 2011