14 th Industrialists Conference Muscat, Sultanate of Oman 30 March 2014 Industrial Exports: Opportunities and Challenges Mustafa Mente Turkish Exporters Assembly Secretary General
Agenda 1. Turkish Exporters Assembly Who we are? Progress of Turkish Export 2. Turkish Economy and Export Development Snapshot of Turkish macroeconomic outlook 10 Reasons For Successful Industrial Export 3. 2023 Export Strategy Methodological Approach Focus Areas of Strategy 2
Billion US$ TIM (Turkish Exporters Assembly) We represent 60 regional and sectorial Exporters Associations, acting under 13 Secretariat Offices, with more than 58.000 active exporting companies. 1993 2013 2023 600 500 Turkish Exporters Assembly was established 400 200 0 151.8 15.3 47.2 1993 2003 2013 2023 We aim to increase annual Turkish exports to $ 500 bn 3
Our Main Activities Seeking solutions to common problems of Turkish exporters Representing exporters nationwide and abroad at the highest level. Ensuring coordination between Exporters Associations Establishing policies for improving exports and related services like logistics Ensuring coordination between the public and private sector organizations, exporters and decision makers 4
Sectorial Breakdown of Turkish Agriculture Industry Mining 7% 4% 3% 25 23.8 27% 5% 68% 37% 56% 9% 89% 2% 93% 20 15 10 5 0 13.2 1.3 4.4 70 s 80 s 96 Custom s Union 2013 Total Services Exports $ 42 bn. (2012) 5
Our Exports in 2013 By Region North American Countries $ 6,4 bn Share %4,4 Other American Countries $ 2,7 bn Share % 1,9 European Countries $ 61,9 bn Share %42,6 Middle Eastern Countries $ 27,5 bn Share %18,9 African Countries $ 14,1 bn Share %9,7 CIS Countries $ 18,2 bn Share %12,5 Far Eastern Countries & Other Asian Countries $ 7,6 bn Share %5,2 Other Countries: $ 7 billion 6
Agenda 1. Turkish Exporters Assembly Who we are? Progress of Turkish Export 2. Turkish Economy and Export Development Snapshot of Turkish macroeconomic outlook 10 Reasons For Successful Industrial Export 3. 2023 Export Strategy Methodological Approach Focus Areas of Strategy 7
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 GDP & GDP Per Capita 900 800 700 600 500 400 300 200 100 0 GDP levels more than tripled to $ 786 billion in 2012, up from $ 231 billion in 2002. 231 x3,3 786 2002 2012 12,000 10,000 8,000 6,000 4,000 2,000 0 3,492 GDP Per Capita Soared to $ 10,500 up from $ 3,500 between 2002-2012. 10,504 Source: UNCTAD, Ministry of Economy 8
Total FDI Inflow to Turkey ( Billion $) 14 12 10 8 In the 2013 World Investment Report of UNCTAD, with $12.4 billion inflow, Turkey was one of the most attractive country for FDI. USD 136 billion of FDI in the past 10 years 12 6 4 2 0 2 1 0.4 1980 1990 2000 2003-2013 Ave. Source: UNCTAD, Ministry of Economy 9
Turkey Has Room For Improvement to Shine as a Growth Story GROWTH FORECASTS FOR SELECTED COUNTRIES / COUNTRY GROUPS (%) IMF OECD DB TURKEY EURO ZONE USA BRAZIL RUSSIA 2013 3,8-0,4 1,9 2,3 1,5 2014 3,5 1,0 2,8 2,3 2,0 2015 4,3 1,4 3,0 2,8 2,5 2013 3,6-0,4 1,7 2,5 1,5 2014 3,8 1,0 2,9 2,2 2,3 2015 4,1 1,6 3,4 2,5 2,9 2013 4,3-0,4 1,8 2,2 1,3 2014 3,5 1,1 2,8 2,4 2,2 2015 3,9 1,4 2,9 2,7 2,7 10
10 Reasons For Successful Industrial Export Turkey: A Production Hub 11
10 Reasons For Successful Industrial Export 1. Liberal and Reformist Investment Climate Business-friendly environment with long tradition of market economy Turkey: A Production Hub 12
10 Reasons For Successful Industrial Export 1. Liberal and Reformist Investment Climate Business-friendly environment with long tradition of market economy Turkey: A Production Hub 2. Proximity to EU Market Potential EU Member State in the course of accession negotiations, CU member since 1996 13
10 Reasons For Successful Industrial Export 1. Liberal and Reformist Investment Climate Business-friendly environment with long tradition of market economy Turkey: A Production Hub 2. Proximity to EU Market Potential EU Member State in the course of accession negotiations, CU member since 1996 3. Easy access to MENA Region Easy access to Eurasia, the Middle East and North Africa 14
10 Reasons For Successful Industrial Export 1. Liberal and Reformist Investment Climate Business-friendly environment with long tradition of market economy Turkey: A Production Hub 2. Proximity to EU Market Potential EU Member State in the course of accession negotiations, CU member since 1996 3. Easy access to MENA Region Easy access to Eurasia, the Middle East and North Africa 4. Infrastructure Well-established transportation routes, organized industrial zones, techno parks, 15
10 Reasons For Successful Industrial Export 1. Liberal and Reformist Investment Climate Business-friendly environment with long tradition of market economy Turkey: A Production Hub 2. Proximity to EU Market Potential EU Member State in the course of accession negotiations, CU member since 1996 3. Easy access to MENA Region Easy access to Eurasia, the Middle East and North Africa 4. Infrastructure Well-established transportation routes, organized industrial zones, techno parks, 5. Qualified and Competitive Labor Force 27 million young & well educated labor force 16
10 Reasons For Successful Industrial Export 1. Liberal and Reformist Investment Climate Business-friendly environment with long tradition of market economy Turkey: A Production Hub 2. Proximity to EU Market Potential EU Member State in the course of accession negotiations, CU member since 1996 3. Easy access to MENA Region Easy access to Eurasia, the Middle East and North Africa 4. Infrastructure Well-established transportation routes, organized industrial zones, techno parks, 5. Qualified and Competitive Labor Force 27 million young & well educated labor force 6. Large Domestic Market 77 million population, median age 30 17
10 Reasons For Successful Industrial Export 1. Liberal and Reformist Investment Climate Business-friendly environment with long tradition of market economy Turkey: A Production Hub 2. Proximity to EU Market Potential EU Member State in the course of accession negotiations, CU member since 1996 3. Easy access to MENA Region Easy access to Eurasia, the Middle East and North Africa 4. Infrastructure Well-established transportation routes, organized industrial zones, techno parks, 5. Qualified and Competitive Labor Force 27 million young & well educated labor force 6. Large Domestic Market 77 million population, median age 30 7. Emerging Turkish consumer brands Strong brands to reach foreign consumers 18
10 Reasons For Successful Industrial Export 1. Liberal and Reformist Investment Climate Business-friendly environment with long tradition of market economy Turkey: A Production Hub 2. Proximity to EU Market Potential EU Member State in the course of accession negotiations, CU member since 1996 3. Easy access to MENA Region Easy access to Eurasia, the Middle East and North Africa 4. Infrastructure Well-established transportation routes, organized industrial zones, techno parks, 5. Qualified and Competitive Labor Force 27 million young & well educated labor force 6. Large Domestic Market 77 million population, median age 30 7. Emerging Turkish consumer brands Strong brands to reach foreign consumers 8. FDI for Export Green field FDI investments to boost export 19
10 Reasons For Successful Industrial Export 1. Liberal and Reformist Investment Climate Business-friendly environment with long tradition of market economy Turkey: A Production Hub 2. Proximity to EU Market Potential EU Member State in the course of accession negotiations, CU member since 1996 3. Easy access to MENA Region Easy access to Eurasia, the Middle East and North Africa 4. Infrastructure Well-established transportation routes, orgonized industrial zones, techno parks, 5. Qualified and Competitive Labor Force 27 million young & well educated labor force 6. Large Domestic Market 77 million population, median age 30 7. Emerging Turkish consumer brands Strong brands to reach foreign consumers 8. FDI for Export Green field FDI investments to boost export 9. University-Industry Cooperation Planned hence 1960 s and increasing now 20
10 Reasons For Successful Industrial Export 1. Liberal and Reformist Investment Climate Business-friendly environment with long tradition of market economy Turkey: A Production Hub 2. Proximity to EU Market Potential EU Member State in the course of accession negotiations, CU member since 1996 3. Easy access to MENA Region Easy access to Eurasia, the Middle East and North Africa 4. Infrastructure Well-established transportation routes, orgonized industrial zones, techno parks, 5. Qualified and Competitive Labor Force 27 million young & well educated labor force 6. Large Domestic Market 77 million population, median age 30 7. Emerging Turkish consumer brands Strong brands to reach foreign consumers 8. FDI for Export Green field FDI investments to boost export 9. University-Industry Cooperation Planned hence 1960 s and increasing now 10. Adaptability Huge incentives for R&D, innovation 21
Agenda 1. Turkish Exporters Assembly Who we are? Progress of Turkish Export 2. Turkish Economy and Export Development Snapshot of Turkish macroeconomic outlook 10 Reasons For Successful Industrial Export 3. 2023 Export Strategy Methodological Approach Focus Areas of Strategy 22
2023 Export Strategy of Turkey BEING AMONG TOP 10 LARGEST ECONOMIES $ 2 TRILLION GDP $ 25,000 INCOME PER CAPİTA $ 500 BILLION EXPORTS 10 GLOBAL BRANDS 23
2023 Export Strategy Planning Methodological Approach Strategy and Corporate Performance Management Model We conducted The first country-wide and sectoral level example of Balanced Scorecard " approach in Turkey, which is considered the most influential management idea of the last 75 years. 24
2023 Export Strategy 2013 x2 $ 3,0 / per kg $1,5 / per kg 98 million tons $ 152 billion x1.7 X3.4 166 million tons $ 500 billion 25
Top 5 Most Exported Sectors in 2013 & 2023 Export Targets ($ Bn) 80 75 16% 70 60 50 40 30 20 14% 50 9% 60 11% +13* +11% +13% 55 10% 45 8% +13% +14% 14% 12% 10% 8% 6% 4% 10 0 19 17.5 16 15.4 11.7 Automotive Chemical Apparel Steel Electric&Electronics 2013 2023 2023- Share 2% 0% * Required annual average growth rate to reach 2023 export target 26
BREAKTHROUGH INVESTMENT From Today to Tomorrow LEADERSHIP 2010 2011 2012 2009 2013 2018 2023 27
Turkish Exports in Middle & High Technology Products (%) 40.0% 35.0% 30.0% 27.3% 28.0% 29.2% 30.0% 30.8% 31.5% 32.1% 35.0% 25.0% 20.0% 15.0% Share of Middle & High Tech. Export Share of High Tech. Export 10.0% 5.0% 3.4% 3.6% 3.1% 3.5% 4.1% 4.9% 5.5% 8.0% 0.0% 2010 2011 2012 2013 2014 2015 2019 2023 28
4 Main Component of High Value Added Export Growth R&D Innovation Branding Design 29
Turkey Innovation Week &Turkey Innovation League 28-30 November 2013 2 nd Turkey Innovation Week 26.000 Participants 20.000 TIMTV+web viewers Over 500 R&D and Design Projects 54 R&D Centers 16 Technoparks 8 Science Centers 30
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