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YOUR COMPLIMENTARY COPY

7

TH YEAR

BRIEFING Turkey the Champion of Diplomacy Traffic IN DEPTH A New Era For Investors: Super Incentive System BRANDS Assan Foods: Grow In Industry Scale Continuously

AUGUST 2017 ISSUE 49

ECONOMY BUSINESS FOREIGN TRADE ANALYSIS

TurKEY energy: for An ambitious candidate Turkey has overcome its low self-sufficieny rate, thanks to successful politics of the consecutive governments in the last decade.


The Turkish Perspective

Contents 36 CoVeR 05 FIRST 05 | President Erdoğan: Hails ‘Defenders of Nation’ 06 | Bring Giant Venture Funds Together 07 | Free Trade Agreement Negotiations Begin 08 | Foreigners Line Up To Turkey 09 | Series of Strategic Decisions 10 | 23rd Summer Deaflympics In Samsun 11 | $1.5 Billion Financing From International Investors

05

TurKEY for energy:

An AmbiTious cAndidATE

Turkey’s self-sufficiency in when primary energytosources very low. Turkey is a vulnerablerate actor it comes energyissupply. the insufficient consecutive governments of ItsDespite primary energy source resources, is natural gas, 98%of which is exported. Turkey ingovernments the last decade used energy a keyas element The consecutive of Turkey used as energy a key element withagreat with greatsuccess. success.

13 BRIeFIng 13 | BRIdgeS To ouR eneRgy FuTuRe

High-level executives from leading energy companies and up to 50 energy ministers attended the triennial congress.

16 |mAInTAInIng uPwARd momenTum

The chemical sector maintained its upward momentum in the first half of the year, maintaining the third sector’s contribution to the Turkish economy.

17 |loComoTIVe oF TuRkISH eConomy

The Turkish Cement sector once more emphasized their importance with the “ISO 500”.

18 |ongoIng SuCCeSS In eXPoRT

In the first half of the year, the Turkish automotive sector exported 14 billion 359 million 485 thousand dollars with an increase of 22.4 percent.

19 |TuRkey THe CHAmPIon oF dIPlomACy TRAFFIC

Turkey President Recep Tayyip Erdoğan met other world leaders at Germany’s G-20.

57 BRAndS 22 |Tİm-TeB BuSIneSS HouSe PRoVIded InVAluABle BeneFITS

KeyID, which is supported by TİM-TEB Start-Up Business House, provides high technology products, integration services and consultancy services.

27 |Sky IS THe lImIT FoR TuRkISH eXPoRTeRS

52 | A new eRA FoR InVeSToRS: SuPeR InCenTIVe SySTem

57 57 | ASSAn FoodS: gRow In InduSTRy SCAle ConTInuouSly

The Turkish Exporters Assembly (TİM) announced the results of the “Turkish Export Products Perception and Image Research” conducted in 26 countries.

From the start to present day, Assan Foods has exported products to more than 70 countries.

30 |TuRkISH AIRlIneS Took THe CenTeR STAge AT gBTA ConVenTIon 2017

59 |TeRmIkel:CouRTeSy And CouRAge

Turkish Airlines Chairman of the Board and the Executive Committee İlker Aycı spoke at the Global Business Travel Association (GBTA) Convention.

32 |TuRkey ATTRACTS one oF THe woRld’S ToP mAnuFACTuReRS oF wInd TuRBIne BlAdeS

The new plant, with an initial annual capacity of 500 MW, features a world class high-tech production line.

52 IndePTH

Keeping a finger on the pulse of the industry for long years by making no concessions to the steps of development, Termikel has its signature under a number of innovations.

60 |mARkeT leAdeR In TuRkey

Wee Baby is the brand that was created by Burda Bebek A.Ş. in 1998 and today Wee Baby is the market leader in Turkey.

Turkey has started implementing a new model that could be called the “Super Incentive System” to attract investors.

52

62 AgendA FAIRS, eXHIBITIonS, SummITS, meeTIngS In THe neXT mounTH

63 FIguReS THe ToP 10 SeCToRS THAT InCReASe eXPoRTS THe HIgHeST RATe

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2 Online

Online

theturkishperspective.com MANAGEMENT Publisher on Behalf of Turkish Exporters Assembly/ CHAIRMAN of The Turkish Exporters Assembly

MEHMET BÜYÜKEKŞİ

The Turkish Perspective Digital

The Turkish Perspective website is to be launched soon. A new medium to learn, analyze and monitor everything about Turkish economy

Strategıc Partner Presıdent of Prıme Mınıstry Investment support and promotıon Agency

Arda Ermut

and business, is born. The Turkish Perspective Digital will share the latest

Manager In Charge H. BADER ARSlan PhD

news, interviews with decision makers, provide in-depth analyzes and will be the

PUBLICATION BOARD

foreigner’s guide in Turkey regarding regulations and legislations.

M. İlker aycı MUSTAFA ÇIKRIKÇIOĞLU Honorary PhD BİLAL EKŞİ SÜLEYMAN KOCASERT Noyan gürel BÜLENT AYMEN ZEKERİYA METE Furkan Karayaka

PUBLICATION MANAGEMENT President Mehmet Mücahİd Demİr

mdemir@theturkishperspective.com

VICE President YAŞAR MAMATİ Project COORDINATOR Ahmet Damgacıoğlu adamgacioglu@theturkishperspective.com

Business Culture t Investmen ce S and cien Innovation ay D e th Video of News keting d B r a n Ma r

Edıtorıal Editors mustafa yİğİt myigit@theturkishperspective.com

RAMAZAN GÜZYURDU european COORDINATOR İnanç atılgan contrıbutıng reporters İLHAN ALPAY OGAN ALPEREN ÇEVİKASLAN design

YOUR COMPLIMENTARY COPY

YOUR COMPLIMENTARY COPY

ExCLUSIvE INTERvIEw

The Minister of Economy expresses his views on economic developments in Turkey.

APRIL 2017 ISSUE 45

ECONOMY BUSINESS FOREIGN TRADE ANALYSIS

7

TH YEAR

PAnoRAmA Q&A on Turkey’s Attraction Centers Program BRIeFIng Startup Business House Project By TİM and TEB In dePTH Invest to learn, Learn to invest

mAy 2017 ISSue 46

eConomy BuSIneSS FoReIgn TRAde AnAlySIS

Discover your own story with Turkish economy’s comprehensive transformation process.

YOUR COMPLIMENTARY COPY

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YOUR COMPLIMENTARY COPY

BRIeFIng Strong Growth In National Defense Industry

7

TH YEAR

In dePTH Top 500 Industrial Enterprises BRAndS Ganjan New Town

july 2017 ISSue 48

eConomy BuSIneSS FoReIgn TRAde AnAlySIS

a New Form of Revolution Explore the achievements of Turkey’s service sector explained by the skilledworkforce, cost effective service compared to international standards.

BRIeFIng Turkey the Champion of Diplomacy Traffic In dePTH A New Era For Investors: Super Incentive System BRAndS Assan Foods: Grow In Industry Scale Continuously

AuguST 2017 ISSue 49

eConomy BuSIneSS FoReIgn TRAde AnAlySIS

TURKEY FORENERGY:

AN AMBITIOUS CANDIDATE Turkey is a vulnerable actor when it comes to energy supply.

More than a magazine, the Turkish Perspective will now be more interactive and responsive, as expected from Turkey’s main voice for international audience.

info@theturkishperspective.com

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contact T. + 90 212 216 19 48 info@medyatr.com.tr www.medyatr.com.tr Neither text nor photographs from this publication may be reproduced in full or part without acknowledging the source and securing prior permission from the publisher.

AUGUST 2017 ISSUE 49


The Turkish Perspective

Editorial MEHMET BÜYÜKEKŞİ PRESIDENT (TIM)

MANAGING PERCEPTIONS

World trade has contracted by %3,2 in 2016, but has been steadily increasing since last November. World trade has witnessed a 8,8% increase in the first 5 months of 2017.

T

he recovery in global trade

effects our exports also, having a leverage effect. Our national exports have increased by 8.2 percent in the first 6 months to reach 77.5 billion dollars. In this case, we reached the half of $ 155 billion target, which we set with our Ministry of Economy for 2017. Moreover, our exports have also increased by 12,6% in the first half of 2017 in terms of quantity. However, although our exports increased both in terms of value and quantity for that period, our export unit prices are not yet at the right place. At this point, we should focus on producing high-valueadded products and give importance to branding. In other words, R&D, innovation, branding and design should have high level importance for us. Similarly, our exporters should closely follow current technologies and tendencies to catch global trends easily. Only by this way, we could reach our targets. Beside all these, the perception generated for Turkish export products directly effects our exports, too. At this point, I would like to share with you our esteemed readers that we have successfully completed our Turkish Export Products Perception Researches, which we started in October 2016. With our research, we wanted to measure the current level of perception and level of Turkish export products in our foreign buyers. Besides, we want to produce a field study that will guide our firms for exporting in medium and long term. We performed three different

field measurements in this study, which we conducted with face-to-face interviews with managers responsible for purchasing a total of 2520 firms in twenty-six countries where we exported the most in the six main sector groups. Those are “Turkish Export Products Perceptions”, “Turkish General Perceptions” and “Turkey: Discover the Potential Campaign Awareness and Activity Perception” conducted by our Assembly. These three areas were met with strategic findings in our research. While 62 percent of the respondents said that they were especially satisfied with Turkish export products, the highest rate of satisfaction was in England with 85 percent, France with 77 percent and India with 74 percent. When we look at the rate of satisfaction of Turkish Export Products of our sectors, this ratio is quite close and high to all

of our sectors, and the highest sector is Electric and Machine by %65. On the other hand, we see that our image is high in Spain, Germany and India when we look at the country breakdown of our image while the proportion of those who find Turkey’s image positive is 60 percent. For the EU as a whole, this figure is above the general average which is 60 percent with 65 percent. The two sector groups with the highest overall image in terms of sectors were Chemicals and Textiles, Carpets, Leather with 63 percent. In the last section, we examined the level of reflection of the Turkish brand’s awareness, appreciation level, and thoughts on Turkey in campaign of Turkey: Discover the Potential. In general, Turkey’s brand awareness rate was 41%, the highest of these countries are Italy, Egypt and Russia. As a result of our research which we try to explain the outline, we see that the established perceptions about the Turkish export products, brand and image in foreign countries are positive. This study was the first step of an annual chain of researches about Turkish perception globally. We will conduct the second step of the same research next year. Thus, we will have the chance to compare the next year’s results with this year’s. This will give us a detailed information about how our works have affected the perception for our country and for our export products, and let us know what to do the next. We will, therefore, take firmer steps to our export targets forward.

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The Turkish Perspective Content: President Erdoğan: Hails ‘Defenders Of Nation’ P05 Bring Giant Venture Funds Together P06 Free Trade Agreement Negotiations Begin P07 Foreigners Line Up To Turkey P08 Series of Strategic Decisions P09 23rd Summer Deaflympics In Samsun P10 Financial Deal With International Investors P11 Editor: Mustafa Yiğit

First

polıtıcs, avıatıon, busıness, health, economy, energy, tourısm, fınance, sport, defense, dıplomacy... “There is no other nation who stops bullets by their chests. There is no other nation that stop tanks with punch.”

polıtıcs

President Erdoğan:

hails ‘defenders of nation’

Turkey’s president addresses commemoration ceremony at July 15 Martyrs’ Bridge to mark first anniversary of defeated coup.

P

resident Recep Tayyip Erdogan on July 15 applauded the nation for fighting a “gang of betrayal” during a coup attempt last July. At a ceremony to commemorate the July 15 defeated coup in front of the parliament building, Erdogan said

the country achieved a new victory by disrupting the 40-year plan of traitors in less than 20 hours. The government overthrows orchestrated by the Fetullah Terrorist Organization (FETO) and its U.S.-based leader, Fetullah Gulen,

martyred 250 souls and injured 2,200 others as Turks foiled the military coup with their bravery, courage, determination and patriotism. On the night, coup plotters in Istanbul used military tanks to close the Bosphorus Bridge -- later renamed the

Bridge of the Martyred of July 15. Warplanes flew at low altitude in the skies of Istanbul and Ankara, and bombed the parliament building and the headquarters of police and intelligence agency. “Had my nation took arms? Had my nation marched against the

scoundrels, traitors with weapons with their hands? My nation marched with their faith and flag. There is no other example of this. There is no other nation who stops bullets by their chests. There is no other nation that stop tanks with punch,” President said.

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First

AVIATION

TURKISH AIRLINES LAUNCHES ISTANBULPHUKET FLIGHTS

busıness

Bring Giant Venture Funds Together The Turkish Union of Chambers and Commodity Exchanges (TOBB), is set to bring $1 billion worth venture capital funds together with Turkish companies.

Turkish Airlines has launched direct flights from Istanbul to the Thai island of Phuket. In a statement, the company said four weekly flights to the island, off Thailand’s western coast, would cost from $569. “As an awardwinning airline that invites people to explore the beauties of our world, it was a natural choice for us to decide on Phuket as our next destination,” Turkish Airlines CEO Bilal Ekşi said in a statement. Turkish Airlines has 333 aircraft and flies to 251 international and 49 domestic destinations. It was named Europe’s Best Airline for the sixth time in last year’s World Airline Survey by Skytrax.

AUGUST 2017 ISSUE 49

health

Medicine For Japan’s Astellas

S

peaking to a group of journalists, TOBB head Rifat Hisarcıklıoğlu said their aim was to move the growing Anatolian companies up to an upper league. “We will bring a number of venture capital funds with an investment pool worth $1 billion together with Anatolian companies, which have great growth potentials, in the next two years. We want to help these companies scale up,” he noted. Saying that venture capital funds’ investments totaled $320 billion in 2016, Hisarcıklıoğlu noted that their investable financial sources hit $525 billion. According to Hisarcıklıoğlu, their aim is to take Istanbulbased venture capitalists, all of whom are the members of TOBB’s Venture Capital Assembly, to Anatolia. In a bid to achieve this goal, the association held its first meeting in this kind in the southeastern province of Gaziantep, which is a regional industrial hub, he said, adding that the second meeting will be held in the Central Anatolian province of Konya. “We invite companies which will lure the attention of venture capital funds according to a series of criteria, which are set by these funds. Companies which grew in the last three consecutive years on a sustainable manner attract their attention,” Hisarcıklıoğlu added. A total of 10 venture capital funds, namely Diffusion Capital Partners BV, Doğuş SK Girişim Sermayesi, Earlybird, İda Capital, İş Girişim Sermayesi, Mediterra Private Equity, Revo Capital, Taxim Capital Advisers Limited, Tekfen Ventures and Turkven Private Equity, will take part in this initiative.

Turkish pharmaceutical company Santa Farma signed a contract manufacturing agreement with company Astellas. According to the statement issued by Santa Farma, as part of the cooperation, the company will produce Astellas’s medicine for urinary system diseases at its production facility in Dilovası. Speaking on the agreement, Santa Farma CEO Erol Kiresepi said, “We are in a period when we are beginning to actualize our vision of domestic contract manufacturing as a result of the investments we have made... Our aim is to ensure that the products of the world’s leading pharmaceutical companies are produced in Turkey at our new and modern facilities.”


The Turkish Perspective

health

MEDICAL EQUIPMENT TO COLOMBIAN UNIVERSITY The Turkish Cooperation and Coordination Agency (TİKA) donated technical equipment to a Colombian university. TİKA donated the material to the nursing faculty of the University of Antioquia in the northwestern city of Medellin. A fully equipped patient simulator, a computer with drug recognition program and a vital symptom monitor were presented to school administrators during a ceremony, attended by TİKA’s Bogota Coordinator Mehmet Özkan. Lina Maria Zuleta Vanegas, dean of the nursing faculty, said TİKA made a very important contribution to the expansion of the capacity for training students and about 700 undergraduate and graduate students will benefit from the advanced technology equipment. Administrators thanked Turkey and TİKA for its support. TİKA was established in 1992 and is responsible for implementing Turkey’s developmental cooperation policies overseas.

economy

energy

Free Trade Agreement Negotiations Begin Turkey and Thailand, signed a declaration in Ankara to start negotiations for a free trade agreement.

S

peaking at the signing ceremony, Zeybekci underscored that the agreement with Thailand will increase bilateral trade between the two countries by 40 percent. He said that the first phase of the agreement negotiations would only cover goods trade and will gradually be expanded to cover other sectors. “The first stage of the agreement will cover merchandise trade while investments, services and electronic commerce will be incorporated in the free trade agreement in the next stage,” he said. Zeybekci stated, “We aim to move this perspective toward Asian and far east Asian countries.” He pointed out that similar free trade agreements with South Korea and Malaysia have already come into force and an agreement with Singapore was waiting for approval. In addition, negotiations with Japan, Indonesia, and Vietnam were also in progress, he confirmed.” Zeybekci said the agreement will make Thailand an important trade partner for Turkey.

strıkıng a balance Two ministers have set a joint target to double the trade volume between the countries within three years of the free trade agreement coming into force.

164 40%

$

MILLION

Turkey’s exports to Thailand

targeted bilateral trade between the two countries

1.5

$

BILLION

imports from turkey to thaıland

GREEN LIGHT FOR SOLAR PROJECTS IN PAKISTAN With new solar projects, Zorlu will increase solar capacity in Pakistan to 300 megawatts. Turkey is a step closer to building two solar power plants in Pakistan after receiving the necessary prelicenses, Turkey’s Zorlu Energy Electricity Generation Company announced on July 18. Zorlu Energy, via its subsidiaries Zorlu Sun Power Limited and Zorlu Renewable Pakistan Limited, will develop two solar power plants, each with 100 megawatts in capacity. Zorlu and the Punjab State Government signed a goodwill agreement for the projects in late February of this year. The completion timeline for the two projects was not revealed. In January, Zorlu and Pakistan agreed to a 100-megawatt solar project. The company previously announced plans to finish its first 100-megawatt Quaide-Azam solar project within the year. With the new solar projects totaling 200 megawatts, Zorlu will increase its solar capacity in Pakistan to 300 megawatts.

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First

fınance

health

foreıgners line up to turkey

Foreign banks, saw that political stability in Turkey, have put major projects in Turkey under their radar.

L

tourısm

Turkish TV series inspire Arab tourists People from Gulf and Arab states are increasingly spending their holidays in Turkey, as they try to replicate the life seen in Turkish TV shows. Ahmet Kırk, chairman of the Arab Travel Agencies and Tourism Development Association (ASATDER) said that people from Gulf and Arab countries watch Turkish TV series due to the common culture between them and Turkey, as well as the production quality of the TV series. Stressing that Turkish romantic and historical drama series are watched with great interest, Kırk noted that Gulf and Arab people like TV series shot in historical places, especially in Istanbul, so they want to see the actors and places where these TV series are filmed when they come to Istanbul. AUGUST 2017 ISSUE 49

eading banks in Germany have lined up to finance the third airport project. Accordingly, Germany’s largest bank, Deutsche Bank, has launched negotiations to refinance the third airport. A 4.5 billion-euro financing agreement was signed with six banks for the first round of the 150 million passenger-capacity project. Previously, Deutsche Bank offered to refinance the first phase financing package for the İzmirIstanbul highway project. The bank held talks with eight Turkish banks again, and the loan was renewed at a lower rate. Moreover, Export-Import Bank of Korea (KEXIM) Turkey Chief Representative Ahn Sang-Seon pointed out that the Çanakkale 1915 Bridge is an important project not only for the development of the region but also for Turkish history, stressing that this project will be

realized where the Turkish military achieved an important victory and will be inaugurated in 2023 when the 100th anniversary of the Republic of Turkey is celebrated. “During the bidding process, we sent our letter of intent about the financing of the project to the consortium. We currently continue our support for the financing of the project,” Sang-Seon added. The consortium that won the bid for the Çanakkale 1915 Bridge has two Korean contractors and Turkey’s leading groups, Limak and Yapı Merkezi. Daelim and SK fulfill an important criterion of having a Korean investor group among Kexim’s financing terms. SangSeon said that Kexim, founded in 1976, has 28 agencies around the world and that they opened their agencies in Turkey three years ago.

technology

Turkish Aerospace Industry Gear Up With New Center

Ao Turkish Aerospace Industries Inc. (TUSAŞ / TAI), will set up a “solution center” in Teknopark Istanbul.

T

AI General Manager Temel Kotil told Anadolu Agency (AA) that the aerospace industry is a field of study that requires continuous research and development (R&D) work and high technology. Kotil said TAI’s innovation policy has been defined as “the

execution of innovative and applied research activities in a way that will increase the competitiveness of the products of the company’s fields of activity” and “the study of innovative and hightech alternatives for the products whose external dependency is required to be terminated.

ıstanbul hosts cONGRESS ON HEALTH IN AFRICA Over 700 international participants from 60 countries are taking part in 2-day conference. Several African health ministers and experts along with Turkish authorities had an exchange of ideas in Istanbul on July 20 on the recent developments concerning health issues in Africa. The event was organized by the Federation of Islamic Medical Associations (FIMA) for the 35th Scientific Congress in partnership with the Turkish Ministry of Health, Hayat Foundation, and Istanbul Medeniyet University. Sudan Health Minister Bahar Idriss Abu Garda said the Africa had experienced serious health-related difficulties, most of which are still ongoing.


The Turkish Perspective

economy

economy

Series of Strategic Decisions

Act on Al-Aqsa restrictions

As employment mobilization continues, the government is preparing for a new move that will implement a series of strategic decisions.

President Recep Tayyip Erdoğan condemned the Israeli restrictions on Al-Aqsa Mosque.

buy new ship with EBRD loan The European Bank for Reconstruction and Development (EBRD) has said it providing a boost to the Turkish shipping industry with a 27.5 million euro loan. Alternative Transport is investing in a new 55.5 million euro vessel with a capacity of 283 trailers to carry wheeled cargo such as cars, trucks, trailers or railroad cars that are driven on and off the vessel, read the statement. The new cargo ship will enable the firm’s much-needed expansion on the route connecting the Istanbul port of Haydarpaşa and the north-eastern Italian port city of Trieste, increasing profitability and operating efficiency.

dıplomacy

C

onsisting of 20 main constituents, the National Employment Strategy includes training for 500,000 tourism professionals, the recruitment of 10,000 information technology (IT) specialists every year, premium regulations or flexible working staff, maternity leave and consultancy services for whitecollar workers. In the scope of the government’s National Employment Strategy and the 2017-2019 Action Plan, 500,000 young people will be provided labor force training in the tourism sector and 400,000 employees in the tourism sector will be provided on-the-job training. Seasonal employment will be eliminated, as well as clandestine employment in the sector and failure to report labor wages will be eliminated. Employment in the tourism sector will increase by 80 percent. A total of 10,000 IT specialists will be trained yearly and job

opportunities for nearly 100,000 IT specialists will be created by 2023. The government is also planning to design a labor market information-monitoring system, and improve the capacity of education and training to meet the labor market requirements. Women who migrate from villages will receive lessons to help them enter the labor force. Business and counseling services will be provided for all individuals of working age who receive welfare benefits. National occupational standards will be prepared in the finance sector. Flexible conditions will be provided regarding premium days in flexible worker’s leave and maternity leave. The forms of flexible working will be supported with the social security system, the acquired rights of works will be protected and their employability will be ensured as part of economic and social rights.

A statement released on the Presidency website said that it is unacceptable for Israel to impose new restrictions on Muslims’ entrance to the al-Haram ash-Sharif complex - which includes AlAqsa Mosque and the Dome of The Rock - by justifying it through the incident on July 14, which was also regretted by Turkey. Erdoğan condemned Israel’s attitude despite all warnings, prevention of Muslims’ performing Friday prayers at the Al-Aqsa Mosque and the use of excessive force by Israeli security forces against people who gathered for Friday prayers as the term chairman of the Organisation of Islamic Cooperation (OIC), while extending his condolences to those who were killed during the clashes in Jerusalem. “The Organisation of Islamic Cooperation was founded in 1969 during an attack against al-Haram ash-Sharif; and today the Islamic world stands with our Palestinian brothers with the same spirit of unity and solidarity,” Erdoğan said.

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sport

23rd SUMMER DEAFLYMPICS IN SAMSUN

The 23rd Summer Deaflympics started on July 18 in province of Samsun, where more than 3,000 athletes from 97 countries - the highest ever number of participants in the event’s history - are competing. As many as 294 athletes are participating in the event from Turkey.

A

round 1,500 volunteers are carrying out duties during the event, of whom 250 are deaf. In addition, 500 sign language translators will work at the event. Before the start of the international event, hearing impaired athlete Onur Kayıhan lectured 350 volunteers and 40 other people whose mothers or fathers were hearing impaired to teach sign language. “I did not meet any hearing impaired friends until I was 17,” said Kayıhan, adding that he started doing sports afterwards, when he was taking speaking lessons at the Anadolu University in the Central Anatolian province of Eskişehir. “Then I saw that there were many people like me,” the 35-year-old told Doğan News Agency. “Then I learned the sign language. I understood that it was very important for me and it was actually my mother tongue.” In addition, local authorities provided lessons for journalists who are covering the games. The participants are competing in 21 categories, including athletics, badminton, basketball, beach volleyball, bowling, cycling, football, golf, handball, judo, karate, mountain bike, shooting, swimming, table tennis, AUGUST 2017 ISSUE 49

97 37

countrıes partıcıpated the deaflympıcs

sports facilities wıll be used in the games

3000

athletes from all over the world

Turkey participated in the Deaflympics for the first time in 1989 and won 84 medals so far, 17 of which were gold.

taekwondo, tennis, volleyball and wrestling. The Deaflympics will be held at 37 sports facilities in eight different districts of Samsun. As many as 294 athletes are participating in the event from Turkey. The first Deaflympics was organized by the International Committee of Sports for the Deaf (ICSD) in Paris in 1924 and the number of participating countries has risen constantly if the World War II era is disregarded. The U.S. has been the most successful country in the Deaflympics with 987 medals, of which 350 were gold. Turkey participated in the Deaflympics for the first time in 1989 and won 84 medals so far, 17 of which were gold; 33 of these medals were won by Turkish athletes in last summer’s games in Sofia, Bulgaria. Turkey expects a record number of medals at the Samsun games, Turkish Sports Minister Akif Çağatay Kılıç said, praising efforts to register Turkey as the host country. Samsun police chief Vedat Yavuz said some 3,500 officers would be on duty for security.


The Turkish Perspective

defense

Turkey joins ItalianFrench consortium Turkey has signed an agreement with Italian-French consortium Eurosam to develop its national missile defense system. “I am happy to announce that this afternoon Turkey has signed a cooperation agreement with Italian-French consortium Eurosam to produce missile defense systems,” the Defense Minister said, speaking at a reception for Bastille Day at the French embassy in Ankara. According to the deal, Turksh companies and Eurosam will work together to produce SAMP/T Aster 30 long-range surface-to-air missile (SAM) systems, which is already in use in several NATO member countries.

busıness

economy

Financial Deal With International Investors Turkey’s Rönesans Health Investment and Japan’s Sojitz have concluded a $1.5 billion financial deal with eight international investors for joint city hospital.

S

ome 80 percent of the total investment of the project was thus met with the financial closing agreement, which was signed in Istanbul on July 21 by the project owners with JBIC, NEXI, SMBC, BTMU, Nippon Life Insurance Company, Dai-ichi Life Insurance Company, the Iyo Bank and Standard Chartered. In a bid to be one of the world’s largest hospitals with a capacity of 2,700 beds, Istanbul’s İkitelli City Hospital will provide and create 10,000 jobs when it is commissioned, according to a follow-up press release from Rönesans. The hospital will provide services to 23,600 patients on daily basis. Its construction is planned to commence on Oct. 1 and to be completed within 36 months. To be equipped with more than 2,000 isolators, the hospital will be the world’s largest building with seismic isolators, which enables it to be able to continue its normal operation even during big earthquakes. Erman Ilıcak, president of Rönesans Holding, said the hospital would be built on an over 1 million-square-meter area by more than 5,000 workers in a three-year period.

turning Istanbul into a health capital The hospital will play a key role in turning Istanbul into a health capital and health tourism hub when it becomes fully operational.

3.2

9500

construction area

capacity of healthcare

MILLION square-meter

beds

1.82

$

BILLION

total costs of the hospıtal

Turkey set for high-level EU meeting Turkish ministers to meet senior EU figures next week for wideranging talks. Turkish and EU figures are set for a high-level meeting next week to work on Ankara’s longrunning bid to join the bloc, Turkey’s foreign ministry announced on Friday. Next Tuesday will see talks in Brussels between Foreign Minister Mevlüt Çavuşoğlu and EU Minister Ömer Çelik plus EU foreign policy chief Federica Mogherini and Johannes Hahn, EU Enlargement Commissioner. The state of Turkey’s accession talks as well as economy, trade, counterterrorism, migration and visa liberalization will all be on the agenda, the ministry added.

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The Turkish Perspective Content: Bridges to Our Energy Future P13 Maintaining Upward Momentum P16 Locomotive of Turkish Economy P17 Ongoing Success In Export P18 Turkey The Champion of Diplomacy Traffic P19 TİM-TEB Business House Provided Invaluable Benefits P22 More Work More Success P24 Turkish Airlines Took The Center Stage At GBTA Convention 2017 P30 Turkey Attracts One of The World’s Top Manufacturers of Wind Turbine Blades P32 Editor: Mustafa Yiğit

Briefing

energy, chemıcal, cement, automotıve, summıt, startup, exporters dıary...

Around 3,000 delegates from more than 90 countries had participated in the congress in four days.

energy

BRIDGES TO OUR ENERGY FUTURE

High-level executives from leading energy companies and up to 50 energy ministers attended the triennial congress. By RAMAZAN GÜZYURDU

photograph byLOREM IPSUM

D

ubbed as the “Olympics of Petroleum”, the 22nd World Petroleum Congress (WPC), which gathered top managers of the leading oil and gas companies in Istanbul, has ended. During the closing ceremony, Turkey’s Energy Ministry undersecretary Fatih Dönmez handed over the official emblem of the WPC to the host of the next congress, Sylvester Turner, the mayor of the U.S. city of Houston.

Speaking at the ceremony, Dönmez said that around 3,000 delegates from more than 90 countries had participated in the congress in four days. Anadolu Agency was the global communications partner of the largest meeting of the oil and gas industry, which took place between July 9 and July 13. High-level executives from leading energy companies and up to 50 energy

ministers attended the triennial congress, of which the theme was “Bridges to our Energy Future”. Turkish Energy Minister Berat Albayrak as well as his Russian counterpart Alexander Novak, Bahrain Oil Minister Shaikh Mohammed bin Khalifa bin Ahmed al-Khalifa and Minister of Petroleum and Natural Gas of India Dharmendra Pradhan also attended to the congress.

13


Briefing

ceremony and said that the program was very good.

President of the World Petroleum Council Jozsef Toth also said that they had a great week and thanked everyone who contributed. Stressing that serious slats are exceeded in terms of excellence in Congress Toth, “We had a very good quality congress. It was a great opportunity for cooperation will be held in the coming years. We want to build new bridges in the coming years.” Besim Sisman, President of the Turkish National Committee of the World Petroleum Congress and TP General Manager Besim Sisman stated that Turkey has been working for this event for a long time and said “Turkey is a key country thanks to its diplomatic vision and Turkey has always been in favor of peace and dialogue. It’s the philosophy behind the WPC “ he said. The Mayor of Houston, Sylvester Turner, said that the Turkish National Committee had done a great job and said, “They organized a perfect congress and they was very productive conclusion from the very beginning in terms of content” he said. Stressing that Houston’s election to organize the 23rd World Petroleum Congress is very important for them, Turner said: “When you come to Houston in 2020, we will try to do what is best for you, we will try to organize the WPC as the world is proud, we will try to meet both our heart and soul with you and we will organize a congress so that you can come and have a good time with your family.” Galen Cobb, President of the American National Committee, said that Turkey had a great job from the opening to the closing

The congress, known as the Olympics of the oil and natural gas industry, was held under the auspices of President Recep Tayyip Erdoğan. Erdoğan said in his speech “the way to become a powerful country for the last 1-1.5 centuries is to have energy sources or to have a say on them,” he said. “However, efforts to dominate the energy resources and roads that are at the center of global conflicts often end in internal conflicts. We have to remember that oil and natural gas, which should be a source of wealth and prosperity in the geographical region where we exist, have to be remembered with more war, blood and tears. We have been contributing to the peace and prosperity of mankind from the very beginning as Turkey. We need to use it in such a way as to provide it” added that. In addition to President Erdoğan, Prime Minister Binali Yıldırım, Energy and Natural Resources Minister Berat Albayrak, President of Azerbaijan Ilham Aliyev, Russian Energy Minister Alexander Novak, President of Serbia Aleksandar Vucic, Albanian Prime Minister Edi Rama, Bulgarian Prime Minister Boyko Borisov, as well as numerous countries Energy and oil ministers also participated to the congress. Muhammed Barkindo, General Secretary of the Petroleum Exporting Countries (OPEC), Farih Birol, Executive Director of the International Energy Agency (EIA), and senior representatives of various international organizations and think tanks have been sharing their ideas about the sector. In addition, senior executives, policy makers,

AUGUST 2017 ISSUE 49

Details Of The Congress

We have been contributing to the peace and prosperity of mankind from the very beginning as Turkey.

decision makers and opinion leaders from leading energy companies such as Shell, BP, ExxonMobil, Chevron, Total and Statoil made assessments on various panels.

Featured in the Congress High-level executives from leading energy companies and up to 50 energy ministers attended the triennial congress.

Within the scope of the congress, World Petroleum Council President Jozsef Toth presented the “Dewhurst Award” given to US Secretary of State Rex Tillerson, former president and CEO of energy company ExxonMobil,

photograph byLOREM IPSUM

“We want to build new bridges”

photograph byLOREM IPSUM

14


The Turkish Perspective

photograph byLOREM IPSUM

photograph byLOREM IPSUM

About The World Petroleum Council (WPC)

Thomas Dewhurst, founder of WPC. Minister Albayrak held a series of bilateral talks, mainly on the congressional basis, with Tillerson and Russian Energy Minister Aleksandr Novak. Albayrak, who accepted Istanbul’s ministers and sector representatives separately, shared his Twitter account on the subject and said, “With the diplomacy we carry out within the scope of congress, Turkey is energizing the ‘key’ country position” said that. Albayrak also met with Israeli Minister of Energy, Infrastructure and Water Resources Yuval Steinitz. “Following the four rounds of talks, we decided to speed up the negotiations between us and conclude an intergovernmental agreement to build the pipeline between Turkey and Israel before the end of this year,” Steinitz said, referring to Albayrak and the construction process of the natural gas pipeline between the two countries.

The World Petroleum Council (WPC) is a non-advocacy, non-political organisation with charitable status in the U.K. and has accreditation as a Non-Governmental Organization (NGO) from the United Nations (UN). The WPC is dedicated to the promotion of sustainable management and use of the world’s petroleum resources for the benefit of all. Accordingly the WPC does not have a formal position on issues but does act as a forum to bring together in dialogue the various sectors of society that have views on specific issues. WPC is a non-advocacy, non-political organization and has accreditation as a Non-Governmental Organization (NGO) from the UN. The WPC is dedicated to the application of scientific advances in the oil and gas industries, to technology transfer and to the use of the world’s petroleum (oil and gas) resources for the benefit of all. Headquartered in London, since 1933, the World Petroleum Council includes 70 member countries from around the world representing

“With the diplomacy we carry out within the scope of congress, Turkey is energizing the ‘key’ country position.”

133

over 96% of global oil and gas production and consumption. WPC membership is unique as it includes both OPEC and Non-OPEC countries with representation of National Oil Companies (NOC’s) as well as Independent Oil Companies (IOC’s). Each country has a National Committee made up from representatives of the oil and gas industry, academia and research institutions and government departments. Governing body is the Council consisting of representation from each of the country national committees. Every three years the Council organizes the World Petroleum Congress hosted by one of its member countries. The triennial Congress is also known as the “Olympics” of the petroleum industry and covers all aspects of the industry from technological advances in upstream and downstream operations to the role of natural gas and renewables, management of the industry and its social, economic and environmental impact. In addition, outside stakeholders such as governments, other industry sectors, NGOs and international institutions have also joined in the dialogue.

Net Oıl export of OPEc’s member country

This statistic represents OPEC’s net oil export revenue streams in 2016, by member country (excluding Iran). Revenue in billion U.S. dollars

54 47 37 36 S. ARABIA

IRAQ

UAE

KUWAIT

IRAN

26 26 24 22 19 ANGOLA

NIGERIA

QATAR

4

VENEZUELA ALGERIA ECUADOR

2 LIBYA Data: OPEC

15


Briefing

chemical

MAINTAINING UPWARD MOMENTUM

The chemical sector maintained its upward momentum in the first half of the year, maintaining the third sector’s contribution to the Turkish economy. By alperen çevikaslan

Demand from the European Union countries continues to contribute to the export of chemicals. In the first half of the year, EU’s share of chemical exports increased to 35 percent. Germany, Italy, Spain and Greece were among the top 10 exporting countries

ccording to the

data of the Association of Exporters of Chemicals and Products of Istanbul (İKMİB); Chemical exports, according to the same period of the year, increased by 11.79 percent with an increase of 9 million 477 thousand tons. Besides, the value of the sector increased by 13.17 percent with 7 billion 955 million dollars in the first half of the year. EU countries took the biggest share with 35 percent of January-June 2017 exports.

Plastic Products: Leader In Sub-Sectors

The effect of USA and Russia The increase in exports in the first half of the year made chemistry industry comfortable. According to the same period of the first half of the year, exports of the sector reached 9 billion 477 thousand tons with an increase of 11.79 percent and 7 billion 955 million dollars with a value increase of 13.17 percent. The increase in exports to the USA and Russia among the most important markets in addition to the demand from the EU countries also supported the upward trend. Exports to the US amounted to 334 million 337 thousand dollars with an increase of 36.74 percent, placing the country in the 5th place in the ranking of the countries with the highest exports. Russia rose by 35.21 percent and was ranked 18th AUGUST 2017 ISSUE 49

35 Percent Recorded In The First Six Months Chemical Exports

11.79% ıncrease

ın tons of chemıcal exports compared to 2016

7.95 Billıon DOLLARS

total export ın the fırst half of the year

2017

The increase in exports in the first half of the year made chemistry industry comfortable.

In the first half of the year, the sub-sectors exported the most chemicals to plastics and supplies, while the strongest increase was in mineral fuels and oils. In January-June 2017 period, plastics and products increased by 1.17 percent and exports of $ 2 billion 545 million were sustained. Mineral fuels, oils and products increased by 61.82 percent to $ 2 billion 67 million dollars while second place with an increase of 3.20 percent and 607 million 586 thousand dollars with rubber and rubber products undertaken. When looking at the exports of the chemical sector on a monthly basis, it is seen that exports of the sector decreased by 1.64 percent in the same month of the year when exports of the sector decreased by 1 million 447 thousand tons and 2.53 percent in value by 1 billion 291 million dollars. The top ten countries exported the most in this period; Egypt, USA, Germany, Iraq, Spain, Italy, Iran, Romania, United Arab Emirates and Bulgaria.

photograph byLOREM IPSUM

A

with exports of 144 million 653 thousand dollars. During the period of January-June 2017, the 10 countries that the chemical sector performed the most were; United Arab Emirates, Germany, Iraq, Egypt, USA, Italy, Iran, Spain, Singapore and Greece.

photograph byLOREM IPSUM

16


The Turkish Perspective

CEMENT

LOCOMOTIVE OF TURKISH ECONOMY The Turkish Cement sector once more emphasized their importance with the “ISO 500”. By ilhan alpay ogan

“OUR TARGET IS 110 MILLION TON CAPACITY” M. Şefik Tüzün refers to the future of the industry; “The clinker capacity of the Turkish cement industry has been 80 million tons by the end of 2016. This figure is expected to be 82.5 million tons at the end of 2017 and 85 million tons of clinker capacity and 110 million tons of equivalent cement capacity at the end of 2017 with the planned capacity increases” said that.

“MEGA PROJECTS WILL PROVIDE CONTRIBUTION TO CEMENT SECTOR GROWTH”

photograph byLOREM IPSUM

photograph byLOREM IPSUM

I

stanbul Chamber of Industry (ISO) announced the results of the “Turkey’s Top 500 Industrial Enterprises Research 2016”. In this list, which is of great importance for the Turkish economy, 20 cement companies belonging to the Turkish Cement Manufacturers’ Association took place. Although the Turkish economy has left a difficult year behind, according to the results of ISO 500, the sales of industrial giants increased by 8.8 percent compared to the previous year and reached 490 billion TL, the total operating profit increased by 18.6 percent to 52.4 billion TL And total exports rose by 3.1 percent to $ 55.1 billion.

CEMENT SECTOR DEVELOPS TURKISH ECONOMY The Turkish Cement sector once more emphasized

The Turkish Cement sector once more emphasized their importance with the “ISO 500” and 20 cement companies took place among the elders.

8.8% ıncrease

ın the sales compared the prevıous year

their importance with the “ISO 500” and 20 cement companies took place among the elders. The 20 giant names of the cement industry reached a turnover of 9.944.778.466 TL. M. Şefik Tüzün, Chairman of the Turkish Cement Manufacturers’ Association (TÇMB); “This list once again proves that our cement industry is a fundamental building block in the country’s development. Moreover, according to the first three months of the year of the year in the cement sector, 13.4 percent of the produced cement contributed to the export. In other words, we continue our last year’s growth in a sustainable way both inside and outside. This support we have given to the Turkish economy gives us pride.”

“Urban transformation projects that are implemented by the government, the third airport, Eurasia Tunnel, subway and highway projects have a direct impact on the sector and energy investments such as HEPP, WPP, etc., which aim to reduce Turkey’s energy dependency, will contribute to the growth of the cement sector in 2017. However, despite the stagnation of the domestic cement demand and the decrease in the growth rate in the last 2 years, the new investments on the agenda and the future capacity of the additional capacities increase the dependency of the sector on export performance. The failure to the anticipated recovery and growth in the global economy, the ongoing mixed and unstable situation in the political and economic aspects of the Middle East and North Africa (MENA) region, which is a major milestone for the Turkish cement sector, the inability to capture the expected growth in Europe, it is a disadvantage for Turkey, which is one of the leading countries of exports. These issues need to be addressed sensitively and new policies must be adopted.” Tüzün added that.

17


Briefing

automotıve

ONGOING SUCCESS IN EXPORT

In the first half of the year, the Turkish automotive sector exported 14 billion 359 million 485 thousand dollars with an increase of 22.4 percent. By RAMAZAN GÜZYURDU urkish automotive

sector broke new record with 14 billion 359 million 485 thousand dollars export in the first half of the year. In recent years, the sector closed the January-June period with foreign sales of $ 10-11.8 billion, leaving $ 24.7 billion behind by $ 13.6 billion in the first half of 2008, when the export record was broken all the time. Automotive sector, exports of 11 billion 734 million 74 thousand dollars in January-June period of the year, increased by 22.4 percent in the same period this year carried 14 billion 359 million 485 thousand dollars. Having the largest share with 18.8 percent of Turkey’s total exports, the automotive leader also completed the first half of the year as a clear leader. Automotive followed by “Apparel” with 10.7 percent, “Chemicals and Chemical Products” with 10.4 percent and “Steel” sectors with 7.6 percent. The automotive sector exported 174 countries and autonomous regions and 12 free zones in this period.

16.4 Percent Increase in June In June of last year, the automotive industry, which realized export of 2 billion 147 million 765 thousand dollars, increased its exports AUGUST 2017 ISSUE 49

9 of the Top 10 Countries Exported Are Again in the EU

by 16.4 percent to 2 billion 500 million 46 thousand dollars in the same period of this year. In the sector exports, the 36.8 percent increase in January was recorded as the highest rate of increase since August 2011 (66 months) on a monthly basis. In February, automotive increased its foreign sales by 12.5 percent, and with an increase of 32.5 percent

22.4% ıncrease

total export as of june 2017 compared to 2016

14

bıllıon dollars total export ın the fırst half of the year

Nine of the top 10 countries exported by the Turkish automotive sector were also members of the European Union (EU) member countries. January-June period, an increase of 12.52 percent 2 billion 191 million 277 thousand dollars in exports maintained the German leadership. Italy, with an increase of 28.47 percent in Germany and 1 billion 676 million 900 thousand dollars, with an increase of 19.33 percent and 1 billion 469 million 803 thousand dollars in the United Kingdom, an increase of 26.50 percent and 1 billion 488 France with 150 million dollars, followed by Spain with an increase of 26.30 percent and 827 million 624 thousand dollars. The United States, Belgium, Poland, Slovenia and the Netherlands were also among the countries with the highest exports.

photograph byLOREM IPSUM

T

in March, it sold 2 billion 712 million 809 thousand dollars in foreign sales, thus reaching the highest export figure of its history on a monthly basis. The sector recorded 12.4 percent increase in exports and 28.4 percent increase in May. The sector, which has completed foreign trade in the January-June period of 10-11.8 billion dollars in recent years, has reached $ 13.7 billion in the first half of 2008, when the export record was broken all the time with 24.7 billion dollars, and reached 14.3 billion dollars With the signing of a record in the first half of this year.

photograph byLOREM IPSUM

18


The Turkish Perspective

The president also vowed that Turkey would not allow efforts to establish a Kurdish state in northern Syria.

G 20 SUMMIT

Turkey the Champion of Diplomacy Traffic

Turkey President Recep Tayyip Erdoğan met other world leaders at Germany’s G-20. By MUSTAFA YİĞİT

photograph byLOREM IPSUM

photograph byLOREM IPSUM

T

he summit began at July 7, with conflicts

looming over climate, trade and other global issues both inside and outside the heavily fortified venue. Fears over nuclear-armed North Korea, which just successfully tested an intercontinental ballistic missile (ICBM), casted long shadow over the gathering, which brought the leaders of China, Japan and South Korea to the northern city of Hamburg. Some 20,000 police guarded the heads of the Group of 20 big industrialized and emerging economies against anticapitalist protesters are greeting them with the combative slogan “G-20 - Welcome to Hell.”

The year’s biggest diplomatic event outside the UN also provided a stage for other world leaders muscling for power and regional influence.

But trouble is also brewed at the conference table at a time when the West and Europe are deeply divided, the post-Cold War order is fraying and China and Russia are asserting themselves on the global stage. All eyes were on Trump, who had vowed North Korea’s goal of developing a nuclear weapon that can reach the U.S. “won’t happen” and has repeatedly pressed China to rein in its truculent neighbor. In the most anticipated moment of the G-20, Trump met Russian President Vladimir Putin, the ex-KGB agent accused of having aided, with hackers and fake news, the surprise ascent of

the property tycoon to the White House. The moment they shake hands is sure to see “an Olympian level of macho posturing between these two leaders, who both understand the importance of symbolism and the perception of being tough,” said Derek Chollet of the German Marshall Fund of the United States. Chinese President Xi Jinping, who met German Chancellor Angela Merkel held talks with regional rival Japan’s Prime Minister Shinzo Abe, at a time when both increasingly worry about the threat posed by Pyongyang. Also looming over the summit was the bloody conflict in Syria and the frozen one in Ukraine - both involving Russia - as well as the struggle for Mideast dominance between Saudi Arabia and Iran. Trump, before the summit, met leaders from ex-communist eastern European nations, including Hungary’s authoritarian Viktor Orban - threatening to deepen a new east-west split in the EU,

19


Briefing

AUGUST 2017 ISSUE 49

“Turkey will not remain unresponsive to support to given to terror organizations in the region.”

a security headache in Germany’s second-largest city. Police struggled over 8,000 leftwing radicals ready to use violence. The protesters were a diverse group of environmentalists, peace and anti-poverty activists, united in the belief that the world’s elite guarded by riot police is failing to solve the pressing global problems. “We think that they all deserve our protest and our resistance from the streets,” said one activist, Georg Ismael, 25.

Erdoğan’s Diplomatic Mission Russia Turkish President Recep Tayyip Erdoğan and his Russian counterpart Vladimir Putin met on July 8 on the sidelines of the G-20 Hamburg Summit in Germany. The two leaders discussed bilateral cooperation, the Syrian crisis, the Turkish Stream natural gas pipeline project and Akkuyu nuclear power plant, the Kremlin said in a statement. “We have been keeping in contact on a regular basis. A great deal has been achieved recently, both towards a full-scale development of bilateral relations and to address a number of problems that concern us,”Putin said, according to the statement. Deputy Prime Minister Mehmet Şimşek, Foreign Minister Mevlüt Çavuşoğlu, Economy Minister Nihat

photograph byLOREM IPSUM

which is facing Brexit and still recovering from divisions over the debt crisis. The US president on July 4 met Merkel, the longestserving leader and, aside from Britain’s Theresa May, the only woman in the G-20 club. Merkel, hailed by some as the “new leader of the free world”, advocates an internationalist approach to global issues - but her G20 motto, “Shaping an Interconnected World”, contrasts sharply with Trump’s go-it-alone approach. The chancellor, a green energy champion who has allowed more than a million mostly Muslim refugees into Germany since 2015, that “the differences are obvious and it would be dishonest to try to cover that up. That I won’t do.” On the streets, up to 100,000 protesters marched in some 30 rallies, creating

photograph byLOREM IPSUM

20


The Turkish Perspective

“We will not hesitate to use our right to self defense against formations threatening the security of our country.”

Cupica eti, sederox medo, que is nonducid pecrimuracio inc videmedit. Bem te tem, sis; inihillaric tum

Merkel recalled that she and Erdoğan held a bilateral meeting on July 6 on the sidelines of the summit, where they discussed recent political disagreements between the two countries. “The many arrests, the overall actions in Turkey, and the failure to allow visits to Incirlik (air base) those are all developments that show deep differences and we did not sweep them under the table,” she said.

photograph byLOREM IPSUM

photograph byLOREM IPSUM

Erdoğan’s Messages to the World

Zeybekci, Energy Minister Berat Albayrak, National Intelligence Organization head Hakan Fidan and Presidential spokesperson İbrahim Kalın also attended the meeting. Ahead of the one-hour meet, Erdoğan stressed the positive consequences of Ankara’s relationship with Moscow, saying that expectations were high in Syria and the region. “Above all, the expectations at the region regarding Syria and Iraq are very high. I place importance to our meeting also from that point,” Erdoğan said. Putin meanwhile said situation in Syria changed for the better due to Turkey’s role and gained ground in anti-terror fight. He also added that bilateral relations reached to a significant point as many problems were resolved. In June, Russian stateowned nuclear power

company Rosatom signed an agreement with a Turkish consortium of contracting conglomerates, to sell a 49 percent stake in Turkey’s Akkuyu nuclear power plant project. The plant is estimated to meet around 6-7 percent of Turkey’s electricity demand.

USA President Recep Tayyip Erdoğan and his American counterpart Donald Trump hold an unexpected meeting on the sidelines of the G20 Hamburg summit on Saturday. The meeting between the two presidents lasted approximately 20 minutes. Syria and Qatar row were the main issues covered in the meeting, Turkish officials said, without giving further details. White House Spokeswoman Sarah Huckabee Sanders also said Saturday that the two leaders

discussed the situation in Syria. The U.S. and Russia announced an agreement for a cease-fire in southwest Syria during the G-20 summit. Trump and Erdoğan previously held extended talks at the White House in May.

Germany Germany’s Chancellor Angela Merkel on July 8 praised Turkey’s contribution to the success of the G20 summit, a key gathering of the world’s 20 largest economies. “Turkey and President Recep Tayyip Erdoğan showed a lot of commitment. He was very much engaged on the whole agenda of the summit and gave his contribution,” Merkel told a news conference at the end of the two-day summit in Hamburg. “We also paid tribute to Turkey’s efforts for the refugees, and he also pointed out these efforts again during the discussion round on migration,” she added.

Turkey will not remain unresponsive to support to given to terror organizations in the region, President Recep Tayyip Erdoğan has said. “We will definitely not remain silent and unresponsive to support and arms provided to terror organizations next to our borders and the formation of terror islets in the region,” Erdoğan told a press conference at the G-20 summit in Hamburg on July 8. The president also vowed that Turkey would not allow efforts to establish a Kurdish state in northern Syria and said he supported the unity of both Iraq and Syria. “We will never forgive threats coming from there,” Erdoğan said. “Iraq will be a strong country as long as it protects its unity,” he added. Ankara sees the Syrian Kurdish Democratic Union Party (PYD) and its armed wing, People’s Protection Units (YPG), as being organically linked to the outlawed Kurdistan Workers’ Party (PKK) and has repeatedly called on its allies to cease cooperating with them. Erdoğan also stated that he hoped the G-20 meeting would mark a “breaking point” to accept the fact that terror targeted everyone without discriminating between religion and race.

21


Briefing

START-UP

TİM-TEB

BUSINESS HOUSE PROVIDED INVALUABLE BENEFITS

KeyID, which is supported by TİM-TEB Start-Up Business House, provides high technology products, integration services and consultancy services.

Increased Productivity

By ramazan güzyurdu

K

eyID, which is

supported by TİMTEB Start-Up Business House, provides high technology products, integration services and consultancy services that will enable its corporate customers to easily adapt their systems to Turkish E-Identity Documents. The security items of our chip-electronic TC identities, which are distributed throughout the country this year, are electronically verifiable and can not be copied. In order to prevent fraudulent ID operations, the AUGUST 2017 ISSUE 49

is provide value added product exports in export. KeyID, which was established in 2014, has been awarded many valuable R&D projects with TÜBİTAK R&D support and TEB Start-Up Business House support. At the same time, it has developed its card-based projects (for example carded physical access control or virtual environments card access control systems).

“Possibility of office usage in different locations of Istanbul provided by TIM-TEB Start-Up Business House is increased the productivity of their employees.”

systems must be updated to enable electronic identity card verification. KeyID is one of the rare companies that can offer products and consulting services in this field. KeyID, which is supported by TİM-TEB Start-Up Business House, is a technology company esatablished by the engineers who left the team developing the electronic system of TC E-Identity Documents in TÜBİTAK UEKAE (National Electronics and Cryptology Research Institute) in cooperation with TİM and TEB. The aim of the company

Seda Polat Erdeniz, the founder of KeyID, said that the unlimited support that KeyID received from TIM-TEB StartUp Business House until the present day has not decreased at all but increased. On the other hand, “Possibility of office usage in different locations of Istanbul provided by TIM-TEB Start-Up Business House is increased the productivity of their employees by facilitating their office use and therefore their lives. In addition, TIM-TEB Start-Up Business House’s marketing consultancy and customer network support provided invaluable benefits for KeyID.”

photograph byLOREM IPSUM

22


Briefing

exporters were behind export figures of last year.

Cupica eti, sederox medo, que is nonducid pecrimuracio inc videmedit. Bem te tem, sis; inihillaric tum

export

MORE WORK MORE SUCCESS

Aegean Exporters’ Association (EİB) reached the export figure of 1 billion 5 million 680 thousand dollars as of 1 June 2017. By RAMAZAN GÜZYURDU

I

n the first half of the

year, it reached 5 billion 546 million dollars from 5 billion 463 million dollars with an increase of 2 percent compared to the JanuaryJune period of 2016. The last one year exports of Aegean Exporters were recorded as 10 billion 984 million dollars. Aegean Exporters Associations’ exports of industrial products amounted to 576 million dolars from 543 million dolars with an

AUGUST 2017 ISSUE 49

Aegean Exporters Associations’ exports of industrial products amounted to 576 million dolars from 543 million dolars.

increase of 6% compared to June of 2016 while exports of agriculture products fell from 390 million dolars to 354 million dolars with 9 percent decrease in the month of June. The exports of the mining sector were $ 74 million in a horizontal course. In June, 6 of the 12 exporter unions under the roof of the Aegean Exporters’ Association were successful in increasing exports compared to June of 2016 while 6

photograph byLOREM IPSUM

Continues To Grow The Aegean Olive and Olive Oil Exporters Association, which has been breaking records every year in exports for the last year, increased its exports by 163 percent to 21 million 388 thousand dollars in June 2017. In June of 2016, this figure was 8 million 137 thousand dollars. The Aegean Apparel Exporters Association took back the summit, which the Aegean Tobacco Exporters Association had captured in May, after a month’s break, with an export figure of 107 million 589 thousand dollars. In the second place, the Aegean Ferrous and NonFerrous Metals Exporters Association took place with a foreign exchange inflow of 83 million 810 thousand dollars. In June, Aegean Aqua and Animal Products Exporters Association, which managed to increase exports by 20 percent, placed third place in the country with 78 million 858 thousand dollars in foreign currency. The Aegean Mine Exporters Association reached 74 million 275 thousand dollars in exports. The exports of the Aegean Tobacco Exporters Association were 71 million 50 thousand dollars in June. Aegean Textile and Raw Materials Exporters Association reached 20 million 406 thousand dollars in exports in June of 2017. Aegean Leather and Leather Products Exporters Association increased its exports by 8 percent to 12 million 612 thousand dollars in foreign currency. In addition to these figures, the Aegean Exporters’

photograph byLOREM IPSUM

24


The Turkish Perspective

Association, which is the most experienced institution in foreign trade in Turkey, engages in dozens of activities in the fields of industry, agriculture and mining every year. Aegean Exporters’ Association have activities such as Fair Trade, Education, R&D, Innovation. It also mediates the Ministry of Economy’s agricultural returns and state aid to the exporters.

photograph byLOREM IPSUM

photograph byLOREM IPSUM

Participation Organizations To The International Fairs Aegean Exporters’ Association, which is an indispensable part of international trade, has been working continuously for many years in the area of fair trade and has been organizing national participation organization of 10 fairs every year in mining, organic sector, food, apparel, textile and leather sectors. Every year, 250-300 exporters participate in fairs in China, Germany, England, Japan, United States, France and EİB and diversify their export markets. Combining innovation with 78 years of experience, the most interesting fair organization of Aegean Exporters’ Association was Xiamen Natural Stone and Technology Fair held in Xiamen city of People’s Republic of China, the world’s largest natural stone and technology fair. 69 companies participated in this fair in 2017. One of the most intensively participated fairs, the Aegean Exporters’ Union has also participated, is the Fancy Food Fair in New York City of the United States. Turkey was the Partner Country at the Fancy Food Fair, the USA’s biggest food fair, this year. Nurettin Tarakçıoğlu, Vice

Coordinator of Aegean Exporters’ Associations said that they aimed to get US $ 2 billion share of US $ 130 billion in food products imports annually. The Aegean Apparel Exporters Association, which wants to bring European importers together with the Turkish apparel sector, is organizing a National Participation Organization with four fuels in Germany, France and England in 2017. During these fairs, 66 Turkish weary attorneys have the opportunity to introduce their new collections to European importers, the chance of seeing collections of famous buyers, Turkish companies and having bilateral business talks. The fairs organized by the Aegean Apparel Exporters

workıng to reach the top In June, Aegean Exporters’ Association were successful in increasing exports compared to June of 2016.

2% 21

ıncrease ın total export compared to 2016

mıllıon dollars total Olive and Olive Oil Export ın 2017 Association

576 mıllıon dollars

exports of industrial products ın 2017

Aegean Exporters’ Association has been working continuously for many years in the area of fair trade.

1.05 bıllıon dollars export fıgure as of 1 june 2017

Association, which is also organizing Turkish National Participation Organization, is the Premiere Vision (PV) Manufacturing Paris Fair held in Paris from 7th to 9th February 2017 and the Fashion SVP Fair in London from 27th to 28th June 2017 was held in Munich, Germany from 5th to 7th September 2017 Apparel Source Fair and the Premiere Vision (PV) Manufacturing Paris Fair to be held in Paris from 19 - 21 September 2017.

Entering The Japanese Market With Foodex Fair Another of the food fairs that Aegean Exporters’ Association has successfully organized for many years is Foodex Japan International Food and Drink Fair held in Japan. In order to increase the exports of the Turkish food sector to Japan, which does not pay for food in the amount of 60 billion dollars a year, 31 firms took place in Foodex Japan International Food and Beverage Fair, the biggest food fair of the AsiaPacific market.

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Briefing

Fair held in Anaheim, USA between 10-12 March 2017 brought together importers of new world and exporters of Turkish organic products. All China Leather Exhibition (ACLE) Fair, which Ege Leather and Leather Products Exporters Union has been successfully organized for many years by the Turkish National Participation Organization, is another one of the fair organized by exporters.

Priority Target Of Value Added Product Exports

EIB organized 2 organic fairs in 2017

The Aegean Exporters’ Association, which is the Coordinator Union in Turkey in the organic sector, attended the 20th Turkish Biofach Organic Products Fair held in Nürnberg, Germany between 15-18 February 2017. In addition, for the first time this year, Natural Products Expo West AUGUST 2017 ISSUE 49

Aegean Exporters’ Associations have been carrying out projects for the creation of R&D, Design, Innovation perception for value added product exports.

For many years, Aegean Exporters’ Associations have been carrying out projects for the creation of R&D, Design, Innovation perception for value added product exports. The EİB Fashion Design Competition, organized this year for the 12th time by the Aegean Apparel Exporters Association, is the longest running organization of Aegean exporters. Young designers such as Emre Erdemoğlu, Merve Uçar, Mahmut Ağaç and Ruhi Tamer Çoğal, who have succeeded in the worldwide success thanks to this competition, have been

25 Thousand People Attended Innovation Week İzmir Events In order to increase the high value added products in the export, the Turkish Exporters Assembly (TİM), the Ministry of Economy and the Aegean Exporters’ Associations cooperated in the first activity of ‘Turkey Innovation Week’ in İzmir in 2014, 2015 and 2016, trying to spread the eco system of innovation and entrepreneurship to the country. More than 25 thousand industrialists and entrepreneurs participated in the events for 3 years. Sectoral Trade Mission Organizations, Purchasing Mission Organizations, R&D Projects, workshops, conferences, etc. organized by 12 exporters ‘associations within the Aegean Exporters’ Unions. Turkey is trying to contribute to the export of activities.

photograph byLOREM IPSUM

As part of the second year of the Turquality Project for the Promotion of Turkish Food Products in the Japanese and South Korean Markets conducted by the Secretariat General of the Aegean Exporters’ Association, concurrent with the Foodex Japan 2017 Fair, a reception was held at the residence of the Embassy of Tokyo in Tokyo with the participations of Japanese public representatives, importer companies, press members, bloggers and exhibitors. At the reception, the Japanese chef Masayuki Okuda prepared menus suitable for the Japanese taste of Turkish food products. Okuda’s menus have received great acclaim.

brought to the Turkish fashion sector. Deep (Deri’n) Ideas Leather Production and Design Competition, organized by the Aegean Leather and Leather Products Exporters Association, which is organized by the Turkish leather industry for 7 years, has the first feature in the world in its lane to produce high value-added products among the racing teams of designers and leather engineers. Aegean Exporters Associations aiming to meet innovative ideas in the food sector with the industry have organized Food R & D Project Market activity 5 times to date. Of the 416 projects that were finalized on May 25, 2017, V. International Food R&D Project Market, 54 of these projects were worthy of being exhibited.

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The Turkish Perspective

SKY IS THE LIMIT FOR TURKISH EXPORTERS

The Turkish Exporters Assembly (TİM) announced the results of the “Turkish Export Products Perception and Image Research” conducted in 26 countries.

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üyükekşi evaluated

the research results and said that: “The image of our export products is often perceived positively in international markets. As we say on every platform to move this perception up further, we must invest more in researchdevelopment, innovation, branding and design.” The Turkish Exporters Assembly (TIM) announced the results of a Turkish Export Products Perception and Image Research conducted by face-to-face interviews with the purchasing manager of 2,520 firms in 6 major sector groups in 26 countries. Beside Turkish Export Products Perception and Image Research, Turkey’s General Perception and Turkey Discover the Potential Campaign’s Awareness and Perception of Activity were also examined at three main axes research. The research that started in October 2016 was carried out with Kantar TNS firm. President of TIM Mehmet Büyükekşi gave a speech at the press conference that the research results was announced. Büyükekşi said about the Turkish Export Products Perception and Image Research section: “62 percent of research participants said they were especially satisfied with Turkish export products. The countries with the highest satisfaction rate are England with 85 percent, France with

to make up a shortage importer in Germany.”

Countries with the highest country image: Spain, Germany and India Büyükekşi mentioned that according to research’s Turkey’s General Perception part 60 percent of participants find Turkey’s image positive. “When we look at the country breakdown of our image, we see that it is high in Spain, Germany and India. It is above with the 65 percent than general average of 60 percent in across the EU. 2 sector groups with the highest general Turkey image in terms of sectors are Chemical Materials and Textiles, Carpets, Leather with 63% percent.” Büyükekşi pointed out the brand awareness ratio has increased to 41 percent, and expressed they investigated the awareness of Turkey brand, levels of liking and thoughts reflection on the last part on Turkey: Discover the potential Campaign Awareness and Perception of Activity.”

“Our perception is positive, we have to invest to move higher”

“In order to move this perception up further we must invest more in research-development, innovation, branding and design.”

77 percent and India with 74 percent. This rate is 59 percent across the EU which has almost half of our exports.” “Netherlands, Poland and Germany are pulling down EU ratio” said Büyükekşi and continued “our exporters have to pay special attention to these countries exporters. Germany is always in the first place in our exports. However, we see that the rate of satisfaction is below average. If we can determine the reason of dissatisfaction of our importers, we will be able

Büyükekşi who evaluated the results said that: “The image of our export products is generally perceived positively in international markets. As we say on every platform, in order to move this perception up further we must invest more in researchdevelopment, innovation, branding and design. Our products are also strong in markets where our country’s image is strong. We must never allow our country image to deteriorate. A mistake one of our company will make in any market can cause the market become a bazaar which is hard to enter and hold on for all our other exporters.”

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Briefing

The prominent information sources related Turkish export products are sectoral publications, internet and internal research departments. Consultancy firms specific to USA, public institutions in Turkey for Netherlands and Germany, sectoral fairs specific to Iran and China have high usage rates as information sources.  The percentage of those who indicate that they will/would prefer Turkish export products is generally above 90% and higher than this ratio. It is seen that the countries with the highest percentage of those who stated that they would definitely prefer (as first choice) Turkish export products are Egypt, Azerbaijan, Italy and Turkmenistan.  The general awareness level of the Logo / Slogan is 41%. It is observed that the sector with the lowest rate is the Food sector with 35%.  The countries which Logo / Slogan awareness level is lowest are Australia, South Africa and Belgium. * Turkish export products stand out as channels which the Logo/Slogan are seen and heard most intensely. Newspapers and emails of individuals who work with follow these channels.  The liking level of Logo / Slogan is generally 43% and this ratio is similar among the sector groups. It is seen that the countries with the highest liking level for Logo / Slogan are Algeria, France and Italy. 

AUGUST 2017 ISSUE 49

Having a strong and stable economy and highly qualified human resources are the primary outstanding image perception criteria for Turkey. The other criteria follow these criteria with a slight difference.  Especially Germany, Azerbaijan and Turkmenistan are the countries in which Turkey stands out as strong and stable economy. Particularly in Canada, it is seen that Turkey is prominent as a country where people are interested in touristic, cultural and historical features as well as commercial cooperation.  The level of those who find Turkey’s image generally positive is around 60%. The countries stand out with the highest rates are Germany, Italy, Spain, France, India and Turkmenistan, while the countries with the lowest rates are Canada and England.  The ratio of those who stated that they visit Turkey for various reasons is generally around 64% level. It is clearly observed that the countries with the highest rates are Italy and France, while the countries with the lowest rates are USA, Canada, Australia and South Africa. 

PS: 26 countries conducted research United States, Germany, Australia, Azerbaijan, United Arab Emirates, Belgium, Brazil, Algeria, China, France, South Africa, India, Netherlands, United Kingdom, Iran, Spain, Israel, Italy, Japan, Canada, Egypt, Poland, Romania, Russia, Saudi Arabia, Turkmenistan.

TİM-TEB START-UP BUSINESS HOUSES’ MARK ON SEEDSTARS WORLD

Seedstars World, which is hold to discover the best rapidly growing start-ups at emerging markets, has been organized in İstanbul this year.

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of 10 finalist entrepreneurs of Seedstars

İstanbul 2017 contest is composed of TİM-TEB Start-up Business House Entrepreneurs. Also, top-3 entrepreneurs are turned out to be from TİM-TEB Startup Business House after the evaluation of jury. Top-3 entrepreneurs are by respectively Paym.es, Udentify and Ahtapot. Paym.es from İstanbul TİM-TEB Startup Business House has won the right to attend Global Seedstars Contest to represent our country. What is Paym.es? : Paym.es, who had entitled to attend Global Seedstars, is an online shopping system which provide us to safely sell and buy new and second-hand products via messaging programs. What is Udentify? : Getting the second place at Seedstars İstanbul 2017 contest, Udentify is an innovative software which is designed to obtain customer data by facial recognition technology instead of its inadequate methods in physical environment.

What is Ahtapot? : Winning the third place at Seedstars İstanbul 2017 contest, Ahtapot is a mobile application which provides its members an intra community social network service. Ahtapot members can enhance social activities and professional business relations according to their hobbies and expertness.

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Important Findings Turkish Export Products Perception and Image Research

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The Turkish Perspective

NEW ERA STARTED FOR THE TRADE WITH IRAN

Turkey, with the aim of $50 billion, has landed on Iran with a committee including Minister of Economy Nihat Zeybekci, President of Turkish Exporters Assembly Mehmet Büyükekşi, investors and exporters.

F

2017 MID-YEAR

PERFORMANCE REVIEW OF TİM

Turkish Exporters Assembly (TİM) 2017 first mid-year performance review has been organized with the participation of Minister of Economy Nihat Zeybekci.

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Trade Centers that are planned to be opened throughout the world, is opened in Tehran, the capital city of Iran. Minister of Economy Nihat Zeybekci and Iranian Minister of Communication Mahmut Vaizi increased the trade volume aim between two countries, which has reached $10 billion last year, and they gave the happy news to the businessmen of both countries.

Trade Center Is Opened

resident of TİM

Mehmet Büyükekşi stated that for the target of having 1, 5% share of world trade: “With the new investments it is a really simple matter to reach the target of 1, 5%. It could be really flowing. Especially an increase in the rate of exports of high-tech products in total exports would led us to reach our goal of 1, 5% really fast.” Minister of Economy Nihat Zeybekci declared that 1,5% share is a realistic goal. Zeybekci: “if not 2023, it would be 2024 or 2025. Turkey would have been in a really different situation when we take our place in 1st Leaguein the world. We will not give up from our target.” He continued: “Keep following us about Automotive. Everything is going to be just fine. Turkey will become one of the most important production centers of some of the existing brands.”

irst of the 20 Turkish

Turkey will become one of the most important production centers of some of the existing brands.

The expectation is to increase the product number within the scope of Preferential Trade Agreement (PTA) and the target is to achieve Free

Trade. Minister Zeybekci has met with Iranian Minister of Industry and Mining Muhammed Rıza Nimetzade and Iranian Minister of Communication Mahmud Vaizi throughout his visit to Iran. Zeybekçi with President of TİM Mehmet Büyükekşi has attended to the opening of Turkish Trade Center and made a speech at TurkeyIran Business Forum. Ideas were exchanged during the meetings for the mutual goal of increasing the number of products within the scope of PTA, which was signed 3 years ago. Currently, there are 265 products in total in the list from both of the countries.

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Briefing

AVIATION

Turkish Airlines Took The Center Stage At GBTA Convention 2017

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BTA Convention is the world’s largest business travel event. Over 7,000 business travel professionals from around the world gathered in Boston this year for state-of-the-art education, exclusive networking opportunities and the news on the latest innovations in the industry. GBTA Convention 2017 marked the 49th edition of The Business Travel Event of the Year and their theme this year, Convergence, was chosen to address the latest trends, issues and guidelines that emerged as the business

AUGUST 2017 ISSUE 49

travel industry has evolved. “We are extremely pleased to welcome Turkish Airlines Chairman of the Board and the Executive Committee M. İlker Aycı to the stage at GBTA Convention 2017,” said Michael W. McCormick, GBTA Executive Director and COO. “The Turkish Airlines story that began 84 years ago with just five planes, and is now the story of an airline flying to more countries than any other, is sure to entertain and inform our attendees.” The speech of Mr. Aycı, which described the national

photograph byLOREM IPSUM

World’s premier business travel event held in Boston, U.S., featured Turkish Airlines Chairman of the Board and the Executive Committee M. İlker Aycı as the keynote speaker.

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photograph byLOREM IPSUM

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The Turkish Perspective

flag carrier’s successes that have won many prizes in passenger satisfaction and service quality, and the policies that will be implemented in the future, have attracted a great deal of attention. Mr. Aycı also talked about the ban preventing passengers from keeping large electronic devices in the cabin on flights to the U.S. from a number of Middle Eastern countries and Turkey. “We understand the sensitivities of air and passenger safety. This issue is a priority for us, too. But this decision was a little unprepared and quickly taken. We carried 81 thousand computers without any problem within the 103 day period.” he said. Mr. Aycı has called on airline executives to support liberal air transport agreements. He underlined that they should refrain from protectionist policies. He said that protectionist policies pose risks to all sectors, especially tourism, transport and airline operators. Mr. Aycı continued: “If you want to hide behind protective walls, you can not improve your service quality and your business. I am talking to company executives and leaders: Do not be afraid of competition.” Turkish Airlines Chairman pointed out the importance of GBTA 2017 and said: “Airline companies, hotel chains, travel management companies and all related organizations are in Boston for this convention. Here we are, talking about innovations in the sector. We evaluate the results and numbers of the previous year and every company is trying to set and organize their future goals. Here, at GBTA, every company establishes new business contacts and connections.

“Turkish Airlines’ quality of service is based on the hospitality in Turkish culture.”

NEVER GIVE IN

“If you want to hide behind protective walls, you can not improve your service quality and your business.”

The Chairman of Turkish Airlines M. İlker Aycı responded to a question about the company’s quick reaction to the incidents at Istanbul Ataturk Airport last year and fast return to normal state of operations. “We know what terrorists want from us. They want to stop us, to slow us down. They want to change our attitude and scare us. They want to interfere with and curtail our activities. We responded very strongly to that. We are not going to give in. They can not change our way of life, they can not attack our way of life, our right to live.” Mr. Aycı stated that the operation at the airport and flight services were normalized in 8 hours. He thanked the highly motivated employees of Turkish Airlines who are dedicated to their work. He also underlined the importance of Istanbul New

Airport, currently under construction and stated that the new airport will be smart, user-friendly, safety-equipped to the current conditions and to the highest level of service quality. He told the audience that he believes Turkish Airlines will be much stronger after the third airport. He said that Turkish Airlines’ quality of service is based on the hospitality in Turkish culture. After explaining what he understands from hospitality, he said: “Our theme in recent years was ‘Widen Your World’. I invite everybody to Istanbul to attend the Turkish Airlines C orporate Club Conference to be held this September and experience Turkish Airlines quality first hand. We had a challenging year, but we had a strong start to 2017 and we are performing very well. We have risen from the ashes. We, Turks, know how to do it and we were able to do it again.” Turkish Airlines had a strong presence at the world’s premier business travel event.

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Briefing

INVESTMENT

TURKEY ATTRACTS ONE OF THE WORLD’S

TOP MANUFACTURERS OF WIND TURBINE BLADES

The new plant, with an initial annual capacity of 500 MW, features a world class high-tech production line. M Wind Power, a leading manufacturer of wind turbine blades and a subsidiary of General Electric Renewable Energy,

held an inauguration ceremony in Bergama Organized Industrial Zone, İzmir to mark their 14th blade manufacturing facility

worldwide. The new plant, with an initial annual capacity of 500 MW, features a world class high-tech production line.

ISPAT President Arda Ermut, a keynote speaker at the ceremony, said, “I am honored to be with you at the opening of this

AUGUST 2017 ISSUE 49

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The Turkish Perspective

“We believe that Turkey needs to fulfil its potential in the renewable energy field in this new era.”

photograph byLOREM IPSUM

photograph byLOREM IPSUM

LM Wind Power, and a subsidiary of General Electric Renewable Energy, held an inauguration ceremony in Bergama.

landmark investment by LM Wind Power – a GE company operational in Turkey since 1948 and the world’s largest wind turbine blade manufacturer. This project will provide significant contributions not only to the power sector, but with an employment campaign well underway, I am quite excited that this key investment in Bergama Organized Industrial Zone (BOIZ) is set to provide employment for 450 people in the first phase and 900 in the next. 2017 has been a year of transformation for the renewable energy sector. This is mainly due to the opening of a third lane for investors with the Renewable Energy Resource Areas (YEKA) model, which provides an alternative to the non-licensed and licensed projects. We believe that Turkey needs to fulfil its potential in the renewable energy field in this new era not just as an importer and consumer of this technology, but as a producer as well. Even better still, we have ambitions to turn

Turkey from a renewable technology producer into a powerhouse developing this technology. In this way Turkey can leverage its added value and position itself as a supply center for neighboring countries once it goes this extra mile.” Marc de Jong, CEO of LM Wind Power, said, “We are proud and excited to celebrate with GE and our partners in Bergama. We continue our growth into a new country and this is a very attractive location for operations like ours. We have invested significant time and resources in Bergama and look forward to grow the wind industry with several partners and customers going forward.” Jérôme Pécresse, CEO of GE Renewable Energy, added, “GE already operates eight facilities with more than 2,000 employees in Turkey - a highly promising market for renewable energy and wind in particular. With LM Wind Power, GE Renewable Energy is integrating blade design and production into our wind turbine business giving us a strong position in the fastest growing segment of power generation. Last year, the Turkish wind sector reached a cornerstone by having more than 6GW wind power installed. GE is committed to investing long term in the communities where we operate and this facility is an important milestone in our commitment to work with local talent.” Marking the beginning of a new hub for green industry, LM Wind Power Bergama Plant will employ 450 people to reach an annual capacity of 500 MW and later expand to 2 GW. Production in the new plant is now getting underway.

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Briefing

The goal of the meeting series is to increase awareness of venture capital and private equity funds in Turkey.

Venture Capital Anatolia Meetings Konya, TURKEY - July 19, 2017

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he second in a series of Venture Capital Anatolia Meetings convened in Konya on July 19. The goal of the meeting series is to increase awareness of venture capital and private equity funds in Turkey and

to bring successful Turkish companies together with fund managers. Organized with the cooperation of the Turkish Presidency Economy Monitoring and Coordination Department and the Union of Chambers

and Commodity Exchanges of Turkey (TOBB), the Venture Capital Anatolia Meetings will take place throughout 2017 across nine different provinces in Turkey, including Adana, Bursa, Denizli, Izmir,

Kayseri, Manisa, and Samsun in addition to the meetings in Gaziantep and Konya. There was a panel discussion in the meeting in Konya where managers from several venture capital and private equity funds shared ideas on how to assist companies during their investments in Turkey. ISPAT Deputy Head A. Burak Dağlıoğlu spoke at the panel discussion on private equities. The meeting also featured a presentation by ISPAT Coordinator Ahmet Cüneyt Selçuk on the relation between FDI and venture capital.

Ispat Attends Wto Fifd Workshop In Geneva, Switzerland O

n July 10th, ISPAT Deputy Head Furkan Karayaka and ISPAT Coordinator Necmettin Kaymaz participated on the Workshop on Investment Facilitation for Development in Geneva. The workshop brought together WTO members, experts from international organizations, nongovernmental organizations, the private sector and academia to share their experiences and best practices in the implementation of investment facilitation AUGUST 2017 ISSUE 49

The workshop brought together WTO members, experts from international organizations, nongovernmental organizations, the private sector.

measures. The workshop tried to explore how investment facilitation policies and measures can help countries foster development, diversify their export capacity, integrate into global value chains and link up to the digital economy. The workshop was organized by organized by the Friends of Investment Facilitation for Development – consisting of 11 WTO members; Argentina, Brazil, Chile, China, Colombia, Hong Kong, Kazakhstan, Korea, Mexico, Nigeria and Pakistan.

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Cover / Turkey For Energy

AUGUST 2017 ISSUE 49


The Turkish Perspective

TurKEY for energy: An ambitious candidate

Turkey’s self-sufficiency rate in primary energy sources is very low. Despite the insufficient resources consecutive governments of Turkey in the last decade used energy as a key element with great success. Turkey today in the region shines as a powerful actor on energy. By MUSTAFA YİĞİT

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Cover / Turkey For Energy

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Current Conditions of Turkey with a rapidly growing economy, Turkey has become one of the fastest growing energy markets in the world. Turkey has been experiencing rapid demand growth in all segments of the energy sector for decades. Over the last decade, Turkey has been the second country, after China, in terms of natural gas and electricity demand growth. Projections show that demand growth trend will continue. The limits of Turkey’s domestic energy sources in light of its growing energy demand have resulted in dependency on energy imports, primarily of oil and gas. At present, around 25% of the total energy demand is being met by domestic resources, while the rest is being provided from a diversified portfolio of imports. The primary aim of Turkey is to realize its own energy security. To this end, Turkey aims to diversify its energy supply routes and source countries, increase the share of renewables and include the nuclear in its energy mix, take significant steps to increase energy efficiency, contribute to Europe’s energy security. Turkey continues its efforts to increase the share of renewable energy sources and add the nuclear power into Turkish energy mix with the purpose of reducing the energy dependence, maximazing the use of domestic resources, and combating climate change.

AUGUST 2017 ISSUE 49

The gross electricity consumption in Turkey in 2015 was 265,7 billion kWh, while this figure rose by 3,3% in 2016, reaching 278,3 billion kWh.

Electricity The gross electricity consumption in Turkey in 2015 was 265,7 billion kWh, while this figure rose by 3,3% in 2016, reaching 278,3 billion kWh. At the same time Turkey’s electricity output fell by 4,9% when compared to the previous year (261,7 billion kWh) to 274,7 billion kWh. According to the highly probable scenario of an increase of 6,9% to 392 TWh in the base scenario, electricity consumption in the year 2020 is expected to rise by 5,5% to 357,4 TWh. By the end of the of 2016, power plants containing a total of 5.899 MW additional capacity were added to the system, and as of the end of 2016 Turkey’s capacity has risen to around 78.497,4 MW. In 2016, 32.1% of our electricity production was obtained from natural gas, 33.9% from coal, 24.7% from hydropower, 5.7% from wind, 1.8% from geothermal and 1.8% from other sources. As of the end of 2016, EUAS ( State Electricity Generating Company) had a share of 27.8% in installed capacity of Turkey, 59% of the private sector, 8,3% of build-operate plants, 3,2% of build-operate-transfer plants and 0,4% of unlicensed power plants. As of the end of 2016, Turkey’s electricity


The Turkish Perspective

Approximately 72% of the world’s producible petroleum and natural gas reserves are sıtuated in geographical regions which are close to TURKEY. Turkey’s neighbours possess three quarters of the world’s petroleum.

installed power with new power plants taken into operation and capacity increases have risen to 78.497,4 MW. By the end of 2016, the distribution of our installed power by resources; 35,4% hydraulic, 29% naturel gas,22,1% coal, 6,1% wind, 0,9% geothermal, 7,4% other sources.

51 YEARS

World oil reserves will be suffıcient for

Petrol Petroleum is a very complex component, comprised primarily of hydrogen and carbon, as well as small amounts of nitrogen, oxygen and sulphur. Under normal conditions it can be found in gaseous, liquid and solid form. In order to be able to differentiate petroleum which is in the form of gas from gases which have been manufactured, it is generally known as natural gas. As the principal components of crude oil and natural gas are hydrogen and carbon, these are also known as “hydrocarbons”. The total proved oil reserves of the world were 1.700 billion barrels in 2015. World proved oil reserves have decreased to a very low rate compared to 2014. The largest addition to reserves came from Saudi Arabia adding 1.1 billion barrels. The largest decline came from Russia, where reserves fell by 1.9 billion barrels. In 2015, world oil reserves will be suffıcient for 51 years, which was 52.2 years in previous years. Crude oil, which has a strategic position among primary sources of energy, has met 32.6% of the

world energy demand as of 2014. 109.7 billion tonnes (47.7%) of the petroleum reserves are in Middle Eastern countries, 19.3 billion tonnes (8.3%) are in Russia and the Commonwealth of Independent States (CIS), and 17.1 billion tonnes (7.6%) are in Africa. While the production of petroleum throughout the world reached 93.2 million barrels/day in 2014, it is expected that the biggest petroleum importers in the world will be China and Europe in 2030. America, which is currently the largest petroleum importer in the world, is expected to be replaced in this position by China in 2017, and the petroleum imports of China, which are supported by the economic growth of the country, are expected to make it less dependent on petroleum than Europe. Approximately 72% of the world’s producible petroleum and natural gas reserves are sıtuated in geographical regions which are close to our country. With its geo-politic position, Turkey neighbours countries possessing three quarters of the world’s petroleum and natural gas reserves and it is participating in numerous very important projects as a natural “Energy Corridor” between the energy rich Caspian, Central Asian and Middle Eastern countries and the consumer markets in Europe, and providing support to the said projects. It is expected that a significant portion of the demand for primary

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Cover / Turkey For Energy

energy, which is expected to rise by 40% by the year 2030, will be met from the sources located in the region we are located in. The oldest pipeline in Turkey is the lraq Turkey Crude Oil Pipeline which carries the petroleum from Kirkuk in Northern lraq to the West. The quantity of crude oil transported by the pipeline reached 305 million barrels in 1999, but fell to 10.9 billion barrels in 2006 due to the sabotages which took place and the difficulties experienced in Kirkuk. In 2015, 192.4 million barrels of crude oil was transported through this pipeline. Another pipeline which transports petroleum is the Baku - Tbilisi - Ceyhan (BTC) Crude Oil Pipeline, which went into operation on 28 May 2006. On 22 June 2008, the daily transport capacity of the pipeline reached 1 million barrels, and, as a result of the endeavours to ensure that more petroleum is transported through the pipeline, in 2009 this quantity rose to 1,2 million barrels a day. The domestic producible petroleum reserves in 2016 were 316,6 million barrels (46,2 million tonnes) and unless there are any new discoveries, the lifespan of the total domestic crude oil reserves is 18 years, based on today’s production levels. In 2016, 7% of the dermand for crude oil was met through domestic production, while in natural gas this figure was 0.8%. In 2016, 2884 km 2D and 6629 km2 3D seismic data were collected in Trukey. In 2016, a total of 44 wells were opened and 72.630 meters of drilling was carried out. From the year that the petroleum exploration began in our country to the end of 2016, a total of 4734 wells were opened and 223 fields including 79 natural gas fields and 144 crude oil fields were discovered. Within the scope of activities directed at meeting the ever increasing demand for petroleum and natural gas from domestic sources, the studies being carried out in the basins of Turkey, which have not been AUGUST 2017 ISSUE 49

79 FIELDS

Number of natural gas fields in TUrkey

144 FIELDS

Number of crude oil fields in TUrkey

sufficiently explored, and in particular on the sea in the Black Sea and Mediterranean areas, have gained great momentum. Due to the possibilities of drilling in areas where water is very deep (1.000 - 2.000 m) as a result of the advances in drilling technology in recent years, and the appearance of production possibilities, the structure of hydrocarbons exploration in our seas has been established at pace. Especially, in the last years important steps were taken in the direction of determining the hydrocarbons potential of Mediterranean and Black Sea. In recent years, along with the rising of the importance of shale gas in the world, the importance has been given to searching of shale gas in Turkey. For this purpose, Sarıbuğday-1 in 2012, Konacık-1 in 2013, Akçay-1 in 2014 and Çeşmekolu-1 and Çakıcı-1 wells in Trakya Region in 2015 and 2016 respectively were opened in Southeastern Anatolia Region. Studies are underway to evaluate the data obtained from the wells. Apart from the SouthEastern Anatolian region, it is also believed that there are significant amounts of available shale gas in the Hamitabat and Mezardere areas of the Thracian region, which have yet to be taken into the scope of the operating agreement, but which may be put on the agenda in the coming period. Natural Gas which is one of the oil derivatives is a gas lighter than air, inflammable, colourless and odourless. It consists of various hydrocarbons like methane (CH4) and ethane (C2H6). Gas reserves are located underground usually together with oil as associate gas. They can also be extracted from non-associated gas fields. Natural gas can be used without refining and is transported by pipelines or by vessels in liquid form after being liquefied. According to the studies on the natural gas supply-demand balances, there is no problem concerning the meeting of the annual natural


The Turkish Perspective

gas demand. However, during the winter months, when demand is high, the fall of temperatures to levels below seasonal norms, and as a result the rise of consumption to maximum levels, and any faults in the source countries or countries en-route during the same period, can lead to periodic imbalances between supply and demand. Within this framework, the Silivri Natural Gas Storage Facility, which has a working gas capacity of 2,84 billion Sm3, was taken over by BOTAŞ as of 01 September 2016 in order to be used effecively for ensuring seasonal supply-demand balance and supply security. Further, the Tuz Gölü (Salt Lake) Natural Gas Underground Storage Project, which is currently under construction, was revised by the High Planning Council (YPK) with a decision no. 2016/43 dated 16/12/2016. According to the decision, the working gas capacity is increased to 5 bcm from 1 bcm and withdrawal capacity is increased to 80 mcm/ day from 40 mcm/day. Within the scope of the project it’s aimed to reach 250 mcm working gas capacity in 2017, 500 mcm in 2018, 1,75 bcm in 2020, 3 bcm in 2021 and 5 bcm in 2023 respectively. The first Floating Storage and Regasification Unit (FSRU) of Turkey is invested by the private sector in Aliağa/İzmir on 23 December,2016 so as to achieve supply security and diversification of gas sources. Moreover, studies for the connection of FSRU to natural gas transmission system in İskenderun and Saros Gulfs are continuing by BOTAS.

3,2% share

total world reserves of lignite/sub- bituminous coal are in Turkey

As of the end of 2016, Turkey’s remaining producible natural gas reserves were 18,7 billion m3. Turkey’s installed capacity using natural gas for the generation of electricity in 2016 was 21.217 MW, and this value meets 28,3 percent of Turkey’s total installed capacity.

Coal Lignite is a type of coal which is generally used as a fuel in thermal power plants in order to possess its low grade and the high amount of ash and humidity. However, it is an energy raw material which is frequently used as it is quite abundant in the earth’s crust. On the other hand, Anthracite, is among the group of high calorie coals. Around the world, 310,5 gigaton (34,8%) of the coal reserves are located in Eurasian countries,288,3 gigaton (32,3%) in the Asia Pacific countries, 245 gigaton (27,5%) in North America, 33 gigaton (3,7%) in African and East Mediterranian countries and 14,6 gigaton (1,6%) in Central and South American countries. The World Energy Council has reported that the world coal reserves are present in around 80 countries, and The greatest part of the reserves isin the USA with 237,3 gigaton. The USA is followed by the Russia Federation with 157 gigaton, and China with 114,5 gigaton. Among the other coal rich countries are: Australia (76,4 gigaton), India (60,6 gigaton), Germany (40,5 gigaton), Ukraine (33,9 gigaton), Kazakhstan (33,6 gigaton) and the Republic of South Africa (30,2 gigaton). Thus, more than 90% of the world coal reserves are situated within the borders of this nine countries. According to the research carried out by the World Energy Council, the proven and exploitable coal reserves within the world amount is 892 billion tons in total. 403 gigaton of these are in the anthracite and bituminous coal category, 287 gigaton are sub-bituminous coal, and 201 gigaton are lignite. When the total coal production in the world in 2015 is taken into consideration, it is calculated that the global coal reserves have a lifespan of around 114 years. As a result of the serious coal exploration activities carried out in recent years, the lignite reserves in our country can be increased significantly. At the same time, the efforts directed at classifying the said reserves in accordance with international standards, and determining our economically exploitable reserves are continued. Turkey is evaluated as being at medium levels in terms of the reserves and production amounts of lignite, and also at low levels inanthracite. Approximately 3,2% of the total world reserves of lignite/sub- bituminous coal are in Turkey. In addition as the grade of a large portion of Turkey’s lignite is low, its use in thermal plants has stood out. Approximately 46% of the lignite reserves in Turkey are located in the Afsin – Elbistan basin. The most important anthracite reserves of our country are in Zonguldak and the surrounding regions. The total anthracite reserves in the Zonguldak basin are 1.30

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Cover / Turkey For Energy

gigaton,but however the visible reserves are around 506 million tons. Lignite/sub- bituminous coal fields are spread out among all regions of our country, and the grade of the lignite/sub- bituminous coal in these fields varies between 1000-5000 kcal/kg. Around 68% of the total lignite/subbituminous coal reserves in our country are low calorie, with 23,5% between 2000-3000 kcal/ kg, 5,1% between 3000-4000 kcal/kg, and 3,4% is above 4000 kcal/kg grading. By the end of 2015, Turkey possessed 126,9 million tons of Equivalent Petrol (MTEP), with the share of coal in the total primary energy consumption being 27,3%. As of the end of 2016, the power plant installed capacity dependent on coal in our country was 17.316 MW, and this is equal to 22,1% of the total installed capacity. The installed capacity using domestic coal is 9.437 MW (12,1%) and using imported coal is 67.879 MW (10%). With the aim of meeting of the demand for energy which increased in parallel with industrialization and the increase in the population; the efforts to find new coal fields and developing the existing ones have been speeded up within the framework of the objectives of placing more importance on domestic resources and decreasing the dependence on imports in the production of energy since 2005. In addition to the 8,3 gigaton of existing reserves, 7,38 gigaton of new lignite reserves were determined by the end of 2014 as a result of these explorations. In 2016, total of 92,3 TWh gross electricity was generated from coal, and this is around 33,9% of the amount in total gross electricity generation.

The theoretical hydroelectricity potential of Turkey is 1% of theoretical potential of the world, while its economic potential is 16% of the economic potential of Europe.

7,38 GIGATON

New lignite reserves found in Turkey

About 7.38 gigaton of reserves increase has been provide between 2005-2015. While the level of lignite reserves in 2005 were 8,3 gigaton,at the end of 2015, this level has exceeded15 gigaton. AUGUST 2017 ISSUE 49

Hydraulics Hydroelectricity plants work in harmony with the environment, are clean, renewable, and highly productive plants with no fuel expenses. They take on the role of an insurance in energy prices, have a long lifespan, low operating costs, and are not dependent on imports. Among the various sources of energy, hydroelectricity power stations are preferred due to their being environmentally friendly and carrying low potential risk. Turkey’s hydraulic resources, which hold the most important position in the renewable energy potential of our country, possess a hydroelectricity potential of 433 billion kWh, while the technically usable potential is 216 kWh, and the economic hydroelectricity potential is 140 billion kWh/year. Turkey continues to take steps towards developing the investment environment based on competition within the energy sector, and establishing a transparent market structure and in particular with the influence of the legal arrangements directed at renewable energy in the electricity generation sector.By January 2017, 594 power plants with 26,678 MW are licensed. As of the end of 2016 June, there were 572 hydropower plants, with a total installed capacity of 26.246,6 MW. This is the equivalent of 34,3% of the total potential. In 2016, 24.7% of our electricity production was obtained from hydropower. Hydroelectricity production have realized 67.3 billion kWh in 2016. It is aimed that all of the hydroelectricity potential which can be evaluated – both technically and economically – be used in the generation of electricity until 2023.


The Turkish Perspective

Wind The characteristics of the wind differs (in respect of time and region), based on local geographic differences and the non-homogenous temperatures of the surface of the earth. Wind is stated as two separate parameters – speed and direction. The speed of the wind rises with height, and its theoretical strength changes proportionately to its cubic speed. The initial investment costs of wind energy applications are high, and their capacity factors are low. Together with this, they have the disadvantage of inconsistent energy production. Their advantages, on the other hand, can be listed as follows: • In plentiful and free supply within the atmosphere; • It is a renewable and clean source of energy, and is environmentally friendly; • Its source is reliable, and there are no risks of running out or prices increasing over time; • Its cost has reached the level where it is able to compete with the power plants of today; • Maintenance and repair costs are low; • It creates employment; • Its raw materials are completely domestic, and it does not create a dependence on imports; • The installation and operation of its technology is relatively simple; • It can be taken into operation within a short time. Wind energy has been used from the first ages, by taking advantage of the shaft power of the turbine, for pumping water, cutting various products, shearing, grinding, pressing, obtaining oil, and other similar activities where mechanic energy is needed. Wind turbines can be manufactured either with a horizontal or a vertical axis, based on the

Wind turbines are the principal structural elements of wind energy plants, and are machines which convert the kinetic energy of the moving air, first of all to mechanic energy, and then to electricity energy.

direction of their rotational axis. Wind turbines with a horizontal axis are more widely used. These types of wind turbines can be built with one, two, three or multiple propellers. Wind turbines with a horizontal axis are also known either as up-wind or down-wind turbines. The axes of wind turbines with a vertical axis are straight and vertical towards the direction of the wind, and their propellers are also vertical. Modern wind turbines, which are used for generating electricity, and are connected to the network, mostly have 3 propellers, horizontal axes, and are wind turbines of the up-wind type. In parallel with the technological developments of our day, wind turbines with horizontal axes with a power of 1,0-7,5 MW are used in the large, powerful wind energy plants. The propeller dimensions of wind turbines with three propellers has reached 100 m, and, indeed, more. The hubs of modern wind turbines are 60-120 m above ground level, on a tower. The amounts of energy which can be obtained from one wind turbine is dependent, in the first degree, on the wind speed at the turbine hub height. Raising the hub higher will ensure maximum benefit from the existing wind power. Wind turbines are only able to start generating electricity energy at a specific wind speed. A wind turbine will generate energy in between the cut-in and cut-out speeds. The cut-in speeds of modern wind turbines are between 2-4 m/s, their nominal speeds are between 10-15 m/s, and their cut out speeds are between 25-35 m/s. Each wind turbine reaches the maximum power value which can be obtained from the system at a specific wind speed. This maximum power is known as nominal power and the wind speed at this level is known as the nominal speed. Wind turbines automatically stop after a certain wind speed has been exceeded, in order to ensure that the system is not damaged. This maximum speed is known as the system cut-out speed. The body possesses sound insulation in order to prevent noise pollution. The towers are built in the form of cages or pipes. As the towers can be very high, the constructions outside the cage towers can consist of two or three parts. It has been accepted that wind plants with a capacity of 5 MW can be established in Turkey at heights of 50 meters above ground level, and in areas with a wind speed exceeding 7.5 m/s. In the light of this acceptance, a Potential Wind Energy Map (PWEM) has been prepared, where the source wind details obtained using a mid-scale weather forecast model and micro-scale wind flow model are given. The wind energy potential of Turkey has been estimated as 48.000 MW. The total area which is equivalent to this potential is just 1.30% of the total surface area of Turkey.

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8,6 MILLION TONES

Biomass potential in Turkey equivalent petrol

As of the end of 2016, it has been given the prelicence 34 solar power plant whose installed capacity is 402 MW and the licence 2 solar power plant whose installed capacity is 12,9MW. AUGUST 2017 ISSUE 49

Solar According to the Solar Energy Map (SEM) of Turkey prepared by the Renewable Energy General Directorate, it has been determined that the total annual insolation time is 2.737 hours (a total of 7,5 hours per day), and the total solar energy derived per year is 1.527 kWh/m2 per year (total 4,2 kWh/m2 per day). While solar energy technologies are extremely varied in terms of their methods, materials and technological levels, they can be split into two principal groups: Photo-emissive Solar Technologies and Concentrated Solar Power (CSP):In this system heat is obtained from solar energy, and can be used either directly or in the generation of electricity. Solar Cells: Semi-conducting materials, which are also known as photovoltaic solar energy systems, convert the sunlight directly into electricity. This capacity will be increased gradually in the coming years, with the target of our Ministry being a minimum of 3000 MW installed capacity of license PV plants in 2023. The total established solar collector area within our country as of 2012 was calculated as being close to 18.640.000 m2. The annual production of planary solar collectors was calculated as 1.164.000 m2 and vacuum-tube collectors was 57.600 m2. 50% of the planary collectors, and all of the vacuum-tube collectors which are produced are known to be used within the country. In 2015, close to 811.000 TEP Tonnes Equivalent to Petrol) heat energy was produced using solar collectors. The use of the heat energy produced in 2015 was calculated as 528.000 TEP in homes, and 283.000 TEP for industrial purposes.

BioFuels Biomass can be defined as the total mass of living organisms that belong to a society consists of species or consist of several species. Biomass is also defined as an organic carbon. There are four types of biomass resources. The first group, Herbal Biomass Resources include; oilbearing crops (canola, sunflower, soybean, etc.), Staple crops (flax, kenaf, hemp, sorghum, miscanthus, etc.), Protein crops (peas, beans, etc.), Herbal and agricultural residues (branches, stalk, straw, root, bark, etc.) The second type of biomass resources are generated from forest and forestry products. This includes wood and forestry waste(energy forest, energy crops, various trees). The third type is called animal biomass resources which consist of cattle, horses, sheep, chickens waste, slaughter house waste and animal wastes that arise during the processing of products. The last type is organic wastes, biomass resources obtained from urban and industrial wastes. This type is gathered from sewage sludge, paper industry and food industry wastes, industrial and domestic waste water, municipal waste and large industrial facilities waste. It is estimated that the biomass potential in Turkey is about 8,6 million tonnes of equivalent petrol (MTEP), and biogas quantities that can be produced from biomass is 1,5-2 MTEP. 2023 target for biomass installed capacity was determined as 1000 MW.


The Turkish Perspective

Modern geothermal plants which use geothermal energy emit very low amounts of CO2, NOx, SOx gases, and therefore, it is evaluated as a very clean source of energy.

Geothermal energy is the heat energy obtained from the hot water, steam, dry steam and hot dry rocks by artificial methods, which have gathered within rocks in the depths underneath the soil, and have moved and were stored by the fluid heat. Geothermal sources are mostly formed around active fault systems and volcanic and magmatic units. Geothermal energy includes all types of direct or indirect benefit derived from geothermal sources. Low temperature (20-70°C) fields are particularly used for heating, and also in industry, for the production of chemicals. Medium temperature (70150°C) and high temperature (above 150°C) fields can be used as well as the generation of electricity in heating applications integrated manner depending on the re-injection conditions. As of the year of 2016 the installed capacity of geothermal energy was 13,300 MW. The electricity output from this source in 2016 is approximately 75 billion kWh. The top five countries in electricity generation from geothermal energy are the USA, the Philippines, Indonesia, New Zealand and Italy. Its use other than for the generation of electricity is 70.328 MW thermal. The top five countries in geothermal heat and hot springs applications are

Comparison of Geothermal applications in Turkey for the vears 2002-2016

16

25

Number of fields suitable for electricity production reached from 16 in 2002 to 25 in 2016.

Greenhouses heating by geothermal energy

Residential heating from geothermal energy

2002

2002

Electricity Production from geothermal energy 2002

Geothermal heat capacity

2016

2016

114.6 820 thousand RE MWe

14 .000 Mwt

Increment

Increment

Increment

2002

500 30 15 thousand m thousand RE MWe

3000 Mwt

2016

2016

2

3.93 million m Increment

2

686%

281%

5366% 366%

China, the USA, Sweden, Turkey and Germany. As Turkey is situated on the Alps - Himalayas belt, it is a country with quite a high geothermal potential. In theory, the geothermal capacity of Turkey is 31.500 MW. 79% o the areas with a potential within Turkey is situated in Western Anatolia, 8,5% in Central Anatolia, 7,5% in the Marmara Region, 4,5% in Eastern Anatolia and 0,5% in the other regions. 94% of Turkey’s geothermal resources are low and medium heat, and suitable for direct applications (heating, thermal tourism, the output of minerals, etc.), while 6% are suitable for indirect applications (the generation of electricity energy). In 2005, with the support of ministry, the development of existing geothermal resources initiated and began to search for new potential areas. Due for this mobilization, our usable geothermal heat capacity reached to 5000 MWt (by the end of December 2015) from 3100 MWt (by the end of the year 2004) with 212.000 meter drillings. With MTA’s drilling activities, 173 discovered geothermal fields reached to 232 fields which 10 of them are suitable for electricity production. So far, total of 607 drillings with total of 370,000 meters of depth performed by MTA and 5000 MWt of heat energy (including natural springs) obtained from these wells.

Nuclear energy has entered the agenda of politicians, scientists and industrialists in the process of the discovery of Uranium in 1879 and the reaction of the atom in 1934. As with many other technological advances, the studies that first began in the field of military defense later began to offer commercial productivity. Many countries, especially the USA and Russia, have made intensive studies to utilize nuclear energy, and as a result of these studies, systems have been developed to convert the heat energy, which is the result of atomic reaction, into electrical energy. These systems, in other words, nuclear power plants, ensure that nuclear energy is obtained in a safe, controlled and sustainable way. The spread of nuclear power plants began with the oil crisis of the early 1970s. Countries that do not have oil and other hydrocarbon resources have inclined to nuclear power plants to reduce their dependence on these

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resources and ensure security of energy supply. Nuclear power plants continue to be established all over the world, despite a slowdown due to accidents Three Mile Island (TMI) in the US on 1979 and Chernobyl incident in Soviet Russia on 1986 (today in the Ukrainian borders). The concept of safety culture came to fore in the light of the lessons learned from these accidents. There have been both administrative and technical improvements to establish and operate safer nuclear power plants all over the world. On the one hand, the establishment and operation of nuclear inspecting institutions began to be monitored and controlled; On the other hand, new techniques, technology, standardization and quality systems have been developed for the production of safer equipment and systems. Nowadays, nuclear power plants have become an electricity source preferred by countries due

to their unique characteristics. The need for a reliable, affordable, sustainable and accessible energy source with increased environmental awareness places more emphasis on nuclear power plants than other alternatives.Uranium which is nuclear fuel raw material, has spread to different geographies in the world. The cost of fuel in electricity unit cost pricing is very low compared to other sources. Therefore, the possible fluctuations in fuel prices can not affect the electricity production costs. In addition, nuclear power plants do not release greenhouse gases during operation. For this reason, they are an important alternative to prevent global warming. Moreover, the installation area of nuclear power plants is very small compared to all other power plants. For this reason, agriculture, inhabiting and natural life are effected slightly. The half-century goal of Turkey to establish a nuclear power plant has begun to actualized with the signing of the Intergovernmental Agreement on Cooperation AUGUST 2017 ISSUE 49

6.5 years

Training of a student to be nuclear edpert

600 STUDENTS

sent to Russia for nuclear energy education from Turkey

on the Establishment and Operation of a Nuclear Power Plant on Akkuyu Site between Government of Turkish Republic and the Russian Federation on 12 May 2010. The mentioned agreement was approved by the Turkish Grand National Assembly on 15 July 2010 and published in the Official Gazette dated October 6, 2010 and numbered 27721. Within the scope of mentioned agreement process, the Project Company was established on 13 December 2010 in Ankara with the name of Akkuyu Nükleer A.Ş. In the meantime, positive decision on Environmental Impact Assessment (EIA) report (December 2014) was obtained from Ministry of Environment and Urban Planning and 36 months electricity production license was obtained from Energy Market Regulatory Authority. The Site Parameters Report prepared by Akkuyu Nükleer A.Ş. was submitted to TEAK. The process of reviewing and evaluating the mentioned document by TAEK continues. Following the approval of this report, the construction license application which is a prerequisite for the construction of Akkuyu Nuclear Power Plant will be carried out by Akkuyu Nükleer A.Ş. It is projected that TAEK will provide “limited work permit” in 2017 to start construction of auxiliary buildings. The ultimate objective is to get the first unit of Akkuyu Nuclear Power Plant to commissioned by 2023. On May 3, 2013, an intergovernmental agreement on nuclear power plant construction and cooperation for the Sinop Nuclear Power Plant which is the second nuclear power plant project of Turkey was signed with Japan. In order to meet the rapidly increasing demand for electric power and to reduce the risks arising from import dependency, it is planned to commission 2 nuclear power plants by 2023 and start the construction of the 3rd power plant. Nuclear power plants should be not regarded only as electricity generation facilities. The nuclear power plant project, which consists of approximately 550 thousand components and equipment, will provide added value to Turkey’s industry together with the dynamism and employment opportunities it provides to other sectors. In addition to this, studies continue at the focus of human resource development. Every year, as many as 600 students are sent to Russia for nuclear energy education. By this year, 261 Turkish students were sent to Russia for nuclear training. In particular, Turkish students will be employed in different fields from engineering to managerial level in the Akkuyu Nuclear Power Plant Project after approx. 6.5 years of training, including internship in the plants in Russia.


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Cover / Natural Hub

Concrete Ste

A Natural Hub Turkey’s becoming a central country for energy in recent years. With all energy doors gathering in Istanbul, Turkey stands out with its principle of “the key country of energy,” and will lead the world energy.

AUGUST 2017 ISSUE 49


The Turkish Perspective

Steps To Be

ral

try l l, le d

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Cover / TurKEY for energy

E

nergy

is one of the most important subjects of TurkeyEU relations. As an indication of the importance given to regional energy cooperation, Turkey joined the Energy Community with an observer status in 2006. (Energy Community which aims to have an integrated energy market supporting the competition between the EU members and non-EU members of South East Europe as well as other neighboring countries was founded in 2005.) Within the scope of Turkey’s accession negotiations with the EU, the screening process of the Energy Chapter was completed in 2007. Energy relations between Turkey and EU constitute a positive agenda item. Turkey-EU High-Level Energy Dialogue was launched under the co-chairmanship of the then-Minister of Energy and Natural Resources, Taner Yıldız and Vice President of the Europen European Commission responsible for Energy Union, Maroš Šefčovič on 16 March 2015 in Ankara. The second High Level Energy Dialogue Meeting was held on 28 January 2016 in İstanbul.

Drawing the Future Vision

Turkey has become one of the fastest growing energy markets in the world, paralleling its economic growth over the last ten years. Following the successfully implemented privatization program in the said period – power distribution is now completely in private sector hands, while the privatization of power generation assets is set to be completed within the next few years – has given the country’s energy sector a highly competitive structure and new horizons for growth. Economic expansion, rising per capita income, positive demographic trends and the rapid pace of urbanization have been the main drivers of energy demand, which is estimated to increase by around 6 percent per annum until 2023. The AUGUST 2017 ISSUE 49

n the last decade, the Turkish government has made significant reforms in the provision of energy.

6% INCREASE

IN DEMAND TO ENERGY PER ANNUM UNTIL 2023

current 74 GW installed electricity capacity is expected to reach 120 GW by 2023 to satisfy the increasing demand in the country, with further investments to be commissioned by the private sector. As part of its efforts to offer sustainable and reliable energy to consumers, Turkey offers investors favorable incentives, such as feed-intariffs, purchase guarantees, connection priorities, license exemptions, etc., depending on the type and capacity of the energy generation facility. In the last decade, the Turkish government has made significant reforms in the provision of energy, moving forward the participation of private entities, and thus creating a more competitive energy market. The privatization of energy generation assets, coupled with a strategy to clear the way for more private investments, has


The Turkish Perspective

resulted in an increased share of private entities in the electricity generation sector, from 32 percent in 2002 to 75 percent in 2015. Another step taken by the Turkish government towards a more competitive energy sector is the establishment of an energy stock exchange. Once operational, the exchange will not only enhance the liberalization of the market, but will also ensure transparency and help maintain a healthy balance between supply and demand. In addition to having a huge domestic market, Turkey is in a strategic location between a number of major energy consumers and suppliers, and so serves as a regional energy hub. The existing and planned oil/gas pipelines, the critical Turkish straits and promising finds of hydrocarbon reserves within the country itself give Turkey increased leverage over energy prices and reinforce its gateway status. Opportunities for renewable forms of energy

to reach 2023 vısıon Turkey’s ambitious vision for 2023, the centennial foundation of the Republic, envisages grandiose targets for the energy sector in Turkey. These targets include:

120 GW

Raising the total installed power capacity

30% Increasing the share of renewables

Increasing the installed capacity based on wind power

geothermal

1,000 MW SOLAR

5,000 MW

Installing to provide power plants both geothermal and solar

20,000 MW

production – hydro, wind, solar, geothermal and others – are abundant in Turkey, and encouraging policies backed by favorable feed-in tariffs are expected to increase their share in the national grid in the coming years. The Turkish government has made it a priority to increase the share of renewable sources in the country’s total installed power to a remarkable 30 percent by 2023, while taking on board the energy efficiency concept by enacting laws that set principles for saving energy, at both individual and corporate levels, as well as by providing incentives to energy efficiency investments. As important as the renewables are for Turkey’s energy strategy in the coming years, technologies in such fields as waste processing and greenhouse gas reduction are also often cited together with this new form of power generation as critically important supplementary practices. Sustaining the environment by resorting to renewable resources is accompanied by a number of measures and regulations that are either currently in effect, or will soon be in effect, including lowering carbon emissions, increasing generation/transmission efficiency and promoting the use of waste management technologies. The sum of these factors has had a profound effect on Turkey’s energy sector, and turned it into one of the most attractive investment destinations in the world. In line with the implementation of investor-friendly regulations and the high increase in demand, the Turkish energy sector is becoming more vibrant and competitive, attracting the attention of more investors for each component of the value chain in all energy sub-sectors. The total investments required to meet Turkey’s expected energy demand in 2023 is estimated to be around USD 110 billion, more than double the total amount invested in the last decade.

5 billion m3 Raising the natural gas storage capacity

30 GW Increasing the coal-fired installed capacity

60,717 KM

Extending the length of transmission lines

158,460 MVA

Reaching a power distribution unit capacity Source: ISPAT

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In Depth / Super Incentive System

A New Era For Investors:

SUPER

INCENTIVE

SYSTEM

AUGUST 2017 ISSUE 49


The Turkish Turkish Perspective Perspective The

Turkey has started implementing a new model that could be called the “Super Incentive System” to attract investors. By RAMAZAN GÜZYURDU

I

n the month of August, a very important step regarding our investment incentive system was taken by means of “Law No. 6745, Supporting of Investments on a Project Basis and Administering Changes in some and Decree Laws.” By initiating this step, Turkey has started implementing a new model that could be called the “Super Incentive System”, to attract investors, and as such the Cabinet of Ministers has been granted the authority to extend comprehensive incentives to investments to be decided on a project basis. However, since August, the investments that would be evaluated and supported within this scope have not yet been determined. Therefore, we are yet to witness an investment project that

has benefitted from this new incentive system, which was initiated in August. By means of the Decree No. 2016/9495 “Regarding the State Assistance to be Extended to Investments on the Basis of Projects (BKK)” published in the Official Gazette dated November 26, the type of investments to benefit from this important incentive system and the procedure to be used have been clarified. Firstly, there are some important issues regarding the incentives that have been left to the authority of the Cabinet by means of Law No. 6745 and then the system that has been established by means of published Cabinet Decree No. 2016/9495. What Are the Super Incentives? It had to state that a flexible incentive system has been initiated by means of Law No. 6745. The new model is a very important milestone where the development of the investment incentive system is concerned. Thanks to this model, investors able to say that a special incentive system unique to each investment project put forward for

support can now be developed. According to the stipulations of the respective Law, the Cabinet will be able to grant the right to benefit from all or some of the incentives - that are described in the Law - to the investments that are supported on a project basis by the Ministry of Economy. In other words, the Cabinet would be able to design a flexible and special incentive mechanism for each investment project designated to receive support by the Ministry of Economy. In determining the projects to be supported within this scope, attention will also be paid to whether these investments meet the current or future requirements of Turkey in line with the targets set in the development plans and annual programs and/or whether they could ensure continued supply, reduce dependence on foreign sources, achieve technologic transition, be innovative, and add value as well as being R&D focused. It could be said that the authority granted to the Cabinet by means of the Law has been quite comprehensive. As stipulated in the Law, the Cabinet will be able to: • Have the corporate tax rate applied at a discount of up to 100% and determine the rate of contribution in the investment up to a rate of 200%. • Grant exemption from corporate tax, limited to the earnings obtained from

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In Depth / Super Incentive System

the investment, for a period that extends up to 10 fiscal periods starting from the commissioning of the investment, Grant the right to benefit from the “income tax withholding” incentive applicable to the recruited personnel in the cities restricted presently to only the 6th region, • Grant Customs Duty exemption, • Grant free of charge easement or utilization rights for a period of 49 years in relation to the immovable property belonging to the Treasury and have the immovable property of Treasury transferred free of charge if requested with the condition that the investment is completed and the predicted employment rate is achieved for a period of 5 years, • Meet the employer’s share of the investor in the insurance premium for a period up to 10 years, • Meet up to 50% of the energy consumption expenditures in the operating period pertaining to the investment for a period up to 10 years, • Provide interest or profit share support or extending a grant for a period up to 10 years for the investment credit used in the financing of the fixed investment amount, • Provide salary assistance up to 20 times the minimum gross wage for a period of up to 5 years for a designated number of qualified personnel that are essential for the realization of the investment, • Participate in the investment, provided that 49% of the investment amount is not exceeded and that the shares acquired are offered to the public or sold to the investors within a period of 10 years. One or more of the incentives listed above could be extended to the designated investors. Opportunities provided to the investors are not restricted to the ones listed above. The purchase guarantee and easing of some bureaucratic procedures are among the alternatives. It should be elaborated on this subject: • The Cabinet could possibly extend a “purchase guarantee” to the product subject to the projectbased investment for a period and amount to be determined by the Cabinet. Furthermore, where the project requires, it will also be possible to make any substructure investment based on the decision of the Cabinet. • In the new model, the Cabinet could also provide exemptions regarding the AUGUST 2017 ISSUE 49

The new model is a very important milestone where the development of the investment incentive system is concerned.

permits, allocations, licenses, registrations and other restrictive requirements stipulated in other laws on investments included within the scope of the scheme or make arrangements in the legal and administrative processes for purposes of speeding up or streamlining investments. This would lighten the legal and administrative burden of the investors to a great extent. How Will the Projects Be Submitted to the Cabinet? According to Law No. 6745, the Cabinet could use its above indicated authorities for the investments chosen for support by the Ministry of Economy on a project basis; however the investments to which these significant incentives will be applicable have not been clarified since August. By means of Cabinet Decree No. 2016/9495 published on November 26th, the type of investments to benefit from this important incentive system and the procedure to be used have been somewhat clarified. Briefly, the project-based incentive model will become operational when the Ministry of Economy determines the investment subject and suggests a relevant investor or investors to the Cabinet. Investors Who Are Not Invited or Do Not Possess the Qualifications


The Turkish Perspective

Announced Will Not Be Able to Benefit From the System! It had to state that the system established by means of Decree No. 2016/9495 has no precedent in the past. That is to say; as per the Decree the Ministry of Economy could invite one or more firms to invest in the subject designated for investment or invite relevant firms to apply for investment by making an announcement. In other words, all investors meeting the terms of the related incentive scheme as stated in the respective legislation would not be able to apply to the Ministry, as was the case with the previous incentive models. They have to wait either for the invitation to be issued or the announcement to

be made by the Ministry to be able to make an application. The investors that respond to the invitation they receive or the announcement made will be required to make their application to the Ministry of Economy with the information and documents indicated in the Decree No 2016/9495. It has been also stated that the Ministry could also request information and documents from the investors that are not included in the decree. The “Minimum Fixed Investment Amount” of the Project to Be Supported Must Be At Least USD 100 Million! According to the Decree, it is not possible for investments with minimum fixed investment amounts of less than USD

100 million to benefit from this incentive system. The Ministry of Economy will evaluate the project applications received on the basis of the following criteria. • Being able to meet any critically important current or future requirements of our country, • To develop our technologic capacity in the fields we technologically fall behind in. • To reduce dependence on imports in the areas where a foreign trade deficit exists. It had to emphasize at this point that, exceeding a specific amount of imports as prescribed in the “incentives for strategic investments” or having a higher volume of exports in comparison to imports are not the conditions set out in this Decree. However, last year’s import and domestic production numbers regarding the investment product and projections of the production and import numbers to be achieved upon conclusion of the project will be requested from investors who submit an application. • To improve our country’s competitive power, • To be an innovative R&D focused investment, • To be an investment oriented towards the production of processed products of high added value in the sectors that affect the current account balance negatively and also experience raw material shortages. The projects that are deemed to be suitable on the basis of the criteria above shall be presented to the Cabinet by the Ministry of Economy and an “incentive decree” will be published for the projects chosen for support by the Cabinet. In other words, the incentives that the chosen project will receive, will be assured in the decree of the Cabinet. Following

55


56

In Depth / Super Incentive System

this decree, the Ministry of Economy will issue an “Investment Incentive Certificate” for the respective investment project. The Investment Will Be Followed Up Bi-annually Through Sworn-In CPA Reports! The investment is required to be completed between the commencement and completion dates indicated in the incentive decree; however, an extension of time could also be granted if there is a reasonable justification. It also had to underline the fact that the investments that benefit from the incentives provided within the scope of this Decree would not be able to use other incentives and assistance provided under other incentive systems. Different from other incentive schemes, a tracking and control system specific to the investments supported by means of this system is being established. Accordingly, the investor will be required to submit to the Ministry, accompanied by a sworn-in CPA’s (sworn tax advisor) report, the information on the realization of its undertakings pertaining to the investment in the investment and operating periods, and the amount of incentive used in the months of January and July throughout the period designated in the incentive decree. What Consequences Will an Investor Failing to Meet its Obligations Face? If the investor fails to meet its obligations indicated in the Incentive decision, it will be required to pay back any corporate tax that has not been accrued due to the discount or the exemption applied and the income tax withholding incentive applied and any applicable default charges - excluding tax loss fines. Other incentives will be recovered within the framework of the provisions of Law No. 6183 on the Collection Procedure for Public Receivables. From the Point of The “Responsible Tax” Approach According to the data issued by the Ministry of Economy, the inflow of “Foreign Direct Investments” to Turkey in the 2016 January-July period amounts to USD 4.8 Billion. This shows a decrease of 54.2% in direct investments compared to the same period of 2015. In consideration of the difficulties it was experienced in terms of “savings”, the vital importance of foreign direct investments for Turkey becomes quite clear. It had to underline the fact that AUGUST 2017 ISSUE 49

The next step is to explain this incentive package to all national and international investors and to lure the investments into Turkey.

this new incentive system is a significant step taken in this direction. However, this doesn’t fully resolve the issue. It is necessary to explain the super incentive system to all domestic and international investors to have the investments start flowing into the country as soon as possible. Within this context, it should be started promoting the new system in the most effective way possible, emphasizing the opportunities the new system as well as our country can provide to investors. Investors’ Bureacratic Burden to be Totally Eliminated As it may be known, one of the major complaints raised by national and international investors is that the

bureacractic procedures in Turkey are very complex and require application to multiple authorities. The investor has to spend months or even years to obtain license, permit, etc for its investment in most of the cases. It is obvious that this weakens the competitiveness of our country in luring investors. According to the Draft Law, the Council of Ministers will also be capable of bringing exceptions for permit, allocation, license, and registrations and other restrictive provisions brought by other laws with regard to investments that are determined by the ECC, and that can benefit from the above-listed opportunities. As such, the investor will fall an important burden of legal and administrative bureaucratic procedures. What is Next? Investors were obliged to state that the changes which are planned for Turkey’s incentive system – both for national and international investors –with the aim of increasing Turkey’s investment attraction capacity represent major steps. If the Draft Law is enacted, - for investments to be designated by the Ministry of Economy- Turkey will enter an “era of incentive packages” which include strong tailor-made incentives, with completed permit/licence and similar processes, as well as purchase guarantee for the product to be produced. The next step is to explain this incentive package to all national and international investors and to lure the investments into Turkey. Not only the Government or the State, but every single person, primarily including NGOs, business world and the media, has an important role to play in introducing the draft law after it is enacted.


Brands / Lorem

The Turkish Perspective

Content: Grow In Industry Scale Continuously P57 Courtesy And Courage P59 Market Leader In Turkey P60 Editor: Mustafa Yiğit

food, ındustry, product...

food

Assan Foods:

grow ın ındustry scale contınuously

Assan Foods also supplies multinational food companies operating in several countries across the world.

From the start to present day, Assan Foods has exported products to more than 70 countries. By alperen çevikaslan

A

ssan Foods was

founded in 1998 in Susurluk, Balıkesir close to the Karacabey Plain, an area where tomatoes, which are flatter in shape and used in paste production, are grown in industrial scale. Entering the industry with tomato processing and tomato paste production in a state-ofthe-art plant, Assan Foods launched ketchup production in 2000, and mayonnaise

and sauce production in 2002. From the start to present day, the company has exported products to more than 70 countries. Currently exporting to more than 30 countries in four continents, Assan Foods has been producing tomato paste for numerous countries in the Middle East, Caucasus and Africa, and ketchup and sauces for the European market, and particularly

supermarket chains for many years. Assan Foods also supplies multinational food companies operating in several countries across the world with tomato paste, pepper paste and pepper juice as raw material. Producing nearly 300 types of products including high quality tomato paste, ketchup, tomato sauces, mayonnaise and other sauces in its plants in Susurluk and the Aegean Free

57


58

Brands / Assan Foods

Trade Zone, Assan Foods boasts the highest tomato processing capacity in one location at its Susurluk plant. Assan Foods is also one of the top tomato processing producers in Turkey with an industrial investment of over $50 million.

Production and Operations in Turkey Assan Foods operates two plants, one in Susurluk, and the other in the Aegean Free Trade Zone, Ege Assan. Susurluk plant has the highest tomato processing capacity in one location in Turkey. Built on a land of 200,000 square meters, the Susurluk plant consists of 21,600 square meters of production facilities, warehouses, administrative and service buildings and social facilities. The plant has a processing capacity of 4,500 tons of tomatoes per day and can produce 1.5 million products per day. Ege Assan is spread on 4,500 square meters, and has an annual capacity of packaging 24,000 tons of tomato paste. Assan Foods is one of the major players in

1

st

Turkey’s largest exporter of ketchup and sauces in 2016.

50$

mıllıon (Over) ındustrıal ınvestment from tomato ın

30

countrıes ın four contınent the company exports

Turkey targeting only out-of-home consumption (OOH) channel which covers HORECA (Hotels, Restaurants & Cafes) with own brands Kingtom, Oba, and Colorado. In addition to the large volume packages of tomato paste, ketchup, mayonnaise and sauces used in kitchens by chefs, it also offers tabletop products for restaurants. The company produces Private Label products for our clients in retail as well as global brands such as Burger King, Popeyes, Pizza Hut, KFC, Domino’s. and many more. The production capacity and technology, as well as substantial R&D experience allows to serve different needs of our customers all around the world. The company’s priorities are to increase the out-ofhome consumption of our products, and to open up new channels. One of the best examples it can be given for new channels is the çiğköfte (Turkish style bulgur balls) channel. Assan Foods produces a special ketchup and sauce for the important çiğ köfte brands

in Turkey. Regarding the brand Colorado, it has been set a target of introducing three new sauces every year. The Meat Sauce, Chipotle Sauce, Gyro Sauce and Spicy Meat Sauce, which are the company’s new Colorado sauces, create an excellent flavor combination with all kinds of grilled meat, fries and chips. It also continuously revitalize the tabletop products as well as developing new sauces. In doing so, Assan Foods approaches the products almost like consumer products, studying different flavors and tastes in detail, as well as working diligently on packaging.

targets and expectations for 2017 and 2018 Assan Foods has been Turkey’s largest exporter of ketchup and sauces for years. The company repeated this success in 2016 as well. Exports make up about half of our business. It has significant goals for 2017. With extensive experience of working with multinational customers for years and the approach of world-standard production, the company is building collaboration in numerous countries where it has not operated before.

scope of the export markets Assan Foods exports to more than 30 countries in four continents. It produces tomato paste for many countries in the Middle East, Caucasus and Africa, and ketchup and sauces for Europe, particularly large supermarket chains. Furthermore, it supplies tomato paste, pepper paste and pepper juice as raw materials to multinational food companies in several countries across the world, mostly in the Far East. AUGUST 2017 ISSUE 49


The Turkish Perspective

ındustry

on the front burner and will maintain its existence with the “Quality Makes the Difference”.

Termikel:

courtesy and courage

Keeping a finger on the pulse of the industry for long years by making no concessions to the steps of development, Termikel has its signature under a number of innovations. By ramazan güzyurdu

C

ourtesy and courage lie at the bottom of the success achieved by Termikel, founded by Mehmet Kaya in 1957. Keeping a finger on the pulse of the industry for long years by making no concessions to the steps of learning and development, Termikel has its signature under a number of innovations, like the first rectangle oven with glass door, the first mini washing machine with automatic wringer and the first churn with eccentric belt, and continues its production activities at the most modern facilities of both Turkey and Europe. As a company exporting to 75 countries, producing for 110 brands and serving approximately 2000 customers, Termikel has become a market leader in Turkey and Europe and keeps putting its signature

under more innovations on its facilities of 45.000 sqm located on an open area of 60.000 sqm. TERMİKEL; MARKET LEADER OF TURKEY AND EUROPE Termikel owns the biggest factory manufacturing built-in oven and stoves, as well as range hoods, amongst its counterparts in Europe. With a production capacity of 1,200,000 pieces in a single shift, the factory continues operating at a high-quality level, holding a CE certificate approved by accredited certification bodies and employing more than 2.000 employees. The products offered for sale through various channels domestically reach consumers via 60 stores across the country. Attaching utmost importance to consumer relations,

Termikel has a network immediately addressing all needs of consumers, starting from the product purchasing stage. Considering the consumption stages particularly in the importing countries, this process is handled more carefully. For instance: Germany. The level of education and the rate of conscious consumers are high across the country. Unsurprisingly, the consumers are cautious against all kinds of potential problems that could occur during utilization. The effective feedbacks received from Termikel’s sales to Germany indicate that the company is capable of overcoming such challenges and has strengthened its position in the market. Meeting 70 percent of its production through local suppliers, the company is

FIRST IN TURKEY: “REGISTERED INDUSTRIAL DESIGNS” Termikel, with its registered industrial designs and specific productions, increases its export data each passing day. As the company settles its position in the industry by exporting to 75 countries and producing for 110 brands, special product lines are also manufactured in accordance with the traditions and needs of countries. Recording an annual export turnover of TRY 100 Million in 2016, 68 percent of Termikel’s exports go to Europe, whereas 3 percent to South America, 9 percent to the Middle East and Africa, 18 percent to Asia and 2 percent to Australia. Registered designs of Termikel awarded the “Interior Innovation Award Winner 2013” award, an entity of German Federal Parliament, are as follows: FIRST IN TURKEY: • iPad design set – By using the iPad embedded in the range hood, you can search for recipes or surf social media while cooking. • Range hood with built-in microwave oven – A special ergonomic design for 1+1 and 2+1 flats. • Rustic Line – A special built-in set created by combining Retro and technology, on these days when nostalgia is on the agenda. The specific pioneer in the field of Built-in Systems, Termikel ranks among the top thousand companies this year, amongst 61.000 exporter companies, in the “Top 1.000 Exporter Companies” research held by Turkish Exporters’ Assembly for 15 years and covering all 26 sectors.

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60

Brands / Wee Baby

product

MARKET LEADER IN TURKEY

Wee Baby is the brand that was created by Burda Bebek A.Ş. in 1998 and today Wee Baby is the market leader in Turkey. By ilhan alpay ogan

T

he foundation story of Burda Bebek goes back to 1986 where Burda Bebek entered the market with Bebsi brand selling a variety of teether’s and baby cups and enhanced its portfolio in the coming years. Following advancing world standards and changing technologies, Burda Bebek A.Ş. developed its production capability and service processes accordingly and created Wee Baby brand in 1998. Continuously launching

AUGUST 2017 ISSUE 49

new models and product varieties Burda Bebek A.Ş. still continues to grow with Wee Baby brand, today. Wee Baby brand has a rooted past of 31 years. It has a strong position in the market today offering solutions to a variety of needs. Wee Baby holds a wide product range of 132 product lines and 400 SKU’s of Mother and Baby products. Wee Baby has led the way in the industry by manufacturing its products

at world standards to allow mothers and babies to have access to safe and high-quality products at an affordable price. Starting with Turkish Mother and babies, Wee Baby’s biggest goal is to make quality products accessible to all mother and babies and in order to produce right quality products, raw material plays a crucial part in our production, Wee Baby uses FDA-approved BPA free raw materials that are safe to come into contact with food so that the mothers


The Turkish Perspective

With the investment on new production facility and new product categories, Wee Baby planning to expand our sales to other countries.

mind will be at ease knowing that their babies are safe and that they are giving the best to their babies. Although soothers and baby’s bottle are the first products to come to mind when Wee Baby is mentioned, it supplies a wide range of products to answer all the needs of mothers and babies. Wee Baby offers 400 products in 6 categories; special products for breastfeeding mothers, soothers, baby feeding bottles, sippy cups, plates and spoons, personal care products and other accessories. Wee Baby is the first local brand to produce products in line with European Standard in our category. As it is a local manufacturer, this allows the company to offer fast and effective solutions answering the demands of the customers.

The company’s flexible production and experience are the biggest advantages and this differentiates the company from among their competitors. The brand meets with customers in more than 33.000 spots starting with pharmacies, chain markets and baby shops. The products are sold in 23.000 pharmacies out of 25.000 that are active all-around Turkey. Wee Baby is among few brands in the world that has 90% own production. In April 2017, it gathered all our production sites under one roof in Sakarya Organized Industrial Site. The company’s new and modern facility is built with 15.000 square meters indoor space. With this new facility, it is doubling the production capacity and the company is currently evaluating potential automation projects. Wee Baby’s aim to grow in Turkey as well as in export. With the investment on new production facility and new product categories, Wee

Baby planning to expand our sales to other countries. With increasing capacity, the projects in logistics and R&D will accelerate. It will be able to provide service to our customers more effectively and also offer different product varieties. Currently, Wee Baby exports to 24 different countries including Europe, Middle East, Africa and Turkic Republics. We especially desire to grow in Middle East and Europe zone in 2017. The investments will reach to 12 million TL by the end of 2017 and it will continue to invest in 2018 as well. Wee Baby achieved an annual growth of 17% in 2017 that is above sector average and as the market leader they are continuing to grow. 2017 has started out well for the company. It can be shared that it moves parallel to the growth plans both locally and internationally. The goal is to

triple our sales in 3 years. In order to achieve the target, Wee Baby also evaluating to purchase new brands and business as well as organic growth. With this strategy, they have initialized legal operations to purchase 55% share of MYCey brand that produces mother and baby products. They have always embodied the mission to manufacture high quality products that are in line with world standards, with this mission Wee Baby have decided to acquire MYCey that produces specific and quality product that answer the need of consumers. The company will continue their journey with both brands Wee Baby and MYCey. As Burda Bebek, they aim to become “Turkey’s Mother and Baby Brand” consolidating different product groups in motherbaby category under one roof. Mother and Baby Products market is very open to innovation. The potential of growth is significantly high. It can be said that many improvements took place with developing technology in the last five years. The brand is constantly renovating and updating itself following changing health standards, raising quality essentials and conscious consumer parameters as well as always keeping up with what’s happening around the world. The company constantly continues the development and search for alternative products and categories. Recently, they have added electrical breast pump to the mother specific products being the first electrical device we offer to consumers. They have also launched our noncontact thermometer to the market. Wee Baby has a plan on increasing the product range in this category in the future.

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62

Agenda

FAIRS, EXHIBITIONS, SUMMITS AND MEETINGS IN THE NEXT MONTH

MAYFU SHOES AND FASHION FAIR S & K Manisa BSB Fair Center Manisa / Turkey MAYFU, which has set out to lead the shoe industry around Manisa and its vicinity, has reached its deserving position thanks to its attendants, visitors and supporters. The fair, which is organized twice a year in Spring-Summer and AutumnWinter, is very popular.

August

03-06 18-27 August

86 İzmir International Fair th

İzmir Kültürpark - İzmir / Turkey

İzmir having hosted various civilizations throughout the history, is the host of the first fair in the history of Turkey. First anf most comprehensive trade fair of Turkey, İzmir International Fair being organized 85 years before depite of wars, famine and crises will open its door for 86th time this year. Annually changed main team of İzmir International Fair is decided as “INNOVATION - ENERGY” for this year. Honored City is “MUĞLA”. Partner Country is “RUSSIA”. DLG-ÖÇP Agriculture and Technology Days

The exhibition, which has shown the interest of the industry members for new models, new designs and new connections, is also organized with the support of the cooperation of Manisa Metropolitan Municipality, Kosgeb Fair support and Manisa Chamber of Commerce & Industry, Shoemaker’s Chamber, Union of Chambers of Artisans and Artisans Chambers.

Karaevli / Tekirdağ

23-26 August

DLG-ÖÇP Agriculture and Technology Days is an annual event for agricultural machinery and technology on an area of 19 hectare in Karaevli-Tekirdağ, Turkey. Machinery and agricultural implements will be presented on campus grass and at machinery demonstrations. The live demonstrations will take place on areas specially prepared for this purpose. In addition, the event is dedicated to bioenergy issues and also to products and technologies for animal husbandry. With almost 25,000 visitors, the DLGÖÇP Agriculture and Technology Days is a very attractive event for visitors and specialists

August

Project Marble Eurasia Natural Stone, Marble Project And Technologies Fair İstanbul Expo Center - İstanbul / Turkey

23-26 august

With its share of 40% of the world’s natural stone reserves, Turkey dominates the world stone market. Turkish stone market, full of profitable opportunities, is now ready to welcome you in a brand new trade fair called PROJECT MARBLE EURASIA, opening its gates for everyone wishing to take their parts in this growing market. A bridge connecting Middle East, Europe, Asia and North Africa with each other, Turkey plays a key role in the world’s natural stone trade. Due to this strategic location of Turkey, Project Marble Eurasia is expected to make a significant contribution to Turkey’s marble trade.

AUGUST 2017 ISSUE 49

24-27

Uşak 3rd Agricultural and Livestock Technology Exhibition Kemal Özal Indoor Marketplace - Uşak / Turkey

Uşak, which has high potential in livestock and agriculture sector in Turkey, is located in a region with fertile landscapes and is an important center of the region with its geographical location. The fair invites you with this aspect of crop and livestock production and processing of products required will be the most important fairs in the area of new technologies introduced at the Uşak Aegean Agriculture and Livestock Technology Fair for you to take your place.


63

Figures EVER-GROWING FORCE OF TURKEY

Turkey’s automotive sector is growing continuously compared to same month of the last year.

Production*

Export

2016

2017

17’/16’

Total

725.941

869.158

P.Cars

441.366

601.586

20 (%) 36 (%)

2016

2017

555.755 714.284 340.623 504.466

Export (Billion $)**

17’/16’

2016

2017

17’/16’

29 (%) 48 (%)

11,91

14,54

3,57

6,09

22 (%) 71 (%) Data: OSD

*Production units in this report only show the data of osd members. ** Total industry including components

Top 10 countries with the highest export growth*

TO REACH THE TOP

Turkey’s export growth is increasing constantly and unstoppable among these countries. LIBERIA

3.017 44.593 1378,1%

COUNTRIES (Thousand $) 2016 1 - 30 JUNE 2017 1 - 30 JUNE Change Rate %

ICELAND

CHILE

1.716 16.237 1020,7%

125.327 237.006 89,1%

SINGAPORE

SOMALIA

MARSHALL ISLANDS

6.219 18.339 194,9%

7.239 12.377 71% MALTA

25.346 69.916 175,8%

GIBRALTAR

8954 17.729 98%

*Among the countries exported over 10 million dollars

1 January - 30 June 2017 (Million $)

13.972 27.205 94,7% RUSSIA

11.450 43.849 283,0%

Export figures of the agricultural processed products are increasing as expected and try to reach the top.

2016

2017

Change Rate ('17/'16)

AGRICULTURAL PROCESSED PRODUCTS

16.57 20.76 25,26

Textiles and Raw Materials

11.69 14.43 23,50

Leather and Leather Products

2.04 2.65

29,64

Carpet

2.83 3.67

29,37

CANADA

52.211 89.220 70.9% Data: TİM

Data: TİM

Agricultu Process Product


64 Figures

GERMANY

1,26

BELGIUM

0,23

NETHERLANDS

0,30

FRANCE

0,54

UK

Turkish exports to most prominent 20 markets in the globe enjoyed in June 2017.

0,79 USA

0,72

exports to tOP 20 COuNTRIES by TURKey ın june (bıllıon $)

SPAIN

0,50

poland

0,24

ROMANIA

0,26

RUSsıa

0,23

ITALY

0,73 BULGARIA

0,22

china

0,20

IRAN

ıraq

0,59 Algerıa

0,13

Data: TİM

AUGUST 2017 ISSUE 49

saudı arabıa

0,18

ISRAEL

0,28

0,25

EGYPT

0,19

UAE

0,23


TURKISH PERPECTIVE 49  
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