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BRIEFING Key of the Mediterranean IN DEPTH Close Ties, Common History BRANDS Beko:The Offıcial Partner of the Everyday

JULY 2018 ISSUE 60

ECONOMY BUSINESS FOREIGN TRADE ANALYSIS

From the foreign-dependent banks in the late Ottoman Era to the national banks of the Republic of Turkey, Turkish banking system improved itself with structural changes and resisted the most painful financial crisis.


Marathon of Innovation

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The Turkish Perspective

Contents 05 FIRST

34 COVER

05 | TANAP: ‘Silk Road of Energy’ 06 | Democracy Winner of Turkish Elections 07 | Fly High in U.S Drone Contest 08 | Ready for Deployment 09 | Tourism Boom with EURO 2024 11 | Turkey’s First Metro Car Export

06

13 BRIEFING 13 | SUGGESTGRID: PERSONALIZING APPLICATIONS

46 INDEPTH

46

46 | TURKEY AND THE BALKANS: CLOSE TIES, COMMON HISTORY

Being itself a Balkan country, Turkey attaches great importance to its bilateral relations with the Balkan countries and maintains good relations with all of them throughout the history.

A resident of TİM-TEB Start-Up Business House, SuggestGrid is helping websites and applications from all around the world to serve their users better with their personalization service.

55 BRANDS

16 | GIANT INVESTMENTS BOOST TURKISH ECONOMY

Azerbaijan’s state-owned oil company SOCAR has been heavily investing in the Turkish market since 2008.

18 | ROBUST INDUSTRY, THRIVING

ECONOMY

Turkey’s Top 500 Industrial Enterprises 2017 survey released on 30 May 2018 by the Istanbul Chamber of Industry (ISO).

58| BEKO: THE OFFICIAL PARTNER OF THE EVERYDAY

20 |ENTERTAINMENT AND INNOVATION CNR Games Week Yeşilköy Video Games and Technology Expo- visited by children and adults with equal enthusiasm was held at CNR EXPO Yeşilköy.

26 | KEY OF THE MEDITERRANEAN

18

Beko is a global brand facilitating daily life in Turkey with white goods, solo products, built-in products, small home appliances, air-conditioners and electronic products.

Turkey continued its moral and financial aid to the Turkish Cypriots after the establishment of the Turkish Republic of Northern Cyprus.

28 28 | ANOTHER STRATEGIC PARTNERSHIP FROM TURKISH AIRLINES The signing ceremony of the joint venture between Turkish Cargo, Chinese cargo giant ZTO and Hong Kong based PAL Air Ltd., took place in Istanbul.

62 AGENDA FAIRS, EXHIBITIONS, SUMMITS, MEETINGS IN THE NEXT MONTH

63 FIGURES THE BASIC INDICATORS OF TURKEY IN THE MAY 2018

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2 Online

Online

MANAGEMENT

theturkishperspective.com

PUBLISHER ON BEHALF OF TURKISH EXPORTERS ASSEMBLY/ CHAIRMAN OF THE TURKISH EXPORTERS ASSEMBLY

MEHMET BÜYÜKEKŞİ STRATEGIC PARTNER PRESIDENT OF PRIME MINISTRY INVESTMENT SUPPORT AND PROMOTION AGENCY

ARDA ERMUT

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 AND BUSINESS, IS BORN. THE TURKISH PERSPECTIVE DIGITAL WILL SHARE THE LATEST NEWS, INTERVIEWS WITH DECISION MAKERS, PROVIDE IN-DEPTH ANALYZES AND WILL BE THE FOREIGNER’S GUIDE IN TURKEY REGARDING REGULATIONS AND LEGISLATIONS.

MANAGER IN CHARGE H. BADER ARSLAN PhD

PUBLICATION BOARD M. İLKER AYCI HC. DR. MUSTAFA ÇIKRIKÇIOĞLU BİLAL EKŞİ SÜLEYMAN KOCASERT BÜLENT AYMEN FURKAN KARAYAKA

PUBLICATION MANAGEMENT PRESIDENT MEHMET MÜCAHİD DEMİR

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VICE PRESIDENT YAŞAR MAMATİ PROJECT COORDINATOR AHMET DAMGACIOĞLU adamgacioglu@theturkishperspective.com

EDITORIAL EDITORS MUSTAFA YİĞİT myigit@theturkishperspective.com

RAMAZAN GÜZYURDU rguzyurdu@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

EUROPEAN COORDINATOR İNANÇ ATILGAN CONTRIBUTING REPORTERS İLHAN ALPAY OGAN İBRAHİM AVCI SERAP KAYA DESIGN CREATIVE DIRECTOR AHMET SAİD ÇELİK acelik@theturkishperspective.com

GRAPHIC DESIGNER UMUT DURUTUNA YOUR COMPLIMENTARY COPY

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BRIEFING The Only Thing We Need: Innovation

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IN DEPTH Invest in France

ECONOMY BUSINESS FOREIGN TRADE ANALYSIS

TURKISH EXPORTERS:

BRIEFING Soda Ash: The Largest Producer in Europe

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IN DEPTH Turkey: Global Player in Defense

BRANDS Arzum: A 50-Year Brand In Household Electrical Appliances

JANUARY 2018 ISSUE 54

IN DEPTH Invest in Greece

MARCH 2018 ISSUE 56

ECONOMY BUSINESS FOREIGN TRADE ANALYSIS

PANORAMA Global Trade On The Rise BRIEFING Major Actor of Humanitarian Aid

BRANDS Şölen: Re-Establishing the Chocolate Candy Rules

FEBRUARY 2018 ISSUE 55

ECONOMY BUSINESS FOREIGN TRADE ANALYSIS

THE YEAR OF

RECORDS

We’re grateful for your confidence Turkey has a “breakthrough year” in 2017 and gained the confidence of all world.

TuRkEy iS REaDy fOR ThE yEaR Of RECORDS afTER ThE bREakThROugh yEaR, 2017.

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APRIL 2018 ISSUE 57

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EXCLUSIVE INTERVIEW

Nihat Zeybekci, Minister of Economy, shared the current state of Turkish economy with Turkish Perspective.

ECONOMY BUSINESS FOREIGN TRADE ANALYSIS

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BRIEFING One Festival, Two Continents

ECONOMY BUSINESS FOREIGN TRADE ANALYSIS

Turkey

on the Move

Turkey has long been a country shaken by chronic economic and financial crises (1959, 1969, the 1970s, 1994, 2000-2001), but it has risen, in the last decade, to rank 17th among global economic powers.

BRIEFING Forum Istanbul 2018: Towards 2023 IN DEPTH Turkey: ‘Heart’ of Health Tourism

IN DEPTH Bridging The Energy Gap

MAY 2018 ISSUE 58

BRANDS Unique Tastes with Tamek

JUNE 2018 ISSUE 59

ECONOMY BUSINESS FOREIGN TRADE ANALYSIS

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

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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.

JULY 2018 ISSUE 60


The Turkish Perspective

Editorial MEHMET BÜYÜKEKŞİ PRESIDENT (TİM)

PASSING THE TORCH

During our term as the TİM Executive Board, we had diverted our efforts towards increasing Turkey’s exports permanently and sustainably. To achieve this, we tried to increase the quality of our exports in order to strengthen Turkish economy. Our focus have been on producing higher value-added products and increasing export unit value.

D

URING OUR TERM AS THE TİM

Executive Board, we had diverted our efforts towards increasing Turkey’s exports permanently and sustainably. To achieve this, we tried to increase the quality of our exports in order to strengthen Turkish economy. Our focus have been on producing higher valueadded products and increasing export unit value. When we first came to office, we begun with creating Turkey’s 2023 Export Strategy. Following this study, we shaped our agenda with high value-added production in mind. We know very well that, Turkey has to invest more in R&D, be more innovative with product design and create strong brands in order to reach higher export figures. From this point of view, we have set out to spread the awareness of innovation in Turkey and create a culture of innovation for future generations. Since 2012, in every province we went in every corner of Turkey, we explained why we need innovation. With these efforts, we have widened many of our citizens’, especially our youngsters’, horizons and showed them new paths to follow. As a result, something that I am very happy with has occurred, TİM and innovation started to come to mind together. With the motivation and courage we have mustered from this development, we have created new events about innovation one after another. As we continue our efforts to improve Turkey’s exports and economy, we decided

that we have to strengthen our internal structure to achieve our goals and created “TİM Management Compass”. With this guidebook, we have clearly revealed the vision and mission of TİM as we aim to achieve a stronger corporate structure as Turkey Exporters’ Assembly. Moreover, we have become a part of the International Trade Centre (ITC) network in order to represent Turkish exporters’ interests in the international arena, and to increase TIM’s international recognition in the world. Following the path to modernization, we decided to increase the number of women board members in exporter associations by saying that we need to have a more balanced and sound structure in order to achieve success. At the moment, we have three Chairwomen, while there were none. There are 52 female board members on the exporter association boards. As this

number rises further, I believe that the exporter associations will be functioning a lot better. Another achievement regarding the exporter associations were the establishment of the Association of Service Exporters. Turkish service exporters whom had to act individually until today, have found an opportunity to act together by taking place under a common roof. Besides, they now have a platform where they can make their voices heard. As Turkey, to strengthen our position in the global economy, we need to place importance on service exports. With the help of this new association, Turkey’s potential in service exports will be unleashed, and Turkey’s share in the global service trade will increase. Our 2023 targets include $500 billion in merchandise trade as well as $150 billion in service exports. We have no doubt about reaching this goal with the contribution of the Association of Service Exporters. TİM’s priority has always been to solve our exporters’ problems quickly and efficiently. Today, Turkey’s exports have reached record levels. The share of Turkey in global trade, which was 0.81% in 2008, rose to 0.9% in 2017. I believe that in the coming years both our exports and Turkey’s share in global trade will set new records. I am certain that, our friends who will take the torch after us will act with the same values and do their best in improving Turkish economy and Turkey’s exports.

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The Turkish Perspective Content: Tanap: ‘Silk Road of Energy’ P05 Democracy Winner of Turkish Elections P06 World’s 4th Longest Tunnel Opens P07 Number of Air Passengers up over 16 pct P08 Tourism boom with EURO 2024 P09 Solutions for Water Problem P10 Establish High-Tech Boron Carbide Facility P11 Editor: Ramazan Güzyurdu

First

ENERGY, EXPORT, BUSINESS, POLITICS, ECONOMY, DEFENSE, TOURISM, AUTOMOTIVE, SPORT...

TANAP will also boost European supply security by enriching the energy resource channel for continental countries.

TANAP:

‘SILK ROAD OF ENERGY’

The Trans-Anatolian Natural Gas Pipeline started operations after the inauguration ceremony in Eskişehir with President Erdoğan and his Azerbaijani counterpart in attendance.

D

UBBED AS THE Silk Road of Energy, the TransAnatolian Natural Gas Pipeline (TANAP) started operations at a grand inauguration ceremony in Eskişehir. President Recep Tayyip Erdoğan, Azerbaijan President İlham Aliyev, Serbian President Aleksandar

Vucic, Ukranian President Petro Poroshenko and Turkish Republic of Northern Cyprus (TRNC) President Mustafa Akıncı were present at the event along with energy ministers and the project’s partner representatives. Seen as the product of

strong collaboration among partners countries, TANAP is seen as the harbinger of many prospective projects of this kind. TANAP is the backbone of the multinational European Commission energy project, the Southern Gas Corridor (SGC), and it will

carry natural gas from Azerbaijan’s Shah Deniz-2 and other fields in the Caspian Sea to Turkey and Europe. The TANAP project brings gas from the Shah Deniz-2 gas field to the Turkish border through Georgia, via the South Caucasus Pipeline. TANAP then

connects to the TransAdriatic Pipeline on Turkey’s İpsala border, going on to deliver Azeri gas to European markets through pipes in Greece, Albania and the Adriatic Sea before coming ashore in Italy’s south. This will help reduce Europe’s dependence on Russian gas.

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EXPORT

POLITICS

Democracy Winner of Turkish elections Erdogan declared his success in Turkey’s historic presidential and parliamentary elections.

EXPAND FURTHER INTO EAST ASIA Renowned for their quality and taste across the world, Turkish cherries have become a favorite of European consumers. Turkey has received a permit to export cherries to China, following eight years of technical and diplomatic work, and many rounds of serious negotiations between Turkish exporters and Chinese authorities. A delegation from Taiwan is due to visit Turkey for local cherries as well. Uludağ Fresh Fruits and Vegetables Exporters Association Vice Chairman Senih Yazgan stressed that the Taiwanese market is very attractive for Turkish exports. “The quarantine requirements between Turkish and Taiwanese governments must be fulfilled on absolute terms in order to enter this market,” said Yazgan. JULY 2018 ISSUE 60

D

EMOCRACY is the winner

of Sunday’s presidential and parliamentary elections, President Recep Tayyip Erdogan said early Monday. Addressing the nation from the balcony of Justice and Development (AK) Party headquarters in capital Ankara after his election victory, Erdogan said every one of the 81 million Turkish citizens is a winner. “Winners of June 24 elections are Turkey, Turkish nation, sufferers of our region and all oppressed in the world,” he said. “I would like to express my gratitude to my people, my brothers and sisters who put their trust in me, my alliance and my party,” he said. Erdogan pointed out the benefits of forming alliances in the elections. “As you see, this [alliance] has become beneficial both for other [political] parties and our country.” Earlier on Sunday, Erdogan declared his success in Turkey’s historic presidential and

parliamentary elections. AK Party is also leading in parliamentary elections. The president said he received the citizens’ message in the polls. “In this term, we will be before our nation and make up for our shortcomings. “Starting from tomorrow, we will be in a rush trying to deliver on promises that we have made to our nation.” “Immediately after the oath-taking ceremony, we will start implementing our program by identifying our bureaucrats,” Erdogan said, vowing to work day and night as “we have no single moment to lose.” “Starting from tomorrow, we will be in a rush trying to deliver on promises that we have made to our nation.” “Turkey has decided to take the side of growth, development, investment, enrichment and a reputable, honorable and influential country in all areas in the world,” Erdogan said.

ECONOMY

4.4 PERCENT

INCREASE IN CULTURAL JOB Cultural employment in Turkey increased in 2017 compared to the previous year, TurkStat said. “In 2017, 614,000 people were included in cultural employment in Turkey with an increase of 4.4 percent compared to 2016,” TurkStat said. It added that 51.5 percent of the cultural employees were males and 48.7 percent were females. TurkStat said “64.8 percent of the people in cultural employment were in the 30-54 age group, 27.7 percent in the 15-29 age group and 7.5 percent in the 55-and-over age group.” It added that 87.1 percent held jobs in the category of “cultural occupation.” The next cultural employment figures are due to be released in June 2019.


The Turkish Perspective

ECONOMY

BUSINESS

EXPORTS TO RUSSIA UP OVER 60 PCT Turkey’s exports to Russia reached $1.4 billion in the first five months of this year. According to Turkish Exporters’ Assembly (TİM), exports to Russia rose from $872.9 million in the January-May period of 2017 to $1.4 billion. The resolution of diplomatic problems having emerged between the two countries in late 2015, as well as the positive developments in commercial relations was effective in the 61.4 percent increase in exports. In the first five months of the year, the fresh fruits and vegetables sector ranked first with $263.6 million in terms of the size of exports to Russia, followed by the automotive industry with $195.9 million. The exports of fresh fruits and vegetables managed to increase exports from $123.7 million last year, achieving an increase of $139.9 million. Thus, the sector almost doubled its exports. In export growth, the ship and yacht sector was followed by ornamental plants and products with 288.3 percent, carpets with 234.5 percent, textiles with 217.4 percent and olives and olive oil with 157.6 percent.

TECHNOLOGY

World’s 4th Longest Tunnel Opens Ovit Tunnel is expected to facilitate freight transportation and boost connectivity mechanisms between the region and neighboring countries.

FLY HIGH IN U.S DRONE CONTEST

T

URKEY’S second-longest

and the world’s fourthlongest highway tunnel stretching 14.3 kilometers was inaugurated in the eastern Black Sea province Rize yesterday. President Recep Tayyip Erdoğan and Transport, Maritime Affairs and Communication Minister Ahmet Arslan were both in attendance for the opening ceremony of the Ovit Tunnel, which was constructed at an altitude of 2,640 meters on Mount Ovit in Rize’s İkizdere district. Speaking at the opening ceremony, President Erdoğan stressed that

the Ovit Tunnel is the starting point of Turkey’s north-to-south corridor and has immensely facilitated the transportation between the north-south axis to a great extent. “Ovit is not simply an infrastructure project, but is of great strategic importance due to its location on the Caucasian corridor that opens to Europe and Central Asia,” he added. The project facilitates freight transportation and boosts connectivity mechanisms between the region and neighboring countries, as well as major ports.

ANOTHER GREAT PROJECT FROM TURKEY The tunnel will ease transportation between the Baku-Tiflis-Kars Railway and it is also expected to reinvigorate the historic Silk Road.

14.3

2123

773

THE LENGTH OF THE TUNNEL

TIME OF THE COMPLETION OF THE TUNNEL

THE NUMBER OF THE PEOPLE WORKED

KILOMETERS

DAYS

PEOPLE

Turkish teams ranked among the Top 10 at the 2018 Student Unmanned Aerial Systems (SUAS) Competition held in Maryland, U.S. The 16th edition of the event was held between June 13 and June 16. Only 69 university teams from different countries around the world were accepted at the event after a tough preliminary application stage. Five teams from Turkey took part in the AUVSI SUAS 2018. Of them, teams from Istanbul Technical University (İTÜ) and Yıldız Technical University (YTÜ) ranked in the Top 10, alongside the likes of Harvard University, Stanford University and U.C. Berkeley. Istanbul Technical University team ITÜNOM ranked seventh and Yıldız Technical University’s team Lagari came in at eighth in the competition.

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DEFENSE

TOURISM

READY FOR DEPLOYMENT

Turkish defense industry companies are introducing new products for security forces.

U TECHNOLOGY

IZMIR TECH BASE SET TO BOOST R&D The Turkish government has unveiled the Izmir Technology Base, which will bring together hundreds of technology companies. Prime Minister Binali Yıldırım said Tuesday the Izmir Technology Base will add $15 billion to the country’s national income in 10 years. Speaking in Izmir at an introductory meeting of the base, Yıldırım said the base will directly and indirectly generate around 40,000 jobs for youth and researchers in the long term. The center, expected to cover a 9.5-millionsquare-meter area, will serve as a hub for technological research and development for both “local and global companies,” Yıldırım said, adding that other projects will follow this initiative. “We aim to increase the number of companies in the Izmir Technology Base to 800 in 10 years,” he said. JULY 2018 ISSUE 60

ndersecretariat for Defense Industries (SSM) is increasing the capabilities of existing products. An example of these recent developments is a new unmanned defense platform – the Remote-Controlled Weapon Platform (UKAP) for Turkish security forces, which is ready to be deployed. UKAP was developed by leading defense firm Katmerciler and equipped with the ASELSAN weapon system. The mobility and shooting capability of the UKAP, which was subjected to field tests under all sorts of challenging conditions, was developed in line with current demands. Accordingly, comments, suggestions and opinions of institutions such as land forces, security and gendarmerie were taken into consideration. As a result of these efforts, the first installment of these

unmanned land vehicles reached a level where they could serve operationally. UKAP consists of the main platform developed by Katmerciler and ASELSAN’s Stabilized Advanced Remote Weapon Platform (SARP). The vehicle will be able to serve in “hot” clash zones with remote control functions, while contributing to the maximum protection of personnel safety during operations in and outside the city. Work on more advanced and intelligent versions of the platform are in progress under the supervision of the SSM. The UKAP is among the leading product in meeting the security needs of unmanned land systems. Undersecretary for Defense Industries İsmail Demir announced that more than 20 platforms will be delivered to Turkish Armed Forces (TSK).

BUSINESS

Number of Air Passengers up over 16 pct

The number of passengers passing through Turkish airports surged 16.4 percent annually in the first five months of 2017, the country’s airport authority announced.

T

he Turkish airports served more than 78 million people between January and May, up from 67 million in the same period last year, according to the General Directorate of State Airports Authority (DHMİ). In the same period, cargo traffic also saw an increase of 15.2 percent

year-on-year to reach over 1.4 million tonsincluding overflights. In May, more than 18 million passengers passed through Turkish airports, up 7.3 percent from the same month last year. The number of international passengers increased 17 percent to reach 8.7 million in May.

GREEKS FLOCK TO AEGEAN TOWN AYVALIK While many Turkish citizens cross borders from the Aegean province Balıkesir’s Ayvalık district to Greece’s Lesbos Island every year, this time Greek tourists flocked to Ayvalık for shopping, taking advantage of the rise in euro against Turkish lira. There is recordbreaking level of activity at Ayvalık Sea Border Gate’s Turkey entrance this year. The Greeks who have come to Turkey from the islands in the Aegean Sea, mainly from Lesbos, for shopping have created the rush in the region. Greek tourists who prefer Turkey for shopping have filled the ferries. Hundreds of Greek citizens flocked to the neighborhood market in Ayvalık, returning to their homes with full shopping bags in their hands. Fatih Jale, the owner of a tourism firm in the Aegean district said the people of Lesbos flocked to the neighborhood markets in Ayvalık, pointing out that the number of arrivals from the island to Ayvalık has increased recently. “Since the euro is high against TL, the people of Lesbos wanted to get all their shopping from Ayvalık and filled the ferries. 400 Greeks came to the region’s largest neighborhood market in Ayvalık,” Jale said.


The Turkish Perspective

AUTOMOTIVE

TECHNOLOGY

Mobge Wins Apple Design Award 2018

EXPORT 400 BUSES TO ROMANIA Turkish automotive giant Otokar has signed a deal with the Bucharest Municipality to supply some 400 buses. The contract is the largest bus export deal ever secured by a Turkish automotive company. Otokar, a subsidiary of the Koç Holding, in a statement, said that the company exports buses for public transport to 50 different countries. As part of its deal with the Bucharest Municipality, Otokar will export as many as 400 buses in separate batches in 2018 and 2019. It will also provide after sales services for eight years. Otokar General Manager Serdar Görgüç said they participated in the tender, held to meet the Romanian capital’s increasing public transport needs, through its Otokar Europe.

Mobge, founded by two young software developers, won the Apple technology, innovation and design award with its first game Oddmar.

A

PPLE DESIGN Award, which

represents excellence in the field of design, innovation and technology, was given to a Turkish company for the first time in its 21-year history. Mobge venture Oddmar, founded by two friends from Bilkent University’s Computer Engineering Department at Eskişehir Anadolu University Technopark, was one of Apple’s five winning games. For 21 years Apple has granted Design Awards to apps and games selected from thousands of apps across the iPhone, iPad, Mac, Apple Watch and Apple TV platforms. Apart from Turkey, applications from the United States, Canada, India, Austria, Denmark, Australia, the Netherlands and Finland won the Apple Design Award this year with an international representative. While five useful mobile applications and five-game applications took home the award, Mobge’s mobile game

Oddmar, founded by two young entrepreneurs from Eskişehir, is exported to all over the world at a cost of $ 4.99. Oddmarr is available on iPhone and iPad products using iOS operating system. It will be downloaded to millions of devices along with the award, which points to the export success achieved by an Eskişehir-based venture. Özgür Taşkın and Ferhat Aydoğan, the founders of Mobge, spoke to Sabah, the sister newspaper of Daily Sabah, about their experience in this process, while Oddmar, inspired by the Vikings cartoon, received Apple’s prestigious award. Ferhat Aydoğan, on the other hand, said the perfectionist approach gave them a good self-confidence. “We have always preferred to work with the best. While creating the sound, graphics and story, we always had a good chance to work with competent people,” he added.

SPORT

TOURISM BOOM WITH EURO 2024 UEFA EURO 2024 may bring an additional 10 million tourists and $10 billion in tourism revenue for Turkey. The Turkish Football Federation (TFF) submitted its official bid on April 26. A TFF delegation, led by its President Yıldırım Demirören, handed over the bid dossier to UEFA General Secretary Theodore Theodoridis at the House of European Football in Nyon, Switzerland. The TFF submitted a declaration of interest to host the tournament earlier in March 2017. Turkey, however, will face a tough competition from the German Football Association (DFB). The UEFA Executive Committee will meet in Nyon on Sept. 27 to pick the Euro 2014 host. Speaking to the Turkish language newspaper, Sabah, Turkish Travel Agencies Association Chairman Firuz Bağlıkaya said Turkey’s location- only a three to four-hour flight away from most European countries- is highly advantageous. As part of the tournament bid, the Culture and Tourism Ministry will promote Turkey’s key tourist destinations.

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BUSINESS

BUSINESS

Make Turkey’s First Metro Car Export Bozankaya, a leading public transport vehicle builder in Turkey, is set to make the country’s first-ever metro car export, the company said.

DEFENSE

ASELSAN NEW LASER SYSTEM TESTED

SOLUTIONS FOR WATER PROBLEM

The laser defense system, developed by Turkish defense giant ASELSAN, has been successfully tested.

Turkey has initiated talks with Iraqi officials to resolve the water shortage in the country. The people of Iraq, who have recently had difficulties due to a drought, have called for Turkey’s aid. A delegation from Iraq visited Ankara and exchanged views on the steps to be taken in the coming months. It was learned that the Iraqi Parliament will request Ankara to postpone water-holding operations at Ilısu Dam once again. Commenting on the issue through his social media account, Turkey’s Ambassador to Baghdad Fatih Yıldız said Turkey exhibited its willingness to cooperate when it postponed water-holding operations at Ilısu Dam previously. “Turkey will continue to be on Iraq’s side regarding the Tigris and Euphrates, seen as our common water.” Turkey is closely cooperating with Iraq to eliminate the water shortage problem in the neighboring country.

The LSS was developed to effectively eliminate threats posed by unmanned aerial and underwater vehicles at the range of 500 meters as well as improvised explosive devices and suspicious roadside packages at the range of 200 meters. The system can be used on ship platforms, power plants, airports, border police stations, military posts and convoy transit routes. In the successful tests, the system’s high power laser source, very low cost of shots, highcapacity magazine, continuous shooting, optical target detection and advanced target tracking system were highlighted. The company is ranked 58th in the list of the world’s top 100 defense giants in the year of 2016. JULY 2018 ISSUE 60

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OZANKAYA, a leading

public transport vehicle builder in Turkey, is set to make the country’s first-ever metro car export, the company said. Bozankaya will provide 22 sets of four-car trains for Bangkok’s metro line for $46.1 million, the largest export Turkey has ever made to the Southeast Asian country. “Today, we put our signature on Turkey’s first metro exports and we are glad to contribute directly to the exports of Turkey,” Murat Bozankaya, the head of

the Bozankaya Group, told a ceremony in the capital Ankara, which was marking the first train set to be rolled out of the assembly line. The first of the 140-ton metro trains will leave the factory at the end of June, it will travel over 15,000 kilometers in six weeks to reach the Laem Chabang Port in eastern Thailand. After the tests are completed, the new trains will be included in Bangkok’s Skytrain fleet, which serves more than a million passengers a day.

INNOVATION FROM THE TURKISH FIRM Bozankaya, founded in 1989 in Germany, and is also known for producing Turkey’s first indigenous fully electric bus.

1572 THE TRAIN’S TOTAL PASSENGER CAPACITY

46.1

$

MILLION

THE LARGEST EXPORT TURKEY HAS EVER MADE TO THE SOUTHEAST ASIAN COUNTRY

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PROVIDING SETS OF FOUR-CAR TRAINS FOR BANGKOK’S METRO LINE


The Turkish Perspective

ENERGY

ESTABLISH HIGH-TECH BORON CARBIDE FACILITY

Energy Minister Berat Albayrak attended the launch of the new boron strategy and a MoU signing ceremony with Chinese Dalian Jinma top executive Wang Yahne and Eti Maden General Manager and Chairman Serkan Keleşer. The agreement to establish the facility marks a historic moment in the promotion of boron.

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TATE-RUN mining firm Eti Maden and China’s Dalian Jinma, a world leader in boron technology, signed yesterday a Memorandum of Understanding (MoU) to establish a high-tech boron carbide production facility in western Turkey’s Balıkesir. The signing ceremony was attended by Energy and Natural Resources Minister Berat Albayrak. Speaking at the program in Istanbul, Minister Albayrak focused on the benefits of boron carbide. “Boron carbide is worth 2,000 times more than regular boron. A ton of boron is worth $200, but once it is processed into a high-tech product, the value increases to nearly $400,000,” he said. Albayrak stressed that the agreement to establish the facility marks a historic moment in the promotion of boron. He added that technology transfer was also part of the agreement. He said that the energy ministry places high importance on localizing technology in all its projects since technology can add immense added value and increase revenues. The minister said boron carbide can become an important export item for Turkey. “It is widely used in the defense industry thanks to its low density and high heat resistance.

400

$

THOUSANDS WORH OF THE HIGH-TECH BORON

73% TURKEY’S HOLDS WORLD’S BORON RESERVES

The energy ministry places high importance on localizing technology in all its projects since technology can add immense added value and increase revenues.

2.2

TONS OF BORON SOLD BY ETI MADEN IN THE YEAR OF 2017

“The local production of boron carbide, which is widely used in tactical vehicles, helicopters, aircraft, light armored vehicles and bulletproof vests, will be an important step for Turkey’s defense industry,” Albayrak said. He added that the new process will continue with projects on ferro boron and boron nitrile, where boron is converted into high-tech products. “Ferro boron will provide magnetic material production for high quality and high durability steel,” he said. “Boron nitride could also be used in very important areas like atom reactors, aircraft and rocket engines due to its high-temperature resistance and high electrical insulation properties. “Boron nitride costs $50,000 per ton today. We will achieve this technology with the process that we started today, reaching the capacity to obtain strategic products with much higher added value than boron nitride,” Albayrak continued. According to the energy minister, Turkey holds 73 percent of world’s boron reserves and will increase that to 80 percent by developing its reserves. Recalling that Eti Maden was the world leader in boron production, Albayrak said that Eti Maden sold 2.2 million tons of boron in 2017 - 57 percent of the global market.

11


Together We Innovate

InovaTİM is a family of 2256 students full of spirit of development and change who puts innovation in the center in Turkey’s 156 different departments of 150 universities in 72 cities.

www.inovatim.org


The Turkish Perspective Content: SuggestGrid: Personalizing Applications From All Around the World P13 SOCAR Turkey’s Giant Investments Boost Turkish Economy P16 Robust Industry, Thriving Economy P18 CNR Games Week: Entertainment And Innovation P20 Export Champions of 2017 are Announced P24 Key of the Mediterranean P26 Another Strategic Partnership From Turkish Airlines P28 UNCTAD Reveals World Investment Report 2018 P30 Editor: Mustafa Yiğit

Briefing

TECHNOLOGY, ENERGY, INDUSTRY, BUSINESS, GAMING, POLITICS.... TIM-TEB

SuggestGrid:

PERSONALIZING APPLICATIONS FROM ALL AROUND THE WORLD A resident of TİM-TEB Start-Up Business House, SuggestGrid is helping websites and applications from all around the world to serve their users better with their personalization service.

13


14

Briefing

M

achine learning is a popular subfield of artificial intelligence. Tech companies like Google and Facebook create better experiences such as displaying captivating content and predicting their users’ behavior using machine learning. However, the majority of websites, applications, and businesses lack the human resources, technical expertise, and infrastructure costs to justify the benefits of machine learning for their users. This is where SuggestGrid’s personalization service provides significant benefit. Customers of SuggestGrid could easily personalize their applications or websites, without understanding the technology behind the curtains. “Personalizing applications using machine learning is no longer a burden for our customers.” says Co-founder of SuggestGrid Ferhat Sobay, emphasizing the challenges on development, deployment, affordability, monitoring, and security of managing in-house machine learning solutions.

JULY 2018 ISSUE 60

technique on aggregating the collective taste of the users. When a group of users shares similar preferences, they are likely to enjoy each others’ preferences. Making use of this loose connection between the users, we could predict which items or users are similar to each other, as well as which items to recommend to their users, and which users to recommend to their items.” says Co-founder Han Tuzun.

GLOBAL PARTNERSHIPS

PERSONALIZATION IS PARAMOUNT

Using SuggestGrid’s service, they find recommendations, and similarities, and then display these to their users in websites, mobile applications, and emails.

Ever came across sections such as “Articles picked for you”, “People bought this also bought these accessories”, “Similar TV series” while browsing the Web SuggestGrid’s customers are displaying the recommended content to their users under such titles. Using SuggestGrid’s service, they find recommendations, and similarities, and then display these to their users in websites, mobile applications, and emails. “We use a

This May, the company succeeded its release as an add-on on Heroku, the leading cloud platform for deploying applications, owned by Salesforce. It is the first machine learning add-on on Heroku. That is a significant achievement after a demanding public beta trial phase before being accepted as an official add-on. Proven themselves as a Heroku add-on, SuggestGrid is looking forward to new platform partnerships in order to become the de-facto personalization solution on other platforms as well.


The Turkish Perspective

PLATFORM AGNOSTIC

Being a platform agnostic service, SuggestGrid could be integrated into any software running on any platform, no matter which programming languages are used in the project, or where it is deployed. Moreover, on their freshly updated dashboard, people without programming knowledge could make use of SuggestGrid’s recommendation and similarity insights. This unique feature allows easier integration for developers and enables the power of SuggestGrid to customer engagement, and marketing teams.

FROM THE TEAM BEHIND SEARCHLY

SuggestGrid is developed by the team behind Searchly, which was founded in 2014. Searchly is powering in-app search engines on customer websites. If not as complex as personalization, finding search query results on the content of websites is tedious, and often delegated to search as a service provider such as Searchly. Being available on Salesforce Heroku, IBM Cloud, and Pivotal Cloud Foundry as add-ons, Searchly has around a thousand paid customers worldwide. “Our experience on providing an uptime guaranteed service for some Forbes 500 companies with Searchly has prepared us for the challenges we are tackling for SuggestGrid.” says Co-founder Ferhat Sobay.

TİM-TEB START-UP BUSINESS HOUSE

Searchly has become materialized thanks to the supports of TİM-TEB Start-Up Business House and TUBİTAK (Scientific and Technological Research Council of Turkey). TİM-TEB Start-Up Business House is

SuggestGrid

SIMILARITIES & RECOMMENDATIONS

ACTIONS

USERS

a supportive incubator for promising entrepreneurs with the hopes to grow global brands. While TİM-TEB has been offering valuable office and mentorship support, TUBİTAK has supported Searchly with their prestigious research and development grant. “High technology start-ups in Turkey are given a lot of support in Turkey, both from the private and public institutions.” says Ferhat Sobay.

EXPORTING ALL OVER THE WORLD

Capitalizing on the experience and financial support of Searchly, nascent SuggestGrid has customers from all around the world, from the US to Europe, Mexico to Japan. “Internet cables cross borders without any interruption. On the other hand, only recently software service companies like ours are popping up not only from Silicon Valley but also from where they deem fit. We have a customer from New Zealand, and we use a software service also from New Zealand. Even this example might make you think about the state of the contemporary software industry. This ongoing decentralization

of software services is an exciting phenomenon, offering new opportunities for keen developers, and entrepreneurs.” says Co-founder Han Tuzun.

LOCATION INDEPENDENT

This location independence has become possible with the nature of Software as a Service (SaaS) businesses. No matter where provider companies are located in, software services are provided from the infrastructures of major Internet companies such as Microsoft, Amazon, or Google. The software development process is the same regardless of where the developers are located in. Providing customer support through distance has become the norm. Therefore, software services like SuggestGrid need not be based in the Silicon Valley anymore. On the contrary, government and private support in Turkey, lower costs, and talented human resources, make Turkey a great location for such software services to thrive.

SCALABLE BUSINESS MODEL

Not only SuggestGrid has an accomplished team, they are also visionary. Their goal

is to make SuggestGrid one of the exemplary software start-ups from Turkey. They are planning to keep on research and development on machine learning and artificial intelligence while keeping their operations lightweight as they grow. “Businesses, where previous actions could create insights for future actions, could start using SuggestGrid towards their goals right now. A software developer could integrate our service in an afternoon.” says Co-founder Han Tuzun. “Our customers find SuggestGrid since they are already looking for such a service, they follow the documentation, and start paying if they could extract value from our service after their free trials. It is more of a self-service experience, with a friendly and prompt support always available in need. With our business model, the overhead of 10.000 customers compared to 10 customers is going to be much less than what it could have been in a sales-oriented business. Eventually, we want SuggestGrid to create a desirable model for upcoming Turkish SaaS start-ups.” he continues. Such a scalable business model could only become possible on top of a scalable software infrastructure. “Our backend is scalable. No matter what our customers might load on our infrastructure, or how many customers we will serve, SuggestGrid is ready for all.” concludes Co-founder Ferhat Sobay. Solving all the scalability bottlenecks took a lot of development resources, but the resulting service is rigid and ready for what the market is going to ask for. Visit suggestgrid.com to learn more about SuggestGrid.

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16

Briefing

STAR Refinery was the largest single-site private investment in Turkey.

ENERGY

SOCAR TURKEY’S GIANT INVESTMENTS BOOST TURKISH ECONOMY

Azerbaijan’s state-owned oil company SOCAR is one of the most-established oil producers in the world. The company has been heavily investing in the Turkish market since 2008.

I

TS INVESTMENTS, which will reach USD 19.5 billion when completed, include the STAR Refinery, Petkim, Petlim, Petkim Wind Power and TANAP. Zaur Gahramanov, SOCAR Turkey CEO, stated that the main source of motivation for their investments was the centuries-old brotherhood of Turkey and Azerbaijan. “One nation, two states” ideal of Haydar Aliyev, founder of the Republic of Azerbaijan, continues to strengthen existing bonds between

JULY 2018 ISSUE 60

Turkey and Azerbaijan through economic relations as well. Azerbaijan’s state-owned oil company SOCAR is the most important leg of the economic bridge between Turkey and Azerbaijan, and continues to add value to Turkish economy through giant investment projects. Entering the Turkish market by acquiring the country’s first and only integrated petrochemicals plant in 2008, SOCAR has been making additional investments to transform the Petkim peninsula into one of

the largest production centers in Europe. During its ten-year presence in Turkey, SOCAR Turkey has undertaken several large-scale projects, whose total value will reach USD 19.5 billion when completed. Zaur Gahramanov, SOCAR Turkey CEO, said: “Recent regulations introduced in Turkey, especially those related to the energy industry, have been important milestones for investors. As a company that has full confidence in Turkish economy, we never stopped investing, and in the

near future, we will continue contributing to Turkey’s economy through new investments.”

USD 1.5 BILLION ANNUAL CONTRIBUTION TO REDUCING THE CURRENT ACCOUNT DEFICIT Stating that SOCAR Turkey would this year start production in addition to investment projects, Gahramanov said: “We entered the Turkish market in 2008 by acquiring Petkim, and completed major projects including the STAR Refinery,


The Turkish Perspective

Petkim Wind Power, TANAP, and Petlim. However this year is special for us. After gas starts to flow through the TANAP pipeline in June, the STAR Refinery will become operational by the end of September. Now, it’s time to start producing.” Pointing out that the USD 6.3 billion STAR Refinery with an annual capacity of 10 million tons was very important to them, Gahramanov said that the refinery was going to reduce Turkey’s current account deficit by USD 1.5 billion annually. Stating that the STAR Refinery was the largest single-site private investment in Turkey, Gahramanov added the following: “All the investments that we made in the petrochemicals industry aim to reduce Turkey’s current account deficit. We have also determined the product range of the refinery in view of this target. We want to produce naphtha, diesel, LPG and jet fuel, which Turkey currently has to import partially. In addition, once commissioned, the STAR Refinery will fully meet Petkim’s raw material needs. This is really important in terms of Petkim’s rawmaterial supply security and standardization efforts.”

REDUCING THE FOREIGN-DEPENDENCY Standing out as the first refinery established since 1984, STAR Refinery will meet more than 25% of the processed oil products need of Turkey upon its startup.

$6.3 BILLION

“TANAP is a fruit of the joint efforts of Azerbaijan and Turkey, and will certainly not be the last one.”

of the Republic of Azerbaijan, the President of the Turkish Republic of Northern Cyprus and the heads of state of Serbia and the Ukraine, TANAP will start delivering gas to Turkey on 30 June. 1 billion cubic meters of gas will arrive in Turkey until the end of the year. Europe will receive 10 billion cubic meters of the 16 billion cubic meters of gas to be transported from 2020 on.”

Gahramanov remarked that TANAP was extremely important for the two countries both economically and strategically, and stated that the project was going to make a major contribution to Turkey’s and Europe’s energy supply security. Stating that TANAP was going to meet 12 percent of Turkey’s natural gas consumption singlehandedly, Zaur Gahramanov added: “This project is a fruit of the joint efforts of Azerbaijan and Turkey, and will certainly not be the last one. This is because we have confidence in Turkey’s future, as much as its present, and we are committed to shaping the joint future of these two sister countries.”

Investment Value of Star Refinery

$1.5

BILLION

Annual Benefit to Reduce Current Account Deficit

99.2% Overall Progress in Star Refinery by June 2018

10

MILLION TONS Annual Crude Oil Processing Capacity

TURKEY’S LARGEST PROJECT ON A GLOBAL SCALE: TANAP Stating that the TransAnatolian Natural Gas Pipeline Project (TANAP) would transport 6 billion cubic meters of natural gas annually to Turkey from the Shah Deniz - 2 gas field in the Caspian Sea, Gahramanov said: “With a length of 1,850 kilometers, TANAP is the most important part of the 3,500-kilometer Southern Gas Corridor. Opened on 12 June by Recep Tayyip Erdoğan, President of the Republic of Turkey, İlham Aliyev, President

SOCAR is the most important leg of the economic bridge between Turkey and Azerbaijan, and continues to add value to Turkish economy.

17


Briefing

INDUSTRY

Robust Industry, Thriving Economy Turkey’s Top 500 Industrial Enterprises 2017 survey released on 30 May 2018 by the Istanbul Chamber of Industry (ISO). BY IBRAHIM AVCI

P

UBLISHED EVERY YEAR

since 1968, each edition of Top 500 Industrial Enterprises’’ reports serve as a rich library and a history of Turkey economy and industry. TÜPRAŞ (Turkish Petroleum Refineries Co.) was revealed as Turkey’s biggest industrial enterprise, with sales-from-production figure of 51.1 billion Turkish liras ($14 billion) in 2017. The study shows the key role of the automotive industry in the manufacturing sector in Turkey. International car manufacturer Ford was the second-biggest company JULY 2018 ISSUE 60

with production-based sales of TL 22.7 billion ($6.2 billion), followed by automaker Toyota, which rose from sixth to third with TL 17.8 billion ($4.9 billion). Three other automobile manufacturers, Tofaş, OyakRenault, Hyundai Assan, made it into the top 10. Iron steel industry, one of the major industry of Turkey has continued its performance during last year. Steel producers Isdemir, Erdemir and Içdaş Çelik, and appliance manufacturer Arçelik were the other firms in the top 10. While this year Isdemir and

Erdemir rose to seventh and eighth places, respectively, Turkey’s largest electric power producer Elektrik Üretim A.Ş. dropped from seventh to 18th place in 2017. The Istanbul Chamber of Industry’s survey said the total production-based sales of industry giants posted their highest growth in 13 years, up 33.2 percent yearon-year, to reach TL 653 billion ($178.9 billion). The exports of ISO 500 exceeded the total export increase of the country and increased by 17 percent to 64.5 billion dollars.

Istanbul Chamber of Industry Chairman Erdal Bahçıvan said: “Our country has faced difficult times for the last two years both in our economy and in our political-social life. For all these reasons, during the year of 2017, which was very pessimistic, our economy reached one of the brightest growth rates in the world. Turkey’s economy grew 7.4 percent in 2017, compared with the previous year. When we look at the factors supporting the growth of 7.4 percent, we have seen that one of the biggest contributors to growth is from our industrial sector.” Bahçıvan stressed that one of the most important opportunity for our industry should be the development of R&D spending and the use of incentives in the right direction. “The number of companies engaged in R&D in Top 500 Industrial Entreprises increased from 239 to 254. R&D expenditure reached TL 3.5 billion, up by 23,7 percent year-on-year.” he said. The survey said the total production-based sales of industry giants posted their highest growth in 13 years, up 33.2 percent year-onyear, to reach TL 653 billion ($178.9 billion). ISO 500 companies’ exports also surged 17 percent last year to $64.5 billion, making up 42.8 percent of Turkey’s total industrial exports. Ford was the top exporting companies, recording nearly $4.80 billion of exports in 2017. Toyota followed with $4.59 billion, Tofaş with $3.27 and OyakRenault with $3.18 billion.

PHOTOGRAPH BYLOREM IPSUM

The growth of 7.4 percent, we have seen that one of the biggest contributors to growth is from our industrial sector.

PHOTOGRAPH BYLOREM IPSUM

18


The Turkish Perspective

TURKEY’S TOP 10 INDUSTRIAL ENTREPRISES ARE CONTINUING TO GROW WITH THE TURKISH ECONOMY

1

Established

Total Employees

1983

Production-Based Sales

51,14

TRY Billion

5002

Export

Operating Profit

Billion

Billion

$ 2,78

2

TRY 4,18

Established

Total Employees

1990

Production-Based Sales

17.83

TRY Billion

5339

Export

$ 4.59 Billion

TRY

4

Operating Profit

15.67

6.927

Export

$ 3.18 Billion

15.91

6

Operating Profit

10.62

4.872

Export

$ 420.9 Billion

Established

14.96

8

Operating Profit

PHOTOGRAPH BYLOREM IPSUM

PHOTOGRAPH BYLOREM IPSUM

9.307

TRY Billion

Export

Operating Profit

Billion

Billion

$ 3.26

TRY 895.4

Total Employees

17486

Export

Operating Profit

Billion

Billion

$ 1.93

TRY 376.4

Export

$ 884.2 Billion

Products Steel and Alloyed Steel Products

Operating Profit

TRY 521.7 Billion

Total Employees

1960

TRY

Billion

4141

Established Production-Based Sales

TRY 3.371

Total Employees

1969

Production-Based Sales

9883

1955

TRY Billion

Products Hot-Rolled Flat Steel Products, Long Steel Products

9

Total Employees

Established Production-Based Sales

N/A

Total Employees

1970

TRY Billion

Billion

TRY 1.33

Products Consumer Electronics, Home Appliances

Established Production-Based Sales

Billion

$ 4.79

1968

TRY Billion

Products Passenger Car Models

7

Operating Profit

Established Production-Based Sales

N/A

Total Employees

1969

TRY Billion

Export

Products Passenger Car Models, Light Commercial Vehicles

Established Production-Based Sales

22.66

Billion

10835

Products Passenger Car Models, Light Commercial Vehicles. Heavy Commercial Vehicles

Products Passenger Car Models

5

Total Employees

1959

Production-Based Sales

Products LPG, Fuel Oil, Base oils, Waxes and Extracts, Bitumen and Bitumen Binders, Other

3

Established

9.920

Billion

6108

Export

Operating Profit

Billion

Billion

$ 190.4

TRY 3.61

Products Hot-Rolled/Cold-Rolled Flat Steel, Galvanized / Galvanealed Flat Steel, Tin / Chrome Coated Flat Steel

10

Established

Total Employees

1994

Production-Based Sales

8.361

TRY Billion

N/A

Export

$ 1.986 Billion

Products Passenger Car Models

Operating Profit

N/A

19


Briefing

CNR Games Week:

ENTERTAINMENT AND INNOVATION

CNR Games Week Yeşilköy - Video Games and Technology Expo- visited by children and adults with equal enthusiasm was held at CNR EXPO Yeşilköy between 6-10 June. BY IBRAHIM AVCI

G

AME ENTHUSIASTS

rushed to CNR Games Week Istanbul. The Video Games and Technology Expo visited by young and old alike with enthusiasm was held at CNR EXPO Yeşilköy between 6-10 June. Many new and innovative products such as VR platforms with the latest technology, computers, computer components, consoles, independent game developers, and box games were introduced

JULY 2018 ISSUE 60

to the visitors at the expo organized by CNR Holding. The children had the chance to relieve the stress of an extended school year at Games Week which was an entertainment destination for adults as well. The expo realized with the participation of phenomenon gamers, tourists, gamers and technology enthusiasts, game studios, The average age of 32,085 visitors was 22. The leading names in the gaming

Apart from many individual players, e-sport teams participated in the tournaments such as Pubg, Fortnite, League of Legends, Cs: Go, Fifa 18, Hearthstone, Rocket League and Pes 18 held during the expo.

industry which reached US$ 850 million market size in Turkey displayed their latest technological products.

35,000 TL PRIZE FOR THE WINNERS OF THE TOURNAMENTS Domestic and foreign computer gamers, phenomenal gamers, technology enthusiasts, game studios, universities and leading game companies came together at the expo. Apart from many individual players, e-sport teams participated in the tournaments such as Pubg, Fortnite, League of Legends, Cs: Go, Fifa 18, Hearthstone, Rocket League and Pes 18 held during the expo. The highest-ranking gamers won a total of 35,000 TL in the tournaments organized in cooperation with the E-sports Club of Bahcesehir University. Furthermore, the celebrated names in the industry such as Oğuzhan Uğur, Mervan Tepelioğlu, Uğur Yaman, Oyun Gemisi, Oğuz Atalay and Mendebur Lemur came

PHOTOGRAPH BYLOREM IPSUM

GAMING

PHOTOGRAPH BYLOREM IPSUM

20


The Turkish Perspective

the world-famous e-commerce company GearBest stand area. While the visitors had the chance to buy the products of the renowned technology brand Xiaomi with exclusive discounts from the world-famous e-commerce company GearBest stand area, the domestic game seat manufacturer XDrive introduced its professional gamer seats and massaging series with heating and cooling features.

THE LEADING BRANDS OF THE GAMING INDUSTRY ALSO TOOK THEIR PLACES AT THE EXPO

together with the visitors at the expo.

PHOTOGRAPH BYLOREM IPSUM

PHOTOGRAPH BYLOREM IPSUM

THE NOSTALGIA AREA CAME INTO VOGUE FOR YOUNG AND OLD ALIKE The virtual reality application AvioVR providing a realistic airport and flight experience developed by Red Horizon was one of the most remarkable applications of the expo, enabling participants to overcome their fear of flight in the presence of expert psychologists. Games such as Street Fighter and Mortal Combat that adults between the ages of 30-40 used to enjoy playing in their childhood were in the nostalgia section of the expo. Moreover, the “Diskless Computer Systems,” which allows a computer connected to a server to operate without a hard disk, received thumbs up from the visitors. The visitors had the chance to buy the products of the renowned technology brand Xiaomi with exclusive discounts from

The expo brought the key players in the Turkish gaming industry worth over US$ 850 million. Students from Aydin University, Altınbaş University, and Kültür University exhibited their projects at the expo where companies such as GearBest, MSI, Troy Games, Time Valker, Zümrüdü Anka-Phoenix, Cino, Nitra Games, Mangodo Digital, Zambitious S.L, MTV Electronics, Eflatun Software, X Donanım, Nüans Foreign Trade, the Natural Sciences Association, Atom Bilişim, XDrive, Malcom Computers, GNB Digital participated.

One of the most notable applications of the expo was the virtual reality application AvioVR. The application developed by Red Horizon.

UNIVERSITY COURSES ON MOBILE PHONES Throughout the expo, the VR Aydın Project, developed by New Media Center in Istanbul Aydin University and the virtual reality platforms HTC Vive and Playstation VR were introduced. According to the information given by Deniz Yengin PhD, Associate Professor Head of New Media Department at İstanbul Aydın University, the 360° videos of some university courses can be watched 360° with the IOS application of VR Aydın Project. The cardboard required for the appliaction was also produced by the university. Yengin also said they observed the players with

the virtual reality platform they developed at university. ‘’Thanks to this project, we aim to prevent diseases that may arise in the field today. Previously, terminologies related to these subjects were being provided from abroad. Now we can get this data with the virtual reality projects we have developed,’’ she said. Yengin expressed that one of their students in university has developed two virtual reality games, zombie game and car racing that they will earn revenue by selling them.

GETTING OVER FEAR FLIGHT THANKS TO VR One of the most notable applications of the expo was the virtual reality application AvioVR. The application developed by Red Horizon is a realistic airport and flight experience that helps patients get over fear flight with psychologists. Nostalgic games such as Street Fighter and Mortal Combat also took place in the section of the expo. Moreover, “Diskless Computer Systems” which hundreds of computers can be managed through a single server aroused interest.

21


22

Briefing

ATR MOVEMENT CERTIFICATES ENDORSE ELECTRONICALLY As a new tool provided by TİM, ATR movement certificate is endorsed electronically. Exports procedures in Turkey is easier now. out in electronic way, exporters and customs brokers will not have to go to Exporters Associations’’ or customs to submit documents. They will not spend time for this procedure.”

CUSTOMS APPROVAL IS ALSO TAKEN ELECTRONICALLY

T

Exporters and customs brokers will load the data content and related documents of ATR to the system by using the web interface provided by TİM. Exporters Associations will check the relation between the content of ATR and the customs declaration and will endorse ATR if the provided data is matching. The certificate including endorsement signs and numbers will be ready to be printed after the customs approval granted electronically. Exporters and brokers will be able to print the endorsed certificate content on the hard document wherever they want.

URKISH EXPORTERS

Assembly, in accordance with The Ministry of Customs and Trade, provided a new convenience to exporters as a result of reform attempts undertaken by YOİKK (Board of Coordination for Enhancement of Investment Environment in Turkey). As the first step of efforts carrying endorsement procedures to electronic environment, ATR movement certificate was started to be endorsed electronically by 14th of May, 2018. Endorsement will be carried out both physically and electronically in the transition period; however, all approval transactions will only be made electronically soon. Preparations to grant electronic endorsement for JULY 2018 ISSUE 60

SECURITY CONCERNS CLEARED other origin and movement certificates are also continuing.

TRANSACTIONS ARE NOW COMPLETED AT OFFICES Mr. Mehmet Büyükekşi, The Chairman of Turkish Exporters Assembly, said “This facility will end loss of time and other additional costs in customs procedures. Since endorsement will be carried

Exporters Associations will check the relation between the content of ATR and the customs declaration and will endorse ATR if the provided data is matching.

The endorsement system for origin and movement documents was designed within high tech security standards. With the use of QR code on the certificate, the content of the document can be displayed by buyers or customs authorities of the European Union countries, thus security concerns about correctness of the content of the document will be eliminated completely.


The Turkish Perspective

İNOSUIT KNOWLEDGE AND EXPERIENCE SHARING SESSION ATTRACTED INTENSIVE ATTENTION AT İZMIR

I

presentation on İnnovation. Later, İnoSuit firms and mentors shared success stories. Dr. H. Bader Arslan expressed his appreciation about applications of firms from İzmir which is almost ten percent of all applications. Furthermore, by virtue of high valueadded export, he called more firms to be part of İnoSuit Program. İ. Cumhur İşbırakmaz pointed to irreplaceability of innovation and the importance of it given by TİM and Exporters’ Associations.

NOSUIT KNOWLEDGE

and Experience Sharing Session hosted by Aegean Exporters’ Associations was organized by Turkish Exporters’ Assembly (TİM) and with the participation of nearly 100 firms and mentors. Participants were from different cities from Aegean Region notably İzmir, Manisa and Aydın. Opening speeches were given by Dr. H. Bader Arslan, Secretary General, TİM, and İ. Cumhur İşbırakmaz, Secretary General, EİB. Following opening speeches, Dr. Merih Pasin made a

TURKEY CONTINUES STRONG GROWTH PERFORMANCE Turkish Exporters Assembly Chairman Mehmet Büyükekşi evaluated the growth data of Q1 of 2018.

W

E ARE CONTINUING

our strong growth performance in the first quarter of 2018. We reached one of the fastest growing countries in the world, surpassing expectations with a growth rate of 7.4%. With this ratio, we ranked second in the G20 after India, and ranked first among the OECD countries. Also, Turkey three times higher than the average of the EU countries. Despite all the obstacles, we continue to grow rapidly thanks to the strong structure of our country’s economy. As we do every

year, we will continue to grow this year beyond the expectations of many credit rating agencies or other international organizations.

In the first quarter, due to the strong domestic demand growth, net exports contributed negatively to GDP growth. However,

we expect net exports to contribute positively to growth in the upcoming quarters, especially with the strong acceleration in the tourism sector. Thus, we believe that we will continue to achieve successful growth performance in the following quarters as well. Another development that we like about the growth figures is the 9.7% increase in the investment. Despite all the negative operations created on the perception of our country, increase in both domestic and foreign investment shows us high confidence in Turkey’s economy remains. We believe that both the increase in investments and the rise in our exports of goods and services will help our country’s healthy and sustainable growth performance continue in the upcoming period.”

23


Briefing

BUSINESS

EXPORT CHAMPIONS OF 2017 ARE ANNOUNCED Top 1000 Exporters of 2017 were announced by Turkish Exporters Assembly (TİM) with a press conference. BY RAMAZAN GÜZYURDU

While the exports of 436 firms remained between 25 and 50 million dollars, only 10 firms could exceed 1 billion dollars. Chairman of TİM Mehmet Büyükekşi expressed that; “Considering the potential of Turkey, companies with more than $1 billion exports are quite low. Our goal for 2023 is to have at least 50 companies with more than $1 billion in exports. To achieve this goal, we must export products with higher added value. We must invest more in R&D, innovation, design and branding. Last year, among the top 1000 firms, 202 had R&D centers and the companies have spent ₺6.2 billion on R&D. “

SHARE OF DOMESTIC COMPANIES WAS 61 PERCENT

A

CCORDING TO TİM,

Ford Otosan was the top exporter with 4 billion 797 million dollars in 2017. Number 2 was Toyota with 4 billion 443 million dollars, and the third was TOFAŞ with 3 billion 209 million dollars.

R&D EXPENDITURES EXCEEDED TRY 6 BILLION, 10 COMPANIES REACHED $1 BILLION EXPORTS The total exports of top 1000 exporters increased by 13.4 percent compared to 2016 and reached 92.3 billion dollars, while the share of these companies in total exports was 58.8 percent. JULY 2018 ISSUE 60

TOP 10 EXPORTERS OF 2017 # Company

Exports (Million $)

1 2 3 4 5 6 7 8 9 10

4.796,90 4.442,81 3.208,58 3.183,15 2.767,13 2.513,81 2.104,78 1.816,17 1.052,94 1.049,92

FORD OTOMOTIV SAN. A.Ş. TOYOTA OTOMOTIV SAN. TURKIYE A.Ş. TOFAŞ TÜRK OTOMOBİL FAB. A.Ş. OYAK-RENAULT OTOMOBIL FAB. A.Ş. TÜRKİYE PETROL RAFİNERİLERİ A. Ş. KİBAR DIŞ TİC. A.Ş. VESTEL TİCARET A.Ş. ARÇELİK A.Ş. BOSCH SAN. VE TİC. A.Ş. MERCEDES-BENZ TÜRK A.Ş.

In 2017, 66.8 percent of the top 1000 exporter companies were producerexporters, 16.5 percent were exporters, 12 percent were group foreign trade companies and 4.7 percent were sector-capital foreign trade companies. Given the distribution of capital structure of firms; 81 percent of the firms were domestic firms, 11.3 percent were foreign, and 7.4 percent had domestic and foreign partners. Domestic companies’ share in the export value of top 1000 exporters were 61 percent.

Our goal for 2023 is to have at least 50 companies with more than $1 billion in exports. To achieve this goal, we must export products with higher added value.

PHOTOGRAPH BYLOREM IPSUM

24


Innovation

Focused Mentorship Program How will the Process run?

Who will be the mentor?

How will the firms be chosen?

Which supports will be given?

Every firm will be paired with an innovation mentor who is determined by TİM and Sabancı University

Academicians and private sector representative who have the competency of Innovation Management

As a result of TİM’s pre-evaluation and according to their application date firms will be chosen

Program is financed by the firms with the 25% joint financial support of both TİM and Exporters’ Association that the firm is member of.

If you want your company to design and put into practice corporation innovation systems that are tailored yo your company’s aims, structure and needs create and strengthen the infrastructure of innovation management increase innovation management competency sustainably

PHOTOGRAPH BYLOREM IPSUM

İnoSuit is just for you…

www.tim.org.tr/en/inosuit-innovation-focused-mentorship-program.html


26

Briefing

POLITICS

KEY

OF THE MEDITERRANEAN

TURKEY, WHICH HAD PROVEN ITS SUPPORT TO THE TURKISH CYPRIOT PEOPLE

IN ALL STAGES OF THE CYPRUS PROBLEM, CONTINUED ITS MORAL AND FINANCIAL AID TO THE TURKISH CYPRIOTS AFTER THE ESTABLISHMENT OF THE TURKISH REPUBLIC OF NORTHERN CYPRUS. BY RAMAZAN GÜZYURDU

T

URKEY IS WITH NO DOUBT the most

important supporter of the Republic of Northern Cyprus (TRNC) in every field, which is not recognized by any other country. Following the proclamation of the TRNC, the main aim had been the improvement of the relations between the TRNC and the Republic of Turkey deriving from historical and cultural ties. Another major aim had been the establishment and development of official relations between the two States based on mutual trust, respect and cooperation. In terms of the solution of the Cyprus problem, foreign policies of two countries have always been conducted in close cooperation and harmony. Turkey has always strongly JULY 2018 ISSUE 60

supported the negotiation processes on the Island. Existing strong historical, cultural, religious, linguistic and national ties between the Turkish Cypriot and Turkish peoples naturally reflects on the relations between the TRNC and the Republic of Turkey

in a strong and constructive manner. It is generally possible to summarize the relations between the two countries as natural allies who protect the rights and interests of each other in every field and who spare no effort to improve mutual relations.

The Embassy of the Republic of Turkey in Lefkoşa and the Embassy of the TRNC in Ankara, together with its ConsulateGeneral in İstanbul and the Consulates in İzmir and Mersin undertake the usual diplomatic and bureaucratic relations of their countries. In addition to this, the restrictions on the daily lives of the Turkish Cypriots resulting from the isolation imposed on them are intended to be overcome through cooperation agreements and protocols on various fields signed between the Turkish and Turkish Cypriot Ministries. In this respect, Turkey is acting as the only bridge connecting the TRNC


The Turkish Perspective

and the Turkish Cypriots with the rest of the world on humanitarian and vital issues. Even the basic human rights of the Turkish Cypriots such as transportation, telecommunication and postal services are provided through Turkey. Many protocols have been signed between the TRNC and the Republic of Turkey to regulate the existing trade and economic relations. The Trade and Payment Protocol was the first to be signed among these documents in 1975. This Protocol was signed with the aim of strengthening the economic and trade relations between the two countries. The Protocol also aimed at solving the import and export problems faced by the TRNC in cooperation with Turkey. Until 1994, trade and economic relations between Turkey and the TRNC were under the scope of the Joint Economic Commission meetings. Republic of Turkey had taken some precautionary measures in order to overcome the economic problems in the face of the decision of the European Court of Justice dated 1994 which seriously hit the TRNC economy. It was attempted to offset the decrease in the exports of the TRNC due to this decision through the increase of exports to Turkey. In 1997, the formation of a Partnership Council between the TRNC and Turkey on economic and financial matters was decided. The Council also aimed to work on cooperation in the fields of security, defense and foreign policy. Relations between the two countries was also intended to be shaped through this Council under the title of “Joint Economic Area”. On January 1998, an agreement titled “State Aids in Investments” was signed

Many protocols have been signed between the TRNC and the Republic of Turkey to regulate the existing trade and economic relations.

Turkey has been strongly supporting the negotiation processes on the Island.

between the two countries. This agreement was followed by the Trade and Economic Cooperation agreement signed in February 1998 and Agreement on Additional Easements to Citizens of Both Countries which was signed in 1999. The Republic of Turkey made utmost contribution in order to ease, to a certain extent, the difficulties faced by the Turkish Cypriots arising from the restrictions. Until these restrictions were to be removed, the aim was to provide the TRNC with the opportunity to trade with the whole world, Turkey and European countries in particular, under the best possible circumstances and to open to the international system.

In order to overcome the growing structural and economic problems resulting from the banking crisis in the TRNC which occurred at the beginning of 2000, economic development programmes were adopted as of 2000 and Economic and Financial cooperation protocols were signed to enable Turkey’s financial and technical support to these programmes.

THE CYPRUS ISSUE AND THE RELATIONS IN TERMS OF FOREIGN POLICY The political solution to be found to the Cyprus problem is the key factor to protect the rights and interests of the Turkish Cypriots and Turkey on the Island and to further these

rights on a solid foundation. Continuation of the strong and independent existence of the Turkish Cypriots is a must to reach this end result and the relations between the TRNC and Turkey are organized accordingly. The Republic of Turkey has always been the major supporter of the Turkish Cypriot side on the negotiations which have been ongoing for many years between the two sides in order to reach a just and viable settlement which would protect the rights and interests of the Turkish Cypriots. Turkey also has been strongly supporting the negotiation processes on the Island. The constructive approach demonstrated and the proposals put forward by Turkey during the negotiation processes are the indicators of Turkey’s support to the negotiations on the Island. Moreover, Turkey also shown its moral support at all times to Turkish Cypriots to protect their rights and interests both at the negotiation table and in the international platform. The policies which are formulated to end the unjust isolations and to make the voices of Turkish Cypriots to be heard in the international arena are conducted by two countries in close cooperation. As was the case in previous negotiation processes, the Turkish Cypriot side has shaped its constructive and proactive policies towards the solution of the Cyprus problem in the shortest possible time together with Turkey and continues its cooperation with Turkey in order to reach the desired outcome from the current negotiation process.

27


Briefing

AVIATION

Another Strategic Partnership From Turkish Airlines

T

URKISH CARGO, a brand of Turkish Airlines, keeps taking strong steps on its way to become one of the top 5 cargo companies in the world. The latest of these steps, the partnership between Turkish Cargo, ZTO and PAL Air Ltd., regarded not only as a huge strategic step for Turkey prior to the opening of the Istanbul New Airport but a game

JULY 2018 ISSUE 60

changer for the global express transport business, was sealed and signed by Turkish Airlines Chairman of the Board and the Executive Committee, Mr. M. İlker Aycı, ZTO Express Chairman Mr. Mei Song Lai and PAL Air Ltd. ViceChairman Ms. Vivian Lau. “Today, I feel privileged to welcome you all for the signing ceremony of a great

partnership agreement between the biggest brands of China and Turkey,” said Mr. M. İlker Aycı, Chairman of the Board and the Executive Committee of Turkish Airlines, and continued: “As Turkish Airlines, ZTO Express and PAL Air Ltd., we are announcing the signing of MoU to build a joint venture company to operate as a Global Express/

courier company, mainly focusing on global e-commerce market with full door to door services. We are delighted to make this strategic move into Global Express business together with the strong partnership of ZTO, the best and largest Express company in China and our long term cross border forwarding partner PAL Air Ltd. from

PHOTOGRAPH BYLOREM IPSUM

The signing ceremony of the joint venture between Turkish Cargo, a brand of Turkish Airlines, the most valuable brand in Turkey, Chinese cargo giant ZTO and Hong Kong based PAL Air Ltd., took place in Istanbul

PHOTOGRAPH BYLOREM IPSUM

28


The Turkish Perspective

Hong Kong. The joint venture, after reaching quickly to fully functional and operational levels, is expected to take place within the world’s largest integrators. In 5 years’ time it will generate over 2 billion USD of revenue. The growth is expected to continue gradually parallel to the e-commerce demand. Istanbul New Airport, which will become operational this year on October 29 and will function as Turkish Airlines’ main operating hub, will gradually provide Turkish Cargo up to 4 million tons of cargo handling capacity. The flow of e-commerce products globally with this joint venture and via Istanbul mega hub, will provide maximum value to our customers worldwide.” The services of the new global express joint venture company, which will be based in Hong Kong, will include all door to door logistics activities; trucking, collection & distribution, freight transportation, cross docking and final mile delivery. It will also include warehouse management, order and supply chain management when necessary.

PHOTOGRAPH BYLOREM IPSUM

PHOTOGRAPH BYLOREM IPSUM

AIMING FOR THE BEST ZTO is the world’s largest parcel distributer, by daily 28 million parcels and additionally having the widest express delivery coverage in whole China. PAL Air Ltd. on the other hand, has launched a B to C Wholesales Postal Express Service including last mile fulfillment to the Retail Express Services Providers in Hong Kong, China, Thailand, Vietnam, India and the USA. Speaking at the ceremony, ZTO Express Chairman Mr. Mei Song Lai commented; “The cooperation between the three partners will form synergy by combining strong core competencies and

“The Istanbul New Airport will be opened by 29th of October this year and it will function as Turkish Airlines’ main hub.”

integrating key resources, and will undoubtfully effect positive progress in the areas of global express delivery, warehousing, cargo freight, and aviation route development and more; and will ultimately benefit traders and consumers globally.” Pal Air Ltd. Vice-Chairman Ms. Vivian Lau said; “PAL is honored to have played a role in creating a three parties venture that will unleash the best of three worlds, together with two global giants, Turkish Airlines and ZTO. Turkish Airlines, ZTO and PAL look forward to the creation of a

world class integrator.” Turkish Cargo transports cargos to more than 290 cities, 49 of which are domestic lines and also arrange scheduled cargo flights with its cargo aircraft. Moreover, Turkish Cargo have more than 82 S.P.A agreement and more than 172 interline connections all over the world, in order to offer the best services to its customers. As one of the fastest-growing air cargo companies in the cargo industry, Turkish Cargo offer useful and reliable services to its customers. Providing technological logistic solutions to its individual and corporate

customers and moving forward with determined efforts, Turkish Cargo aims to become one of the top 5 cargo companies in the world by exploiting the strategic location in Istanbul, situated in the center of the world commerce routes. As the airline that flies to more countries than any other with its global network of 304 destinations in 122 countries, Turkish Airlines, declared as the “Most Valuable Brand” in Turkey in all sectors, will expand its business scope and provide a seamless service to its customers from pickup to linehaul to door-to-door delivery. ZTO and PAL Air Ltd. will also broaden their market focus from domestic China to global markets by using Turkish Airlines’ world-wide exposure and network capability.

29


30

Briefing

INVESTMENT

TURKEY’S INVESTMENT OPPORTUNITIES SHOWCASED IN GERMANY I

SPAT held an exclusive seminar on Turkey’s investment climate and workshops on Turkey’s automotive and machinery industries during Global Connect 2018 in Stuttgart, Germany, on June 20-21. Speaking at the “Turkey’s Investment Opportunities for German SMEs” panel, ISPAT President Arda Ermut mentioned that Germany has always been an essential country for Turkey. “Trade volume surpassed EUR 32 billion in 2017. Germany ranked 1st in Turkish exports

and 2nd in imports. Today, there are more than 7,200 companies with German capital operating in Turkey. German companies that are aiming to go global by accessing MENA or augment their global footprint must focus on Turkey in relation to international investments,” Ermut added. During Global Connect 2018, ISPAT held two workshops and offered insights into the opportunities in the Turkish automotive and machinery industries.

European Institute for Eurasian Dialogue Recognizes ISPAT’s Success B

ISPAT Holds Investment Seminar in Tokyo I

SPAT Senior Advisor in Japan Yuichi Aoki on June 19 in Tokyo presented on Turkey’s investment climate at the Turkey Investment Seminar: Opportunities in the Izmir Region seminar held by the United Nations Industrial Development Organization - Investment and Technology Promotion Office in Tokyo (UNIDO ITPO Tokyo), the Japan Cooperation Center for the Middle East, (JCCME) and Izmir Development Agency. JULY 2018 ISSUE 60

ari-based European Institute for Eurasian Dialogue (EIEAD) carried out a comparative study among FDI incentive schemes of several countries in the Eurasia region (namely, Azerbaijan, Armenia, Iran, Israel, Lebanon, and Turkey) so that entrepreneurs could assess the best location for their investments and for establishing their presence in the area. The result of this research revealed that Turkey

is the country with the most advantageous incentives system and that ISPAT was the most successful investment promotion agency. The award ceremony held for ISPAT in Lerici, La Spezia on June 22 by EIEAD was attended by the Italian Desk and Country Advisors of ISPAT and the EIEAD President Leonardo Manzari, the Scientific Committee Coordinators, the former Ambassador of Italy to Turkey Carlo Marsili and Valeria Giannotta. EIEAD aims to increase the political and economic/industrial cooperation between the EU countries (Italy in particular) and the Eurasian region.


The Turkish Perspective

UNCTAD REVEALS WORLD INVESTMENT REPORT 2018 G

lobal foreign direct investment flows fell by 23.4 percent in 2017, to USD 1.43 trillion from USD 1.87 trillion in 2016, according to UNCTAD’s World Investment Report 2018. The global fall was caused in part by a 22 percent decrease in the value of cross-border mergers and acquisitions. The value of announced greenfield investments – an indicator of future trends – also fell by 14 percent, to USD 720 billion. Projections for global FDI in 2018 show fragile growth. Global flows are forecast to increase marginally, by up to 10 percent, but remain well below the average over the past 10 years. Higher economic growth projections, trade volumes, and commodity prices would normally point to a larger potential increase in global

FDI in 2018. However, risks are significant, and policy uncertainty abounds. Escalation and broadening of trade tensions could negatively affect investment in global value chains. In addition, tax reforms in the United States and greater tax competition are likely to significantly affect global investment patterns.

FDI Inflows to Selected Regions and Countries ($ Billion) World Developed Economies Developing Economies European Union United Kingdom Poland Slovenia South Africa United States Chile Russian Federation

U N I T E D N AT I O N S C O N F E R E N C E O N T R A D E A N D D E V E L O P M E N T

Czech Republic WORLD INVESTMENT REPORT

Turkey

2018

India

INVESTMENT AND NEW INDUSTRIAL POLICIES

Mexico China Romania Brazil

2016

2017

1,867.5 1,133.2 734.3 524.0 196.1 13.9 1.3 2.2 457.1 11.2 37.2 9.8 13.3 44.5 29.8 133.7 5.0 58.0

1,429.8 712.4 717.4 303.6 15.1 6.4 0.7 1.3 275.4 6.7 25.3 7.4 10.9 39.9 29.7 136.3 5.2 62.7

Change -23.4% -37.1% -2.3% -42.1% -92.3% -53.8% -44.3% -40.7% -39.8% -39.7% -32.0% -24.5% -18.0% -10.3% -0.2% 2.0% 3.3% 8.1%

Global FDI Inflows ($ Billion) 2000 1800 1600 1400 1200 1000 800 600 400 200 0

1921

1894 1568

1485

1404

1575

1372

1425

1179

1868 1430

1339

949 590

551

2002

2003

693

2004

2005

2006

2007

Developed Economies

2008

2009

2010

2011

Devoloping Economies

2012

2013

2014

2015

2016

2017

31


w.

e

or o is ny,

s to ne s.� N e. 0

32

Briefing

WAIPA CONNECTS IPAs, IMPROVES THEIR COOPERATION WORLDWIDE FROM ITS PERMANENT SECRETARIAT IN ISTANBUL T

he World Association of Investment Promotion Agencies (WAIPA) was founded in 1995 under the auspices of the United Nations Conference on Trade and Development (UNCTAD). Established as an autonomous, non-profit organization it is registered in Geneva, Switzerland, and has its Permanent Secretariat in Istanbul, Turkey. The Investment Support and Promotion Agency of Turkey (ISPAT) is currently holding the Presidency of WAIPA. As the umbrella organization of investment promotion agencies (IPAs) globally, WAIPA represents members from 130 countries and provides for a wide range of activities and strong partnerships through its Consultative Committee formed of UNCTAD, UNIDO, ICC, IEDC, ILO, OECD, and the World Bank, as well as other partnering organizations such as the World Economic JULY 2018 ISSUE 60

Forum. Some of these benefits include the opportunity for IPAs to network and exchange best practices in investment promotion and facilitation through training events, seminars, and conferences. Its yearly flagship conference, the 23rd annual WAIPA World Investment Conference (WIC18), will be held this year in Xiamen, China, from 7-9 September 2018. The conference will be hosted by CIFIT and WAIPA member China Investment Promotion Agency (CIPA).

This meeting will bring together IPAs from all around the world, government officials, development sector leaders, private sector representatives, and academics relevant to FDI policy and strategy. At last year’s WAIPA WIC17 in Dubai, UAE, it was emphasized that foreign direct investments are vital to maintain and strengthen economic growth. Therefore, WAIPA actively continues to put full effort on the empowerment of IPAs and their corporate

development. With the support of international bodies and the global community, WAIPA creates together with its Consultative Committee Members programs and projects to enhance the capacities of IPAs. As such, one strong focus of WAIPA lies on capacity building programs. Together with its partners, WAIPA undertakes these educational endeavors and aims to focus particularly on the needs of its members to give them the necessary skills


The Turkish Perspective

and background to attract investments and also to retain them. Some of the notable training partnerships over the past year included an Executive Training on FDI with the World Bank and participants from five continents in the newly inaugurated WAIPA Training Center and an Executive Training Program for Investment Promotion Agencies on innovative approaches to investment promotion jointly organized with UNIDO and the Turkish Cooperation and Coordination Agency (TIKA) that featured more than 20 high-level participants from 17 selected developing countries of Africa, Central Asia, and the Caucasus. Additionally, WAIPA this year started its own training program called the FDI Excellence Series. The series began with two successful trainings in Istanbul, on FDI Essentials and Attraction, and then shifted to Helsinki, Finland, at the end of May for the FDI Marketing course. The next courses, which will cover Facilitation and Leadership, are scheduled respectively on 24-26 July in Buenos Aires, Argentina, and September 6-7 in Xiamen, China. The final course in the series, on FDI Aftercare, will take place at the beginning of December in Budapest, Hungary. Overall, WAIPA brings together its member agencies from across the globe, engages them in improving understanding and cooperation, and offers them capacity building programs to serve the cause of global FDI and its benefits. The Consultative Committee gives WAIPA useful and strong structural competency, and as such the association each year becomes an increasingly important actor in the world of Foreign Direct Investment and a true advocate for its member agencies.

U.S.-BASED ZYNGA ACQUIRES TURKISH GRAM GAMES S

CEO of Zynga Frank Gibeau said, “Gram Games focuses on culture and creativity. We will keep them, and they will operate as an independent studio inside Zynga.” Gram Games has daily active users of 3 million and its free of charge games have been downloaded more than 170 million times.

an Francisco-based gaming giant Zynga acquired Turkish game maker Gram Games for USD 250 million in cash. Founded in 2012, Gram Games has studios in Istanbul and London and has nine live games, some of which are in the top-50-grossing games in the U.S.

CHINA INVESTS IN WIND ENERGY IN TURKEY C

hina State Development and Investment Corporation (SDIC), Smart Growth Holding, and contracting company PowerChina signed a USD 226 million memorandum of understanding to invest in a 170-megawatt capacity wind power plant project in

the Turkish cities of Aydin and Manisa. SDIC and Smart Growth Holding will have 80 percent and 20 percent shares in the projects, while PowerChina will undertake the construction. The project is expected to produce electricity by September 2020.

INDIAN GIANT VARROC IN TALKS WITH TURKISH SA-BA V

arroc Lighting Systems, a subsidiary of Indian giant Varroc Group, is in talks with Turkey’s light manufacturing company, SaBa Endustriyel Ürünler A.Ş. Varroc Group is an India based global automotive component manufacturer and supplier of exterior lighting systems, powertrains, and similar

products. Sa-Ba is one of the leading brands of the sector engaged in production in Turkey as well as Bulgaria. Sa-Ba produces signals, plastic based products, semi-finished products, and lighting equipment for main industries. If an agreement is reached, Varroc Group will acquire 100 percent of Sa-Ba.

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Cover / Fellowship Towards Resilient of the Twenty Growth

The roots of Turkey’s Banking go back to 19th century, the late Ottoman Empire, but truly improved and nationalized during the Republic of Turkey. BY RAMAZAN GÜZYURDU

JULY 2018 ISSUE 60


The Turkish Turkish Perspective Perspective The

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Cover / Fellowship Towards Resilient of the Twenty Growth

Banking practices first emerged in Italy century and spread around the world in time. Banks

in the 13th started to serve as prominent facilities in Europe where business activities developed considerably in the aftermath of the Industrial Revolution. At the time, the Ottoman Empire had strong business relations with Europe, and the first example of banking facilities in the Ottoman Empire started to emerge in those days. During the first half of the 19th century, with the adoption of western models of trade and finance, foreign banks began their activities in the Ottoman Empire. The first bank in the Ottoman Empire was founded by two bankers in 1847 under the name of Istanbul Bank (Banque de Constantinople). With British capital, Bank-ı Osmani (Ottoman Bank), whose headquarters were in London, was founded with in 1856. With the participation of French capital in 1863, the bank continued with the name Bank-ı Osmani-i Şahane both as a central bank and a facility for business and investment. The Ottoman Bank is considered the first modern bank in the Ottoman Empire and the modern Republic. The bank even had the privilege of minting money. At that period, there was not enough capital to found a national banking system. Ottoman farmers as a majority of population had to borrow money from the usurers with high interest rates. Under these conditions, the governor of Niş (Niš) province of the Ottoman Empire (now in Serbia), Midhat Pasha (1822–1884) began to take the first steps to overcome these difficulties in 1863 and achieved the reorganization of Memleket Sandığı (Homeland Funds), which became a law with Homeland Funds Regulations in 1867. That was the first agricultural financial institution founded by the state and operated with a state guarantee. In 1888, Homeland Funds was renamed Ziraat Bankası (Agriculture Bank), and Ziraat Bankası’s head office in Istanbul began to function. JULY 2018 ISSUE 60

The Ottoman Bank is considered the first modern bank in the Ottoman Empire and the modern Republic.

Turkish banking sector in the early years of the Republican period had 22 small domestic and 13 large foreign banks operating with 419 branches. Convened in February 1923 during a recess in the Lausanne Peace Conference, the İzmir Economic Congress consisted of more than 1,100 Turkish delegates representing agriculture, trade, artisans, and labor, as well as top political leaders, including Mustafa Kemal Atatürk. The necessity of establishing a national banking system


The Turkish Turkish Perspective Perspective The

was expressed by all participants in the congress. Nevertheless, the inadequacy of private sector’s resources forced the state subsidy to construct national banking. In order to support national capital accumulation, Turkiye İş Bankası was licenced as a private bank capitalised with certain incentives in 1924 and the restructuring of Ziraat Bank for agricultural support was completed. These two banks are still active and are leading banks in their areas. A National Central Bank came after ten years from the first meeting of the General Assembly. At the beginning of the second decade of the Young Republic, the basic financial architecture was almost complete with the creation of a central bank and the 14 emergence of private banks. Public banks were inserted to the financial system in order to further support capital formation. A public and private co-operation to empower the young Republic was considered to be the road to welfare growth. Besides, sectoral banks were created in order to give incentives for prioritised areas of development. Sümerbank was formed in 1933 to encourage the development of the textiles sector. Moreover, there was the Municipal Bank for regional development, Etibank for natural resources including iron and steel, Denizbank for sea lines and maritime development and Halk Bankası for small- and medium-sized enterprise credits. Between the years 1945 - 1959, investments, modern enterprises, rapid growth of national income and population, growth of cities, industrial sector getting more share from the national income and expansion of production for the market caused the need for money and credit in the economy. During the second half of the 1940s, small banks with low capital bases disappeared fast. A newly emerging trend was the fast-growing private banks which reached 30 in number. For example, in 1946 Yapı Kredi and Garanti, in 1948 Akbank, in 1953 Demirbank, in 1954 Sekerbank and Vakıfbank were formed. As the cold war heightened political stress all countries, Turkey decided

to put an end to liberal development strategies and imposed a heavily regulated import-substitution growth strategy. The banking sector was largely under state control and influence and the establishment of new banks was limited in this period. Branch banking has begun to develop, and most private commercial banks have become group banking. During planned economy years a total of 7 banks were established, 5 of them in development and 2 in trade.

Public banks were inserted to the financial system in order to further support capital formation.

During the early 1980s, the Central Bank was determining deposit rates but interest rates on loans were set freely even though high and volatile inflation rates eroded the capital adequacy ratios of banks. Financial liberalisation opened the doors for competitors and bankers armed with certificate of deposits began to challenge the dominance of banks in the financial system. However, a lack of adequate supervision and regulation coupled with ponzi style games created a systemic risk and there was a Bankers’ crisis and a loss of confidence in 1983. The marketisation incentives of the 1980s generated a serious gap for high quality financial regulation and supervision during the nineties. Transition from heavy state involvement in relative price adjustment to marketdetermined pricing resulted in financial discipline being deficient. The lack of a credible stabilisation programme and the mismanagement of the public debt as well as interventions in TCMB operations with implicit and explicit tools during 1993 caused financial stress to cumulate and in 1994 a destructive banking crisis returned once again. Day-to-day management of the economy, many national policy mistakes, global financial conditions and crises, and even natural disasters caused negative growth rate in Turkey.

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JULY 2018 ISSUE 60


The Turkish Turkish Perspective Perspective The

PROGRESS WITH STRUCTURAL TRANSFORMATION The 2001 financial crisis, the roughest crisis experienced by Turkish banking, brought with it serious structural changes in the sector. The aftermath of the crisis saw the introduction of many macro measures and regulations in order to strengthen the Turkish banking sector. In other words, after the crisis of 2001, a restructuring process was initiated in the Turkish banking sector to solve the financial structure problems of banks.

I

n the late 1980s, while Turkey’s economy was dealing with a chronic and high inflation rate, high public-sector deficits, and public financing, Turkish banks were suffering from capital, deposit, and loan deficiency, oligopolistic market structure and competitive inequality, currency substitution, open positions, and high funding costs. All of these prepared the ground for the economic and financial crises of November 2000 and February 2001.

Following the crises, Turkey entered into a period in which important economic and financial decisions were taken. With the “Transition to a Strong Economy Program” announced on 14 April 2001, the entire financial sector, especially banking, entered into a restructuring process. Thanks to these efforts, the potential negative effects of the 2008 global crisis on the Turkish banking sector were minimized. After the global financial crisis, Turkey’s economy recovered rapidly.

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Cover / Fellowship Towards Resilient of the Twenty Growth

By 2018 it is seen that the Turkish banking sector is more resistant to risks and shocks, its payment systems are functioning effectively, and that it can perform as a driver of growth. In addition to these, the banking system is equipped with new technologies, the system has increased the variety of financial services with mobile applications, the branch network of the banks has expanded, and the competition power of the sector has increased. Thus, the banking system supports the growth of financial markets in Turkey.

PANORAMA OF TURKISH BANKING SECTOR AFTER 2001 The Turkish banking sector continues its strong and rapid development after the rehabilitation and restructuring processes that it has taken from the crises of 2000 and 2001. The strong equity, asset quality, and liquidity shields it possesses seem to increase the banking sector’s resilience against risks and probable crises. The shrinkage in the financial markets during the 2008 global economic crisis and the capital outflows from developing countries as a result of the change in the risk perception have led to instability in the markets in Turkey since the savings gap. Reflections of these developments were felt more strongly in Turkey in the last quarter of 2008. While demand for investment and working capital credits is declining, the banks, trying to understand and measure the effects of the developments on the sectors, took a more conservative approach by raising the standards in credit supply. The uncertainty in the debt turnover ratio, the change in the ownership structure of foreign banks, the uncertainty of the macroeconomic results of the shocks, particularly on public budget and balance of payments, the changing rules in banking, the effect of increased risks on capital adequacy, the declining demand in TL, the increase in funding costs, and the short-term nature of funding sources also played into their decision-making JULY 2018 ISSUE 60

process. In this period, the most troubling issue for the banks was the uncertainty on the roll-over of their maturing foreign debts. For this reason, the banks tried to strengthen their foreign exchange liquidity to finance their short-term liabilities. Turkish Lira liquidity decreased, but a liquidity problem did not occur thanks to the sound and timely approach of the Central Bank of Turkey.

After 2008, the banking sector continued to grow moderately, with recovery in economic activity, support for credit access, and the expectation of high growth rates. The high share of the loans within the banks’ balance sheets had been preserved. Regulations related to consumer loans, measures taken to finance the real sector in terms of eliminating the consequences of the July 15 failed coup attempt, and the regulations

Table 1 Number of Banks Branches and Personnel in Turkish Banking System Number of Banks

Number of Branches

Number of Employees (Thousand)

2002

61

6,908

121

2008

45

8,79

171

2018

47

10,51

193

Data: The Banks Association of Turkey (BAT)

Table 2 Turkish Banking Sector Basic Balance Sheet Items ( TL Million ) Total Assets

Total Loans and Receivables

Total Deposits

The Sharaholders Equity

Pald-in Capital

Net Profit/ Loss

Off-Balance Sheets Items

2002

212,675

61,792

141,832

25,698

12,011

2,356

228,477

2008

05,871

366,901

453,485

82,696

36,936

12,774

6,832,864

2017

3,095,039

2,071,376

1,713,185

344,031

76,12

47,083

18,635,978

Data: The Banks Association of Turkey (BAT), CBRT


The Turkish Turkish Perspective Perspective The

Protecting its strong liquidity position against possible shocks, the banking sector increased its resistance.

The total asset size of the Turkish banking sector increased rapidly, reaching TL 3.1 trillion in 2017 from TL 212 billion in 2002, growing almost 15 times. Although the aggregate asset size of the sector is high, it does not measure as much as the asset size of a single bank in a developed country. The total volume of deposits in the sector has increased from TL 141 billion to TL 1.7 trillion and has grown by about 12 times. Similar increases were seen intotal credit volume, equity, and profitability.

FINANCIALLY AND STRUCTURALLY STRONG on the cost, collateral, and maturity components of loans all supported the credit growth. In particular, since the second half of March, 2017, there has been a strong increase in corporate loans with the acceleration of the loan guarantees provided by the Credit Guarantee Fund (KGF). Today, the banking sector maintains its strong liquidity position and remains resilient to a possible liquidity risk. The healthy structure of the banking sector’s asset quality has been maintained. One of the key indicators, the non-performing loans ratio is relatively low. The upward trend in the profitability of the banking sector in recent years continued in 2017 as well. Along with the recovery in lending appetite, the improvement in net interest incomes and the continuation of the austerity measures in non-interest expenses contributed to the profitability of the industry. The banking sector maintains its strong capital structure. As of March 2017, the capital adequacy ratio of the sector was well above the legal (%8) and target (%12) ratios and continued to maintain sufficient buffer to cover possible shocks. Protecting its strong liquidity position against possible shocks,

the banking sector increased its resistance. The gold and currency liquid assets held by the banks within the CBRT under the reserve option FOCUS mechanism (ROM) have also increased recently. Despite recent credit growth, strong growth in deposits offers additional protection for banks’ liquidity positions and supports credit supply. Thus, the banks have not met an important funding constraint, depending on the movements in credit and deposits, and have largely met the credit growth with core obligations. Depending on the fluctuations in the global economy and financial markets, risks related to the next round of the economy also remain on the agenda. The course of monetary policy in developed countries, global geopolitical risks, and political developments in the Euro Area are among the possible fragility factors for the financial system. Nevertheless, it can be argued that the Turkish banking sector will continue to withstand such risks thanks to its strong capital base, stable asset quality, and sufficient level of liquid assets. As of March 2018, 47 banks were operating with 10,510 branches and 193 thousand personnel in the Turkish banking sector. While the number of banks decreased between 2001 and 2008, the number of branches and employees increased. The sector continues to operate with fewer banks, but with increased scale.

The developments in the aftermath of the July 15 failed coup attempt in 2016, the Central Bank’s rate hike, geopolitical problems in the world, the UK’s decision to Brexit, continuing problems experienced in the EU banks, the presidential change in the US, and the Fed’s rate hike have all affected the financial system and the banking sector. Despite all these negativities, it seems that the Turkish banking system is financially and structurally strong and is well managed thanks to the experienced managers of the economy. However, having a strong financial structure and being prepared for possible risks is not enough for the Turkish banking sector. The financial sector, the most important supporter of the real sector, has to allocate its funds to more rational investments for the revival and growth of the economy. Therefore, it is expected that the capital, risk, and cost management strategy, credit allocation, and monitoring policies for the development of asset quality and especially riskbased pricing issues will be the most important agenda items of banking sector. Turkish banks, which are exemplary in technology investments in Turkey and abroad for many years, are set to shape the market in the coming period with innovative solutions focusing on customers and productivity.

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Cover / Fellowship Towards Resilient of the Twenty Growth

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The Turkish Turkish Perspective Perspective The

TURKEY: HUB OF BANKING INNOVATION

Turkey is often referred to as a hub of banking innovation in Europe. Not only does it Most of the big banks in Turkey are in Istanbul, the capital of the country.

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ost of the big banks in Turkey are in Istanbul, the capital of the country. This includes Finansbank, Akbank, Garanti Bank and İşbank. However, one of the largest banks in Turkey, Ziraat Bankası, is actually located in Ankara. International banks in Turkey include HSBC, Citibank, ING Bank, JP Morgan Chase, RBS, and Societe Generale. Founded in 1924, İşbank is often regarded as the largest bank in Turkey and launched the country’s first ATMs: Bankamatik. At the end of 2017, it had 1,364 branches and 6,545 Bankamatik ATMs. In digital terms, 5.2 million customers used its İşCep mobile app for transactions. Isbank currently holds TRY362.4bn ($80.4bn).

One of the many banks in Istanbul, Garanti Bank recorded net income of TRY3.3bn in 2017, a staggering 24% higher than the previous year. It offers services in all business lines, such as retail banking, private banking, corporate, SME, and payment systems. Currently undergoing a digital transformation, Garanti now has 5.9 million digital banking customers, compared to 4.8 million in 2016, and 5 million mobile banking customers compared to 3.7 million year-on-year. Akbank was founded in 1948 and its largest shareholders are members of the Sabancı family, one of the wealthiest families in Turkey. It has been ranked as the most valuable

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Cover / Fellowship Towards Resilient of the Twenty Growth

banking brand in Turkey by Brand Finance for six years in a row. In 2017, it was ranked 127th most valuable banking brand out of all banks in the world. In the first quarter of 2018, Akbank saw its net income rise 14% year-on-year to hit TRY1.6bn. Finansbank was, at one point, the largest Turkish bank in terms of foreign branches. In 2016, it was acquired by the QNB Group, the largest bank in the Middle East and Africa. The deal was completed on June 15 2016 and led to QNB holding a 99.8% stake in the bank. Ziraat Bankası is state-owned and was founded in 1863. According to the Bankscope database, it is the second biggest Turkish bank after Garanti according to total assets. It has 1,814 branches across the world, 25,015 employees, and 6,869 ATMs. It is hard to say what the best bank in Turkey is due to their amount of variance. Some are more digitally orientated, while some prefer the personal touch. For sheer presence in Turkey, it would be hard to be against Isbank or Garanti. However, if you wanted a bank with more of an international presence, Finansbank and Ziraat have an arguable larger global reach. have its local banks, but the best banks from across the world have a presence there.

THE WORLD’S NEXT CASHLESS SOCIETY Turkey is excelling from a business and economic perspective and is aiming to be totally cashless by 2023. With a GDP of around $850 billion, Turkey is currently the 17th largest economy in the world, according to the World Bank. The country’s vision is to be one of the top ten world economies by 2023, and it is well on track to achieve this, according to H. Bader ARSLAN, PhD Secretary General Turkish Exporters’ Assembly. A key factor in Turkey achieving its aim of becoming a cashless society by 2023 is the existing, and future, demographic of the country. Almost a quarter of all Turks are younger than 14, and around half are under 30. Only 9% are above the age of 65. Generally speaking, it will be the younger generations leading the adoption of new digital services – indicating that Turkey has an incredibly strong base of JULY 2018 ISSUE 60

consumers who are ready, and already starting, to make the shift to digital payments. According to a study by ING, 56% of the Turkish population have used a mobile payment app at some point. This is more than double European countries such as France (25%) and Germany (23%) – indicating that banks and other financial institutions can place a strong degree of confidence in adoption of new or existing mobile payment technologies introduced to the market. With such a significant proportion of the population open to these technologies, it’s also likely that any solutions introduced will quickly cover many sectors of the economy. With this young, tech-savvy population comes a ready acceptance of payment methods beyond cash. Turkey has the highest number of registered cards (over 170 million) in Europe – indeed, only China, the US, Brazil, Korea, Russia and Mexico boast more registered payment cards.

Investment And Collaboration The economic growth of Turkey, particularly amongst start-ups, is a priority for the government. This is evident in

the number of economic reforms we’ve seen over the last few years, all aimed at nurturing entrepreneurs and the success of Turkish businesses. This is no different for the financial technology sector, where we’ve seen the sector growing at an annual average of 14% – with no sign of slowing down. Turkey is also unique in who’s driving the innovation in financial services, and payments specifically. Whereas other countries tend to rely on agile startups to lead in developing new solutions for consumers, in Turkey it is often the incumbent players driving innovation and establishing collaborative networks of vendors, startups and established institutions. With an increasingly young, educated and innovative workforce, a booming technology scene, financial institutions willing to drive change, and rapidly expanding business links with countries around the globe, Turkey is uniquely positioned to take advantage of the boom in the digital payments space. The country has already gone some way to achieving this, but has only started to tap into a market extremely willing and savvy enough to embrace the change – time to discover the potential.


Turkey’s New Entrepreneur Force

TÄ°M-TEB Global Houses are intended to encourage, develop and strengthen innovative entrepreneurs and start-up businesses that generate high added value and have export potential.


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In Depth / Turkey and The Balkans

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The Turkish Perspective

TURKEY AND THE BALKANS…

CLOSE TIES, COMMON HISTORY “A strong Turkey is good for the Balkans and a stable and prosperous Balkans is good for Turkey and the world.” BY RAMAZAN GÜZYURDU

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VIT US,

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In Depth / Turkey and The Balkans

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ITH THE DISINTEGRATION OF YUGOSLAVIA, ALL THE BALANCES in the Balkans were altered and the instability that arose from this process reached a level that threatened international peace. In the 1990’s the Balkans had to live through destructive wars and ethnic cleansing, today’s environment of peace and stability could have been attained only after international intervention. Following the declarations of independence by Montenegro in 2006 and by Kosovo in 2008, the borders of the newly independent states in the region have become definite. High level political dialogue, security for all, utmost economic integration and the preservation of the multi-ethnic, multi-cultural and multi-religious social structures in the region constitute four main axes of Turkey’s Balkan policy, which is shaped by the principles of “regional ownership” and “inclusiveness”. Our leading objectives are the acceleration of the existing cooperation through the creation of “areas of joint interest” among the countries of the region and the attainment of an extensive regional integration. Being itself a Balkan country, Turkey attaches great importance to its bilateral relations with the Balkan countries and maintains good relations with all of them. Our bilateral relations with these countries are based on the principles of respect for independence, sovereignty and territorial integrity and non-intervention into internal affairs and further developed on the basis of our historical ties and the principle of good neighborliness. The historical ties between the peoples of Turkey and countries of the region have extended until today. There are Turkish minorities and communities as well as kin communities in the Balkan countries on the one hand; whereas there are citizens of Balkan-origin in Turkey on the other. Thus, any crisis

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in the Balkans affects Turkey closely and thus, the preservation of peace and stability in the Balkans bears vital importance for Turkey also in that respect. Turkey believes that the international presence, especially in Kosovo and Bosnia and Herzegovina, is important and necessary both for the strengthening of the state structures in these countries and regional stability. Turkey, therefore, contributes to all international presences and initiatives in the region.

BEING ITSELF A BALKAN COUNTRY, TURKEY ATTACHES GREAT IMPORTANCE TO ITS BILATERAL RELATIONS WITH THE BALKAN COUNTRIES AND MAINTAINS GOOD RELATIONS WITH ALL OF THEM.


The Turkish Perspective

İBRAHİM KALIN DEPUTY SECRETARY GENERAL AND SPOKESPERSON OF THE PRESIDENCY AMBASSADOR

WHAT DOES TURKEY WANT IN THE BALKANS?

Turkey, believes that it is the Balkan countries themselves who can make the essential contribution to their own future and intensively deliberates on the development of authentic cooperation mechanisms in the Balkans. The most concrete examples of Turkey’s contribution to good neighborly relations and regional cooperation with these countries are the trilateral consultation mechanisms founded upon our initiative between Turkey-Bosnia and Herzegovina-Serbia and TurkeyBosnia and Herzegovina-Croatia. These cooperation mechanisms, which were accepted in short time in the region as outstanding confidence building measures, aim at enhancing peace, stability and prosperity in Bosnia and Herzegovina, on the one hand and transforming the whole Balkans to a more stable place, on the other. From past to today, Foreign Ministers of Turkey, Bosnia and Herzegovina and Serbia have met six times and Foreign Ministers of Turkey, Bosnia and Herzegovina and Croatia have met four times within the framework of these trilateral mechanisms.

Turkey's relationship with the Balkans and southern Europe has always been a matter of interest for some. What does Turkey want in the Balkans? What is its so-called 'grand plan' for the region? An important meeting in Ankara organized by Turkish Cooperation and Coordination Agency (TİKA) this week sought to answer these questions. No need to panic: the answers are good for everyone. Those who never stop making up stories about Turkey's Balkans policy need to know what Turkey is trying to do there. Let me give it a try with a few points. First of all, Turkey shares a common geography of mind and heart with the Balkans. Ever since the Balkans joined the larger Muslim world, Turks saw the region as their own home, building cities, roads, schools, hospitals, bridges, mosques and et cetera. Secondly, Turkey invests in all Balkan countries without discrimination in regards to ethnic and/or religious identities. Turkish government, state banks, private companies and nongovernmental organizations have carried out hundreds of projects across the Balkans and continue to do so. The third dimension is culture and arts where Turkish and Balkan traditions merge in a shared legacy. Ottomans built many of their great works of architecture in the western lands of the empire and this includes southern Europe and the Balkans. A cultural flourishing is key to remembering the tradition and recognizing the realities of modernity. One does not have to come at the expense of the other. As a consequence, Turkey's goal in the Balkans is not to seek influence but to ensure political stability, spur economic development and support cultural and educational activities. Turkey opposes micro-nationalisms of all kinds. It also opposes foreign intervention. National and local issues should be led and owned by local people and national authorities. A strong Turkey is good for the Balkans and a stable and prosperous Balkans is good for Turkey and the world.

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In Depth / Turkey and The Balkans

BOSNIA AND HERZEGOVINA Bosnia and Herzegovina has a tradition of bilateral relations with Turkey, since the very beginning of Bosnia and Herzegovina as an independent state and relations between these two states are based on several aspects, which are political, educational, military, cultural and economical.

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HILST SOME ARE LESS DEVELOPED, certain aspects which comprise relations between Turkey and BiH are further emphasized and expanded. The examples of relations which are significant and impact upon further development of BiH are relations which are focused on political, educational and economic strengthening. Political relations between Turkey and Bosnia and Herzegovina reflect a very strong myriad of assistance and support. Due to deep historical, cultural and social bonds, Bosnia and Herzegovina has always been one of those countries which have a privileged place on the Turkish foreign policy agenda. Turkey believes that the reestablishment of the multi-ethnic and multi-cultural status of Bosnia and Herzegovina through preservation of its independence, sovereignty

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and territorial integrity within its internationally recognized borders is important. However, present – day world is working interdependent and in order to survive, a country has to have relations with other countries, where it can seek for help if needed. Especially small countries like Bosnia and Herzegovina which survival depends on the friendly relations with the rest of the world. All in all, the Turkish– Bosnian cooperation can be considered as moderate and improvements have to be done. Still projects are ongoing and the relations are improving where both sides gain benefits.

BOSNIA AND HERZEGOVINA HAS ALWAYS BEEN ONE OF THOSE COUNTRIES WHICH HAVE A PRIVILEGED PLACE ON THE TURKISH FOREIGN POLICY AGENDA.

CROTIA Turkey was among the first countries to recognize the independence of Croatia. She has established very close relations with this country and has supported its accession to NATO.

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ILATERAL HIGH-LEVEL VISITS which have gained momentum with the signing of the “Strategy Document” beginning of 2009, have contributed to the development of bilateral relations. With the establishment of Turkey-Bosnia Herzegovina-Croatia trilateral advisory mechanism in January of 2010, and within the context of the Southeast Europe Cooperation Process Presidency that Turkey had assumed during the period June 2009 – June 2010, close cooperation was developed between the two countries on regional issues as well. In recent years, Turkish firms got more interested in Croatia as it relates to tourism, banking, energy, construction and textile sectors. Croatian government also encourages Turkish investments in Croatia. Turkish investments towards Croatia have recently gained momentum. In 2012 Turkish businessmen ranked in the top three among foreign investors investing in Croatia. There are 15 Turkish investment firms in Croatia representing a total of 350 million Euros worth of investments. Within Turkish investments in Croatia tourism-hotel-marina management ranks number one. Up until today, 6 projects valued at 610 million Dollars, were undertaken by the Turkish construction firms in Croatia. As of September 2017, 16.768 Croatian tourists visited Turkey.


The Turkish Perspective

ROMANIA

GREECE Commercial and economic relations with Greece have also gained momentum with high-level visit over the last couple of years.

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NEW ERA HAS BEGUN in the Turkish-Greek relations as of 1999, marked with the establishment of various dialogue mechanisms such as regular political consultations, exploratory contacts on Aegean Issues, HighLevel Cooperation Council meetings as well as high-level visits and contacts. While seeking settlement to long-standing problems with Greece by means of bilateral dialogue mechanisms, Turkey aims at enhancing bilateral relations in every possible field and attributes importance to the implementation of tangible projects to the benefit of two countries. Commercial and economic relations with Greece have also gained momentum since 1999. The establishment of the HLCC mechanism in 2010 in particular has paved the way for a substantial increase in commercial relations. The bilateral trade volume thus doubled between 2010 and 2014, reaching 5.6 billion USD by the end of 2014. Although the bilateral trade volume decreased in 2015 and 2016, it gained momentum in 2017 and amounted to 3.5 billion USD. The stock of direct investments from Greece is around 6.8 billion USD. Greek investors, operate in information technology (IT), agricultural applications, packaging, plastics, pharmacy, cosmetics, fisheries, tourism and construction sectors. The stock of direct Turkish investments in Greece, including the

investments via the other European countries amounts to approximately 500 million USD. Turkish investors mostly focus on investing in marinas, ports and the overall tourism sector in Greece. Furthermore, Ziraat Bank has branches in Athens, Xanthi and Komotini. Tourism also is one of the promising fields of cooperation between the two countries. In 2017, around 921 thousand tourists from Turkey visited Greece. In the same year, Turkey attracted almost 595 thousand tourists from Greece. The facilitated visa procedure for visiting seven Greek islands close to Turkish shores has been in effect since 2012. It has also been instrumental in the increase of the number of Turkish tourists visiting Greece.

TURKEY AIMS AT ENHANCING BILATERAL RELATIONS IN EVERY POSSIBLE FIELD AND ATTRIBUTES IMPORTANCE TO THE IMPLEMENTATION OF TANGIBLE PROJECTS TO THE BENEFIT OF TWO COUNTRIES.

Turkey and Romania have strong political, economic, cultural relations and humanitarian bonds based on deep-rooted historical ties. Turkey and Romania maintain their close relations through high-level dialogue and friendship.

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EPENDING ON THE MUTUAL commitment to enhance bilateral relations in every field, the level of the relations were raised to strategic partnership with the signing of Strategic Partnership Declaration in December 2011. The Action Plan on the implementation of the said document was signed in March 2013. The exchange of high level visits between Turkey and Romania reflects the close political dialogue and friendly relations. Article 6 of the Romanian Constitution guarantees national minorities “the right to the preservation, development and expression of � their ethnic, cultural, linguistic and religious identity including education in the mother tongue. More than 70.000 Turks and Tatar Turks, along with other 16 minority groups in Romania, enjoy their constitutional rights through minority organizations they established. Each minority organization has political party status and minority groups are represented in the parliament in proportion to their population. Turks and Tatar Turks have one seat each in the Parliament.

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Turkey is among the largest investors in Romania with its current value of investment exceeding 6 billion USD including those coming from third countries. Currently, around 7.000 Turkish companies are actively operating in Romania. Two Turkish banks, Credit Europe and Garanti Bank Romania, are also operating in Romania. Romania continues to offer significant opportunities for both Turkish exports and investments. In Romania, the construction projects which have been completed by Turkish contractors so far amount to 6,2 billion USD.

KOSOVO Turkey and Kosovo enjoy excellent relations on the basis of common history and friendship ties.

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URKEY RECOGNIZED KOSOVO on 18 February 2008, the very first day following the declaration of independence. Cooperation Bureau of the Republic of Turkey in Prishtina, which was opened in 1999, was upgraded to the Embassy level in 2008. Turkish Consulate General in Prizren, where the Turkish community of Kosovo mainly resides, started operating as of 1 September 2015, standing out as the first consular mission in Kosovo. Turkey attributes utmost importance to the stability, territorial integrity and development of Kosovo, as well as her integration with the European and Euro-Atlantic structures and consolidation of friendly and constructive relations with her neighbors in the region.

MONTENEGRO Turkey was one of the first countries to recognize the independence of Montenegro in accordance with the importance it attaches to the peace.

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TABILITY IN THE REGION and considers Montenegro as a friendly country with whom it has an excellent level of relations. Turkey strongly supports the efforts of Montenegro whose primary foreign policy goal is integration with Euro-Atlantic structures. Moreover, in close cooperation with Turkey, Montenegro acts in solidarity in regional and international platforms. High level visits and contacts between the two countries continue intensively and successfully.

Another important factor in relations between Turkey and Montenegro is the existence of the Bosnians, Montenegrin Muslims and Albanians comprising 17 % of the population of Montenegro. Moreover, existence of these communities of Montenegro also in Turkey, which had immigrated to Turkey at different times, is another potential and motivation for the intensification of our bilateral relations. Turkey attaches great importance to the educational and cultural relations between the two countries. Since its establishment in 2007, TÄ°KA Office in Montenegro has undertaken various social, cultural and infrastructure projects. Yunus Emre Turkish Cultural Center also started operating in Podgorica in 2014 offering Turkish courses and cultural activities to Montenegrin people.

TURKEY STRONGLY SUPPORTS THE EFFORTS OF MONTENEGRO WHOSE PRIMARY FOREIGN POLICY GOAL IS INTEGRATION WITH EURO-ATLANTIC STRUCTURES. JULY 2018 ISSUE 60


The Turkish Perspective

BOTH TURKEY AND SERBIA ENDEAVOR TO REFLECT THEIR DEVELOPING POLITICAL RELATIONS TO OTHER AREAS, PARTICULARLY ECONOMIC AND COMMERCIAL FIELDS IN THE FUTURE.

SLOVENIA

SERBIA

Since the establishment of the Republic of Slovenia, bilateral relations between the two countries have developed positively and within a rich diversity.

Relations between Turkey and Serbia have reached the highest level in the last years throughout the history of both countries in line with the “strategic partnership” objective.

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OLLOWING ITS DECLARATION of independence on 25 June 1991, Turkey recognized the Republic of Slovenia on 6 February 1992. Subsequently, Turkish Embassy in Ljubljana became operational on 1 April 1993 and Slovenia followed suit by opening its embassy in Ankara in September 1996. The favorable relations took a step further with the signing of the document of Strategic Partnership between Turkey and Slovenia on 3 March 2011 in Ankara during the official visit of the then Slovenian Prime Minister Borut Pahor to Turkey. Another factor that contributes to the relations between the two strategic partners are the frequent high-level visits. Most recently, President Recep Tayyip Erdoğan paid a successful official visit to Slovenia on 30 March 2015. The effects of ongoing positive relations in all fields between the two countries are also felt in the cultural and educational spheres. Turkish contemporary art and literature are increasingly attracting the Slovenian society. Slovenian publishers are translating the works of prominent Turkish authors into Slovenian. Moreover, Turkish students studying in Slovenia within the framework of the Erasmus programme play an important role in the flourishment of cultural relations with Slovenia.

ESPITE THE FACT THAT TURKEY and Serbia have no common border, both countries consider each other as neighbors. This represents the confirmation of the shared importance attached to bilateral relations. Considerable progress has been achieved in the context of bilateral relations as well as in the Turkey-Serbia-Bosnia-Herzegovina trilateral mechanism led by Turkey.

This cooperation, which has been closely followed by the international community, constitutes a precedent for relations between regional countries. Recently, main items in the agenda of the bilateral relations such as Free Trade Agreement, Agreement on the Infrastructure Cooperation, mutual abolition of visas, and launching of TIKA’s activities in Serbia were all finalized during the reciprocal highlevel visits of Presidents, Speakers of Parliament, Prime Ministers and Foreign Ministers of both countries. Sancak region, where Bosnians having many relatives in Turkey live, is viewed as “a bridge of friendship” by both countries. The region plays an important role in the context of bilateral relations. Both Turkey and Serbia endeavor to reflect their developing political relations to other areas, particularly economic and commercial fields in the future.

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The Turkish Perspective Content: Balparmak: Turkey’s Honey Industry Trendsetterk P55 Beko:The Offıcial Partner of the EverydayP58 Porland: Enhances the Quality of Life P60 Editor: Serap Kaya

FOOD, HOME APPLIANCES, CERAMIC...

Since 1991, Balparmak has remained the market leader through innovation and R&D investments.

FOOD

Balparmak:

TURKEY’S HONEY INDUSTRY TRENDSETTER

Balparmak, as the honey sector’s leading company, has been delivering healthy, natural and delicious honey to consumers since it was founded in 1980. İLHAN ALPAY OGAN

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Briefing Brands / Balparmak

The manufacturing process and nutritional specifications of honey are different to those of other food sub-categories.

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nly free-roaming bees produce honey. To collect the honey, beekeepers set up hives in places with high bee populations. Success in the honey industry takes considerable know-how and experience. In other words, it requires a holistic view of the bee, beekeeper and nature triangle. In 1980, Balparmak embarked on its journey to provide consumers with natural, pure and delicious honey. Prior to the establishment of Balparmak, the industry did not consist of branded products, in which enabled the company’s pioneer in the sector. In addition to this, Balparmak has helped develop an awareness of high-quality, natural and healthy honey in consumers. The company’s commitment to growth and innovation sets it apart from its Turkish and international competition. It built its first quality control laboratory in 1986 with the intention of developing more innovative and diverse products. Balparmak Research and Quality Control Laboratory is the only one of its kind in Turkey, only and one of the Europe’s most comprehensive four-peer honey specialization laboratories. It was authorized as an R&D Center in 2016. Balparmak R&D Center is the eighth largest in the food JULY 2018 ISSUE 60

industry and Turkey’s first and only center for honey and other bee-related products. Before packaging all-natural honey for its consumers, Balparmak conducts at least 92-parameter analyses. These are to ensure the product sustainability and traceable quality. This process starts at the dive and ends at the tables and is conducted by the internationally accredited “Balparmak Research and Quality Control Laboratory”. Since 1991, Balparmak has remained the market leader through innovation and R&D investments. It boasts 99 percent brand awareness and is renowned as the sixth-

biggest brand in the world’s packaged honey market. It has been a pioneer of the Turkish honey market since its establishment in 1980.

INNOVATION-DRIVEN GROWTH

Balparmak is the first company in the world to employ the Priospot system for food items.

Balparmak’s 1,429 squaremeter R&D Center serves as the definitive base of honey operations. The 60 million Turkish lira investment new facility and 12 million Turkish lira investment center houses the Honey and Other Bee Products Research and Quality Control Laboratory, which was accredited by the Turkish Accreditation Agency (TÜRKAK). At the R&D Center, 44 specialists develop projects that will lead to better quality honey products and improve Turkey’s beekeeping industry.

TECHNOLOGY REVEALS WHICH FLOWERS THE HONEY COMES FROM Balparmak is the first company in the world to employ the Priospot system for food items. This system gives consumers access to analysis reports that contain detailed information which proves the purity of their honey, including details about the flower or plant it came from. All Balparmak honey


The Turkish Perspective

jars contain Priospots and QR codes. The Priospot system also offers transparency with distribution thanks to its simple verification system and reliable product traceability.

TURKEY’S PRIZED PINE HONEY TAKES TO THE WORLD STAGE One of Balparmak’s most crucial goals is to introduce and market Turkey’s prized pine honey to foreign consumers. Pine honey is created when bees mix their natural enzymes with the enzymes left by the pine tree-dwelling Marchalina Hellenica. This honey is produced only in Marmaris and Yerkesik, Muğla; Çanakkale; and in certain parts of the Mount Ida, as the Marchalina Hellenica lives only in these areas. Honey production on the Calabrian pine sites provides a living for nearly 10,000 beekeeper families. Production of pine tree honey, the most valuable of the world’s honeydew honeys, varies from 12,000 tons to 15,000 tons.

INNOVATIVE PRODUCTS DIVERSIFY THE HONEY INDUSTRY Balparmak is involved in a myriad of pioneering initiatives and innovations. These include residue and origin determination analyses

of honey, guarantee strips, regional classifications, and analysis reports for consumers, and additional value products suitable for daily use in the Apitherapy field. Balparmak diversifies functional foods according to consumer’s needs and palatal taste. This is why the Apitherapy line has introduced to the market. Healthy living and good nutrition habits are rising all around the world. Balparmak aspires to follow this trend by altering the course of its product development strategy. One such example is the blending of bee products and herbal plants to meet consumer demand. The ApiteraZen, Apitera Up and Apitera Mind ranges are all part of this Apitherapy line. These are great examples of Balparmak innovation, as they entail blending traditional honey with herbal plants like ginger, cinnamon, turmeric, red ginseng, guarana, and ginkgo biloba, as well as with propolis, the miraculous bee secretion. Offered in “easy snap” packaging, Katla Balla is the first and only one of its kind in Turkey. It allows consumers to carry their honey with them to sweeten food and drinks anywhere they go.

Easy-to-spread BallıMix by Balparmak replaces sugar with honey and an abundance of hazelnut, offering consumers a natural, healthy and delicious alternative at breakfast or snack times.

FREE TRAINING TO BEEKEEPERS Balparmak places a vital role in the professional development of Turkish beekeepers. It carries out projects with tens of thousands of beekeepers and has offered beekeeping training sessions across Turkey since 2004. The last of these free training sessions were held in Adana, Mersin, Balıkesir, Sakarya and Izmir. Nearly 1,500 beekeepers attended the training. Balparmak recently signed a credit financing agreement worth 20 million Turkish lira (around €4.4 million) with the European Bank for Reconstruction and Development (EBRD). With the agreement, the brand will help put into the market value-added and innovative products, while promoting the growth of beekeeping. The company aims to expand the online beekeeping training to women and young people in Muğla as well as offer youth employment opportunities.

CHINA AMONG EXPORT COUNTRIES Anatolia is home to three eighths of the world’s endemic plants. Turkey ranks number two behind China in the world beekeeping market, thanks to its hive and beekeeper potential. In Turkey, the total honey and bee product market brings in nearly $500 million volume. The packaged honey market makes up $200 million of this amount. Balparmak is Turkey’s biggest brandname honey exporter, accounting for 50 percent of the total exports. It is the only brand that has exported to countries like Germany, Austria, Holland, Belgium, France, England, China, Azerbaijan, Singapore and Japan since 1994. In 2018, the company intends to solidify its presence in China, particularly with its pine honey and other value-added products. It is currently assessing the demand on the single-use Balparmak Katla Balla, which is highly popular in China. Balparmak plans to enter into new markets, such as the Middle East and North America. It also plans to expand its store chains within European countries in the coming days.

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Briefing Brands / Beko

Beko has increased its market share more than any other home appliances brand in Europe since 2000.

HOME APPLIANCES

Beko:

THE OFFICIAL PARTNER OF THE EVERYDAY Beko is a global brand facilitating daily life in Turkey with white goods, solo products, built-in products, small home appliances, air-conditioners and electronic products. İBRAHİM AVCI

D

uring 1950s when Turkey was newly becoming industrialized, Vehbi Koç, founder of Koç Holding, was looking for a core product that would bring foreign currency into Turkey. Depending on Turkey’s conditions during those years, he became partners with Bejerano, an experienced establishment in the field, to make investment in a tomato paste and canned food factory. The name of the company established in 1954 was registered as BEKO after the first two letters of Bejerano and Koç. However, the company could not commence business due to country’s conditions. JULY 2018 ISSUE 60

When the opportunity arose for dealership of General Electric bulbs in those years, the name of the canned food company was changed to Beko Ticaret A.Ş. Thus, the first dealership system in Anatolia was established and Vehbi Koç was able to deliver Arçelik products to the homes of the consumers. Transferring Arçelik distributorship to Atılım in 1977, Beko Ticaret A.Ş. with strong experiences commenced operating in Turkey white goods sector under Beko brand in 1983. As Koç Holding Durable Goods Group directed its activities to overseas markets by1990s, Beko was started to be defined as an export brand.

BEKO brand became a part of daily lives of more than 400 million consumers in over 130 countries of the world, currently operating in Europe, America, Africa, Asia and Australia.

By the year 2000, as a result of Koç Holding Durable Goods Group’s restructuring, Beko was taken out of Beko Ticaret A.Ş. and entered under the roof of Arçelik A.Ş. together with Arçelik brand. Being the first Turkish white goods brand that was released abroad, BEKO started out with the target of becoming a “World Brand”. Together with bringing success in the Turkish market to foreign markets as of early 1990s, BEKO brand became a part of daily lives of more than 400 million consumers in over 130 countries of the world, currently operating in Europe, America, Africa, Asia and Australia. Today BEKO is the number 1 freestanding


The Turkish Perspective

Beko launched “Eat Like A Pro” initiative to raise awareness and tackle childhood obesity with FC Barcelona.

home appliances brand in Europe (27 countries including TR) became the fastest growing brand in the European market. International sales of Arçelik in 2017 increased to 12.715.601 Turkish Liras, 30% of the sales provided from Western Europe market and most of these sales belongs to Beko brand. Beko has increased its market share more than any other home appliances brand in Europe since 2000. As its operation keeps growing all over the world Beko signed a joint venture with India’s TATA Group’s Voltas to produce refrigerators. The brand has also a strategy to widen its operation in the ASEAN region. Beko is one of the leading home appliances brand with almost 1300 stores and wide service network all over Turkey. Beko strives to enhance lives of consumers through innovative and environment-friendly technology products and bases its production processes on facilitating lives. Beko operates in global white goods and built-in appliances markets as well as the Turkish small home appliances, electronics and air conditioning markets in addition to white goods and built-in appliances markets.

In 2017, Beko contributed to the growth of Turkish drier market through image communications based on its drier. Since it is also leading the digitalization of retailing, Beko has been transforming its stores and operations with a new concept which focuses on customer experience. Besides white goods Beko has different technology solutions such us payment system solutions. With Beko’s brand philosophy “Providing smart solutions for everyday lives of its customers”, Beko stands to be a consumer-focused brand. Beko develops various smart solutions to cater for the needs of different people, different cultures and different ways of life while delivering technology, innovation, value and efficient solutions with functional design. As a partner of everyday life Beko commits itself for its customer’s healthy life choices and eagerly supports sports in all categories. Beko believes that sports, which represent values matching its dynamic and energetic structure, play a significant role in the development of the youth. Sports’ power to reach large masses is in line with the

440

Million

30 K

Satisfied Customers

Committed Employees

130+ Countries Served

Global 18 Factories

Company’s vision. With this understanding, Beko continued its sponsorship for FC Barcelona. Beko is the official sponsor of FC Barcelona since 2014 and became the main partner and official training partner of the club on February 2018. Bringing two global brands together, this sponsorship

agreement resulted in featuring of Beko logo on the left arm of jerseys, both back and front of the training jerseys. Beko launched “Eat Like A Pro” initiative to raise awareness and tackle childhood obesity with FC Barcelona. This initiative aims at raising awareness on the rapidly increasing childhood obesity and encourage children to eat healthy and make exercise a part of their lives with inspiration of their favourite athletes. The purpose of “Eat Like a Pro” initiative is to help children eat like their heroes and promote healthy nutrition among children worldwide. The purpose is simple; eliminating childhood obesity through measures and education. Global campaign face of the initiative will be FCB star Gerard Piqué. Within this framework Beko raised 1 million Euro for UNICEF to address child obesity problem all over the world. Beko offers a range of FCBbranded products featuring the ultimate freshness solutions to promote healthy nutrition to and help families eat like a pro. In addition to FC Barcelona sponsorship; Beko also supported FCBEscola Istanbul, the official football school of FC Barcelona that operates two schools in Istanbul. As the sponsor of Beşiktaş JK between 1988 and 2004, Beko continued to be the Jersey Back Sponsor of Beşiktaş Professional Football A Team, within the scope of sponsorship agreement signed as of the beginning of 2014/2015 season with this club, with which the Company has special ties.

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60

Briefing Brands / Porland

CERAMIC

Porland:

ENHANCES THE QUALITY OF LIFE

Porland is a respected player in the market who is growing rapidly and preferred both domestically and internationally by its customers. SERAP KAYA

T

he company Porland started its business life as a tableware shop in 1976. After this first step, Imge Trading Company was established in 1984 to carry out marketing of tableware products especially for gastronomic consumers. At the end of 1980’s there was a tendency to start some production. In 1992, Porland Porselen San. ve Tic. A.Ş was established in Gebze. Bilecik facilities went into operation in 1996 in order to support export of Turkey and to meet increasing market demands. Today, Porland is a respected player in the market who is growing rapidly and preferred both domestically and internationally by its customers. Porland has a very strong organizational structure, modern point of view and production capacity, also gives much importance to technology. Porland reflects every fine detail from design to production stage with our superior technology and workforce. While celebrating the 42nd anniversary, Porland is proud to being a trend setter and leading company in the sector with JULY 2018 ISSUE 60

our production power, export power, color and design diversity and advantages that we provide to our customers. Thanks to modern point of view, the importance given to technology, product range, strong organizational structure with more than 1500 labor force and our success in both production and design, Porland is moving forward rapidly to becoming a world brand.

PRODUCTION ACTIVITIES IN TURKEY Porland exports %65 of the production which is 1.500 tons per month and 70 million pieces per year in total

Porland has a very large marketing and sales staff and creates great employment in the sector thanks to the qualified labor force of close to 1500 people.

in Bilecik facilities having 300.000 m2 open and 70.000 m2 closed area. We have a very wide portfolio for both Horeca and Retail with decorated or non-decorated items. These items are being produced according to our customers’ culinary culture and lifestyle habits by analyzing needs of customers very deeply.

Porland releases 4 main collections and 2 intermediate collections every year.


The Turkish Perspective

Porland presents the innovative perspective again by letting our customers to shop freely. With “Create Your Own Set� concept, the customers are able to create unique tables according to their own tastes, lifestyle habits and budgets freely. This can be applied on many of Porland’s collections. Porland is breaking new ground with this service.

EXPANDING THE MARKET SHARE

The biggest difference is the innovative perspective and the production power that Porland realizes by the own designs. Porland is the first and only company in Turkey to make production of Alumilite and also pioneer of the store concept of which you can find everything together needed for house life. Porland consider design and production as two different areas. The designs are made by the Porland design team, by considering trends and consumer expectations of the year, may force production from time to time and may include applications that have never been tried before. At this point our high-tech R&D labs stepping in. Porland is making innovative products with long-term researches. Porland is also a brand that appeals to the world gastronomy market. So,

Porland conducts important researches for the kitchen needs arising from cultural differences and sometimes can even design and produce a form that is not used very much in Turkish cuisine for Far East cuisine. The fact that the production facilities are located in Bilecik is very important for the continuity of the product. Porland is able to serve requested designs/decors or forms to the customers very rapidly. This provides great benefits and easiness to our business partners and the customers in terms of logistics. Besides being a producer, Porland maintains the leading position in the industry with the large-sized 30 concept stores which contains all kinds of houseware apart from porcelain, the product diversity and superiority in decors and designs.

Porland appeals to very different tastes and budgets with our sales channels that includes not only retail stores but also the corners, dealers, wholesalers and export. In the retail channels Porland has products more suitable for end-customers with forms, designs and colors for house usage, while having products for Gastronomy sector which are featuring with their durability and ease of use. Especially for retail products, Porland releases 4 main collections and 2 intermediate collections every year. Designs of both decorations and forms are made by the own designers of Porland. Porland is attending to leading domestic or worldwide fairs every year as a visitor or with a booth. These worldwide fairs are Maison&Objet, Ambiente and Host.

Porland exports to approximately 40 countries of the world and mainly to Europe and Middle East by working with big distributors in these countries. Along with these distributors, Porland work with retailers and wholesalers and exports about %65 of its production. By diversifying the product range in the direction of our R & D activities, Porland aims to grow on a square meter basis in domestic market while expanding our market share in the field of gastronomy and retail abroad. 65% of our 70 million annual production are being exported to more than 40 countries in four main continents. In the UK, Porland has a considerable market share as well as being in a very strong competition with the world-famous porcelain producers. The market share in Gastronomy field of UK is %7. Likewise, Porland is competing fiercely in the Russian, Greek and Israeli markets. Some of the future projects are; increasing our store quantity to 40 by the end of the year, put new and highly preferred collections on market, meet our yearly turnover targets in export and online sales, increasing brand awareness by creating new workspaces, giving importance to social responsibility projects.

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62

Agenda

FAIRS, EXHIBITIONS, SUMMITS AND MEETINGS IN THE NEXT MONTH

EDIRNE FOOD AND AGRICULTURE

JULY

11-15

18th Edirne Food, Agriculture, Animal Husbandry and Industry Fair, which will be organized in Edirne Fair Center between 11-15 July 2018. As an international specialized festival, Edirne Food, Agriculture, Animal Husbandry, Industry Fair-2018 will bring together leading companies in the sector such as, Tractor and Agricultural Equipments, Automobile, White and Brown Goods, Electronic Appliances, etc. Many national and international companies will take part in the fair.

04 - 07 JULY 2018

JUNIOSHOW 2018

TÜYAP BURSA INTERNATIONAL FAIR AND CONGRESS CENTRE

The second gathering of JUNIOSHOW Bursa International Baby, Kidswear & Kids Necessities Fair which is organised by Tüyap Bursa Fairs Inc. and Bursa Chamber of Commerce and Industry (BTSO) in cooperation with Baby Kids Textile Sector Industrialists and Businessmen Association (BEKSİAD) and with the support from the Ministry of Economy, KOSGEB and Bursa Metropolitan Municipality, and the first gathering of which was successfully held in January, will be held on July 4-7, 2018 at Tüyap Bursa International Fair and Congress Centre with a fall and winter theme.

DERIX 2018

MERINOS AKKM-BURSA

28- 01 JUNE

The Leather Products Fair, which has set out to bring all the elements in the leather sector together on the same platform, is to be held in Bursa between June 28th and July 1st, 2018. It is very important for the sector that the trends in the leather sector will take place in the fair. It will be a fashion week; the companies will introduce new collections and the important names of the sector will continue to work to participate. JUNE 2018 ISSUE 60

Katif 2018 - Blacksea Industry and Trade

KATİF 2018

ORDU MUNICIPALITY FAIR GROUND

11- 15 JULY

Katif 2018 - Blacksea Industry and Trade Fair, which will be held between 11-15 July when Ordu Municipality Fair Ground is hosted, is a B2B business activity. Ege Fairs Organization Ltd. Katif Fair General Industry and Trade Fairs organized by the company aims to bring together international exhibitors and visitors in the sectors.

EDIRNE FAIR CENTER

JULY

17-20 ISTANBUL KIDS FASHION TÜYAP BURSA INTERNATIONAL FAIR AND CONGRESS Istanbul Kids Fashion is an international exhibition organized by UBM ICC, where new business opportunities and existing cooperations develop internationally. The exhibitors are gathering under the same roof to make business cooperations with national and international companies, where babies and children’s clothes and accessories age group 0-16 are exhibited. The exhibition is held twice a year; in January under the main brand as Children Baby Maternity Industry Expo (CBME Turkey) and in July as ‘Istanbul Kids Fashion’.


63

Figures STRENGTH OF THE ECONOMY

The statistic shows the gross domestic product (GDP) in Turkey from 2012 to 2016, with projections up until 2022. ( in billion U.S. dollars ) 1 500 1 250 1 000

950.33 873.7

934.08

859.45 863.39

909.89

1 155.94 1 025.65 961.66 1 089.70

849.48

750 500 250 0

2012

2013

2014

2015

2016

2017

2018

2019

RAMPING UP AT A FAST PACE

There are currently only three million e-vehicles on the streets around the globe, but the current growth rates are immense. 3,500

Global electric vehicle stock by year and engine type (in 1,000) Battery Electric Vehicle

3,000 2,000

2022

Data: STATISTA

AMBITIOUS GOALS FOR 2023

As part of its targets set for the agriculture sector by 20 23, Turkey aims to be among the top five overall producers globally.

1st

1,982.04

Number one in fisheries as compared with the EU

703.65

1,000

0

2021

1,239.45

1,500

500

3,109,05

Plug-in Hybrid Vehicle

2020

381.30 179.03 7.48 14.26 61.33 1.89 2.23 2.69 5.16 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Gross agricultural domestic product

Data: International Energy Agency

SHINING AS ALWAYS Germany United Kingdom Italy Spain France

1 - 31 May

Change %

1.345.007 864.837 860.599 757.860 675.836

10.2 13 23.8 51.8 20.3

billion $

8.5

The following countries continue to rise their export in May compared to same month of 2017 and rank as top five. Country

150 million hectare

Data:TÄ°M

Agricultural exports

40 billion $

Irrigable area (from 5.4 million)


64 Figures

GERMANY

10,07

BELGIUM

SHARE OF TOP 20 COUNTRIES IN TOTAL EXPORT (%)

2,51

NETHERLANDS

3,11

FRANCE

Turkish exports shares to most prominent 20 markets in May 2018.

4,79

UK

6,38 USA

4,70

SPAIN

4,89 MOROCCO

1,26

POLAND

2,10

ROMANIA

2,39

RUSSIA

2,08

ITALY

6,17 BULGARIA

1,64

CHINA

1,77

IRAN

GREECE

1,68

1,24

ISRAEL

2,44

EGYPT

1,67 SAUDI ARABIA

1,64

Data: TÄ°M

JULY 2018 ISSUE 60

IRAQ

4,36


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