Zeybekci stated that, despite the uncertainties in the global economy, Turkey has achieved a solid macroeconomic performance and kept realizing its structural reforms, as well as extensive support packages, for a sustainable growth path. Zeybekci pointed out that a new promotional campaign was initiated in order to explain the potential of Turkey to abroad, against the negative perception occurred after the failed coup attempt. Minister Zeybekci also stressed his gratitude for the fact that exporting community is playing a key role for the current “Employment Mobilization” initiated by President Erdoğan. He said “We are happy to see TIM and the exporter's family taking a decisive role in the campaign”
We are going through a period that you call “super incentive period”. The project-based incentive system, which is a unique incentive model with its flexible structure, attracted attention.
What is the impact of this system on Turkish exports, where government support is so intense?
As you have stated, we have established the Council of Ministers Decree, which sets out the principles and procedures for Project-based investment incentives to be implemented for the first time in our history, on 26 November 2016.
With this new model, we aim to provide project-based support for innovation, R & D intensive and high added value investments to meet the current and future needs of our country, supply security, reduce external dependency and realize technological transformation. All kinds of incentives, support and privileges will be determined for projects such as tax, insurance, employment, energy, interest, R & D, marketing and purchasing. We foresee that the conditions determined in the most transparent manner with local and foreign companies will be concluded with legal arrangements on the basis of both sector and firm. We will negotiate with the domestic and foreign investors who are willing to produce in strategic sectors and capacities, taking into account the criteria such as the size of the investment, the technology it will bring, the added value it will provide, the employment to be created and the export potential. As a result of these negotiations, we will implement the support for the projects that we believe will contribute to Turkey with a separate decision of the Council of Ministers.
In addition to ensuring our security of supply, we will also make it a center of attraction for our country in terms of technology investments. I believe that this new incentive model will lead to an increase in exports and production. In this context, we are currently negotiating for possible investment projects that we will support on a project basis. Both the domestic and foreign investors are offering investment projects to take advantage of the Project Based Incentive System. At the same time, we are continuing the promotion meetings of the system abroad and in our country and we provide direct information to investors.
As these projects take place in the upcoming period, we will evaluate the contributions of these projects both on our economy and on our production and export capacity.
You declare 2017 as the year of export mobilization. When we compare Turkey with the past, we prefer to work more in partnership rather than think about foreign trade as a single focus. How will Turkey's foreign trade perspective look like in the coming years?
Our current support, which we have been implementing for many years such as the support to the first exports of our companies or road maps for our companies to be global brands, are already being carried out effectively. Within the framework of our existing support mechanisms, we support our companiesto participate in fairs which are organized abroad. In addition, we organize sectoral and general trade delegation programs for different sectors and for many countries. With the purchase delegation programs, we allow businessmen from different markets to visit our country. In addition, the support of the TurkishTrade Centers we have developed for our companies, which have been difficult to exist in foreign distribution channels alone, has been realized. Again, under our branding support, we encourage our firms to become global brands with the TURQUALITY® Program. We support the projects of our cooperating organizations within the framework of International Competitiveness Improvement (UR-GE) Project to ensure continuous and regular export increase of our companies. In addition to all of these support elements, we are determined to continue to design new mechanisms. In this context, we encourage collective memberships to wholesale and retail e-commerce sites so that our firms can integrate more easily into global markets. On the other hand,we support our exporters who have the potential to be involved in the global supply chain on the issues of hardware, software, training, patent / registration, certification, machine equipment for product development, after-sales services etc. In addition, through the Eximbank,which is linked to our Ministry now, we started to provide financing and export insurance facilities to exporters. In the next period, we will continue our breakthroughs in foreign trade. In this context, we do not interrupt our efforts to increase the activities of existing supports.
We will continue our promotional campaign by using the slogan “Come to Turkey, Discover your own Story” to tell our country's strong, opportunistic economy abroad. We plan to give personal passports to over twenty thousand goods and services exporters. We will strengthen support mechanisms for increasing the export price per unit. We will prepare short, medium and long-term action plans for our major markets. We will ensure that our exporters enter markets more firmly.
We will continue our efforts to increase the financing power of our exporters. As Turkey, we are planning long-term decisions and practices regarding foreign trade and exports. In this regard, we are able to move confidently towards our economic targets without being affected by the temporary ups and downs that may occur in the economy and in the markets. At this point, the 2023 Export Strategy prepared by public and private sector cooperation will continue to guide us.
Work is underway to update the customs union with Europe. How the process Works? Would there be a negative reflection of recent tension?
Through the Customs Union in our commercial and economic relations with the European Union (EU), we have made significant progress during the 21 years of implementation. While the EU is the most important trading partner of our country, Turkey is the 5th most important commercial partner of the EU. Today, our industry is integrated with the EU's value chains. 74% of the total direct investments our country has taken since 2002 are from the EU. The role of the Customs Union is important, as well as the story of Turkey's growth, in achieving this success. We have launched an update process in order to maximize the benefits gained from the Customs Union between our country and the EU, to the highest level. Within the scope of the process, negotiations will be discussed on eliminating problems in the Customs Union, developing reciprocal agriculture concessions, extending preferential economic relations to include public procurement, e-commerce and service sectors. Prior to the negotiations, we conducted intensive internal preparatory work with the related Institutions, NGOs and private sector representatives, both through surveys and information and consultation meetings. We have also undertaken an impact analysis study for an independent research institution to demonstrate the possible effects of the Customs Union Update on our country's economy. In the impact analysis study, it was revealed that GDP would increase by about 1% if the Customs Union resolved structural problems, 50% liberalization in agricultural products and mutual opening of services and public procurement markets. In addition to the mentioned scenario, it is estimated that the GDP will increase by 1.9% with the full liberalization of agriculture products and reforms with the USA and Canada.
An impact analysis conducted by the EU also shows similar results. In an ambitious initiative involving full liberalization in the agricultural sector, it is estimated that our GDP will increase by 1.44%. In both cases, the successful updating of the Customs Union will contribute significantly to the growth rates, exports and prosperity of our country.
At this stage, our country is ready to start official negotiations. The EU is expected to obtain authorization from the Council to conduct negotiations on behalf of member states. After the Commission has been able to negotiate, we are aiming to complete official negotiations at the shortest possible time. It is also worth mentioning that; Our commercial relations, which are a fundamental legal infrastructure with the EU, are progressing independently of political discourses. In this way, the obstacles in the accession process to the EU have not adversely affected our commercial relations based on the Customs Union. Likewise, political negativities with the EU countries do not negatively affect our bilateral trade and economic relations with the EU. Indeed, the expansion of the existing structure to a more effective structure and to the inclusion of new areas of preferential commercial relations will serve the common economic interests of both sides.
We aim to carry out an update process, which will strengthen the grounds for our economic relations with international community, without being affected from political tensions, focusing on economic gains.
The government is developing good relations with Africa. How do you assess the future of Turkey's economic relations with African countries? What would the added value be ?
First of all, it should be emphasized that our point of view towards Africa is based on the use of beauty and riches of Africa for the welfare of African people. We are focused on wins of both sides continuously. We believe in unshakable ties of friendship built on trust. In this respect, I would like to point out that Africa is a very special place for us. Africa, which continues to grow strongly and steadily even in periods of stagnation and economic contraction throughout the world, will be the driving force of the global economy in
the coming period. With the philosophy “Africa is the future and future is “Africa”, we are working to establish an exemplary partnership between Turkey and Africa on the basis of mutual benefit. We are investing in the future of Africa because we believe in it from the heart, we work together for the milestones of development. Our country is committed to developing bilateral relations with its African friends in every field. In 2003, we prepared our strategy to develop trade and economic relations with Africa. While we started our Africa Strategy, our trade volume with the Continent increased from $ 5.4 billion to $ 18 billion, Turkish contractors have undertaken a total of 1,152 contracting projects in Africa, exceeding the total value of 55 billion dollars. Today our investments in Africa are over $ 6.2 billion in size. In the latest period, a Turkish company has reached an agreement for a railway tender for about $ 1.2 billion in Tanzania. We carried out the second of the Turkey-Africa Partnership Summit, which was held on August 18-21, 2008, in Equatorial Ginesi on 19-21 November 2014.
We have increased the number of Embassies in the continent to 39 and the number of our Commercial Counselors to 29. We increased Turkish Airlines flights to African cities. We have provided support for important development programs, including health, infrastructure, transport and environmental priorities.
The number of countries signing the Commercial and Economic CooperationAgreement in Africa has been increased to 39. Again, the number of countries signed in Africa reached 24 with the Mutual Encouragement and Protection of Investments Agreement. We have an agreement on the elimination of double taxation with 11 countries in Africa.
We currently have Free Trade Agreement with Tunisia, Morocco, Egypt and Mauritius, and we continue negotiating FTA with 7 countries from the Continent. We also agreed to initiate negotiations with the two African countries on the Preferential Trade Agreement.
There are 33 countries and the Business Council, which are set up to coordinate the private sector activities, especially business forums, business delegation visits, meetings and seminars, to increase Turkey's economic relations with the African continent. For the first time in November, we organized the Turkey- Africa Economic and Business Forum in coordination with the African Union.
The event was successfully carried out with the participation of over 2,000 businessmen from 48 African countries, as well as 1 President of the African country, 1 Prime Minister, 27 Ministers, 7 Deputy Ministers and 4Secretaries of the Regional Economic Communities / Commissars. The success of this activity has provided us with the impetus to move our relations with African countries forward. With this momentum, it was decided to organize the Forum every two years and to organize sectoral and regional forums. As a matter of fact, Turkey- Africa Agriculture and Business Forum will be held in April this year. Our Ministry is also planning to organize a regional economy and business forum in cooperation with the West African Economic Community. All these developments constitute the basic framework of our future perspective on our relations with Africa.
We believe that Turkish companies will be encouraged to invest in production in Africa, strengthening the activities of our contracting and technical consulting firms in African countries, completing the legal infrastructure in our commercial interaction, improving mutual financing opportunities, increasing the number of our Commercial Counselors in Africa, The promotion of the establishment of the Turkish Trade Centers in the continent is the main pillars of this perspective. In summary, Africa is a geography where we convey our country's success story and support it to grow steadily. Africa offers new and generous opportunities for our business world, especially in terms of potential, opening new fields.
Green passport application that will be given to exporters has been completed. How do you think the system will function? How many exporters will receive a green passport?
The Decree on the Principles Regarding Exporting Passport Issued on March 23, 2017 has entered into force. In this context, we anticipate that our exporters of goods, service exporters, and companies operating in free zones and selling abroad shall receive green passports. The practice has already started and the various exporters in Denizli received the green passports from the hands of the President of the Republic of Turkey. In total, approximately 22,000 exporters are expected to receive green passports.
The Presidential Government System will go public on April 16th. If the result of the proposal is “Yes”, how will the new term effect our economy and export?
As Turkey, we aim to carry our share in global trade to higher levels and reach to the position we deserve. To achieve these goals, we prioritize value-added, innovation and technology-intensive manufacturing in order to penetrate new markets with market diversification and at the same time increase our share in existing markets.
From this perspective, we give support to our exporters, entrepreneurs and investors in every aspect of production and commerce, from investment incentives to market entry activities, from trade organizations to branding and design.
When we pass to the Presidential Government System, our decision processes will be processed more efficiently and faster, bigger projects will be able to be passed on, and direct investments will be increased with the effect of the provided stability environment and new business opportunities will be created in our country.
In this framework, we will be able to record significant distances to reach our foreign trade and international investment goals by using our instruments in a more effective manner.