YOUR COMPLIMENTARY COPY

AUGUST 2019 ISSUE 73 ECONOMY BUSINESS FOREIGN TRADE ANALYSIS

[TURKEY’STURKEY’S FAMOUSFAMOUS] Protected Geographical Indications Turkish paint industry, assertive in every area of the paints and coatings with its product quality, competitiveness, innovative structure and production according to international standards, will continue to be the world's color. The Turkish Perspective 1

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05 FIRST

05 | Turkey ranks 7th among best countries to live and work [TURKEY’STURKEY’S FAMOUSFAMOUS] 06 | Auto Sector Manufactures 735,000 Cars in First Half 07 | Volkswagen is Coming to Protected Turkey 08 | Industrial Production Geographical Up On Monthly Basis 09 | Earns $22B From Flour Indications Product Exports in Last Decade

13 BRIEFING 09 PANORAMA 13 | CENTRAL BANK LOWERS 42 INDEPTH INTEREST RATES 425 BPS While the Central Bank’s interest rate cut by 425 basis points found a positive in the markets, TIM MILITARY MYTHS AND REALITIES: Chairman İsmail Gülle said: “Interest rate decision is a critical and accurate step.” CASE OF TURKEY, 14 | FORD OTOSAN WAS RECOGNIZED WITH THE CLEPA USA, RUSSIA, CHINA INNOVATION AWARD WHO ARE AGGRESSORS 16 | TURKISH CHASING BLACK HOLES THE REVISIONISTS? Turkish scientist at Arizona University, Dr Feryal Özel was among the 200 scientists who photographed the first black hole 24 | TURKISH AIRLINES TAKES announced in April. 55 BRANDS DELIVERY OF ITS FIRST BOEING 18 | BIGGEST FREE TECHNOLOGY EVENT 22 787-9 DREAMLINER IN THE REGION TAKE OFF ISTANBUL 30 new Boeing 787-9 2019 WILL BRING 300 GLOBAL Dreamliner aircraft will be joining the Turkish Airlines’ STARTUPS TO ATATURK AIRPORT 21 | TURKEY: THE 3rd MOST ECONOMIC young and fast-growing fleet Take Off is bringing together the over the next four years, and each most disruptive startups, VCs, COUNTRY OF MEDITERRANEAN REGION will feature the carrier’s all-new accelerators and multinational According to the Travel Cost 55 | A DAY IN LIFE: BRINGING companies from all over the Barometer 2019 Study prepared Business Class cabins. 24 FUTURE TO PRESENT world for a four day of non-stop by the UK Postal Administration, 26 | TURKEY UNVEILS THE 11th 58 | CLEAR YOUR MIND IMAGINE Turkey was the third least innovation. DEVELOPMENT PLAN 26 FREELY expensive country for Brits. 21 60 | DOUBLES CAPACITY WITH 20 | THE CITIES OF TURKEY WITH NEW INVESTMENTFREELY THE HIGHEST BRAND VALUE 22 | A NEW BOOK BY PROF. DR. VEDAT AKGIRAY: GOOD FINANCE 62 | THE GOAL IS TO BE A GLOBAL According to Brand Finance’s BRAND survey on brand value and brand Akgiray, while discussing the power that has been conducted reasons behind financial crises and for the first time in the major their socioeconomic effects in his 64 FIGURES cities of Turkey, İstanbul took the book, he also explains what ‘good first place with its brand value of finance’ is and why the world THE FIGURES OF TURKISH EXPORTS $131,6 billion. needs a better financial system. 24 IN JUNE, 2019 2 Online

MANAGEMENT PUBLISHER ON BEHALF OF TURKISH EXPORTERS ASSEMBLY/ CHAIRMAN OF THE TURKISH EXPORTERS ASSEMBLY theturkishperspective.com İSMAİL GÜLLE Online STRATEGIC PARTNER PRESIDENT OF THE PRESIDENCY OF THE REPUBLIC OF TURKEY INVESTMENT OFFICE ARDA ERMUT MANAGER IN CHARGE THE TURKISH PERSPECTIVE DIGITAL PROF. DR. KEREM ALKİN The Turkish Perspective website is to be launched soon. PUBLICATION BOARD M. İLKER AYCI BİLAL EKŞİ A NEW MEDIUM TO LEARN, ANALYZE AND MONITOR EVERYTHING ABOUT TURKISH ECONOMY ENİSE DİDEM ELMAS MEHMET FATİH BİLİCİ AND BUSINESS, IS BORN. THE TURKISH PERSPECTIVE DIGITAL WILL SHARE THE LATEST MUSTAFA KAMAR NEWS, INTERVIEWS WITH DECISION MAKERS, PROVIDE IN-DEPTH ANALYZES AND WILL BE THE SENEM SANAL SEZERER FOREIGNER’S GUIDE IN TURKEY REGARDING REGULATIONS AND LEGISLATIONS. FURKAN KARAYAKA

PUBLICATION MANAGEMENT PRESIDENT MEHMET MÜCAHİD DEMİR [email protected] VICE PRESIDENT YAŞAR MAMATİ PROJECT COORDINATOR AHMET DAMGACIOĞLU [email protected]

EDITORIAL EDITOR TAMER IŞITIR REPORTER ALPEREN ÇEVİKASLAN BUSINESS BEKİR BİLGİLİ CULTURE INVESTMENT EUROPEAN COORDINATOR İNANÇ ATILGAN INNOVATION AND SCIENCE VIDEO OF THE DAY CONTRIBUTORS NEWS PROF.DR. YAVUZ TEKELİOĞLU BRAND MARKETING [email protected] PROF.DR. EMRE ALKİN HAKAN GÜLDAĞ

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YOUR COMPLIMENTARY COPY CREATIVE DIRECTOR YOUR COMPLIMENTARY COPY AHMET SAİD ÇELİK JANUARY 2019 ISSUE 66 ECONOMY BUSINESS FOREIGN TRADE ANALYSIS APRIL 2019 ISSUE 69 ECONOMY BUSINESS FOREIGN TRADE ANALYSIS More than a magazine, [email protected] The Reference the Turkish Perspective PRINTING ear MAKE TRADE Y NOT WAR PROMAT BASIM YAYIN SAN. VE TIC. A.Ş. of TRADE WARS PUT THE WORLD INTO A NEW ORBIT. THE REMAINING COUNTRIES ARE CLEAR: will now be more New MORE TRADE. ORHANGAZI MAH. 1673 SOK. NO.34 Successes REPORT

The locomotive of exports /30 The guarantee of the future / 40 Being the hub of fashion and apparel/ 46 EXPORTREPORT ESENYURT- İSTANBUL / TURKEY Service sector rises with breakthroughs / 52 REPORT The world’s agricultural warehouse / 56 interactive and responsive, T. +90 212 622 63 63 F. +90 212 605 07 98 [email protected]

YOUR COMPLIMENTARY COPY BRIEFING Free Trade as expected from YOUR COMPLIMENTARY COPY BRIEFING Galataport İstanbul Agreement Showcased in Miami to be on the Agenda INDEPTH Turkish Textile Industry INDEPTH Turkish Laureates YOUR COMPLIMENTARY COPY PANORAMA Turkey may untie Ranks Ahead of China in all over the World the knot in the Eastern Competition Mediterranean BRANDS Btrfly Smart BRIEFING Ankara and Tokyo INTERVIEW Turkey is an Important Lounge Hub for Italy look to seal free trade agreement BRANDS Stylishly Furnished Apartments:Blueground

JUNE 2019 ISSUE 71 ECONOMY BUSINESS FOREIGN TRADE ANALYSIS MAY 2019 ISSUE 70 ECONOMY BUSINESS FOREIGN TRADE ANALYSIS JULY 2019 ISSUE 72 ECONOMY BUSINESS FOREIGN TRADE ANALYSIS Turkey’s main voice for

BREXIT WILL PUT THE EMPIRE IN A NEW PHASE. BUT ALSO BREXIT WILL LAUNCH A NEW ERA FOR BOTH THE UK AND TURKEY FULL OF NEW OPPORTUNITIES. BRE IT TURKEY’STURKEY’STURKEY’STURKEY’STURKEY’STURKEY’STURKEY’STURKEY’STURKEY’S international audience. TURKEY RISK or Steps Into a new TOPTOPTOPTOPTOPTOP CONTACT age OPPORTUNITY Through T. +90 212 216 19 48 [email protected] TURKEY, WHICH WANTS TO INCREASE ITS SHARE IN THE GLOBAL ECONOMY, CONTINUES ITS INNOVATION ATTACK, WHICH HAS BEEN [email protected] CONTINUING FOR YEARS TO REACH THE LEVEL The list of top 1000 exporter OF DEVELOPED COUNTRIES. THE ANNUAL companies, which shape the Turkish TURKEY INNOVATION WEEK EVENT OPENS NEW economy by exporting from Turkey to all HORIZONS FOR TURKEY EACH TIME. www.medyatr.com.tr EXPORTERScorners of the world, has been announced 100010001000100010001000100010001000EXPORTERSEXPORTERSEXPORTERSEXPORTERSEXPORTERSEXPORTERSEXPORTERSEXPORTERSby the Turkish Exporters Assembly. Neither text nor photographs from this publication may be reproduced in full or part without acknowledging the source and securing prior permission from the publisher.

AUGUST 2019 ISSUE 73 The Turkish Perspective 3 Editorial İSMAIL GÜLLE CHAIRMAN (TİM)

While emphasizing that our country attaches great importance to production, NO ONE CAN HINDER US FROM cooperation and sharing concepts with valuable work of Turkey Promotion Group and with the theme “Embrace the Future OUR DEVELOPMENT GOAL with Green”, we as Turkey, aim to reflect our determination to take a leading role for a It should be realised that Turkey is not the former country before the th greener, more livable and sustainable world. 15 of July. There is no power to turn this nation, repulsing the coup The performance we put in the international with their hands and counting on martyrdom as an honour, out of arena is also supported in Turkey, which its way. is also an indication of how much trust is given to the exporter. One of them is the amendment to the General Communiqué ITH A POPULATION OF 82 who martyrised unblinkingly on behalf of on Customs. Accordingly, the limitation on W MILLION, 800 billion dollars of Turkey’s unity and survival. Next to the trees, the import of goods with a maximum of 5 domestic product, productive and dynamic plaques with a square code containing the life stock certificates by means of fast cargo has people, Turkey has the world’s 17th largest stories of our martyrs were placed. been lifted for legal entities. In the name economy. We have emphasized many As TİM, we started to work in 2019 with of sustainability of our exports, it is an times as the entire business and export the vision “Turkey Having Foreign Surplus”. important regulation that will contribute to family, especially our President that this Every month, our exporters set new records. the achievement of our targets with the same is not enough, we want our people to be We crowned the first half of the year with dynamism, especially the incoming samples, more prosperous and Turkey to be a more exports over $88 billion. We aim to reach and allows the free circulation of goods that developed country and our economy should $200 billion at the end of the year. While will be transformed into orders, production be among the top ten economies in the world. working on this path, we are aware that our and export. Another important development It is a fact that difficult times are government is backing us until the end. that will ease us came from the Central Bank experienced in many economies with the With President Recep Tayyip Erdoğan of the Republic of Turkey. The CBRT’s rate problems experienced in international trade and Minister of Trade Ruhsar Pekcan, cut of 425 basis points is an important step and the reshaping of the global political order. last month, we made trips to Japan and that will soon be reflected in the financing On top of it, we were faced with moves that China for high-level contacts. During the activities of the real sector. The interest rate directly targeted our country. For example, in G20 Summit held in Osaka, Japan, and cut occurred at the right time in terms of the August 2018, we witnessed a heavy attack on the bilateral meeting between President competitiveness of our exports of goods and our country through exchange rates. Erdogan and US President Trump, it services. In the first place, we propose that it But the biggest threat to us was the July was decided to increase the previously will boost the market in August, September 15 treacherous coup attempt three years ago. determined foreign trade volume target and October and provide a rapid reflection Turkey’s democracy continued on its way with of 75 billion dollars to 100 billion dollars. on economic growth. With the exchange rate the epic heroism of its people. Now everyone As TİM, we are ready to support this goal stability to be achieved, the contribution of has to realize that Turkey is not the same with all our strength. Accordingly, we have exports of goods and services to economic country before the 15th of July. There is no published a comprehensive report. In 192 growth will continue exponentially. This power to turn this nation, repulsing the coup items, we evaluated the products that could step will accelerate the transition of Turkey’s with their hands and counting on martyrdom increase our exports in the short term. Their economy from offset to the sustainable as an honour, out of its way. common feature is that our country has a growth process. The 11th Development We, the exporters who are the field soldiers competitive advantage while exporting these Plan, which was announced last month of Turkish trade diplomacy, know it very well products and they are imported by the USA and focuses on 2023, the centenary of our that this nefarious venture directly targetted intensively. It was analysed which product republic, has made greater reference to and Turkey which is developing and growing. 15th comes to the fore in which state in detail in export duties than ever in any planning. of July should always be remembered as a day our report. On the other hand, our contacts Our country is fully aware that exports are of National Unity. We, as TİM, in this year’s in China were very successful. By EXPO indispensable for sustainable growth. We, as commemoration ceremony, planted saplings 2019 Turkey National Day in Beijing, we exporters, are aware of the duty that has been in TİM Democracy and National Unity had the opportunity to reflect our culture as given to us. We will continue to work with Nursery in memory of 15th of July martyrs. A well as the development of trade between all our strength to exceed the 2023 targets of plane tree was planted for each of our heroes countries. Turkey.. 65.000

more than 804.000

2002-2018

5.2 784 82 million 2018

Presidency of the Republic of Turkey Investment Office, the official investment advisory body of Turkey, is a knowledge-center for foreign direct investments and a solution partner to the global business community at all stages of investments. It provides customized guidance and qualified consulting before, during, and after entry into Turkey. The Turkish Perspective 5 Content: Auto Sector Manufactures 735,000 Cars in First Half P06 Volkswagen is Coming to Turkey P07 Industrial Production Up On Monthly Basis P08 Turkey Earns $22B From Flour Product Exports in Last Decade P09

First AUTOMOTIVE, AI, REAL ESTATE, INDUSTRY, TOURISM, BUSINESS, ENERGY, DEFENSE, PURCHASE, HEALTH...

REPORT TURKEY RANKS 7th AMONG BEST COUNTRIES TO LIVE AND WORK A survey of the best countries to live and work for foreigners put Turkey in the seventh spot for quality of life and high earnings.

URKEY secured from 163 countries, to their countries. More their home countries. percent said they live T the seventh spot shows Turkey’s ranking than half of people Fifty-nine percent said in cities with a vibrant in a survey by HSBC rose from 22nd place interviewed for the they were able to travel cultural life. More than Group among countries last year to seventh. The survey said they had more while in Turkey, half interviewed for the best for living and 12th annual edition of more time for hobbies and 57 percent said survey said they enjoy working. Ahead of the survey examines and family while in they found time to learn the fine dining and good Germany, the United countries in terms of Turkey, while 55 percent new skills like diving, food in Turkey. Arab Emirates (UAE) quality of life, work and said they could afford cooking and learning A report and Vietnam in a list life balance, financial a fine home and car a new language. The accompanying the topped by Switzerland, revenues and family life. in Turkey. Another 69 majority of them said survey on HSBC’s Turkey provides a It is regarded as one of percent say they felt safe they live in cities rich in website says Turkey, good environment for the most comprehensive in Turkey and that locals historical and cultural which straddles Asia and foreigners, the Expat surveys of expatriates. were very friendly. The texture with landmarks Europe, “Oozes expat Explorer survey says. Sixty-two percent of majority of interviewees and parks. Most live appeal, particularly for The survey, based on interviewees said their said the work-life in central locations business people looking the opinions of more living quality in Turkey balance in Turkey was where there are more to take advantage of its than 18,000 expatriates showed a rise compared far better compared to travel options, and 59 growing economy.” 6 First

“With sunny skies AI and a low cost of living, the country is also TURKEY’S an ideal retirement destination, and its FIRST-EVER AI culture lives up to AUTOMOTIVE ENGINEERING the cliché ‘something for everyone’ with a COURSE OPENS fascinating blend of Auto Sector Turkey’s first artificial Eastern and Western intelligence engineering traditions.” In terms Manufactures 735,000 department established of cultural, open at Hacettepe University and welcoming Cars in First Half in capital Ankara communities, Turkey Automakers in Turkey produced 735,062 vehicles, will admit applicants scores high in the including automobiles and commercial vehicles, in the for the first time this rankings and is a top first half of 2019, according to a sector report. year, starting with 30 choice in terms of ease students. of settling in. A total of 23 “Prepare to be faculty members will delighted. Turkish N THE JANUARY-JUNE PERIOD, also said Turkey’s overall auto sales give lectures at the people are the most I Turkey’s auto production dropped market contracted 45 percent year- department, while friendly people I’ve 13 percent on a yearly basis, said on-year to 200,901 vehicles. students will also be ever met,” a survey the Automotive Manufacturers’ Passenger cars sales were down able to receive lectures respondent says. Association (OSD). 43 percent, while light commercial from academics of “Embrace the good The report showed that local vehicle sales declined 50 percent in related departments via nature and hospitality carmakers’ passenger car output January-June. of the general public stood at 492,700 units in the first Top international automakers — and try to learn a half of the year, pointing to a 12 including Ford, Honda, Hyundai, few Turkish phrases percent decline compared to the Mercedes, Renault, and Toyota — monthly,” another same period of 2018. have factories in Turkey, one of the respondent said. Still, Total commercial vehicle world’s top auto sale markets. the survey shows production also dropped 15 percent In 2018, a total of 641,541 it’d take time for on an annual basis with light vehicles were sold in Turkey, with expatriates to learn commercial vehicle output down 14 passenger cars taking a 75.8 percent cultural nuances percent. The report said around 86 share. Another business group, the optional courses. and points out to the percent of manufactured vehicles Automotive Distributors’ Association Professor Haluk language barrier and were exported, marking an 8 (ODD) said in June that it expected Özen, rector of “frustrating conservative percent annual decline to 634,768 vehicle sales to be between 350,000 Hacettepe University, attitude of some units. and 400,000 this year. said that the students Turks” as challenges The country’s automotive exports Last year, Turkey produced nearly of the department will for new expatriates, totaled nearly $15.6 billion in the 1.6 million vehicles, earning $32.2 have no difficulties or although it adds that six-month period, down 7 percent billion from the exports of some 1.3 employment problems they can adapt “fairly from a year ago. million vehicles. after graduating as there quickly” with the help According to OSD data, local According to the latest data from is already a growing of “delicious Turkish producers delivered a total of the Turkish Exporters’ Assembly need of qualified cuisine, warm weather 419,046 passenger cars to foreign (TİM), the local auto industry was personnel in the field. and friendly locals.” A markets, generating $5.8 billion the largest exporting sector with Turkey’s leading guide for expatriates in export revenues which was 12 a 17 percent share in the country’s aerospace engine accompanying the percent lower compared to the first overall exports in the first half of designer and survey says that the half of last year. The association the year. manufacturer, TUSAŞ country is a captivating Engine Industries Inc. place to live and a recent (TEI) will also provide construction boom scholarships to the first means there are plenty 15 students admitted of properties to rent to the department or buy, while the cost 419,046 17% 400,000 according to their of living is lower than university entrance other popular expat LOCAL PRODUCERS SHARE IN THE COUNTRY’S EXPECTED VEHICLE SALES exam scores, Özen destinations in Europe. DELIVERED A TOTAL OF OVERALL EXPORTS TO BE added. PASSENGERS CARS IN THE FIRST HALF OF AUGUST 2019 ISSUE 73 THE YEAR The Turkish Perspective 7

REAL ESTATE HEALTH MORE THAN HAIR 500,000 TRANSPLANT HOUSES SOLD INDUSTRY IN H1 SURPASSES OVER $1 House sales in Turkey fell to 505,796 proper- BILLION ties in the first half of AUTOMOTIVE Turkey’s hair transplant 2019, down 21.7% on industry has surpassed a yearly basis, TÜİK over $1 billion last announced. Volkswagen is year and continues to Some 206,254 lead the sector with its houses were sold for top-class treatment at the first time while Coming to Turkey affordable prices. the remaining were It is stated that the demands of the German Hair transplant second-hand sales automotive giant, planning to build a factory in services in Turkey -a from January to June, Manisa, is met considerably by Turkey. country that is among according to Turkish the world’s top five Statistical Institute countries in health (TÜİK). HE DETAILS OF THE sort of state guarantee to all tourism- offers high Istanbul, Turkey’s T news in German media deals with Volkswagen, ARD standards with lesser largest city by like “Volkswagen is Building reported. It is also reported costs compared to population and one of a Factory in Turkey” becomes that Ankara has accepted all Europe. its top tourist centers, clearer. of Volkswagen’s demands. The process in took the largest share of According to the German Turkey costs between house sales with 18% or TURKEY COME TO THE FORE AMONG 3 media, the agreement for the 2,000 and 2,500 euros 91,561 houses in the first COUNTRIES new factory will be signed ($2,274 and $2,842). six months of this year. The agency considered Saudi in late September or early Turkey has been a top Official data Arabia, Bulgaria and Turkey to October. destination for people showed that the set up a factory. If all goes well, from Middle Eastern capital Ankara and signatures will be discarded at PASSAT WILL BE PRODUCED countries looking to the Aegean province the end of September for the The model that the factory get hair transplants, an of Izmir racked up establishment agreed to build will mainly produce is Passat. important component 48,814 (9.6%) and in Turkey. The German plans to put 40 of the country’s health 29,066 (5.7% percent) Turkey’s opponent on this thousand Passat models that care tourism for some of total housing sales, issue was Bulgaria. However, will be produced annually in time now, especially in respectively. it is remarked that the labour the new factory, on only to the last three months Mortgaged house cost in Bulgaria is relatively Turkish markets. The factory, those coming from the sales were recorded at high compared to Turkey. which will also produce European countries 82,885, a 16.4% share Skoda models, will also were three to four times of all house sales over THEY EXPECTED TAX DISCOUNT export automobiles to the more than those coming the same period. Volkswagen’s had other Middle East. from the Middle East. expectations from Turkey. According to the news Especially those from Volkswagen waited for based on government Spain, the Netherlands, getting a discount on the sources, the factory will be Belgium, the U.K., and tax. According to the engine built in Manisa, not Izmir, as France began flocking horse-power, consumption tax discussed earlier. Accordingly, to Turkey for cosmetic in Passat model cars rise above the factory will employ 10 surgery and hair 40 per cent of the car prices. thousand people. Based on transplantation. the Turkish family structure, GOVERNMENT GUARANTEE such employment is expected President Recep Tayyip to directly affect 40,000 Erdogan is ready to give some people. 8 First

INDUSTRY BUSINESS NEARLY INDUSTRIAL PRODUCTION 40,000 NEW UP ON MONTHLY BASIS BUSINESSES Turkey’s seasonally and calendar-adjusted industrial production index increased by LAUNCHED PURCHASE 1.3 percent in May from April, the Turkish IN H1 Statistical Institute (TÜİK) said. Nearly 40,000 NIPPON BUYS companies were LOCAL BETEK established in Turkey in the FOR $245 MLN first half of this Japan-based year, TOBB Nippon Paint announced. Holdings has Turkey’s new business announced that filings were down it completed the 13.6% on an annual acquisition of basis in the January- local Betek Boya, June period, the the owner of Union of Chambers well-known paint and Commodity brand Filli Boya. Exchanges of Turkey he seasonally and The durable consumer (TOBB) said in a “The consideration for calendar-adjusted data goods sector saw a 2.1 T report. the Betek Group shares showed that manufacturing percent fall in its production The figures showed is finally determined as production increased 1 in May that followed the 0.5 that more than 5,500 1.4 billion Turkish Liras percent that compared percent rise in April. companies went out (some $245 million) favorably with the 0.8 In its 11th development of business in the and the enterprise percent decline recorded in plan, which covers 2019- first six months of value of Betek Group the previous month. 2023, the government said this year, a rise of is 2.39 billion liras,” the Intermediate goods the country’s industry sector 1.8% compared to the Japanese company said production increased 0.4 will play a central role in same period last year. in a statement released percent on a monthly basis economic growth. The number of on July 11. while durable consumer The plan, which was Betek group, founded goods output fell 0.5 percent submitted to parliament foreign-partnered or in 1988, is a leading in May, easing from the on July 8, predicts that the foreign-funded new company that has deeper decline of 3.3 percent industry sector will expand companies were up the top share in the in April. Energy and capital at a rate of 5.7 percent on nearly 7%, reaching decorative paint market goods production registered average and the sector’s over 6,000 in the in Turkey. Its major 2 percent and 6.5 percent share in the country’s GDP same period. Last brands Filli Boya and increases, respectively. will climb to 24.2 percent month, a total of Fawori have a large TÜİK data also revealed in five years’ time. 4,584 new companies market share and a high that the calendar-adjusted The plan foresees that the were established, up brand-recognition level. industrial production index country’s gross domestic from 5,514 in June By acquiring Betek, in May fell by 1.3 percent product will increase to 2018. Nippon Paint Holding compared to the same $1.08 trillion in 2023 while “In June, 696 is set to achieve a No. month of last year. the per capital income target companies with 1 share in Turkey in Manufacturing output is $12,484. foreign partners addition to Asia. dropped 1.8 percent on The government predicts were established,” the Turkey’s decorative an annual basis, while the annual real economic report said. “Of these paint market is the fifth production decline in the growth at 4.3 percent on companies, 348 had largest in Europe, the intermediate goods industry average between 2019 and Turkish partners, 85 Japanese company says was 6.7 percent year-on-year. 2023. had Iranian partners in a presentation on its and 41 had Syrian website. partners.”

AUGUST 2019 ISSUE 73 The Turkish Perspective 9

TOURISM PRODUCTION TOURISM ANTALYA TURKEY HOSTS Turkey Earns $22B ESTABLISHES NEARLY 7 MLN From Flour Product NEW AGENCY TOURISTS Exports in Last TO PROMOTE Antalya, one of TOURISM Turkey’s most Decade Turkish parliament popular tourist Turkey has earned $22 billion by exporting flour ratified a bill to attractions in the products over the last decade, the Head of the establish a new agency Mediterranean Turkish Flour Industrialists Federation (TFIF) said. to promote and further region, has develop tourism in the welcomed a total country. of 6.9 million The agency aims foreign tourists to help Turkey take a between January larger slice of tourism revenues and it will and July 18, also help boost the marking a strong number of tourists. 16 percent annual The agency will have increase. a 13-person board, Some 86,000 tourists including the CEO of arrived in the city each national flag carrier day through Antalya Turkish Airlines and representatives of the and Gazipaşa airports, HE COUNTRY generated wheat production with 19-20 public tourism sector. but on July 14 the city $10 billion of added value million tons annually. The number of saw a record 96,191 T from $12 billion of wheat However, he said the foreign arrivals in arrivals. imports during the same production could not Turkey surged 11.3% The previous daily period, Eren Günhan Ulusoy meet the demand of flour year-on-year in the arrival records were told. products’ exports due to local first five months of broken again this Ulusoy said Turkey also tops consumption. 2019, according to year on June 22 with the global flour export market “While there were 9.3 official data. 86,308 and June 29 with over 20% of all exports million hectares of wheat Nearly 12.8 million with 90,989. and came in second in the cultivation area in 2001, foreigners visited the “We wake up to pasta export market. this area fell below 7 million country this January- a new day with a He said Turkey’s flour hectares in 2019,” Ulusoy said. May, compared to 11.5 fresh record. If this export, which was about “If we had saved 9 million in the same trend continues we 170,000 tons in 2001, million hectares of period last year. will easily meet our rose by 20 times to cultivated lands, the Russians made up target of hosting 16 reach 3.3 million current yields would 13.1% of the foreign million tourists set tons last year. be more than 20 visitors (or 1.8 million), for this year,” Ülkay “Turkey exported million tons, and there followed by Germans Atmaca, the head of $1B worth of flour would be no need for at 9.5% (1.2 million), the Professional Hotel while imported $1.1B import of wheat,” he added. and Bulgarians at 7.7% Managers’ Association worth of wheat. Our exports He added that over (more than 980,000). (POYD) told. were $2.4B as a whole flour 10,000-year-old cultivated What matters is not product group and our gross wheat- perhaps the world’s only breaking records added value was about $1.4B first- has its origins in but also creating a last year,” said Ulusoy, who the famed ancient site of sustainable tourism is also the director of the Göbeklitepe in Turkey’s industry, Atmaca International Association of southeastern province of noted. “We need to Operative Millers (IAOM) Şanlıurfa. receive 90,000 tourists Eurasia. Turkey has a total of 535 every day throughout He noted that Turkey is active flour factories in almost the year.” the eighth largest country in all 81 provinces, he noted. 10 First

ENERGY GE TO SUPPLY EQUIPMENT FOR 158 MW WIND FARMS IN TURKEY BANKING JEWELRY GE Renewable Energy, the green energy TURKISH division of U.S. giant TURKEY’S JEWELRY EXPORTS General Electric (GE) BANKING announced that it has been selected by SECTOR TO SEE SURGE TO NEARLY $217M Türkerler Holding and DOUBLE-DIGIT RT Enerji to supply IN JUNE equipment for five RISE Turkey exported nearly $217 million worth of onshore wind farms in Turkey’s banking sector jewelry in June, according to Jewelry Exporters’ Turkey. will see a double-digit Association (JTR). In a statement, the rise as of the end of 2019, company said it will the general manager of supply wind turbines private lender Alternatif n a statement, the with $9.6 million, Germany for the Kirazlı project Bank said. I Association said exports with $8.6 million and Israel in İzmir, the Meryem The sector supports increased by 9.52 percent last with $8.5 million. project in Bilecik Şile, the economy with month compared to the same The leading product group the Mahmut Şevket its strong corporate period of 2018. On overall, it of $216.7 million in exports projects in Istanbul and infrastructure, high said foreign sales in the first in June was unwrought or the Pamukova project in capital adequacy and six months totaled nearly $1.7 semi-finished gold with a Sakarya. management capability billion. 49 percent share and $105.7 “Forty-nine of GE’s in uncertainty periods, The European Union million. 3 MW onshore wind Kaan Gür told. country group spearheaded Gold jewelry ranked second turbines will be installed He stressed: “We the exports last month with with a 42 percent share and in İzmir, Bilecik, expect a gradual $97.6 million, followed by $90.2 million, followed by Sakarya and Istanbul,” transition to growth and other European countries diamond-gold jewelry with the company said. positive progress in the with $41.7 million, Near and a 3 percent share and $5.7 With a total capacity second half of this year.” Middle East Asian countries million, silver jewelry with of 158 megawatts Gür added that group with $31.8 million, a 2 percent share and $4.7 (MW), it added, the the inflation rate was other Asian countries with million, and waste and scrap project will provide dropping rapidly $18.8 million and North precious metals or clad with renewable energy to the and could reach Africa with $12.3 million. precious metals with a share region, powering the single digits in The United Kingdom of 2 percent and $4.4 million. equivalent of 183,000 September-October. took the lead on a country- In the meantime, Turkey’s homes. The scope also The annual inflation by-country basis with $67.5 jewelry exports last year includes a 10-year rate, which saw a 25% million, while the jewelry surged by 35 percent to $4.41 servicing agreement. rise last October, was exports to this country billion, with 28 percent, or 15.72% in June. skyrocketing by 2,812 percent $1.23 billion, being made to He said: “As of July, in June compared to the same European Union countries, we expect the Central period of the previous year followed by other European Bank to start dropping Switzerland came second countries with a share of 25 interest rates by 400 with $31.9 million, followed percent (almost $1.1 billion) basis points gradually.” by Hong Kong with $14.2 and Near and Middle East The Central Bank of million, the United Arab Asian countries with 23 Turkey’s (CBRT) policy Emirates (UAE) with $12.3 percent share (slightly over $1 rate -- one-week repo million, the United States billion). auction rate -- is 24% currently.

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DEFENSE NIIP PURCHASE LOCAL FIRMS KORDSA BUYS AMONG TOP Turkey’s net int’l US-BASED 100 DEFENSE Investment Position COMPOSITE COMPANIES Improves PRODUCER Turkish companies Turkey’s net international investment position (NIIP) Turkish tire and secured their posted better performance in May, up 12.2% versus the construction positions in the end of 2018, the country’s Central Bank said. reinforcement most prestigious Kordsa has defense industry bought the U.S.- list, Defense News based composite Top 100. material producer Axiom In 2018, Turkey’s Materials for defense giants posted $181 million. a nearly $4 billion defense revenue, Kordsa -- a subsidiary according to the of Turkey’s leading U.S.-based magazine conglomerate Sabancı Defense News’ annual Holding -- said in a list on company sales press release on July released on July 22. 24 that the latest move The country’s raised its potential for largest defense S OF THE END OF MAY, billion, up 10.6% compared to the creating new products. electronics company A the NIIP- the difference end of 2018. Previously, Kordsa Aselsan ranked 52nd between a country’s external “As regards to sub-items under bought another three in the list, up from assets and liabilities- was minus liabilities, direct investment at U.S. companies -- the 55th last year, $323.1 billion, while it was minus the end of May 2019 recorded Fabric Development, with its $1.8 billion $367.9 billion at the end of 2018, $117.9 billion, indicating a 17.8% Textile Products and defense revenue. In the bank reported. decrease in comparison to the Advanced Honeycomb the previous year, the Bank data showed that Turkey’s end of the previous year, with Technologies -- over the company’s revenues external assets were $239.1 the contribution of the changes last two years. stood at $1.24 billion. billion, up4.4% in the same in the market value and foreign Ali Çalışkan, the Aselsan is active period. exchange rates,” the bank said. CEO of Kordsa, said the in military and civil Meanwhile, the country’s In 2018, the average USD/ company will start to telecommunications, liabilities against non-residents Turkish lira rate was around 4.82, reinforce planes’ engines radar, electronic was around $562.2 billion in May, as one dollar was exchanged for after their tires, wings warfare, defense, down 5.8% from the end of last 6.05 liras on average this May. and bodies thanks weapons, command year. Turkey’s reserve assets rose Total external loan stock of to Axiom Materials’ control and navigation 2.8% to reach $95.6 billion, and lenders went down to $76.1 technology. systems. other investments in the same billion as of end-May, falling 6.6% Aviation company period soared 6.7% to reach $94.7 from the end of last year. TAI ranked 69th and billion. “Total external loan stock of defense technology The sub-item other the other sectors recorded $102.8 firm STM came in 85th investments, currency, and bank billion, decreasing 3.3%,” the with $1.05 billion and deposits amounted to $49.4 bank added. $564.8 million defense revenue, respectively. Missile producer Roketsan, which ranked 89th in the list, recorded a $522.8 $95.6 2.8% $239 million defense BILLION BILLION BILLION revenue. It was 96th in TURKEY’S RESERVE ASSETS TURKEY’S RESERVE ASSETS TURKEY’S EXTERNAL ASSETS the previous list. ROSE

The Turkish Perspective 13 Content: Ford Otosan was recognized with the CLEPA Innovation Award P14 Turkish Chasing Black Holes P16 Biggest Free Technology Event in the Region P18 A New Book By Prof. Dr. Vedat Akgiray: Good Finance P20 The Cities of Turkey with the Highest Brand Value P22 Turkey: The 3rd Most Economıc Country of Mediterranean Region P23

Briefing ECONOMY, AWARD, APPAREL, ASTRONOMY, EVENT, FINANCE, SURVEY, TOURISM...

ECONOMY CENTRAL BANK LOWERS

INTEREST RATES 425 BPS The Central Bank’s new governor Murat Uysal, took the reins While the Central Bank’s interest rate cut by 425 basis points after the former Governor Murat found a positive in the markets, TIM Chairman İsmail Gülle said: Çetinkaya. “Interest rate decision is a critical and accurate step.”

he Central Bank of clash with the government strong tourism revenues is expected to maintain its T the Republic of Turkey on the rate cut. The initial support the economic activity improving trend,” the CBRT (CBRT) significantly cut its response of markets to the through direct and indirect added. benchmark policy rate, the bold rate cut seemed positive channels,” the regulator said in The interest cut was one-week repo rate, by 425 as Turkish Lira remained firm a statement. welcomed by the businessmen. basis points from 24% to against U.S. dollar and euro, “Looking forward, net The corporate sector was 19.75%. briefly shedding 0.5% in value exports are expected to suffering from the declining The Monetary Policy before gaining 0.5% again. contribute to the economic economic activity and tight Committee’s (MPC) decision “Recently released data growth and the gradual financial conditions. The rate marked the biggest rate cut indicate a moderate recovery recovery is likely to continue cut is expected to support since 2002 and the first-rate in the economic activity. with the help of the disinflation economic activity and ease cut in 4.5 years. It also came Goods and services exports trend and the partial financial conditions... after the bank’s new Governor, continue to display an upward improvement in financial Turkish Exporters’ Assembly Murat Uysal, took the reins trend despite the weakening conditions. The composition (TİM) Chairman İsmail Gülle after the former Governor in the global economic of growth is having a positive said the following regarding Murat Çetinkaya was removed outlook, indicating improved impact on external balance. the Central Bank’s interest rate from duty over an apparent competitiveness. In particular, The current account balance decision: PHOTOGRAPH BYLOREM IPSUM PHOTOGRAPH 14 Briefing

“The front-end interest rate AWARD cut by the CBRT is an important step by as soon as it is reflected in the financing costs of the real sector. By the end of FORD OTOSAN WAS spring, inflationary inertia reduced, real interest rate Turkey paid remained high. RECOGNIZED WITH THE CLEPA Therefore, the mentioned 4.25-point interest rate cut was INNOVATION AWARD made at the right time for the competitiveness of our exports Export champion of the automotive industry for eight of goods and services. The fact years in a row and export champion of Turkey for the that most of a potential discount of 6-points in total that could be last four years, Ford Otosan was recognized with the made in the meetings in July prestigious CLEPA Innovation Award by the European and September were made Association of Automotive Suppliers (CLEPA). during this month’s meeting

will initially revive the market in August, September and October and provide a quick reflection on economic growth. Moreover, the exchange rate stability to be achieved, the contribution of exports of goods and services to economic growth will continue exponentially. The fact that exports have been referred to in the 11th Development Plan more than ever in any development plan confirms that sustainable ORD OTOSAN was captured. Ford Otosan was clusters and electronics for exports are indispensable for F recently announced most recently recognized the automotive industry, sustainable growth. Therefore, the “Export Champion” with the 2019 CLEPA for Ford Trucks F-MAX by emphasizing my belief that of Turkey by the Turkish Innovation Award by the tractor, the winner of the this critical and accurate step of Exporters’ Assembly European Association of 2019 International Truck of the CBRT Monetary Policy (TİM) and also named Automotive Suppliers, the Year award, won second Committee will accelerate the the largest industrial which brings together over prize in ‘Cooperation’ in the transition of the Turkish enterprise in the Turkish 120 global suppliers of car Innovation category. economy from offset to the automotive industry parts, systems and modules sustainable growth process and according to “Turkey’s Top and more than 20 national YENIGÜN: “WE WILL KEEP make a significant contribution 500 Industrial Enterprises trade associations, and is RAISING THE BAR THROUGH to employment, I extend my 2018” survey by Istanbul considered one of Europe’s THE RIGHT PARTNERSHIPS best wishes to our country, our Chamber of Industry leading automotive AND OUR INNOVATION economy, and to the whole real (ISO). associations. STRENGTH” sector, especially our Export Ford Otosan, continues The instrument cluster Ford Otosan General Family with its nearly 85 to be recognized in Turkey developed by Ford in Manager Haydar Yenigün thousand members.” and worldwide with the partnership with Takosan, noted that the company sustainable growth it has a supplier of instrument achieved significant success PHOTOGRAPH BYLOREM IPSUM PHOTOGRAPH AUGUST 2019 ISSUE 73 The Turkish Perspective 15

in 2018 despite challenging conditions: “Since the very beginning, we strive to add value to our country and people with commitment and determination at full speed. Last year, we achieved excellent results by balancing the tightening in the “We recorded the domestic market with strong highest ever production and consistent growth in and export quantities export markets. We recorded in our history and the highest ever production became Turkey’s export and export quantities in champion with $5.7 our history and became billion in revenues.” Turkey’s export champion with $5.7 billion in revenues. This figure alone accounts APPAREL for 74% of Turkey’s total year, reaching a record commercial vehicle exports. level of 328,892 units. The successful partnership of According to the 17th COLIN’S: RUSSIA’S Koç Holding and Ford Motor edition of “Turkey’s Top Company took Ford Otosan 1000 Exporters 2018” to European leadership in survey results announced MOST POPULAR commercial vehicles and by TİM at an event last the top of the industry Sunday attended by in Turkey. In a rapidly President Recep Tayyip JEAN-FOCUSED READY- transforming, digitalizing Erdogan, Ford Otosan world, we have reached a broke a new record as TO-WEAR BRAND position where we set global the export champion of standards for Industry Turkey with $5.7 billion in With nearly 600 stores in 38 countries, 4.0, R&D and innovation. export revenues. Our achievements are also Ford Otosan COLIN’S was chosen as Russia’s most confirmed by championships furthermore became the popular jean-focused ready-to-wear and awards by local and only automotive company brand. international organizations. in the Top 10 of “Turkey’s Ford Trucks F-MAX, the Most Valuable Brands” list winner of the ‘International announced by the Truck of the Year 2019’ international brand OLIN’S, who grows to have accomplished this in most recently brought valuation consultancy firm C stronger in the global the largest country on earth. us another international Brand Finance. As in 2017, market every year, has We believe this is a testament award with the instrument the company also added a new success to its to and a result of our steady cluster that we developed in maintained a leadership in international achievements by growth across the globe, and partnership with Takosan. 2018, with TL 31 million becoming the top pick in the we feel energized knowing We will keep raising the bar increase in revenues, as the “Russia’s Most Popular Brands that our achievements will with the right partnerships, largest industrial and Brands with the Largest also strengthen the Turkish innovation strength, domestic enterprise in the Turkish Store Network” research ready-to-wear industry.” production and engineering automotive industry of Jones Lang LaSalle, a The research included 250 capabilities.” according to Istanbul professional services and big brands, which operate in Chamber of Industry’s investment management firm 37 cities with more than half EXPORT CHAMPION FORD (ISO) “Turkey’s Top 500 offering specialized real estate a million inhabitants each. OTOSAN IN 94 COUNTRIES Industrial Enterprises services. COLIN’S was chosen as ACROSS FIVE CONTINENTS 2018” survey, which has Working at COLIN’S “Russia’s Most Popular Ford Otosan, which been conducted for over Russia for 12 years, the last six Brand” because of its network exported vehicles and parts half a century and of which as general manager, of stores covering 95 percent to 94 countries across five constitutes the most Önder Ön, COLIN’S Global of the country. The results of continents in 2018, increased valuable industrial data. Marketing Director, said: the research were announced its export volume by 11% last “As COLIN’S, we are proud by “Mapic Russia.” PHOTOGRAPH BYLOREM IPSUM PHOTOGRAPH 16 Briefing

ASTRONOMY TURKISH CHASING BLACK HOLES Turkish scientist at Arizona University, Dr Feryal Özel was among the 200 scientists who photographed the first black hole announced in April.

ERYAL ÖZEL, conduct- F ing researches on black holes, neutron stars and theoretical astrophysics, is also Chairman of the NASA Astrophysics Committee, NASA Lynx Space Telescope Science and president of the Technical Team and Space Horizon Telescope Science Council and Modeling and Analysis Working Group.

IN THE SAME LIST WITH EINSTEIN Özel, who was elected as an honorary member of the American Physical Society in 2015 for her successful stud- ies in astrophysics and to the Academy of Sciences mem- bership in 2013, has received the Maria Goeppert Mayer Award from the American Physical Society, the Harvard Radcliffe Institute Schol- new ground in the world of Working Group on Modeling arship, and the honorary science, about the imaging and Analysis, where black professorship from the Miller of the supermassive black holes are modelled. Institute of the University of hole in the centre of the M87 She stated that the data California at Berkeley. Galaxy in the constellation of they received from space in Özel, who made her name Virgo, 53 million light-years 2017 could be announced on the list of “20 Great away from Earth. only in April 2019 and gave Ideas” along with the world’s By stating that she has the following information: most renowned scientists as been working on imaging “The black hole photograph famous physicist Albert Ein- black holes for 20 years, Özel created by combining X-ray stein, mathematician John Özel, who made her recalled that at a press confer- data obtained from radio Nash, was recently awarded name on the list of “20 ence in April, a team of 200 telescopes in different parts the METU Outstanding Great Ideas” along scientists announced the first of the world was announced Service Award. with the world’s most black hole photograph they to the public in 5 cities of renowned scientists had obtained by virtually the world with simultaneous CHASING BLACK HOLES FOR as famous physicist connecting 8 telescopes from press conferences. Scientists 20 YEARS Albert Einstein, different points of the world. want to share their excite- ment instantly. Of course, we Professor Dr Feryal Özel mathematician John made a statement to scien- “WE KEPT IT LIKE A SECRET” were very happy when we first tists, who came together un- Nash, was recently Özel said that she also saw the black hole in August der the International Event awarded the METU conducted the Chair of the 2018, but until April 2019 Horizon Telescope project, Outstanding Service Science Council of the Space we could not say anything to which is expected to break Award. Horizon Telescope and the anyone. Because we both had PHOTOGRAPH BYLOREM IPSUM PHOTOGRAPH AUGUST 2019 ISSUE 73 The Turkish Perspective 17

Pointing out that the location of the satellites was confirmed by this theory, Özel said, “This theory, which was put forward 100 years ago, makes it easy for people all over the world to find addresses. In other words, the concepts we encounter in basic science eventually affect one’s life and technology one day. But even if it does not, people are curious and enjoy exploring. It’s a research that comes entirely from the dis- covery of the human soul.”

‘’WE ARE TRYING TO PROVE THAT EINSTEIN’S THEORY IS to be sure and prepare the INCOMPLETE’’ publications. It was hard to Özel made the following keep it secret that we had the evaluations on her studies on first black hole image. the universe: We as a team are try- A BLACK SPACE WHERE LIGHT ing to prove that Einstein’s DISAPPEARS theory is incomplete. So the Özel made this statement theory explains gravity very about the black hole photo- well, but there is another graph they imaged: “In the theory of physics that we call middle of the black hole, quantum mechanics used to there is a black void where the describe particles, and they light is destroyed; and around don’t overlap. There must be the black hole, there is a part another condition one of the where the gases are con- theories so that we can find stantly rotating. Under the “In the middle of the black the first time, we can see the a common point. That’s one hole, there is a black void effect of gravity, these gases where the light is destroyed; existence of this event horizon of the reasons we examine go into the black hole but also and around the black hole, and the disappearance of black holes. So in the black there is a part where the gases some of them turns around. are constantly rotating.” light with our own eyes. Of holes, we are looking for places That’s why the perimeter of course, with this data, we can around which both the effects the black hole looks bright. do many different things.” of quantum mechanics and Circumference like bagels, gravity can have very strong there seems to be a hole in the ‘’THE REFLECTION OF effects. Therefore it’s just the middle.” FUNDAMENTAL SCIENCE beginning. In response to the question RESEARCHES ON LIFE IS After getting the black hole about which secret previously answer whether black holes ENORMOUS’’ picture, we will do a lot of unknown in the scientific have any special feature or While Professor Dr Feryal Özel tests of these laws numeri- world was uncovered with not. From what we have answered the question as to cally. So maybe there’s a place the visualization of the black seen so far, there is indeed a whether the visualization of where Einstein’s theory is hole, Özel said: “Let’s say this volume in which light is lost. black holes would have any missing. If we find that, of is a beginning. After showing The absence of light means effect on daily life, she clarified course, it will make us very that this experiment was suc- that no information can reach that the data obtained in the happy. Einstein hated the cessful, of course, there will be us. So black holes create tiny basic science research has a idea of black holes all his life. much more.”. islets independent of the very large reflections on life, for How do black holes look like, Pointing out that black universe. Of course, we can example, the laser has become if they are what the theory holes are known as the most do a wide variety of tests now. used in surgery years after the predicts, is a very new piece strange objects in the universe We’ve always been trying to invention, the GPS systems of work. So these are the last in Einstein’s General Theory of figure out what’s happening installed on mobile phones 20-year of work. And we are Relativity, Özel said: by looking at the effects of also worked through Einstein’s gathering new data day by ‘’We are looking for an the black hole around it. For General Relativity Law. day.’’ PHOTOGRAPH BYLOREM IPSUM PHOTOGRAPH 18 Briefing

EVENT Biggest free technology event in the region TAKE OFF ISTANBUL 2019 WILL BRING 300 GLOBAL STARTUPS TO ATATURK AIRPORT Take Off is bringing together the most disruptive startups, VCs, accelerators and multinational companies from all over the world for a four day of non-stop innovation.

In 2018, 30 winners were chosen among NUMBERS FROM TAKE more than 200 OFF ISTANBUL START- participants. UP SUMMIT 2019 300+ Startups The most promising 300+ global startups in 7 strategic verticals, will get on stage to pitch for the international jury, VCs and world leading companies 150+ Mentors Take Off leading rockstar mentors from the global startup eco-system will guide and support startups covering all important sectors and STANBUL’S JUICy location “We focus on creating and public companies. In industries close to MENA and Europe July, Take Off put out a call I a value by bringing with its rapidly growing for startup pitches on Food 200+ startup ecosystem is meant together startups and and Agriculture Technologies, Investors to be attractive for promising corporate companies Health, Sport, Wellness Pitching and networking sessions regional startups to grow. At in order to visualise the Technologies, Environment with 200+ investors, business least this is what Hackquarters, future together” said and Energy Technologies, angels, VCs and the best accelera- the first Turkish private startup Kaan Akin. Education Technology and tors from Turkey, MENA, US, ASEAN launchpad and corporate Future of Work, Logistics and Europe. innovation partner, is doing and Smart City Technologies, not only in Turkey, but in the Aerospace Technologies, and 100+ region. Now boosting Take Off “Other Technologies” for all Corporates Startup Summit due on Sept Partnership opportunities with 16-19, 2019 in Istanbul; the 100+multinational and regional biggest startup event in the corporate and public companies region which will take place in represented by innovative and Istanbul Atatürk Airport. digital executives Hackquarters is to bring more than 300 startups from all around the world for the event; where 300 startups will pitch in 5 industries. Take off is to collect at one place the Selçuk Bayraktar from Turkish Technology Team, leading VCs and accelerators; and also CTO of Baykar rockstar keynotes and the Technologies, was one of the keynote speakers at Take most innovative multinational Off 2018. PHOTOGRAPH BYLOREM IPSUM PHOTOGRAPH AUGUST 2019 ISSUE 73 The Turkish Perspective 19

other startups. Being a part of Teknofest Istanbul Aerospace and Technology Festival, Take Off ICUBE STARTUPS brought together more than 200 startups, 100 VCs and hundreds of players from the SHOW-OFF IN LONDON entrepreneurship ecosystem to Promising Turkish startups had their demo day at Impact Hub Istanbul in 2018. You can find more info London, for VCs, investors and corporates from the UK area. about Take Off International Startup Summit 2019 at the official website: takeoffistanbul.com

BORN IN TURKEY, WORKING GLOBAL: HACKQUARTERS Founded in 2015 by Kaan Akin, Hackquarters now working with more than 40 leading multinational companies. Running Bayer’s global Grants4Apps Startup Program in Digital Health; Redbull’s Amaphiko Global Social Entrepreneurship Program; MediaMarkt’s Startup Challenge powered by global RetailTech Hub; Workup Startup Program by Turkish biggest banks Is Bank; International Incubation Institute or Science, Industry and Technology. ICUBE Visa Innovation Program ICUBE aims to help technology companies program is implemented in partnership by Visa; just few of the most or startups by preparing them for sales, with Hackquarters. challenging programs in provide access to international markets, Hackquarters’ portfolio. increase their capacity and network them HERE ARE THE TURKISH STARTUPS WHO Having more than 150 with potential investors. ICUBE will PITCHED AT THE EVENT IN THE UK startups in a daily agenda; provide training, consultancy, mentorship FANALIZ provides financial info and with more than 6000 startups and strategy development support for analysis for potential partners of companies, in different phases scouted selected startups. Our program will take UserVision provides strategic insights via during the past 2 years. With place in Istanbul with mentioned benefits in-depth interviews, Workup by Is Bank being a and our finale will take place in London MHAS is an AR/VR training program for 2nd best accelerator in Turkey with selected few among 23 startups. In medical purposes, in 2017, Hackquarters Founder London, selected startups will get the PDA remote and secure access platform for Akin is now a guest speaker chance to get mentorship and business cloud systems, at the major global events like support within the UK. BiaTech produces a robotic spinal SXSW; Germany Investment decompression device used in the treatment Summit, Innovatours and TO GROW IN THE UK MARKET of lumbar and cervical disc herniation, other international events; and Our kick-off event for ICUBE was on the TETİS Biotech produces value-added fellow at Young Transatlantic 26th of April, at Entertech office within products from discard wild marine resources, Innovative Leaders Initiative Istanbul University. 23 startups selected Tinova is a producer of mobile apps for of German Marshal Fund of for the ICUBE program among hundreds supply-chain, United States of applications, were at the opening event Iltema produces heat emitting intelligent As of 2019, the Founder by Entertech and Hackquarters. textiles and applications, Akin plans to turn ICUBE (International Incubation SolarCurtain produces high-grade, Hackquarters into a global Institute) is a program by Entertech and modular solar panels for various different use network with locations in supported by ISTKA (Istanbul Kalkınma cases, Europe and MENA, launching Ajansı – Istanbul Development Agency) AkSense produces diagnostic devices for new programs on Blockchain, and Republic of Turkey Ministry of diagnosis of healthcare-associated infections. Life Sciences and more. PHOTOGRAPH BYLOREM IPSUM PHOTOGRAPH 20 Briefing

SURVEY revenues are estimated in accordance with following years. He pointed out that THE CITIES OF TURKEY WITH 77 percent of Turkey’s population lives in the major cities, 75 percent of Turkey’s THE HIGHEST BRAND VALUE gross domestic revenue has According to Brand Finance’s survey on brand value and brand been gained from these power that has been conducted for the first time in the major cities and that Turkey’s cities of Turkey, İstanbul took the first place with its brand socioeconomic life is shaped by these cities significantly. value of $131,6 billion. So, he continues, it is important that metropolis should be ruled with the right performance criterions. N COOPERATION with Brand İlgüner continued IFinance and Curiocity, his words in view of the ‘’TURKEY METROPOL 30’’, a report that is named “The survey that is conducted for the World’s Cities - 2018” and first time for the major cities is prepared by the United of Turkey, presented the brand Nations, according to which value and brand power of the 55,3 percent of the world’s major cities. population lives in the cities: While İstanbul took the first ‘’It is estimated that, in 2030 place with their brand value of this rate will be %60 and one $131 billion 614 million, other out of every three will live in a major cities followed İstanbul city with a population at least respectively as below, half a million. In 2000, while Ankara $35 billion 458 there were 371 cities with million, İzmir $24 billion 229 population over 1 million, today million, Kocaeli $16 billion 44 this number has increased to million, Bursa $15 billion 769 548. In 2030, the number is million, Antalya $10 billion expected to be 706. The 358 million, Konya $7 billion number of major cities in the 837 million, Gaziantep $7 BRAND VALUE OF İZMİR EXCEEDED THE SURVEY WILL BE A REFERANCE world has been increasing, in billion 284 million, Adana $7 ANKARA’S FOR GLOBAL COMPETITION addition to this, the allurement billion 244 million and Mersin On the other hand, according The Director of Brand competition of visitor, investor $6 billion 737 million. to survey results that is analysed Finance Turkey Muhterem and qualified resident is Tekirdağ took 11th place with the aspects like ‘’Society’’, İlgüner, who shared his improving. We hope that its brand value of $5 billion 844 ‘’Investment Environment’’, opinions on the survey, by Turkey’s major cities should million, Manisa $5 billion 494 ‘’Production Potential’’, brand uttering that he is grateful as prepare this competition million, Kayseri $5 billion 202 value of Turkey’s metropolis is this kind of survey has been environment powerfully, and million, Hatay $4 billion 997 presented. done for the first time for that these cities can take the million, Sakarya $4 billion 445 On the scale of 100, İstanbul Turkey, he indicated that it righteous share from the visitor, million, Balıkesir $4 billion 366 became the most powerful makes the survey easier when investor and qualified resident. million, Denizli $4 billion 249 major city in terms of brand metropolis law and borders Our purpose is to create million, Samsun $4 billion 44 power with 88,6 points, tally with the civil borders awareness with METROPOL million, Eskişehir $4 billion Şanlıurfa took the last place in of the related city, thus, it 30 survey and report. The 13 million, Muğla $3 billion the list with 41,4 points. The is possible to obtain and performance indicators 999 million followed Tekirdağ other cities followed İstanbul compile the accessible and prepared in accordance with respectivly. respectively; trustworthy socio-economic certain criterions and brand While Aydın, Diyarbakır, İzmir 88,1 points, Ankara statistical data of major cities. powers and brand values that Şanlıurfa, Kahramanmaraş, 82,9 points, Antalya 78,4 İlgüner made point on are calculated considering these Trabzon, Malatya, Erzurum, points, Bursa 76,3 points, that metropolis’s gross indicators, which has been used Ordu and Mardin followed Muğla 69,3 points, Konya 66,7 revenue is joined in three as a reference for metropolitan these cities, Van, which has the points, Trabzon 66,7 points, parts including agriculture, governments, will be an lowest brand value, took the Kocaeli 66,4 points, Adana industry and services important starting point in this last place. 64,4 points. separately and these gross competitiveness.’’ PHOTOGRAPH BYLOREM IPSUM PHOTOGRAPH AUGUST 2019 ISSUE 73 The Turkish Perspective 21

TOURISM TURKEY: THE 3rd MOST ECONOMIC COUNTRY OF MEDITERRANEAN REGION According to the Travel Cost Barometer 2019 Study prepared by the UK Postal Administration, Turkey was the third least expensive country for Brits.

destination in surveys conducted in the last six years. Results from the survey show that the total price paid to nine touristic products in Bulgaria is cheaper than at least one- third of the eurozone regions examined. Last year, Marmaris in Turkey was in second place on the list in terms of cheapness. Although Marmaris fell to third place this year, the barometer costs became %7 less expensive for British tourists compared to last year due to the depreciation CCORDING TO 1 glass of wine, 1,5 litres of £57.45, Turkey £59.13, of TL against the pound. Due to A COUNTRY price soda, sunscreen from the Spain £65.59 and Italy changes in exchange rates, comparison of the nine supermarket, fly-repellent, £78.05. British tourists exchanging main most used holiday 2-person dinner with alcohol 500 pounds to TL in Turkey products that are compiled andPO 2-personST OF lunchFIC withoutE TR AVTURKEYEL MO IS %7N CHEAPEREY FOR this year will have as much as from Travel Cost Barometer alcohol, the 5 cheapest BRITISH TOURISTS if they exchanged an extra 2019 by UK Postal countriesHOLID areA Yas Cfollows:OST S BARSunnyOM BeachETE inR Bulgaria2019 100 pounds in comparison to Administration, Turkey is the Bulgaria £38.86, Portugal has been the cheapest last year. third least expensive country in thePO MediterraneanST OFFICE TRAVEL MO regionNEY LOREM IPSUMDOLOR for BritishHOLIDA Ytourists. COSTS BAR InOM ETravelTER 2019 1 SUNNY BEACH 2 ALGARVE 3 MARMARIS 4 TORREMOLINOS 5 BENIDORM Cost Barometer 2019 study Bulgaria Portugal Turkey Spain Spain determined by1 S UaNNY BsurveyEACH 2 ALGARVE 3 MARMARIS 4 TORREMOLINOS 5 BENIDORM Bulgaria Portugal Turkey CupSpain of coeeS p ain £0.70 £0.57 £0.89 £1.05 £1.58 Cup of coee £0.70 £0.57 £0.89 c£a1.0f5é/bar £1.58 conductedcafé/bar in 20 leading Bottle of local beer/lager £0.70 £1.05 £2.22 £1.89 £1.67 café/bar Bottle of local beer/lager Bottle/can of Coca-Cola Mediterranean£0 .94resorts,£1.32 while£0.89 £1.32 £1.93 £0.70 £1.05 £2.22 £1.89 £1.67 café/bar café/bar Glass of wine £1.17 £1.64 £2.96 £2.33 £1.67 Bulgariacafé/bar ranked first in the Bottle/can of Coca-Cola 1.5 litre bottle of still mineral water £0.37 £0.44 £0.30 £0.33 £0.22 £0.94 £1.32 £0.89 £1.32 £1.93 supermarket café/bar Suncream £2.34 £3.94 £6.67 £4.82 £11.93 list of(SP Fthe15, Nivea/Amb recheapest Solaire) five with Insect repellent £2.34 £5.08 £2.22 G£3l.a07ss of wine£5 .22 supermarket £1.17 £1.64 £2.96 £2.33 £1.67 3 course evening meal for 2 café/bar Sunny Beach, it£21.8 8 is followed£29.38 £34.09 £33.24 £37.17 (including a bottle of house wine) 2 course lunch for 2 people £8.42 £14.03 £8.89 £17.54 £16.66 (no drinks) 1.5 litre bottle of still mineral water £0.37 £0.44 £0.30 £0.33 £0.22 by AlgarveTOTAL COSTS in Portugal,£38.86 £57.45 £59.13 s£u65p.59ermarket£78.05 2019 vs 2018 % +/- -10.7% -16.2% -8.6% -8.7% NEW Marmaris in Turkey, Suncream £2.34 £3.94 £6.67 £4.82 £11.93 Torremolinos in Spain and (SPF15, Nivea/Ambre Solaire) Insect repellent £2.34 £5.08 £2.22 £3.07 £5.22 Benidorm in Italy. supermarket 3 course evening meal for 2 According to the study, (including a bottle of house wine) £21.88 £29.38 £34.09 £33.24 £37.17 for the total cost the British 2 course lunch for 2 people £8.42 £14.03 £8.89 £17.54 £16.66 tourist will pay for a cup of (no drinks) coffee at the cafe or bar, 1 TOTAL COSTS £38.86 £57.45 £59.13 £65.59 £78.05 bottle of beer, 1 can of coke, 2019 vs 2018 % +/- -10.7% -16.2% -8.6% -8.7% NEW 22 Briefing

FINANCE A new book by Prof. Dr. Vedat Akgiray: Good Finance THE NEXT FINANCIAL CRISIS WILL BE MUCH MORE DESTRUCTIVE Akgiray, while discussing the reasons behind financial crises and their socioeconomic effects in his book, he also explains what ‘good finance’ is and why the world needs a better financial system.

HE BOOK ‘GOOD institutions, as well as each “We could not even authorities and academicians, T FINANCE’ written by of these setting a problem, take the necessary has failed. There has been Prof. Dr. Vedat Akgiray, they are also sustaining an ignorant insistence professor of finance at the biggest problem in lessons from the on outdated models and Bogazici University and front of humanity: extreme greatest financial interpretations. This illogical the director of the Center ‘financialism’. Vedat Akgiray collapse in history in resistance to change and for Research in Corporate explains, “We could not 2008. Everyon has repeated mistakes have Governance and Financial even take the necessary failed.” brought us to this day. It Regulation, is published by lessons from the greatest looks like the next financial Bristol University Press. financial collapse in history crisis will be much more Environmental destruction, in 2008. Everyone, including destructive”. increasing wealth and income economic policy makers, Akgiray emphasizes that disparity, loss of trust towards central banks, financial the principle of finance is PHOTOGRAPH BYLOREM IPSUM PHOTOGRAPH AUGUST 2019 ISSUE 73 The Turkish Perspective 23

Akgiray emphasizes that the principle of finance is to bring together the ones who have the money with the ones who need the money. Every other action that does not support this fundamental principle should be questioned.

everything. We can call this ABOUT PROF. DR. VEDAT AKGIRAY: consumption drunkenness. If we cannot afford what Akgiray graduated from Bogazici University. we want, the only solution the Department of Between March 2009 becomes to get in debt - with Management at Bogazici and December 2012, Prof. credit cards, bank loans, etc., University in 1980. He Akgiray was the President of usually without thinking received his Master’s Degree the Capital Markets Board of how to pay back. As the in Finance in 1982, Master’s of Turkey (CMB). At the Degree in Economics and same time, Akgiray was the financial sector craves for the PhD Degree in Finance Vice President of IOSCO client to loan credit and as in 1985 at the Syracuse and Head of The Emerging it became easy to generate University. While working Markets Committee. During credit with the necessary at the Clarkson University his period at CMB, he lead (1986 - 1990), he became the team that prepared the tools, thanks to ‘financial an Associate Professor in new Capital Markets Law. engineering’, it is not a hard 1989. He has been lecturing He is currently giving task to find a loan. Today the at the Bogazici University lectures in the Faculty total revenue of the world is since 1991. Prof. Akgiray of Economics and $85 trillion and the total debt is one of the founders of Administrative Sciences to bring together the ones Postgraduate Program in at Bogazici University is around $300 trillion. It is who have the money with Financial Engineering at the and leading the ‘Bogazici impossible to pay this debt, the ones who need the Bogazici University and lead University Center for it will not be paid back, and money. Every other action the program between 2002 Research in Corporate those people who cannot pay and 2009. In addition, he Governance and Financial that does not support this has been coordinating the Regulation (CCG)’, which he their debts will suffer a lot. fundamental principle should PhD Program in Finance at had founded in 2014. “The first rule of the social be questioned. Akgiray agreement that I mention in advocates that, “Finance is the book is to refrain from not the art of making money country cannot hold the global platforms, free from lending money to those who from other people’s money; privilege of being ‘good’ all prejudices and rooted cannot pay back. Helping yet, the commonly accepted on their own anymore, he ignorances. Trust can only be those in need - if necessary, understanding today is emphasizes the importance built back through this and, unrequitedly - is very different exactly this. The ones who of global collaboration and if necessary steps are taken, from giving a loan of 100 perform this art the most adds, “The crisis of 2008 reputation can be repaired dollars for a new television to successfully are the greatest clearly showed that people as well. Essentially, finance a person with a 10 dollar brains! The topics covered have no trust left towards is a profession of trust and income. First is good, latter is in lectures and books rely organisations, organisations reputation, before money.” bad. Whenever cost of debt is on this understanding. This towards markets, markets In his book, Akgiray higher than increase in shows that we first have to towards governments and mentions the global demand income and productivity, correct the education. Instead governments towards each for a new financial paradigm borrowing is stupid and of teaching the youth how to other. We can observe and that there should be lending is unethical. The design the financial weapons the social and political a new social agreement inevitable end is bankruptcy of ‘mass destruction’, we have consequences of this chain of between the politicians, and financial crisis. The to explain them the financial failed trust. The results of this financial market and persons. decision makers should weapons of ‘mass benefit’.” loss will be very detrimental He explains, “We can have regulate this correctly. The Akgiray remarks on the when the next financial crisis a look at the whole world book, in essence, sets the necessity of discussing hits. What we need to do is to through the internet and introduction to the the purpose of finance for start discussing the essentials we want the better / the aforementioned social people. As a group or a of the topic on national and prettier / the latest version of agreement.” PHOTOGRAPH BYLOREM IPSUM PHOTOGRAPH 24 Briefing

AVIATION Turkish Airlines Takes Delivery of its First Boeing 787-9 Dreamliner 30 new Boeing 787-9 Dreamliner aircraft will be joining the Turkish Airlines’ young and fast-growing fleet over the next four years, and each will feature the carrier’s all-new Business Class cabins.

EGARDED AS ONE OF THE of new technologies and Turkish suppliers and all-new Unique in-flight experience R most advanced aircraft a revolutionary design. It Business Class seats. The modern cabins provide for its fuel efficiency and range can fly 7,635 nautical miles Within a spacious wide- the perfect setting to enjoy flexibility, the 787-9 Dreamliner (14,140 km) in addition body cabin featuring larger Turkish Airlines’ award- opens new routes for national to carrying more cargo overhead luggage bins winning on-board dining and flag carrier, reinforcing its and allowing the airline to and extra-large windows, in-flight entertainment. For status as the carrier that flies to profitably grow its routes. dimmable LED window Business Class passengers, more countries than any other. The aircraft allows operators shades give greater control the 787-9 Dreamliner elevates The new aircraft will offer to achieve better fuel efficiency over light entering the cabin. this experience even higher. passengers refined comfort per seat compared to the A new filtration, better The Dreamliners feature 30 during the longest journeys previous ones in its class. air pressure and greater exceptional, all-new Business across 312 destinations in 124 Turkish Airlines’ humidity helps passengers Class seats, offering unique countries. Dreamliner has a seating feel less dryness and reduces in-flight experience. capacity for 300 passengers, fatigue. Meanwhile, the The lighting scenarios are Economy Class seats produced including 270 economy class engines, interior, systems, drawing inspiration from in Turkey by Turkish suppliers and 30 business class seats. and equipment all feature the colourful sunsets of As part of the 787 The carrier’s 787-9s include vibration isolation to Turkey’s central Cappadocia Dreamliner family, the long haul economy class create a quieter on-board region and idyllic turquoise 787-9 is powered by a suite seats produced in Turkey by experience. beaches, a modern, traveller- PHOTO: ERCAN AKÇAY (TURKISH AIRLINES CORPORATE PHOTOGRAPHER) AIRLINES CORPORATE ERCAN (TURKISH AKÇAY PHOTO: AUGUST 2019 ISSUE 73 The Turkish Perspective 25

friendly 1-2-1 layout offers “The aircraft’s advanced all aisle access to Business technology, fuel Class passengers; enhanced efficiency, and passenger-centric privacy panels, personal cabin design will all help us remain closed stowage space, self-care the first choice for mirror and wide cocktail travellers,” said M. İlker Aycı, table maximizes space to Turkish Airlines’ offer ultimate comfort and Chairman of the Board and introduces a privileged the Executive experience. Forty-four-inch Committee. legroom and a 180° full flat 76-inch seat bed length are provided for each of the 30 seats. Increased seclusion comes from the adjustable privacy panel between the paired middle seats and newly designed seat shell, while an 18-inch HD video display and touchscreen remote control raise the entertainment fuel efficiency, and passenger- Dreamliner’s unmatched fuel offering. Suede-like alcantara centric cabin design will all efficiency, performance and padding -commonly found help us remain the first choice passenger-pleasing comforts in sports cars-, used for the for travellers and provide our will contribute to the airline’s interior trimming of each loyal flyers across the globe reputation as a five-star airline.” Business Class seat, adding with a best-in-class experi- The first B787-9 (Dreamliner) another welcome touch of ence for years to come.” aircraft, which joined the Turkish luxury and refinement. “Turkish Airlines’ growth Airlines’ fleet, was called Maçka Produced by local and has been remarkable in recent in memory of martyr Eren national Turkish suppliers, years, both in expanding Bülbül. 300 passengers joined Economy class seat offers flight options and supporting the custom TK 4900 flight, Turkish Airlines passengers a Turkey’s aviation industry,” Turkish Airlines’ Dreamliners which took place from Istanbul pleasant journey with 12 inch said Ihssane Mounir, Senior feature an exceptional, Airport to Trabzon Airport. HD screens in first 6 aircrafts Vice President of Commercial all-new Business Class cabin, The first commercial 787-9 and 13 inch HD screens after, Sales and Marketing for offering a unique in-flight Dreamliner flight departed new functional literature pocket The Boeing Company. from the new home of Turkish design, 6 inch recline and 31 “We are confident that the experience. Airlines, Istanbul Airport, to inch legroom. Antalya on July 8, 2019, and its first international flight “We’re thrilled to reach new departed from Istanbul to horizons with the addition of Denpasar (Bali) on July 17, one the 787-9 Dreamliner” of the new routes added to the “Turkish Airlines has been network in 2019. committed to continuously Following those, the aircraft expanding its range of services will continue to carry passengers on and off-ground as it grows on a number of medium and in reach and fly to more in- long-haul routes through the ternational destinations than summer. They will fly to any other carrier in the world. London, Dubai, Washington With this goal in mind, we’re DC, New York, Atlanta, Mexico thrilled to reach new horizons City, Cancun, Bali, Amsterdam, with the addition of the 787-9 Delhi, Panama City, and Bogota. Dreamliner to our fleet flying By the end of August 2019, six from our new home, Istanbul 787-9 Dreamliner aircraft will Airport,” said M. İlker Aycı, be operational and servicing Turkish Airlines’ Chairman of international routes, heralding the Board and the Executive the start of a new chapter in the Committee, and added: “The growth of Turkish Airlines’ aircraft’s advanced technology, young and modern fleet. 26 Briefing

INVESTMENT TURKEY UNVEILS THE 11th DEVELOPMENT PLAN

he 11th Development structure will also assist in • The Investment Office accelerates the investment T Plan of Turkey has match-making local and will be authorized as a processes and in which been accepted at the Grand international companies one-stop-shop office for the relevant institutions National Assembly of for possible cooperation. investments. will enter information on Turkey. The plan revealed Accordingly: • Sectoral investment permission and approval a new central investment • Priority will be given roadmaps for permission, processes. system that will allow the to strategic products and approval, and licensing • Partnerships will be Investment Office to better high-technology and related to the investment developed by matching facilitate the investment export-oriented investments processes will be prepared. local companies with processes thanks to a more in the project-based • A Central Investment international investors. streamlined process to incentive system in order to Information System will • Additional support will obtain required permissions attract more international be established within the be provided for investments and approvals. This new investments. Investment Office, which based on technology transfer. NGN GROUP OPENS DATA CENTER IN ISTANBUL

GN Group commis- N sioned the Star of Bosphorus Data Center, one of Turkey’s largest data center investments, in Tuzla/ Istanbul as part of a USD 140 million investment. Industry and Technology Minister Mustafa Varank and Investment Office President Arda Ermut took part in the inauguration of the center. Industry and Technology Minister Mustafa Varank said, “We will write Turkey’s new growth and development story with the National Technology Initiative, which will lead to digital conversion in all areas.” Investment Office centers and data storage have crucial, data center investment Star of Bosphorus. We set off President Arda Ermut become an important part is of great importance for with the goal of Turkey being added, “Developments in of the new world ecosystem. many sectors, particularly the also the data center, which is data volume and diversity In this context, NGN’s high- financial sector. We are aware already the logistics base of with the widespread use of tech Star of Bosphorus Data of such investments in order its region.” technology have enabled Center investment is a type of to move up in the value chain.” Located on 24,000 square- concepts such as big data, investment we encourage and NGN Chairman and CEO meters of indoor space artificial intelligence, and prefer. In this period of time İnanç Erol said, “As NGN, we area, Star of Bosphorus will fintech to emerge and become when information security want to activate the potential provide employment for part of our life. Hence, data and data protection are of the data center sector with more than 1,000 people. PHOTOGRAPH BYLOREM IPSUM PHOTOGRAPH AUGUST 2019 ISSUE 73 PHOTOGRAPH BYLOREM IPSUM while thisvalue is9percent, people holdcryptocurrencies, around 18percent ofTurkish 2018 researchbyIpsos, billion daily. Accordingto processes aroundUSD 1 the worldbytrading volume, exchangeslargest in crypto months. Huobi, oneofthe 12the courseofnext toTurkeyto expand over Huobi announcedplans exchange cryptocurrency • Singapore-based million inTurkey thisyear. invest anadditionalTRY 150 Ferrero announcedplansto giant • Italian confectionery in 2018. European FDIdestination popular most as the7th maintained itsranking share by4percent.Turkey year, increasingitsmarket compared totheprevious percent moreFDIprojects successfully attracted 14 time insixyears, Turkey Europe declined for the first innumber ofFDIprojects Europe, whiletheoverall A Attractiveness Survey ccording toEY EUROPEAN FDIDESTINATIONS TURKEY RANKS 7 million. Vitol GroupforEUR368 Ofisi, wassold to theDutch by Austria’s OMVPetrol companydistribution owned a Turkish fuelproducts • OMVPetrol OfisiAS, EUR 90million. Investment Company for Al RayyanTourism Istanbul totheQatari sold two hotels located in • Turkish Insaat Seba Australians, respectively. Europeans, Americans,and 8 percent,and7percentfor FDI NEWS

paint manufacturer Betek paint manufacturer ofTurkishits acquisition Paint Holdings finalized • Japan-based Nippon distributors. and partners manufacturing radiopharmaceutical the MENA regionas Telixassist inpenetrating Eczacibasi-Monrol will of theagreement, According totheterms agreement. distribution and a manufacturing company, have signed stage biopharmaceutical Pharmaceuticals, aclinical- and Australia’s Telix Eczacibasi Holding, ofTurkey’ssubsidiary • Eczacibasi-Motrol, a th IN TOP 20 IN TOP20 operational by2031. and tobecompletely raw material andchemicals to produce13milliontonsof investment that isexpected facilitypetrochemical for aUSD 11.8billion foreigncompaniesseven offera partnership from hasreceivedmanufacturers, leading polyester • million). TRY 1.4 billion(USD 247 Boya anditssubsidiaries,for

Sasa, oneofTurkey’s The TurkishPerspective 27 28 Briefing

EVENTS

JULY 26 ISTANBUL

Investment Office President Arda Ermut signed an MoU with the Japan Chamber of Commerce and Industry (JCCI) President Toru Ishida in Tokyo on July 26. The MoU aims at paving the way to boost Japanese SMEs presence in Turkey through JCCI, which boasts 1.25 million member businesses nationwide.

JULY 23 ISTANBUL

Investment Office Vice President A. Burak Dağlıoğlu addressed a delegation from the American Turkish Business Development Council in Istanbul, delivering a key message: Turkey is a dynamic and growing G20 economy, uniquely linking the East with the West.

JULY 19 SINGAPORE

The Investment Office Murat Lütem and REDAS held a briefing for the President Chia Ngiang Management Committee Hong, Investment Office members of the Real Estate Country Advisor Emre Developers Association of Büyükkılıç and Re-Pie Singapore (REDAS) hosted Vice Chairman Ali Ergin by the Turkish Embassy delivered presentations on in Singapore. Following opportunities in the Turkish speeches by Ambassador real estate market.

JULY 12 SEOUL-S.KOREA workshop aimed to introduce Turkish State Railway projects Investment Office Country to Korean investors. Advisor Taha Saran delivered a During the workshop, presentation entitled “Investing Turkey’s track record in infra- in Infrastructure and Public structure projects, the legal Private Partnership in Turkey” framework regarding PPP to top executives of major applications, current opportu- Korean construction compa- nities in railways, the market nies at a workshop hosted by situation, and economic de- the Korea Rail Network Au- velopments were shared with thority (KRNA) in Seoul. The potential investors.

AUGUST 2019 ISSUE 73 The Turkish Perspective 29

JULY 11 AMMAN

Samet Akyüz of the Investment Office presented on investment incentives and the roles of investment promotion agencies (IPAs) at the EU-OECD Regional Seminar on Improving the Use of Investment Incentives in the MED Region held in Amman, Jordan.

JULY 10 ISTANBUL JULY 2 TREVISO - ITALY The Investment Office and The Investment Office the Italian Association of brought journalists the Automotive Industry representing Italy’s major (ANFIA) held a meeting in automotive and logistics Kilometro Rosso at Bergamo industry players together Teknopark with prominent with Turkey’s leading automotive suppliers who companies in the sector. were there to learn about the The Investment Office was Turkish automotive sector’s hosted by the Automotive strength and prospects. Manufacturers Association The Office also highlighted (OSD), the Automotive Turkey’s excellent return- Supplier Association of on-investment for North- Turkey (TAYSAD), Ford East Italian companies at a Otosan R&D Center, and meeting held in Treviso by Cavo Automotive. Salone d’Impresa.

JULY 5 ISTANBUL JUNE 26 ROME – ITALY JUNE 25 TURIN – ITALY

The Investment Office’s latest various presentations on The Investment Office has Samet Akyüz of the event on the Competitiveness competitiveness and smart recently been quite active in Investment Office presented and Investment Opportunities technologies in the Turkish Italy with multiple events on how MNCs help local in the Turkish Automotive automotive sector, China’s focused on the promotion companies integrate into Industry, held in cooperation current position in the global of Turkey’s investment global value chains in Turkey with the Gebze Chamber automotive industry, and a legal environment. The Office and what Turkey does to of Commerce and with overview of FDI and incentives presented Turkey’s unique increase the local content contributions of the Turkish mechanisms in Turkey. opportunities at a breakfast of foreign investors in the Automotive Manufacturers conference held by the country. The seminar was part Association, EY Turkey, Embassy of Turkey in of the Effective Investment Sistem Global Consulting, and Rome and Nunziante Facilitation and Sustainable OGB Attorney Partnership, Magrone law firm. The Development Seminar drew interest from over 70 Office also hosted investors held in Turin, Italy, by the major representatives in the from Italy’s Marche Region United Nations International industry. The opening speech at a conference organized Labour Organization (ILO) delivered by Gebze Chamber in Pesaro by the Italian and the World Association of Commerce Chairman Chamber of Commerce and of Investment Promotion Nail Çiler was followed by Italian Trade Agency. Agencies (WAIPA). PHOTOGRAPH BYLOREM IPSUM PHOTOGRAPH 30 TURKISH PRODUCTS GAIN VALUE WITH GEOPRAPHICAL INDICATIONS

TURKISH PRODUCTS GAIN VALUE WITH GEOGRAPHICAL INDICATIONS

TURKEY, WITH ITS FOUR SEASONS, A UNIQUE COUNTRY SURROUNDED BY SEAS ON 3 SIDES, ATTRACTS ATTENTION WITH ITS TYPICAL PRODUCTS [TURKEY’STURKEY’S FAMOUSFAMOUS] GROWN AND PROCESSED IN ITS SOIL. TO DATE, MANY TURKISH PRODUCTS STEPPING IN ALMOST EVERY HOUSE IN THE WORLD ARE BEING Protected VALUED EVEN MORE WITH THEIR GEOGRAPHICAL SIGN REGISTRATION. RICH GI (GEOGPRAPHICAL INDICATION)POTENTIAL WILL Geographical PROVIDE TURKEY WITH NEW INSIGHTS IN THE UPCOMING Indications PERIOD. BY PROFESSOR DR YAVUZ TEKELIOĞLU PRESIDENT OF TURKEY RESEARCH NETWORK ON LOCAL PRODUCTS AND GEOGRAPHICAL INDICATIONS

AUGUST 2019 ISSUE 73 31

[TURKEY’STURKEY’S FAMOUSFAMOUS] Protected Geographical Indications 32 TURKISH PRODUCTS GAIN VALUE WITH GEOPRAPHICAL INDICATIONS

lorida orange, Roquefort cheese, New Zealand lamb or Gaziantep F baklavası, Ezine cheese, Malatya apricot... These all are geographical indications... Recently, geographical indications have been on Turkey’s agenda more than it has ever been. The speech of the President of the Republic of Turkey at the Turkish Patent Awards Ceremonies of 2015-2016 and the Industrial Property Law enacted in January 2017 have been the initiator of this development. Geographical Indication(s) (GI) are distinctive, Official quality signs ensuring the origin of production and production methods of the products recognised and renowned by consumers. The GI, which has a very long history, was used to indicate the origins of the durable bricks and stones used in the construction of pyramids in ancient Egypt, while it was used in ancient Greek as a quality sign of Thasos Island wines. The use of GI, just

like Parmigiano Reggiano and Comté, goes back to the 13th century. Roquefort cheese, whose ‘‘name of origin” is protected by French laws and production is meticulously controlled, has been preserved in France since 1070. GI, which have long been regarded as merely a European phenomenon, has ceased to be a MALATYA “quality guarantee sign” with the development APRICOT of global trade and has become the subject of In the world, Malatya property rights. GI is now a global phenomenon. ranks first in dried It is considered as an intellectual property right apricot production. While that describes a product whose quality, fame or apricot is grown for other characteristic features originate from a edible consumption in particular geographical background. other cities of Turkey, in Geographical Indications (GI) has been taken Malatya it is grown to get under legal protection in all of the signatory ANTEP BAKLAVASI dried, which is because countries, including Turkey, by The World Trade Gaziantep is the first place that comes to mind when it comes of the climate conditions Organisation (WTO) established in 1995 and to baklava. It is registered by the European Commission as a and quality of apricots with Trade-Related Intellectual Property Rights’ geographical indication. Another place where baklava is liked grown. (TRIPs) Agreement signed within that framework. and commonly made is Texas in the USA. It is prepared by placing According to the data of the ”WTO Trade walnut, pistachio, almond or hazelnut between thin doughs. The Center, there are still 10,000 legally protected special sherbet is poured on it in its hottest form and served GIs in the world. Approximately, one-third of after cooling. them (3214) rank in the European Union (EU) and 10% in developing countries.

WHAT IS A GEOGRAPHICAL INDICATION ? “A geographical indication is a sign used on products that have a specific geographical origin and possess qualities or a reputation that are due to that origin” With a short description, GI is the name of a place that indicates a product. The product is known by this place name, it is identified and called with it. This place is usually a locality (terroir). According to the French National Institute of Origin and Quality The Turkish Perspective 33

GIRESUN FAT KAYSERI KAYSERI MEAT HAZELNUT PASTIRMASI PASTY Fındık is a mild climate Pastırma is a delicious A Turkish meat pasty fruit, which is highly food made by drying raw is a local dish made by nutritious. It mostly meat with various spices cutting the ravioli dough grows in Giresun. The and salt which enables it into small squares and famous hazelnut of to be preserved for a long filling the inner parts with Giresun which is sought time without spoiling. stuffing meat, closing in the world markets is It can be consumed and then boiling the a shiny shelled, high-fat raw or cooked. Since dough. If desired, it can type of plump hazelnut. the meats are made be covered with yoghurt FISKOBİRLİK, the by pressing with press and garlic sauce or red world’s largest hazelnut machines, they are called pepper sauce roasted in company, is located in “bastırma” which means hot oil. Giresun. pressed. In Turkey, the main production place of pastırma is Kayseri.

(INAO); the terroir is a system in which there IN THE ”Protected Designation of Origin” sign. These are agricultural production, the physical REGISTRATIONS, are mostly agricultural products. Such as environment and a set of human factors. THE LEADING Malatya apricot, Finike orange, Bayramiç ONES ARE The terroir whose borders form a certain AGRICULTURAL ‘‘beyazı’’ -a kind of peach-. geographical area contains a unique eco-system PRODUCTS (105), Protected Geographical Indication, (PGI): (soil, climate) with a characteristic human FOLLOWED BY Products produced in their geographic area but community inside. The Eco-system allows the LOCAL DISHES (93), whose raw material comes from another place production of a product that can not be obtained CONFECTIONERY, are protected with “Protected Geographical BAKERY AND PASTRY elsewhere (Aydın fig, Florida orange, Antigua PRODUCTS (80). Indication” sign. These are mostly food coffee) and the human community allows the CARPETS AND products requiring hand skills and mastery. production of an original product (Çorum RUGS 29, WEAVING Such as Çorum leblebisi and Mersin cezeryesi. leblebisi, Antep baklavası, Mersin cezeryesi) 21, HANDICRAFT They are produced in Çorum and Mersin but PRODUCTS 26, thanks to the tradition, knowledge, skill and ALCOHOLIC AND chickpeas and carrots used in their productions craftsmanship developed during the historical NON-ALCOHOLIC come from another geographical area. process. Coming out of from these interactions, BEVERAGES HAVE 17 Traditional Speciality Guaranteed,(TSG): these products whose origin, name and reputation REGISTRATIONS. These products do not fall under the belong to the region where they are produced are Protected Designation of Origin or Protected called “local products” and local products, each Geographical Indication and they are the of which is a geographical indication, have very names that identifying the products which strong ties with the region they are produced in. are originating from a traditional production Their common characteristics are that they are method (making recipe) or traditional typical, of high quality and unique products. Also, composition or products manufactured from they have a certain triteness and reputation. For traditional raw materials or supplies. The this reason, they are protected by legal regulations specific feature and the quality of the product in many countries. The instrument of protection are registered here. Traditional Speciality is Geographical Indication Registration. The Guaranteed is not a GI. It’s not the origin organization responsible for this work in Turkey is put under protection; it is the tradition. The Turkish Patent and Trademark Office. Turkey has 3 Traditional means that the product has a long registration from history in the market and is a product that the EU, which are GEOGRAPHICAL INDICATION PROTECTION TYPES shows the transition between generations. This for Gaziantep There are three types of protection in Turkish baklavası, Aydın period is 30 years in the EU and Turkey. laws: figs and Malatya Protected Designation of Origin, PDO: apricots and 15 BENEFITS OF GEOGRAPHICAL INDICATIONS All production processes related to the product of our products GI creates added-value and employment are waiting for that are carried out within their geographical their registration and enables manufacturers to market their boundaries, and products that cannot be in the EU products at a premium price. Also, the price of produced elsewhere are protected with the Commission. the product increases with GI registration. The 34 TURKISH PRODUCTS GAIN VALUE WITH GEOPRAPHICAL INDICATIONS

KAYSERI SUCUĞU ANTAKYA KÜNEFESİ Kayseri sausage is a form of spiced ground beef stuffed into the dried intestine. Antakya Künefesi (Kunafah) identified with Hatay is a dessert The warm wind during the day and cool at night ensure that the sausage dries made with unsalted cow cheese of Antakya region, shredded properly. This wind blows all year long. The specific red colour of the sausage wheat in syrup, butter and sherbet. Its speciality stems from is naturally provided by the nitrate substance present in the groundwater of the precise cooking technic and Antakya unsalted cheese which is produced by special methods from the milk of cows Kayseri. Sausage meats are washed with this water before mincing process. raised in the city.

price of Pinggu peach, which received China’s higher for olive oils, 1.59 times higher for cheese, GI registration from the European Union on and 1.29 times higher for fruits and vegetables. May 11, 2011, increased from 1.5 yuan to 4 yuan In France, registered cheeses find buyers by right after the registration and the income of a 55% higher rate than the others, in Italy by the farmers in the region increased significantly. 74% and Spain by 36%. The price of the famous 431 In Italy, Tuscany olive oil prices increased by Bresse chicken raised in France, the world’s only Turkey currently 20% after the registration on 21 March 1998. registered chicken, is 3-4 times higher than its has 431 registered geographical According to reports from the EU Commission, counterparts. Also, GI, which prevents rural indication EU registreted GI are sold at 1.8 times higher migration by keeping the rural population in prices for meat-based products, 1.79 times place by creating job opportunities, is a very important source of employment. As a matter of fact, in France, where this practice is most TAŞKÖPRÜ developed, 126,000 enterprises generate products GARLIC with GI registration. According to INAO data, Garlic growing in the turnover of these products reached €27.2 Taşköprü, Kastamonu is billion in 2017. the world’s richest garlic in terms of essential BAYRAMIÇ GI PROTECTS PRODUCERS AND CONSUMERS BEYAZI oils, active ingredients, Bayramiç Beyazı is a kind elements and minerals it AGAINST UNFAIR COMPETITION of nectarine which is contains, which makes Consumers perceive GI as an element that the endemic fruit of Kaz it valuable. Besides, indicates the origin and quality of products. If Mountain in Çanakkale. it is the only type of these signs with the well-deserved reputation Its durability is longer garlic that maintains its are not protected, various malicious commercial than other nectarine freshness for 8 months practices may be encountered. Counterfeit varieties. outdoors. utilizations have a devastating impact on consumers and honest manufacturers. The most common example of this is Antigua coffee and Darjeeling tea. The production amount of the famous Antigua coffee produced in Antigua region of Guetamala is only three thousand tons while the amount of coffee sold under this name all over the world reaches 25 thousand tons. Even though

AUGUST 2019 ISSUE 73 The Turkish Perspective 35 TURKEY, HAVING ENORMOUS POTENTIAL IN TERMS OF PRODUCT RANGE AND CULINARY a very successful example of rural development. RICHNESS, HAS ALL THE NECESSARY 10,000 people work in the value chain of Comté CONDITIONS TO cheese produced from raw cow’s milk growing BECOME A LEADER on the Jura Mountains, France and organized IN GASTRONOMY in a very effective cooperative system. Comté, WITH ALSO ITS which reached 66 thousand tons of production ACCESSIBLE GEOGRAPHY. in 2017, gives life to the Massive Jura economy where no economic activity can be made other than animal husbandry.

GI DEVELOP TOURISM AND GASTRONOMY Today, gastronomy is among the top reasons for tourists to travel. Inter-producers competitions, festivals and fairs related to GI are one of the factors that improve tourism. The GI also contributes to the preservation of local gastronomy and traditional recipes and the development of national tourism. famous Darjeeling tea, which is produced in the In this respect, Peru is a model country. The Himalayan mountains of India at an altitude of Peruvian cuisine blows like a storm in the 2-3 thousand meters and called as Champagne world and being a chef adorns the dreams of of Teas, has an annual production amount of Peruvian youth. Peruvian cuisine provides, 10 thousand tons, the amount of tea sold under as well as economic growth, social change in the same name reaches 40 thousand tons in the Peru, and cures poverty. To get to know this world. False use of GI are widespread also in our cuisine, half a million tourists attend the food country. For instance, although 140-150 thousand festival held every year. Lima stands out as the tons of Finike oranges are produced annually, newest and most popular gastronomic centre the amount of oranges entering Istanbul under in Latin America. Peru awarded as one of the the name of Finike oranges reaches 400-450 best culinary destinations in the world in 2015 thousand tons. Finike orange producers and and gained the prize thanks to the efforts of consumers who are deceived are the ones who entrepreneur chefs and the support of the suffer from this case. Ezine cheese, Erzincan state for the branding of Peruvian cuisine gives Tulum cheese and Ayvalık olive oil are at the top very important tips for Turkey. Turkey, having of the other GI, about which unfair competition is enormous potential in terms of product range intense in our country. and culinary richness, has all the necessary conditions to become a leader in gastronomy GI DIRECTS CONSUMERS GI, the quality assurance of products for consumers, guides consumers by making the right choice among a large number of products ANTEP that seem to have the same characteristics in SUSURLUK LAHMACUNU the market and providing them with a wider AYRANI What differentiates Antep choice. GI, which has important functions in Susurluk ayranı is a Lahmacunu from other eliminating information asymmetry in the beverage of the Turkish ones is it contains ground markets by enabling consumers to make the cuisine which is unique MILAS OLIVE OIL lamb, garlic, parsley, right choices, is also a real marketing tool to Susurluk in Balıkesir, Milas olive oil identifying and various spices. and its production and with Milas is officially Furthermore, unlike other that facilitates entry to niche markets that are taste differ from classical registered to the town. It lahmacuns, Gaziantep more profitable than commodity markets and ayran. In comparison has a dark green colour. lahmacun does not have develops niche products. with other ayrans, Unlike other oils, it tastes onions. It is cooked in a Susurluk ayranı is made sharp and intense; also stone oven and served GI ARE REAL ACTORS OF RURAL DEVELOPMENT from yoghurt with fat, leaves an unusual spicy with a roasted, peeled Keeping the rural population in its place with which makes it foamy. flavour in the mouth. aubergine on top. the employment and income they create, GI are also a very important rural development tool. For example, Italy’s famous GI, Parmesan, which has been preserved since the 13th century, has an annual turnover of €2.4 billion and a full 50,000 people work in the value chain. The famous French cheese Comté is also 36 TURKISH PRODUCTS GAIN VALUE WITH GEOPRAPHICAL INDICATIONS

ANTEP PISTACHIO to organize their projects, including their producing specification. Producers should also Pistachio is an edible, shelled benefit from the added value arising from the fruit. It is called with Antep protection of the intellectual property right of because the first pistachio their products. companies were established The registration provides added value to in Gaziantep and pistachio the product; by preventing GI infringement, was distributed to the it protects producers and consumers rest of Turkey from these against unfair competition, also enlightens companies. It grows at consumers who want to know the quality of pistachio trees, it is oily and the products they consume and their specific thin-shelled. Also, it is used characteristics. for making cough syrup in pharmacy and for desserts. GOVERNANCE OF GEOGRAPHICAL INDICATION GI governance is divided into 2 as national and product-level governance. National Governance: In most of the EU countries, it is carried out by public institutions with also its accessible geography. The two assigned for this purpose and affiliated to the UNESCO awards we received will undoubtedly Ministries of Agriculture. Implementations show trigger this process. In 2015, Gaziantep and that success in the GI system is derived from 2017, Hatay gained the title of registered “City complete regulatory and effective governance. of Gastronomy” by participating in “Unesco In this respect, France is a pacemaker country. Creative Cities Network” in the category of Numerous legal arrangements implemented in gastronomy, which has greatly increased the France came to an end with the establishment demand for domestic and international tourism of “The National Institute of Origin and to our two cities. Our dazzling traditional Quality” in 1947. This institute, which is also and regional dishes, many of which are GI called as the architect of the French miracle, is registered, set up a strong substructure to make a public institute responsible for GI governance Turkish gastronomy a brand. While opening under the auspices of the French Ministry up the Turkish cuisine to the world, our young of Agriculture and Food. The institute is chefs should destroy the perception that our responsible for implementing French policies cuisine only consists of doner and kebab; and on official quality signs and on indications of with the awareness that there is a much richer origin. Headquartered in Paris, the Institute has culinary culture waiting to be brought to 24 branches in eight French regions, and 250 light in our country, we need to turn Turkish employees. Also, their budget for 2015 was €23 gastronomy into a world brand, inspired by the million in 2015. INAO, which draws attention past, as Peruvian chefs do. to its unique organizational structure and working system, is taken as an example by many GEOGRAPHICAL INDICATION ORGANIZATION countries. The GI system looks like a trivet. The first counterfort is registration, the second is ISPARTA ROSE OIL governance, the third is the inspection. Essential oils like rose oil are The success of the system depends on the usually obtained by steam harmonious and successful operation of these İNEGÖL SCRATCHED distillation. Steam is passed counterforts. MEATBALL GREEN OLIVE OF through the rose plant under It is a grilled meatball EDREMIT BAY gentle pressure. In this process, peculiar to İnegöl and The fact that Edremit REGISTRATION OF GEOGRAPHICAL INDICATION Bay’s olive is special is the steam picks up some fragrant it does not contain any The first stage of the system, registration, spices. Each meatball is related to the air, water particles of the rose. The steam occurs when a file prepared by a group of round and between 12 - and soil of the region. is then cooled and the rose oil producers on the product identified by the 15 grams. is separated from the resulting geographical indication, and based on a mixture of water and oil. Turkey producing specification (specification-cahiers meets about half of the world's de charges) is examined by The Turkish rose oil demand. Especially Patent and Trademark Office and approved if in Isparta, rose and rose oil it is found to be appropriate. The important production meets the majority of thing here is that the producers must be Turkey's production. at the beginning and in the centre of the registration process. Because it is their job

AUGUST 2019 ISSUE 73 BURSA FIG RIZE SIMITI EZINE CHEESE ANKARA DÖNERI EDIRNE TAVA SIMAV Famous black fig of Bursa One of the differences Ezine cheese, which Döner of Ankara is made CIĞERI CHESTNUT is also among registreted of Rize Simiti from other is produced in Ezine, by stacking the lobed Edirne Tava Ciğeri is Simav chestnuts, which Cİ. Fig is a very delicate ones is that it is sesame- Çanakkale, is a kind of meat obtained from made from the liver grows in Simav, Kütahya, kind of fruit. A fig tree free, therefore it is also white cheese. The most Ankara's curly sheep, of cattle raised in the attract attention in the cannot grow in cold called bald simit. In the important difference of which has not been Thrace region. The market due to their climate. For this reason, production of the simit, Ezine cheese from other extracted from fat, on top most important point nutritional properties it grows in regions where dough prepared with white cheeses is that the of the döner sword. of this flavour is that it and being protective the climate is mild like flour, water, salt and a milk used in the production is made from milk calf against conditions of Bursa, İzmir and Aydın. small amount of yeast of this is provided from a and supplied daily. It is winter. Also, they prevent It is exported to the four is rest for 20 minutes certain region. It is made almost impossible to get problems such as stress corners of the world. and then dipped in hot by the milk of animals the taste of the liver as a and depression with its Besides, it is said that water for 1 minute. After fed with aromatic plants result of the processes calming properties and Duchess Kate Middleton, this process, it is dipped in the Kaz Mountains, an it's through. The reason it purifies the body from member of the Royal into boiling black grape endemic region.( Sheep is called Tava pan comes toxins. Family of England, ate figs molasses to get colour milk %45-55, goat min. from the special pan in against morning sickness and taste. Then the simit, %40 and cow max. %15) which it is cooked. during her pregnancy which is cooked with a Ezine cheese is light yellow period. wood fire for about 30 in colour, and it has a soft minutes, gets ready. or medium hardness and is non-brittle.

Product Level GI Governance: It is carried Sustainability in quality is only possible through out by GI-registered, in other words, by the supervision. For this reason, a very strict registrant institution. The main mission of this inspection network has been established in the institution is to rationalize the production chain countries adopting GI implementation, especially and to carry out all activities for the protection in the EU, and there is strict control over the and defence of the product. Within this registered products. Roquefort cheese production framework, their main duties are to ensure that chain undergoes 400 inspections per year. producers make the production in accordance with the rules of the name of the origin, (internal GEOGRAPHICAL INDICATIONS IN EU audit) to carry out examinations and researches EU quality policies aim to protect and develop about the product, to provide technical services GI and traditional products. Therefore, to the producers, to follow the fraudulent and Common Agricultural Policy quality policies fraudulent use of the name of origin and to are concentrated on the GI. In the European promote and advertise the origin name. The Union, legislation on GI and origin name financing required to fulfil them is covered by product cuts and dues. There are important governance problems in Turkey. Institutions’ relation with GI continues until they receive registration; unable to continue because GI ERZINCAN TULUM governance is not recognized. The main reason PEYNIRI for this is the legal gap that exists. Although the The biggest feature that law specifies the rights of the registration holder distinguishes Erzincan Tulum arising from registration, there is no provision cheese from other cheeses regarding their responsibilities. However, these is that it is made of raw responsibilities are related to GI governance and milk. Tulum cheese is made are a must for the system. of sheep’s milk and kept Inspection of Geographical Indication: on sheepskin (goatskin is Inspection of the products that are protected more sufficient). It has hard by registration ensures that these products are and crumbling structure. manufactured according to the rules defined Also, with natural oil from in the manufacturing specification. What gives sheep’s milk, it gets a slightly the whole process full legitimacy is inspections. yellowish colour. 38 TURKISH PRODUCTS GAIN VALUE WITH GEOPRAPHICAL INDICATIONS

protection began with the regulations 2081/1992 and 2082/1992 which were put into practice in 1992. These regulations were also followed by regulations 510/2006 and 509/2006, which give non-EU member states the right to both apply for registration and appeal against the implementations issued by the Commission. The latest regulation of the EU on the issue is Regulation 1151/2012 which was put into effect on 21 November 2012 under the title of “Quality Systems Applicable to Agricultural and Food Products”. The EU still has a total of 3214 registered GIs, 1766 in wine and 1448 in agriculture and food products. Italy (297) takes the lead in agriculture and food products, followed by France (248), Spain (222) and Portugal (138). Greece, which ranks fifth and is one-seventh of Turkey, has a total of 107 registrations from the EU. According to a report issued by the EU Commission, the total turnover of the GI across the EU reached €55 billion in 2014, and the price of the registered geographic indications is 2.25 times higher than the unregistered ones.

GEOGRAPHICAL INDICATIONS IN TURKEY Turkey with its rich GI potential is one of the world’s rare countries. Utilizing this unique Foreign countries also have registrations from potential with a well-functioning GI system Turkey due to the unfair competition they will provide great insights into our country. come across in our country. These are Scotch The implementation started in 1995 with the Whiskey (Scotland), Champagne (France), regulation 555 “Decree-Law on the Protection Parmesan and Grana Padano, (Italy) and of GI” and was replaced by the “Industrial Turkish Republic of Northern Cyprus (TRNC) Property Law” enacted on 10 January 2017. Halloumi cheese. Other international products The second book of this law, which consists of for which applications have been made and 5 books, is titled “Geographical Indication and pending registration are Gorgonzola (Italy), Traditional Speciality Name”. Turkey currently Cognac (France) and Zivanya (TRNC). has 431 registered geographical indications. Also, 416 submitted products have been WHY ARE GEOGRAPHICAL INDICATIONS SO VITAL pending registration. 155 of the registrations FOR TURKEY? have “designation of origin” and 276 have Turkey, with its extraordinarily rich potential of “geographical indication”. In the registrations, GI, is one of the rare countries that can provide the leading ones are agricultural products itself significant economic, social and cultural (105), followed by local dishes (93), gains. Therefore, GI is vital for our country confectionery, bakery and pastry products for protecting our consumers and producers (80). Carpets and rugs have 29, weaving against unfair competition, adding value to our 21, handicraft products 26, alcoholic and products and create employment, keeping our non-alcoholic beverages 17 registrations. farmers in place by preventing rural migration, AYDIN CHESTNUT While, in cheeses, we have 17 registrations, for rural development and Turkish tourism, In Turkey, Aydin is placed on the 3 of which are foreign, we have only seven protecting our natural resources, traditional top in chestnut production. The registrations in olive oil although we are a production methods and cultural heritage, most exported product of Aydın Mediterranean country. Turkey, the world’s for our agricultural policy being redesigned after fig is chestnut. Chestnut second-largest honey producer after China, recently, for international competition, for can be used as edible, as well as has only registered 4 kinds of honey. Turkey being able to take part in the world economy its shells, wood, leaves and coal has 3 registration from the EU, which are for which expands every day and tends to liberalize can be used in the industry for Gaziantep baklavası, Aydın figs and Malatya the international trade of agricultural products, different purposes. apricots and 15 of our products are waiting to challenge the unidirectional, unhealthy for their registration in the EU Commission. agro-industrial diet imposed by globalization,

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for 2017 belongs to Ardahan flower honey and “Ardahan Province Beekeepers Association”. Although numerous organizations are dealing with the GI in Turkey, three of them are very important. These organizations called as the main agencies of GI are Turkish Union of Chambers and Exchange Commodities (TOBB), Local Products and Geographical Indications Turkish Research Network (YÜcİTA) and the METRO Wholesale Market. TOBB focuses on registration, YÜciTA research, METRO implementation of the subject.

TOBB MOSTLY DEALS WITH REGISTRATIONS %79 of the registrations in 2018 belong to the Turkish Union of Chambers and Exchange Commodities, municipalities and provinces. TOBB, which had %33 share in the registrations between 1996-2016, increased its share to %41 in 2018. TOBB also organizes training and awareness-raising programs related to GI and the regional products fair annually held in Antalya supports YÖREX.

YÜCITA: VOLUNTARY RESEARCH NETWORK YÜciTA is based on Akdeniz University Centre for Economic Research on Mediterranean which destroys small producers and finally Countries (1997). to be able to ensure the food security of the It was established on 15 October 2012 with Turkish people in a world of frequent food the final declaration of the “3rd International scandals and chaos. Antalya Geographical Indications Seminar”.

BREAKING AND BASIC ORGANIZATIONS IN GEOGRAPHICAL INDICATIONS 2015 and 2016 years are milestones in Turkey’s “Geographical Indications” history which has HATAY DEFNE started in 1995. These years are turning points SOAP in the process. The fact that President Erdoğan Laurel soap, which is talked about GI for the first time at patent also known as Aleppo, is awards ceremonies and emphasizing their produced from the oils in the leaves of Laurel importance and calling on governors, mayors tree. Particularly, its use and chamber heads to protect and register their for hair is quite common local values creates a real break in the process. In because it prevents hair İZMİT PİŞMANİYE MARAŞ ICE CREAM our country, where averagely 9 - 10 registrations loss by nourishing and İzmit Pişmaniye seems Maraş Ice Cream is made of have been granted annually for 20 years, these strengthening the hair. like a type of cotton salep and ice cream, which is calls do not remain unanswered. Turkey has Also, in mythology, it candy but it is a unique made by the milk of the goats been experiencing an incredible boom in became legendary with type of dessert, whose fed with flowers such as thyme, implementations and registrations since 2016. the myth of Daphne, the main ingredients are hyacinth and crocus grown in Reduction of registration costs has an important nymph fleeing from the sugar, flour and oil, which Kahramanmaraş province. It god of the sun, Apollo, requires effort during its role in this. Such that, the number of applications, differs from other ice creams turned into a laurel tree. preparation. which was 39 in 2015, reached 93 in 2016, in terms of its distinctive 246 in 2017 and 228 in 2018. The number of pleasant flavour and aroma, registrations put into practice is respectively 13 in slightly chewy elastic texture, 2016 and 111 in 2017 and 87 in 2018. bright white colour, resistance 111 registrations in 2017 are the highest of 22 to melting, maintenance its years of practice, and it is more than three times properties at low temperature the number of registrations (35) of 28-nation EU (-18 ° C and/or below) for a long in the same year. The only producer registration time. 40 TURKISH PRODUCTS GAIN VALUE WITH GEOPRAPHICAL INDICATIONS

AN IMPORTANT TURKİSH GI, BURSA SILK INHERITED FROM THE OTTOMAN EMPIRE TO THE PRESENT. FOR CENTURIES OTTOMAN AND EUROPEAN PALACES WERE DECORATED WITH THIS SILK. NOW, AS IN THOSE TIMES, THE SILK GOES TO THE PALACES OF THE YÜciTA is a voluntary research network. KINGS FROM BURSA. Its mission is to establish an ideal GI system QATAR ROYAL by raising awareness about the importance of PALACE IS ONE OF the GI in Turkey, to support sustainable rural THEM. development by adding value to local products and to work on the protection of cultural and biological diversity. YÜcİTA organizes two workshops every year. These workshops include international conferences, seminars or symposiums. The research network, which carried out 10 studies just in 2018, with 13 TURKEY EXPORTS THE HEREKE, BUNYAN, international workshops, 11 different events GAZIANTEP AND THE USAK CARPETS WHICH ARE in 13 different provinces in the 7-year period IMPORTANT GI OF THE WEAVING PRODUCTS has 5 international publications, 4 of which AROUND THE WORLD. THE PHOTO IS FROM is in foreign languages, and tens of national DÖŞEMEALTI TOWN OF ANTALYA. RUGS AND CARPETS BROUGHT FROM VARIOUS REGIONS OF TURKEY ARE publications. YÜciTA, which publishes a INSOLATED FOR BOTH HAVING A PASTEL COLOURATION quarterly newsletter, established the “Local AND FOR HYGIENE. Products and Geographical Indications Research Foundation” at the beginning of 2019.

METRO WHOLESALE MARKET METRO, that closely deals with geographical indications and awarded by Mr President for its successful works in the field of geographical indications within the scope of 2016 patent awards, starts its first work on the issue with our registered asset Taşköprü garlic project. Taşköprü garlic, which has been losing its value in the face of Chinese garlic competition, is being saved thanks to the works of the consortium led by METRO. METRO, which started a major promotional campaign in Istanbul and all Turkey to create awareness ESKİŞEHIR MEERSCHAUM in the GI field in September 2016, carries its Approximately 75% of world works with the support it provides to producers reserves of meerschaum with a for registration implementations. Kapıdağ fine-porous structure and soft purple onion, Kırklareli curly lamb and Ayvalık texture are found in Eskişehir olive oil are among the GI benefiting from province in Turkey. Located in these supports. METRO, which also exports the soil and different layers, many registered products, informs and directs meerschaum is off-white its suppliers on GI and in its stores, enlightens coloured. Archaeological studies its consumers. Supported by YÜciTA in its reveal the meerschaum’s history dating back five thousand work on GI, METRO has recently been able to years. This ore is mostly used sign a protocol with the Ministry of National in ornamental and pipe making Education and the General Directorate of today. Vocational and Technical Training on 4th of March, 2019, on the inclusion of GI in the

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HEREKE CARPET Many features distinguish Hereke Carpets from other carpets and make them special. These features are the use of double knot technique, one of the thin and thick double KÜTAHYA TILES weft technique and being Mixtures of inorganic materials cut with hand scissors. But such as china, clay, kaolin, quartz, feldspar, limestone in appropriate the most important feature is proportions are ground, that it is one hundred per cent dewatered, shaped and cooked at handmade. It can take years the appropriate temperature. The to weave it. It is the thinnest white tile obtained is decorated and most robust carpet in the with translucent or coloured glaze world, Also it is long-lasting after decorating the semi-finished and can be inherited from product. The product obtained generation to generation. after the second cooking is "tile". Bulk containing tiles can not be used as tableware. They can only be used as decorative and decorative items. curriculum of vocational-technical schools. With this protocol, GI has been moved to a training platform for the first time in Turkey.

TURKEY WILL SWIFTLY SOLVE ITS PROBLEMS Turkey, with its own high GI potential, is a country that can provide itself crucial insights. This can be achieved through the establishment of a well-functioning GI system, as emphasized at different times. The practices, which have lasted for nearly 25 years, show that there are huge weaknesses in GI governance and supervision, also these producers are unwillingly excluded from the system.

TO OVERCOME THESE PROBLEMS: - The producers who are the real owners of the subject must be integrated into the process immediately and a related formula, a legal regulation or a model must be BÜNYAN CARPET Bünyan Carpet is the most present. It is also possible that such an important representative implementation will alleviate the intense of Turkish Carpet with its producer disorganisation experienced in our fine and elegant patterns, carry out these audits during production, agriculture. quality yarn and matching storage and sales stages, and accredited - To bring the system into force, a legal patterns. The carpets, according to EU standards, should be regulation stating the responsibilities of the which are Manchester promptly put into practice. registrants arising from the registration (GI type, are dispatched to the - Since all the problems experienced cannot be Governance) needs to be made urgently. important trade centres overcome with the existing system, effective With this regulation, not everyone will be of the country and also institutional structuring and governance able to get the registration. marketed in Kayseri. The is required. Therefore, an establishment characteristic feature of - Public practices on external audits are far of “Turkish Institute of Geographical Bunyan carpets is their Indications” is required and organic from being satisfactory. For this reason, harmonious light-tone independent, impartial and well-equipped colours and their unique agriculture needs to be included in the private auditing organizations, which will patterns. Institute’s field of study. 42 MILITARY MYTHS AND REALITIES: CASE OF TURKEY, USA, RUSSIA, CHINA WHO ARE AGGRESSORS THE REVISIONISTS? BY TAMER IŞITIR

urkey’s purchase of the S-400 missiles from Russia started a debate which is much larger than the size of the trade. Some have even questioned Turkey’s NATO membership. Most of the time speculations lose their links to reality. TThis time some radical questions were put up again. Is a new world order on the way? Is a new armament race Although the rulers of the countries themselves ex- starting? Does Turkey set a new military-political-eco- ploit such discourses to get votes, they do not apply to the nomic strategy? myths of domestic politics when they determine real poli- The rhetoric in domestic politics is often incompat- tics. This is a general reality, except for periods of certain ible with reality in foreign and, especially military policy. mind eclipses. But domestic policy propaganda can sometimes turn into Discourses seeking to demonize Turkey can be popu- myths that even replace reality in the eyes of policymakers. lar in Western domestic policies, but serious states always The recent S-400 and F-35 crisis is a typical example analyze each other in the light of objective facts. between Turkey and the US. For example take a discourse So how should the world assess Turkey as a military which is used in domestic politics of Turkey for motiva- power? And how should we evaluate the other military tion. Some people exaggerated the size of this crisis to por- forces in the world? tray Turkey as a new world power even referring back to We will suggest a simple indicator. We will consider the Ottoman legacy. Interestingly in the Western domestic the military strategy and vision of a country as a point in a policy parties which want to exploit fear of refugees and two-dimensional coordinate system. use anti-Turkish and Islamophobic rhetoric to win votes If we define two extremes on the axis of military strat- have stuck to the same stories. On the other hand, Turkish egy; one end is defensive and the other end is aggressive. Foreign Minister Çavuşoğlu has strongly denied any im- If we identify two extremes on the axis of military vi- plication of “Turkey leaving the West” again in an article sion; one is conformist and the other is revisionist. he wrote recently. Let’s illustrate what we mean by four examples:

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1. AGGRESSIVE-REVISIONIST COUNTRY: Germany of 1934. Re-armament and re-militarization policy point to 4. DEFENSIVE-CONFORMIST COUNTRY: Poland an aggressive military strategy and a revisionist vision of the and Czechoslovakia between 1933 and 1939, which were demand for a change in the European borders drawn by the both defensives in the face of the demands of Germany and Treaty of Versailles. conformist trying to protect the existing national borders, 2. AGGRESSIVE-CONFORMIST COUNTRY: The which were drawn in 1918. To some extent, even France of United States that carried out the Vietnam War from 1962 the 1930s can be put in this category. to 1975, or France that conducted the Vietnam and Algerian The revisionist country may want to change the balance Wars after 1945. In both cases, there was an aggressive mili- of the world or just change the military-economic-political tary strategy, while France was conformist because it wanted bloc it is in. For example, even if Chavez’s Venezuela did not to maintain its colonial status quo and the US wanted to weigh heavy enough to change the world balances alone, he protect the status quo of the capitalist bloc being superior in moved away from the US pole and increasingly sought part- the Cold War. nership strategies with Russia and China. This can be called 3. DEFENSIVE-REVISIONIST COUNTRY: A typical a revisionist perspective, because it changes the status quo, example is of Turkey starting the National Liberation War in at least of that country. 1919. Turkey was fighting a defensive war against the occu- So where does Turkey stand on this scale? How right pation and trying to revise the ceasefire agreement imposed and fair is it to attribute a policy of revision and aggression on the Ottoman Empire at the same time while the Europe- to Turkey? We’ll try to question this. an Allies tried to maintain the colonial status quo and their hegemonic positions as the victors of the World War I. 44 In Depth / Military Myths and Realities

TURKEY’S DEFENSE TRADE IS NEITHER AGGRESSIVE NOR REVISIONIST Now let’s look at the figures without much com- ment. Contrary to the common belief and propagan- da Turkish military strategy is neither aggressive nor revisionist in terms of budget expenditures. First of all, let’s look at the GDP ratio of the budget allocated to defence in the world as of 2018. Turkey’s defence spending was 19 billion USD in 2018, ranking 15th in the world in terms of value. In 1989, Turkey ranked 16th on this list and again 16th in 1999. Between 2000-2009 Turkey > Turkeys’ military spending was in 15th position on average. ratio to government budget We know that Turkey’s GDP ranking in the was only 7.2% coming not world in this period varied back and forth between even close to the top 15 the 15th and 20th largest economy. So between countries. 1989 and 2019 Turkey has had neither a special ambition nor an accelerating inertia in terms of military expenditure. Giant regional crises (on- going Azerbaijan-Armenia, Georgia-Russia and WHILE MIDDLE EAST IS GETTING INTO AN ARMS Russia-Chechnya conflicts in the Caucasus, Rus- RACE, TURKEY IS TRYING TO PROTECT THE sian-Ukrainian clashes in the Black Sea, Israel- STATUS QUO Palestine conflict in the Middle East), three major North Africa and the Middle East countries, un- wars (Iran-Iraq war, two Iraqi-US wars) and even fortunately, constitute an overwhelming majority a constant and costly struggle against domes- in the top 15 list of countries with highest defence tic terrorism during this period didn’t increase spending ratio to GDP. The list hints to a contra- Turkey’s military expenditures relatively to other dictory fact. Although some of these countries are countries. oil giants of the world, others are struggling with However, contrary to Turkey’s conformist posi- poverty, unemployment and social crises. Such as tion in terms of defence spending, other states in Armenia, Namibia, Mali, Chad… the region had an opposite orientation, almost all When Turkey is compared to the countries in of them escalating a major arms race in the last 10 this list, military spending ratio to the government years. Now let’s look at another list: The list of top budget of Turkey was only 7.2% coming not even 15 countries in the world with the highest ratio close to the top 15 countries. Moreover, except for of military expenditure to their total government four of the countries in this list, all of them are ei- spending. ther neighbours of Turkey or in the near vicinity, This list will reveal more clearly Turkey’s bal- where, in the case of a hot conflict Turkey may also anced attitude compared to its neighbours. be affected with major humanitarian and security crises. The two alarming countries in this list are Saudi REVISIONIST Arabia and Iran. It is not possible to determine the exact military expenditures of both countries. Ira- nian data, in particular, is facing the problem of transparency. TURKEY GERMANY Military spending share of government expense 1919 1934 of Iran was out of as high as 15.8% in 2018. Saudi Arabia has also doubled its military spending ratio in 2018 compared to 2016, reaching 30.4% a ratio DEFENSIVE AGRESSIVE more than 4 times of Turkey’s. Saudi Arabia and Iran are almost in an unde- clared, covert war using militia forces and even USA in their paramilitaries and armies in Syria, Yemen, POLAND Wietnam Bahrain and Iraq, both state accusing the other of 1939 1962-1975 escalating sectarian violence and destabilizing the region. Increasing tension between these countries is not only a threat to the region but also the whole CONFORMIST globe.

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> Top 20 importers of arms

Percent change Share of arms imports (%) from 2009–13 Importer 2014–18 2009–13 to 2014–18 1 Saudi Arabia 12 4.3 192 2 India 9.5 13 -24 3 Egypt 5.1 1.8 206 4 Australia 4.6 3.6 37 5 Algeria 4.4 3.1 55 6 China 4.2 4.8 -7.0 7 UAE 3.7 4.2 -5.8 8 Iraq 3.7 1.6 139 9 South Korea 3.1 3.6 -8.6 10 Viet Nam 2.9 1.8 78 11 Pakistan 2.7 4.8 -39 12 Indonesia 2.5 1.4 86 13 Turkey 2.3 3.2 -21 14 Qatar 2.0 0.7 225 >North Africa and the Middle East countries unfortunately constitute 15 Israel 2.0 0.5 354 an overwhelming majority in the top 15 list countries with highest 16 United States 1.8 3.7 -47 defense spending ratio to government budget 17 Taiwan 1.7 1.0 83 Rank Country % of spending 18 Oman 1.6 0.6 213 TURKEY’S ARMS IMPORTS FELL BY 21 PERCENT 1 Sudan 30.9 19 United Kingdom 1.6 1.7 2.3 We should examine another important element in 2 S. Arabia 30.4 20 Italy 1.5 0.6 162 terms of militarization other than the defence bud- 3 Oman 26.3 Source: Stockholm International Peace Research Institute ( SIPRI ), get which is the arms import ranking of countries. 4 Belarus 25.3 Yearbook 2018: Armaments, Disarmament and International Security. This ranking gives important clues about countries 5 Congo 17.9 that do not have a strong defence industry but dare 6 Singapore 17.2 to face big expenditures for armament. 7 Pakistan 16.7 the largest arms importer in the world with a 12% Leaving aside the arms exporter countries in 8 Algeria 16.1 share of the whole trade in the 2014-2018 on aver- this list, such as Israel, China, Britain, Italy and 9 Iran 15.8 age. This rate is almost three times that of 4.3% of the United States, the list is again dominated by 9 Jordan 15.8 the previous five year period, 2009-2013. Another the Middle East states, which is worrying. 11 Lebanon 15.6 worrying development is the case of Egypt, which Middle East countries transfer their most impor- 12 Armenia 15.5 entered the list with 5.1% in 2014-2018, again an tant resources to countries with military-industrial 12 Chad 13.8 increase of three times compared to the previous complexes for arms imports. Saudi Arabia is again 14 Mali 12.7 period. On the other hand, the United Arab Emir- 15 Myanmar 12.4 ates, Iraq, Qatar, Israel, Oman are other Middle 15 South Korea 12.1 Eastern countries in the top 20 list. To summarize the story we can say that the devel- > The list of top 15 countries in the world with the oped world buys oil and sells death to the region. highest military expenditure While the USA is the top supplier of 11 of the Spending (US$ Bn.) % of GDP top 20 arms importing countries, Russia is the top World total 1,822 2.1 supplier of 4 countries, Britain is the top supplier of two countries and Germany, France and China 1 USA 649.0 3.2 USA are top suppliers for one country in the same list. 649.0 2 China 250.0 1.9 When we look at the list of the second and third 3 S. Arabia 67.6 8.8 major suppliers of each country, Israel is also an China 4 India 66.5 2.4 250.0 important supplier of arms importing countries. 5 France 63.8 2.3 WORLD TOTAL Turkey, the US and Russia share a recent crisis 6 Russia 61.4 3.9 of S-400 and F-35 trade. Of course, there is also a S. Arabia 67.6 7 UK 50.0 1.8 1,822 special depth about the crisis because Turkey is a 8 Germany 49.5 1.2 NATO member. However, if we consider the situa- 9 Japan 46.6 0.9 Other tion of Turkey’s in terms of arms imports again it can 10 S. Korea 43.1 2.6 easily be seen that Turkey is certainly not an aggres- 11 Italy 27.8 1.3 sive buyer. Between the 2009-2013 period and the 12 Brazil 27.8 1.5 2014-2018 period, Turkey’s imports share has fallen 13 Australia 26.7 1.9 from 3.2% to 2.3% with a 21% decrease of gross val- 14 Canada 21.6 1.3 ue in weapons imports lowering Turkey’s rank to the 15 Turkey 19.0 2.5 13th position. Not a rank so high compared to the Source: Stockholm International Peace Research Institute ( SIPRI ), Yearbook 2018: Armaments, Disarmament and International Security. country’s economic size, population and area. 46 In Depth / Military Myths and Realities

In particular, the decline in Turkey’s arms im- ports between 2014-2018 can be explained by the economic problems that the country is ex- periencing. But let’s bear on mind that Turkey is also looking for national solutions for its national defence needs. But in contrast to the recent ten- sion between Turkey and the United States about the purchase of S-400 missiles from Russia, it still can’t be denied that the US is still the major and strongest defence partner of Turkey and most probably be in that position also in the near term when the import figures are examined. TURKEY’S LARGEST ARMS DEALER IS STILL THE US Turkey imports 60% of its arms still from the Unit- ed States. Spain follows the US by 17% and Italy by 15%. Only these figures alone show that Turkey is not in any quest for looking for a new major military partnership other than the Western or NATO block. Up to the last S-400 purchase from Russia, Turkey has never made a single military deal apart from its Iraq the top three arms suppliers are both the US traditional Western allies since 1946. And China is and Russia. Pakistan is busy making deals with both not even on the list. the USA and China. Algeria is in intensive trade with An objection might be “However, Turkey has China and Germany. bought the S-400 missiles and this has started a new Although China, Algeria and Vietnam do not im- era.” The US administration’s decision of dismissing port arms from the USA, they trade with Russia and Turkey from the F-35 program is indeed a negative other countries that can be seen in the former Cold and important development for the two countries War Era “Western Bloc” such as France, Germany relationship and that can’t be denied. However, in and Israel. light of the above figures, Trump has seen this issue In the Top 20 list, if we sort out the countries as more of a trader and businessman and announced that import only from the US and “Western Bloc” that there will be no sanctions against Turkey. We countries the list as followed: Saudi Arabia, Austra- can say that Trump’s words are not always trustable lia, United Arab Emirates, South Korea, Indonesia, and his promises are not so stable but figures show Turkey, Qatar, Israel, the US, Taiwan, Oman, United that it is very hard to replace the US with Russia Kingdom, Italy. It can be said that the arms market as the main arms supplier to Turkey. It’s not only a has been a politicized and compartmented market choice of Turkey, Russian economic structure and by the means of political hegemony of the oligopo- arms industries have limits of their own also. listic superior countries. However, this dominant Besides, if the Cold War is over, and if the entire reality of the arms market is being worn out every world -including Russia and China- without any year. Especially when we look at the list of the top ideological worry, has agreed on a global capitalist 40 importing countries we can see that the number market system, each taking their position as com- of countries importing from USA, Russia, China and mercial partners and competitors why is purchasing Israel simultaneously increases even more. arms from Russia or China a violation of a big taboo Again if we categorize NATO countries and Is- for Turkey? In short, if arms exporters are practising rael as former “Western Bloc” countries within the free competition rules in the arms market which has framework of the former Cold War paradigm, the become of almost a free death market in recent years, number of countries that import arms from “West- and can sell arms to any country regardless of their ern Bloc”, Russia and China at the same time is 8 in differences, regimes, religions human rights policies the list of the top 20 importing countries and 15 in and ideologies, can arms buyer countries not benefit the top 40 countries list. from the same free market? TURKEY IS STILL PART OF “NATO ECONOMY” “FREE” ARM MARKET In the light of these figures, we can say that the main Our aim is not to legitimize this uncontrolled and reason for the crisis that started with the purchase of unregulated market of arms. But Turkey is certainly the S-400 missiles did not source from the military- not responsible for it. Turkey is neither a major ex- economy field but the political-diplomatic field. porter nor an importer. Let’s try to explain buy what When the armament and defence spending we mean by responsibility. Again, we look at the top data of Turkey is realistically assessed it can eas- 20 countries that import arms: For India, Egypt and ily be seen that Turkey can’t be classified as an ag-

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When the armament and defense spending data of Turkey is realisticly assessed it can easily be seen that Turkey can’t be classified as an aggressive and revisionist country.

that the overall increase of arms trade in the world is totally dependent on the growth in the Middle East market, the Middle East region alone in- gressive and revisionist country. Besides not only creases the trade volume. The share of the Middle in terms of military markets but also in all trade THE SHARE OF East in total arms imports increased from %20 to sectors, Turkey is mainly exporting and importing THE MIDDLE %35 in only 5 years. So, in other words, the Mid- with the EU and USA. Military trade choice can EAST IN TOTAL dle East countries’ arms imports have increased very rarely differ radically from non-military mar- ARMS IMPORTS by more than 100% whereas in the same period ket realities in the long run. INCREASED Tukey’s arms imports volume decreased by 21%. Another fact that we will see when we examine FROM 20 We should also note that a large refugee and hu- the market of arms importing countries is that PERCENT TO manitarian crisis in the Middle East has shaken the Middle East countries import more and more 35 PERCENT IN Turkey’s borders in that period. Also a small paren- weapons every year from any country that is ready ONLY 5 YEARS. thesis: Turkey and its western neighbour Greece to make a deal under almost free and unregulated still haven’t been able to solve their long term terri- market conditions. It is this dangerous policy that torial tensions in the Aegean Sea and East Mediter- should be questioned. ranean fronts. Greece started to increase its military When we compare the two 5 year periods spending share in the budget just after 2003, ie af- (2009-2013, 2014-2018) again we see that arms ter Southern Cyprus became a member of the EU. imports have decreased in all world regions except Moreover, this was a period of great economic cri- for the small increase in Asia and Oceania and a sis for Greece. Nevertheless, military spending rose huge increase in the Middle East. Figures show from 2.4% of GDP in 2003 to 3.2% in 2009 , an increase of 80% in GDP ratio. All these tensions and > The largest importers of major arms, by region, 2014–18 and 2009–13, percent of global share crisis hasn’t stopped Turkey to decrease the share of defence spending in the overall government budget Africa, 7.8% and hasn’t caused it to look for new trade partners in Europe, 11% Americas, defence other than NATO countries. 6.2% Asia and Oceania, 40% Middle East, 35% THE USA IS THE UNDISPUTED LEADER IN 2014–18 ARMS EXPORTS Let’s stop focusing on Turkey and look at the top 25 countries that export arms. This list will reveal more clearly the location of both Turkey and the major ac- 2009–13 tors in the arms market. This list shows that the US is by far the first in Asia and Oceania, 47% Middle East, 20% world arms exports. It is followed by Russia, France, Europe, 14% Africa, 9.0% Germany, China, Britain, Spain, Italy and the Neth- Americas, 10% erlands, respectively. When we look at this market, we don’t come 0 20 40 60 80 100 120 140 160 across a phenomenon of Russia or China shaking Volume of arms transfers the position of the US. They may have such inten- (billions of trend-indicator values) tions, but they certainly don’t have such a perfor- Source: Stockholm International Peace Research Institute ( SIPRI ), Yearbook 2018: Armaments, Disarmament and International Security. mance yet. When the two periods of 2009-2013 48 In Depth / Military Myths and Realities

>The 15 largest exporters of major arms and their main clients, 2014–18 Percent change Share of arms exports (%) from 2009–13 Importer 2014–18 2009–13 to 2014–18 1 United States 36 30 29 2 Russia 21 27 -17 3 France 6.8 5.1 43 4 Germany 6.4 6.1 13 5 China 5.2 5.5 2.7 6 United Kingdom 4.2 4.3 5.9 7 Spain 3.2 2.9 20 8 Israel 3.1 2.1 60 9 Italy 2.3 2.7 -6.7 10 Netherlands 2.1 1.9 16 11 South Korea 1.8 1.0 94 12 Ukraine 1.3 2.7 -47 13 Switzerland 1.0 0.9 20 >We should also note that a large 14 Turkey 1.0 0.4 170 refugee and humanitarian crisis in 15 Sweden 0.7 1.9 -62 the Middle East has shaken Turkey’s borders in that period. Source: Stockholm International Peace Research Institute ( SIPRI ), Yearbook 2018: Armaments, Disarmament and International Security. When we consider the 10 top arms exporters in the world, all 8 countries except China and Russia are NATO member Western countries and Israel. and 2014-2018 are compared, it can be seen that The share of these 8 countries in the world arms ex- the leadership of the US in the arms export sec- ports was 55.1% between 2009 and 2013, and this tor is reinforced. While the USA held a 30% share share increased to 64.1% in the next 5-year period. in world exports, this ratio increased to 36% in We see that 6% of this 9% increase comes from the the following period, a 29% increase in monetary USA. However, other NATO countries and Israel terms between these two terms. The first country also increased their arms exports during this period. in the US arms exports list is Saudi Arabia with Israel’s 60% increase is remarkable. 22% of all exports. The second country is Aus- China has achieved a similar export rate in both tralia with 7.7% and the third is the United Arab periods around 5%. At a time when China’s military Emirates with 6.7%. spending increased tremendously, there was only a Russia’s total export volume decreased by 17% in 2% increase in the total monetary volume of arms in five years, and its share in the world exports cake exports. Is China practising a new form of military decreased from 27% to 21%. Is this a permanent mercantilism? Will the next stage be a phase of mili- trend? We’ll see soon. Russia is still an important tary expansionism? It seems more logical that the military force, independent of its economic and US focuses on China, not Russia. That’s a simple political problems. A significant portion of Russia’s fact that is temporarily concealed by the current traditional customers from Cold War Era remains heat of the S-400 crisis. The military competition of as buyers. However, the situation may change if the the 21st century may be between the US and China current trend continues. most probably, not the US and Russia. In other words, the big noise about the S-400 cri- sis should not create the illusion that Russia is a force THE RE-MILITARIZATION OF THE US ECONOMY in the sector that shakes the US throne. Russia is ex- AFTER 2001 periencing its own economic and political crises. It is Now let’s look at the motivation of the United States. still one of the world’s two largest nuclear and military Is the US transforming into a war economy again? forces, but the military-industrial complex is directly When we look at the US military spending, we can linked to the overall economic performance of a coun- say that the winds of globalization, democracy, re- try. Even the strength of the US economy is being gional and global cooperation that wrapped the tested for now, but Russia has long lost its claim to be world after the Cold War years ended in the military one of the two “superpowers” in the economic-com- field in 2002. September 11, 2001 terror attack, in- mercial arena and even in the military sphere. vasion of Afghanistan in 2001 and the invasion of China comes to mind. The Chinese issue is more Iraq in 2003… These are milestones for the re-mili- complex. Because the data that we will look at soon tarization of the US economy. Let us note the 2008 shows that China can indeed be a military force that financial crisis as another important turning point, threatens the US position. However, when it comes and now examine the data. to arms exports, China is far from competing with We will start our first trend from 1975, the end of other NATO countries, not only the United States. the Vietnam War, and bring it to 2018.

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nual defence spending, which fell to $ 300 bil- > Military expenditure of USA (% of GDP) lion, exceeded $ 700 billion in 2010 in 9 years and 6.5 reached a 4.7% share of GDP. As a result of the 6.0 financial crisis and the decrease in the number of 5.5 5.0 troops in Iraq and Afghanistan, we see that the ra- 4.5 tio of military expenditures to GDP has decreased 4.0 to 3.1%. However, the US economy, which entered 3.5 3.0 a growth trend again in 2010, offset this propor- 2.5 tional decline on a nominal basis. Military spend- 2.0 1975 1980 1985 1990 1995 2000 2005 2010 2015 ing remained at a 650 billion USD level. > Military expenditure of USA (current USD) In 2018, while the total military expenditure of Billion governments in the world was $ 1,822 billion, the 700 US alone made 35.6% of it. Only 4.3% of the world’s 600 population and 24.4% of the world’s economy ac- 500 count for 35.6% of the world’s military spending. The 400 US is certainly a military economy, but even within 300 the US, the negative aspects of the militarization of 200 the economy are being discussed more. Trump ac- 100 cuses other NATO countries, particularly Germany, 1975 1980 1985 1990 1995 2000 2005 2010 2015 of keeping military spending low and transferring Source: Stockholm International Peace Research Institute ( SIPRI ), Yearbook: Armaments, Disarmament and International Security. its own defence costs to the United States and thus stepping forward in economic competition. In 1975 military spending was around 100 bil- The overall contributions or harms of the military- lion USD and in 2010 it reached 700 billion USD. industrial complex to the economy are very con- This upward trend is of course in current (2019) troversial. From a Keynesian point of view, military USD value and we must take inflation into account. IN 1975 spending can be considered as an element of growth, In other words, the World Bank’s data includes the MILITARY employment and recovery in the economy by firing nominal USD value of that year. Thus, between 1985 SPENDING WAS public spending. But on the other hand, it can put a and 2001, a stable annual military expenditure of AROUND 100 huge burden on the government budget and create 300 billion USD actually represents a major reduc- BILLION USD a phenomenon of continuous inflation and budget tion in defence spending share of both government AND IN 2010 IT deficit. This is a disadvantage in international com- budget and GDP. REACHED 700 petition. The miracle of Germany and South Korea For a more realistic view, we should analyze the ra- BILLION USD. was indeed supported by an almost zero-cost de- tio of defence spending to the US GDP. THIS UPWARD fence strategy stemming from the special conditions Military spending in 1982 - the famous years TREND IS OF of the Cold War years. of Star Wars – rose up to 6.5% of GDP and then COURSE IN On the other hand, military spending is an obli- fell steadily as the Eastern Bloc and the Soviet CURRENT gation to be a superpower of the capitalist system. Union pulled the white flag in the arms race. (2019) USD The thesis “The US is getting rich by selling weap- 2.9% in 2001 was the historical bottom point of VALUE AND ons to the world” is a simple one to falsify. Take the a 20-year long term of decline. Then after the year WE MUST TAKE year 2018 for example. Military spending in the US 2001, there was a tremendous increase in military INFLATION government budget amounted to 649 billion USD, spending, both nominally and in real terms. An- INTO ACCOUNT while the total export revenues of arms were only 50 In Depth / Military Myths and Realities

10.5 billlion USD. This is an insignificant amount in the total US exports revenue, and it does not even make one in sixty of the total defence costs. However, any comment about “the burden of defence costs on the national economy” without taking account the contribution of the military- industrial complex’ multiplier impact and the eco- nomic externality created by country’s exportation >So don’t be mistaken by focusing on Turkey’s of arms which increases the economic-political purchase of S-400 missiles, Russia’s chance of hegemony domain of the US would be a too sim- being a military rival for the US is much lower plistic interpretation of the issue. than China’s. A country whose economy lags In short, the re-militarization trend of the US behind cannot advance in the military field. economy since 2001 has affected the whole world. The volume of the world arms trade, which did not fall below 40 billion USD in the 1980s, fell to 20 > The top 15 manufacturing companies compared with billion USD in 2000, but then rose over 30 billion the top 15 arms-producing and military services companies USD. And there is no downward trend. Rank Top 15 manufacturing companies Total sales Rank Top 15 arms producers Arms sales Total sales (US$ b.) (US$ b.) (US$ b.) DEFENSE EXPENDITURE EXCEEDS COLD WAR PERIOD 1 Toyota 254.7 1 Lockheed Martin Corp. 44.9 51.0 Another interesting figure is that of the inflation-free 2 VW 240.3 2 Boeing 26.9 93.4 graph of the US defence costs. The graph-based on 3 Apple 215.6 3 Raytheon 23.9 25.3 2009 prices shows the total military spending in US 4 Samsung Electronics 174.0 4 BAE Systems 22.9 23.5 dollars. 5 Daimler 169.5 5 Northrop Grumman Corp. 22.4 25.8 This chart gives a clearer picture of reality. The re- 6 General Motors 166.4 6 General Dynamics Corp. 19.5 31.0 cord military spending of 800 billion USD in 1944 7 Ford 151.8 7 Airbus Group 11.3 75.2 was broken in 2010 for the first time on 2009 prices, 8 Hon Hai Precision Industry 135.1 8 Thales 9.0 17.8 a record that had not been reached even during the 9 Honda 129.2 9 Leonardo 8.9 13.0 Cold War. The worrying trend is that after each peri- 10 General Electric 126.7 10 Almaz-Antey 8.6 9.1 od of hot conflict, US military spending has declined 11 Fiat Chrysler Groupc 125.0 11 United Technologies Corp. 7.8 59.8 slightly –i.e. a decline just after the end of Vietnam SAIC Motor L-3 Communications War- however this decline never reached back to the 12 113.9 12 7.8 9.8 pre-war level. 13 Nissan 108.2 13 Huntington Ingalls Industries 6.5 7.4 Then the famous military race of the Reagan era, 14 BMW 104.1 14 United Aircraft Corp. 6.4 7.7 which broke the Soviets, began. The level of military 15 China Railway and Engineering Group 97.0 15 United Shipbuilding Corp. 5.0 5.6 spending surpassed even the Vietnam War era. But Total top 15 sales 2311 231.6 455.6 after the end of the Cold War the slight decline of Altough total arms sales of the top 15 arms seller companies is only about 10% of the total sales of the top manufacturing companies, total sales including non-military commodities of the arms producers is about twice of that value. That figure alone the 90s did not lower defence costs to the levels of shows the strategic and technological importance of the defense industry and the externalities it creates in other economic sectors. the post - Vietnam War. And finally, the new trend Source: Fortune, ‘The Fortune Global 500’, 2017; and SIPRI Arms Industry Database, Dec. 2018. that started in 2001. Even the Great Financial Crisis in 2008 could not stop this trend and the upward trend reached the level of expenditure of World War > Recent Defense Spending (USD) Billion 2012 II. Of course, in that half-century, the US and the 1000 world economy grew in real terms. However, the term real means real so the threat of armament itself 900

is not unreal at all. 800 There are two peaks in military spending based on 2009 prices. One is the year 1944 and the other is the 700 year 2010. 1944 was the bloodiest year of World War 600 II. This year, US military spending exceeded 40% of GDP. In 2010, this ratio did not exceed even 5% of 500 GDP, but it reached the same level in real value. 400 In short, it can be misleading to say that the world 300 has entered a new arms race. But even before enter- ing a new arms race, the extent of economic milita- 200

rization is frightening. Weapons are not less lethal 100 than in 1944. Let’s make a note of that. Therefore, when we consider the enormous increase in China’s 0 1900 1910 1920 1930 1940 1950 1960 1970 1980 1990 2000 2010 2017 increasing military spending, the picture is even more frightening. Source: www.usgovernmentspending.com

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> US: Recent Defense Spending Percent GDP 40 35 250 billion USD would escalate to 450 billion USD, 30 not very far away from the USA’s level. 25 So don’t be mistaken by focusing on Turkey’s pur- 20 chase of S-400 missiles, Russia’s chance of being a 15 military rival for the US is much lower than China’s.

10 A country whose economy lags behind cannot ad- vance in the military field. 5 When we put these military spending figures of 0 the two countries into the frame of the newly start- 1792 1807 1822 1837 1852 1867 1882 1897 1912 1927 1942 1957 1972 1987 2002 2017 ing Trade War between the US and China, a much Source: www.usgovernmentspending.com more worrying picture arises. US MILITARY EXPENDITURE RIVAL IS CHINA, NOT RUSSIA CHINA’S DILEMMAS AND ADVANTAGES Now let us begin the comparison of China and Of course, to avoid to be misled by China’s astro- Russia with the USA. If we evaluate the increase of nomical military spending, we must provide the fol- military expenditure globally since the 1980s the lowing information. While the number of military chart confirms the previous data. The total military personnel of the Chinese Army was 2 million 695 spending of the world, which remained at a constant thousand as of 2017, the number of personnel of the level in the 1990s with current USD values, sprang CHINA’S US Army was approximately 1 million 359 thou- like a rocket after 2001. MILITARY sand, about half of China’s. The Chinese Army is not Data from China and Russia have been available SPENDING IS as capital-intensive as the US Army is. only since the 1990s. But the main period we will NOT VERY HIGH The leadership of the new generation tech- focus on is after 2001. The figures show that after COMPARED nologies is still in the US and developed NATO 2010, both the US and Russia have cut their military TO ITS GDP. countries mainly. Let’s examine the arms export spending somewhat, but China has achieved a very HOWEVER, data again. As we said, these exports are far from aggressive upward trend. While the gap between the THE FAST meeting military expenditures, but this market US and Russia is opening, the gap between China GROWTH OF presents figures that determine which country is and the US is closing. THE CHINESE leading the military industry and technological Moreover, China’s military spending is not very ECONOMY development. Don’t let the S-400 debate be mis- high compared to its GDP. However, the fast growth REFLECTED leading again. We can say that the US is starting of the Chinese economy reflected itself as a military ALSO ITSELF to make a difference to its competitors and espe- expansion also. AS A MILITARY cially Russia. China exports weapons at a stable The ratio of Russia’s military spending to GDP EXPANSION but modest level which is less than 10% of the US’. rose suddenly in 2010 but still that didn’t add up So why did the enormous increase in China’s mili- near to the USA’s and Chinas gross spending due to tary spending not reflect an effect on arms exports? the low performance of the Russian economy. China, The total number of personnel of the Chinese Army on the other hand, has remained at a stable level in was 3 million 910 thousand in 2000 but it decreased the 1.8% - 2.0% band of GDP band for ten years, but to 2 million 695 thousand in 2017. This is a 32% it has made a huge difference in total military spend- drop. However, while the number of personnel de- ing to Russia and has narrowed the gap with the US. creased by 32%, the military spending rate increased So much so that if China’s military spending alone from 23 billion USD to 228 billion USD in the same increased its GDP share from 1.8% to 3.2% -the 17 years, almost 10 times. ratio of the US- China’s total annual expenditure of This is an indication that China has entered a very ambitious and aggressive military moderniza- tion process. China has its own handicaps, however. > Global military expenditure (current USD) It’s not a naval force and feels vulnerable about its

Trillion ports being blocked. Such a military giant still has only a single aircraft carrier operating. But mean- 1.8 while, China is taking ambitious steps towards be- 1.6 coming a space force. 1.4 Speculations about Russian influence and the

1.2 S-400 missiles miss the real map of the race. By this day together the US and China make 49% of 1.0 military spending in the world, and if this trend 0.8 continues, it is even possible that this share will 0.6 soon get over 60%. 0.4 1980 1985 1990 1995 2000 2005 2010 2015 MILITARY SPENDING IN TURKEY HAS STABILIZED Source: Stockholm International Peace Research Institute ( SIPRI ), Yearbook 2018 : Armaments, Disarmament and International Security. IN THE LAST 10 YEARS 52 In Depth / Military Myths and Realities

TURKEY ENTERS TOP 15 LIST OF ARMS EXPORTERS FOR THE FIRST TIME Checking the 2014-2018 period in terms of ex- port figures shows that Turkey has entered among the top 15 most arms-exporting countries in the world for the first time. Turkey wasn’t even in the top 20 list in the previous period. The most im- portant reason for this achievement is the break- throughs in Turkey’s military industry. A total monetary increase of %170 was reflected in arms exports. However, this rate still represents a very small share of the world arms trade. Turkey has a >Turkey as a country has been long distance to go for a self-sufficient defence in- dependent on the US for more dustry let alone becoming one of the major arms than half a century in terms of supplier of the globe. Turkey’s highest export rates weapons, equipment, technology are to the UAE, (30%), Turkmenistan (23%) and and infrastructure. Figures show that Saudi Arabia (10%) respectively. Let us emphasize 60% of Turkey’s arms imports still that UAE and Saudi Arabia are among the most comes from the US. important customers of the USA as well. In short, Turkey’s arms export strategy can’t be considered Let’s go back to the front of Turkey again finally ask as aggressive and revisionist neither. the same questions: Does Turkey have an aggressive Finally, let’s focus on the total military spend- defensive strategy? Is Turkey’s orientation revisionist ing of the Turkish government. The trend shows or conformist? an increase in the 2000s, but bear on mind that- The numbers will help us again to disperse the Turkish economy has enjoyed a high growth rate myths. Turkey’s arms imports policy is not aggres- from 2001 to 2008. However, Turkey has secured sive, on the contrary, Turkey’s arms purchase has military spending at a stable level from 2008 on- diminished. Turkey’s arms imports decreased by wards, between 16 billion and 18 billion USD per 21% in a period when the arms trade worldwide in- year. However, the world trend in the same period creased by approximately 25%. was quite different. Arms imports of Turkey, which were 1.5 billion Rise in Turkey’s military spending is line with USD in 2014, fell to 685 million USD in 2018. That’s the world trend in 2000-2008. However, after not an armament strategy of aggression. 2008 up to 2018, Turkey has had a very mar- What about a revisionist orientation? Turkey as ginal increase in military spending. Turkey’s an- a country has been dependent on the US for more nual military spending in 2008 was 17.127 billion than half a century in terms of weapons, equipment, USD, and that rose to only 18.967 billion USD, an technology and infrastructure. Is Turkey in search of increase of just 10.7%. Note that these figures are new partners? Leaving daily political debates aside, in 2019 USD values and not inflation-adjusted. figures show that 60% of Turkey’s arms imports still Now let’s look at the volume of military spend- come from the US. This is followed by Spain with ing in the world in the same period. In 2008, the 17% and Italy with 15%. They’re all NATO countries. total amount of global military spending was 1,491 trillion USD and that figure rose to 1,782 trillion USD in 2018, despite the global economic > Arms exports (SIPRI trend indicator values) crisis of 2008. So in this period, Turkey military spending increase rate was almost twice as slow as Billion USD 16 the global increase rate which was a rise of 19.5%. 14 Under these conditions, any objective observer USA can not object to the fact that Turkey doesn’t have 12 an aggressive defence budget. 10

8 RUSSIA TURKISH ARMY STAFF SHRINKS AS WELL The following data belongs to NATO. Turkey’s 6 military staff numbers fell from 800 thousand 4 CHINA since 2000 with a steady decline every year. Data 2 between 2010 and 2017 shows that Turkey dimin- ished its staff size most compared to other NATO 0 1980 1985 1990 1995 2000 2005 2010 2015 armies. During this 8-year period, the Turkish Army

Source: Stockholm International Peace Research Institute ( SIPRI ), Yearbook 2018: fell from 495,000 to 387,000, shrinking by 21.8%. Armaments, Disarmament and International Security. The total number of NATO fell from 3 million 572

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> Military expenditure of Turkey (current USD) 3. Purchase of the S-400 missiles hit the US. F-35 cancellation was a blow to Turkey. Billion 20 No to proposition one. Because compared to 18 the capacity of the US military industry, that is 16 no big deal. The second proposition is both no 14 and yes. Cancellation of a great defensive project 12 partnership is surely a bad development for Tur- 10 key. According to the 2011 US budget, the F-35 8 project is the largest defence project in the US 6 and has a volume of 11.4 billion USD only for this 4 year alone. Turkey was an important partner of 2 the project and it was said that Turkey could con- 0 1975 1980 1985 1990 1995 2000 2005 2010 2015 tribute worth of 1.5 billion USD per year. This is, Source: Stockholm International Peace Research Institute ( SIPRI ), of course, an important project and contribution. Yearbook 2018: Armaments, Disarmament and International Security. The S-400 missiles crisis may escalate and cause even more tensions but the size of the crisis is still not enough to undermine the military-political partnership base of the two countries. 4. US and Russian military competition is increasing and Turkey’s position is uncertain. thousand to 3 million 163 thousand, only a drop of No. Military gap between Russia and the United %11.5. The Turkish Army is trying to evolve into an States is opening. Russia has no call to Turkey for operational army that will deal with high regional exiting NATO. Turkey also does not intend to with- risks leading to major humanitarian crises. Indeed, draw from NATO because there is still no single despite the reduction in the number of army person- military-industrial complex in the world to compete nel, data show that the ratio of personnel expenses in with NATO yet. Turkey’s military spending is increasing. This is the 5. The US and Chinese military competi- result of efforts to professionalize the Turkish Army. tion are on the rise. 27.98% of Turkey’s defence budget in 2010 This is the rumour closest to the reality right was spared as equipment expenses, 49.75% as staff, now. As one of the most important reasons for the 2.84% as infrastructure, 19.43% as others (opera- Trade War that was started by Trump’s administra- tions and maintenance expenditure, R & D expen- tion last year, China’s ambitious space program is diture etc.). In 2017 these percentages were 30.40% shown. Both the US and the EU accuse China to (equipment), 53.28% (personnel), 2.0% (infrastruc- have a military agenda in its space programs. This ture) and 14.31% (other). is one of the few issues the EU has in common with the Trump administration. The EU officials have an- TURKEY IS NEITHER AGGRESSIVE NOR REVISIONIST nounced their sceptical views about China’s space In light of all these data, we can reconsider some of exploration at various times and empathised that the myths shared by the opposite poles in the politi- they are concerned that China’s space ambitions will cal arena. lead to a new armament war. 1. Turkey has entered a more aggressive TURKEY IS NOT What about Turkey? Where is Turkey in the orientation with a new military strategy. AGGRESSIVE new USA-China competition? Nowhere. Turkey is No. The data shows very clearly not that Turkey BUT MAINLY fully in the NATO system. China’s not even a minor is not in the process of an aggressive arming and DEFENSIVE, choice for now and China’s military export products militarization. The economy of the country is not DOES NOT HAVE to the whole world are still marginal. suitable for this. Turkey is still in a defensive position A REVISIONIST Turkey’s defence position and spending must be both regionally and globally. VISION BUT A considered in light of these facts. Turkey is not ag- 2. Turkey is a revisionist country that wants CONFORMIST gressive but mainly defensive, does not have a re- a major change in the global balance of power POSITION. IN visionist vision but a conformist position. In other or at least aims to change its bloc of alignment. OTHER WORDS, words, it wants to protect its borders and even keep No. The data show very clearly shows that Tur- IT WANTS TO the borders of other countries the same in its nearby key’s both military and non-military trade is with the PROTECT ITS region. United States and other NATO countries. Besides, BORDERS AND The latest S-400, F-35 crisis is a result of the se- the Russian military-industrial complex is far away EVEN KEEP curity tension in the south of Turkey that lasted too to meet all the needs of Turkey. THE BORDERS long since 2003. Turkey is currently trying to protect So Turkey has neither changed poles nor trans- OF OTHER himself. Military defence figures are completely con- ferred from the Western Bloc to the Eastern Bloc COUNTRIES sistent with Turkey’s thesis on the purchase of S-400 mostly because distinct blocs like that don’t exist THE SAME IN ITS missiles which claims that’s only an act of “defence anymore. NEARBY REGION. necessity”.

Brands / Lorem The Turkish Perspective 55 Content: Clear Your Mind Imagine Freely P00 Elektra Elektronik Doubles Capacity with New Investment P00 The Goal is to be A Global Brand P00

TECHNOLOGY, ELECTRONICS...

TECHNOLOGY A Day in Life: BRINGING FUTURE TO PRESENT Can you tell the difference between what is real or not? Evidently. What if you’ve been told that a company called Zero Density makes millions world- wide question the reality on their screens? Pushing the boundaries of what we consider to be real is an everyday activity for the ZD team.

he story behind the remarkable T success started in 2014 when a team of individuals with long experience in live production, postproduction, and visual effects teamed up to pursue an innovative project. They wondered what could happen if a powerful engine dominating the gaming industry serve the broadcast industry. As we now know, the answer is “a great deal”, such as enabling the creation of hyper-realistic worlds with seamless amalgamation of physical and virtual elements, including “teleportation” of individuals and giving life to dragons. There are three critical challenges for VS production; visual quality, utility, and ease of implementation. Visual quality is the most important of them. As Ulaş Kaçmaz notes, even though virtual studio production has always been an economically desirable option, most studios have been avoiding it because of the poor visual quality. Zero Density saw the need to develop innovative solutions to these problems of virtual production and started their efforts. With 56 Brands / Zero Density

their insightful idea of using a gaming engine in the broadcasting industry and the vigor with which they conducted research and development, they provided new options for advanced applications in Virtual Studio (VS) and Augmented Reality (AR) production. As a result, they brought the highest level of quality, ease of use, and implementation to the field. In 2016, they went on air with their cutting-edge product “Reality Engine™” which disrupted the industry. It was awarded two prestigious IBC Innovation Awards with Canada’s TFO.

MILESTONES: WHAT MAKES REALITY, REALITY? What makes the Reality Engine™ different? Its unique architecture that allows Hollywood- level visual effects in live production. In particular, its unique compositing and keying tools that enable the magnificent output. One way or another, we are all familiar with the fact that a Zero Density green box is used in movies demonstrates Reality for setting the actors into Engine at NAB 2019 inside FOX fantastic places; space, back Sports’ NASCAR set. in time, fantasy worlds, and FOX Sports chose Reality Engine for so on. This positioning is its first virtual studio enabled by a process called production in its history. “compositing” where actors are extracted from the green box (i.e. the cyclorama) and graphics, extracted actor, and virtual production. Following all their properties—such put in the desired virtual possibly other virtual objects the extraction of actors from as real shadows, reflections, environment. We use the if we wish to add some — for the cyclorama, instead of and transparency—are same process in VS during instance, you, a castle, and a inserting them into a separate automatically crafted live broadcasts, but in dragon, respectively. Lack of layer, it creates the virtual in the rendering stage real-time. interaction between layers, world with the actor in it as if for unification of virtual The first significant such as between the actors they are virtual objects. This with physical objects. difference of the Reality and the virtual objects, method affords the capacity Consequently, Reality Engine™ is its mechanism of creates essential challenges of rendering everything Engine™ achieves an node-based compositing that that reduces the believability uniformly using the Unreal unmatched photo-realistic avoids layer-based processing in VS productions. It may Engine. Rendering in this quality. on which traditional feel as if the actors are hastily fashion avoids the use of The second significant methods of compositing rely photoshopped on the scene. multiple layers, thereupon, difference about Reality in virtual production. In this Reality Engine™, on the the interaction problem they Engine™ is its powerful processing technique, layers other hand, adopts a different create. Actors are considered keyer, the Reality Keyer™— comprise of background and innovative solution for a part of the virtual scene and the process we have been

AUGUST 2019 ISSUE 73 The Turkish Perspective 57

FEELING GOOD: A CASE STUDY AND Prestigious newspapers During NAB Show, they LOOKING INTO THE FUTURE formulated this event as created another milestone The “teleportation” is an “a glimpse of the future”. of the industry by making excellent example of how Since then, Reality Engine™ world’s first real-time the superior visual quality has enabled many other ray traced virtual studio of the Reality Engine™ teleportation across global production with Nvidia and disrupts the way we think televisions. Epic Games. It is important about live broadcasting. Considering the future, to note that the Reality The soccer player is a Zero Density is growing, Engine™ in the big picture Belgian sportsperson named and their roadmap is taking is not a tool, but a platform Eden Hazard. After their shape. They launched their which will respond to many victory against England Europe branch with a team needs of the industry with to take the third place of key experts from the each new release. in the FIFA World Cup broadcasting, media and Zero Density is also 2018, Belgian fans had a sports industry. They are developing a new platform chance to see their favorite also planning to restructure which will unify the separate player in a VS commentary their office in the USA. A workflows of preproduction, program. While Hazard new version of the Reality production and was sharing post-game Engine™ based on Unreal postproduction under one feelings in a Belgian studio, Engine 4.22 is released. roof in order to increase the he was actually in Russia. efficiency and decrease the This futuristic interview duration between these involving a hologram-like processes. This platform will Hazard happened thanks lower budgets too. This will to the Reality Engine™. also transform the cinema Notably, the futuristic industry. Shooting on site part of the interview was and collecting raw data of not the kind of technique Considering the images, graphics and used to conduct it. Keying future, Zero Density tracking into one stream, has been around since the is growing, and their and delivering the result to nineties. However, the roadmap is taking the postproduction crew mechanism behind Reality will be possible with this Engine™, as we discussed to shape. They launched version. As they always do, be insightfully unique, was their Europe branch Zero Density will the essential element which with a team of key disruptively innovate the made this holographic experts from the industry to be more real, interview possible at broadcasting, media utile, and budget-friendly sufficient visual quality. and sports industry. than ever.

talking about as “extracting the actor” is called “keying” in the industry. Reality Keyer™ is an image-based keyer which can perfectly handle the non-uniformity in the green screen. Reality Keyer™ provides spectacular results for keying of real soft shadows, transparent objects and sub-pixel details such as hair. Without losing the vital details, it provides plenty of room of creative teams to play adding dramatic lights and whatnot. 58 Brands / Orka

TECHNOLOGY CLEAR YOUR MIND IMAGINE FREELY Orka creates expert virtual reality and interactive platforms for all industries.

he VR industry is now of our products with customer services of the company. Their T in a long-term growth feedbacks, commercialization first VR product was sold in phase and will be worth of all our projects and making 2013 and from that time they 110 billion USD by 2025, R&D investment with our have been serving with their according to the advisory own resources. Also, the VR technology especially. firms’ research reports. More quality and diversity of our and more entrepreneurs and products along with our EXPANDING TO OTHER INDUSTRIES businesses want to be in this excellent customer care are the They targeted the Maritime industry every day. And one reasons behind our success.’’ Industry because of the of them is Orka Informatics. In the beginning, Virtual founder’s marine background “One of my friends who Orka, has been founded as Reality was only a tool to and his prediction about the runs an event management a Research & Development deliver their training contents gaps in the industry. In a short company visited my office. company focused on like their LMS platforms, time period, they had a chance He was so curious about education and training interactive contents, and to expand their service areas our work and had a chance technologies in 2011, located serious games. Then, VR with tailored VR training to experience some of our in Istanbul and London. became one of the main simulations. simulations. Suddenly he Since their establishment, asked me why we don’t serve all their R&D projects the entertainment industry. completed successfully and Our products were developed commercialized with global with physical algorithms and B2B customers which cover high-quality visuals. Because approximately %80 of their those products designed the income. train the professionals who are Levent Şen, the founder actually doing that job. Your of Orka, mentions that “The work needs to be designed to most important factors add the ability to them and behind the success of Orka it has to be real in the virtual was continuous development environment. So, our works were created with very high- level simulation techniques. However, the entertainment does not need that. We created some special contents for them and they used in

Orka is becoming one of the best and is an innovative virtual reality company that you can access to the incredible VR experiences with latest technological solutions. AUGUST 2019 ISSUE 73 The Turkish Perspective 59

different countries all over the There are 3 company types and Training of the Year” by world. So, we understood that in the VR industry. Content The Academy of International we can find more niche areas providers, service providers, Extended Reality’s (AIXR). in different industries too.’’ and technology companies. The judges (more than We, as Orka, found niche 80 experts) evaluate the “NOT MARKETING OR ANNOUNCING areas to serve and positioned candidates by some criteria ANYTHING’’ ourselves not only as a content such as innovation, practicality, After that they had started provider but also technology applicability and efficiency. to work with professional to and service developer.’’ This can be considered as revise their business model to an indicator of the potential provide a high-level overview FINALIST OF “INTERNATIONAL of their company and the of the areas to consider when VR AWARDS” potential of their products, conceptualising, building Orka revealed some of their especially in the growing VR and selling ideas in addition works on June 2019 and in a industry. to the operational aspects of Levent Şen, the founder of Orka, short time period, they were Today, Orka becoming one mentions that “The most important running a VR company. As factors behind the success of Orka noticed by the industry. Their of the best and an innovative a result, Maritime Industry was continuous development of our work was honoured with being virtual reality company that became only a part of their VR products with customer feedbacks, announced as a finalist of you can access to the incredible commercialization of all our projects business like entertainment, and making R&D investment with “International VR Awards” on VR experiences with latest industrial training, finance our own resources.” the category of “VR Education technological solutions. and mobile applications. They had very unusual strategies like “not marketing product. So, we didn’t make or announcing anything” marketing to consumers but till the beginning of the 3rd enterprises with face to face quarter of 2019. We asked meetings. Our strategy was the reason; “It was all about waiting the right time and it is having the right technology just now.’’ and excellent content and “VR made peak after publish it at the right time. 2014 and lots of companies The VR hardware was too established to be a part of it. expensive to appeal to most However, lots of them focused users and need to come to on similar ideas like using the point where people can VR for Real Estate Sales, purchase it. Also, the VR creating roller coasters and headset technology was only a positioning their companies development kit, not the final as a content provider only. 60 Brands / Elektra Elektronik

ELECTRONICS Chinese railroads, Guangzhou waste water project, Serbia Elektra Elektronik Power Administration and iron and steel plants in Russia abroad, Elektra Elektronik earns 50 percent of its revenue DOUBLES CAPACITY WITH from domestic market and other 50 percent from export. Performing 20 percent of NEW INVESTMENT export mainly to China with transformers and harmonic The company announced 2019 as the Year of Progress and plans filter products, the company to increase domestic production transformer and electronic goods performs other 40 percent exports to 60 countries across 6 continents up to 70 percent. to Europe via the company founded in Germany named Elektra Power Quality for the purpose of direct trade with eading brand of start the installation process EU countries. Planning to add L Turkish electronics of R&D Center in 2020, the America to its export market industry, Elektra Elektronik company’s 40th year. With with this new investment, announced 2019 as the the company in Germany Elektra Elektronik plans to “Year of Progress” as and sales offices in China and increase its total export rate up foreign market share America, Elektra Elektronik to 70 percent by 2020. and business volume exports domestic production Founded 40 years ago in increased rapidly each day. transformer and electronic Istanbul, Esenyurt with the Continuing the progress goods to nearly 60 countries purpose of manufacturing to enlarge production line over 6 continents. With its transformers, the leading of the factory operating in products used in important brand of Turkish electronics Istanbul, Esenyurt in order projects such as airports, rail industry Elektra Elektronik to double its capacity, Elektra systems, city hospitals and serves numerous fields of Elektronik is also planning to such in Turkey alongside industry in Turkey and the

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world with transformers, in numerous projects such as reactors, wound components, Chinese railroads, Guangzhou energy quality and power waste water project, Serbian electronics solutions. Coming Power Administration and forwards with its investments Russian iron and steel plants. on R&D since 2010, Elektra Our revenue consists of 50 Elektronik is positioned as percent domestic market the leading company of low and 50 percent export. We voltage transformer and performing 20 percent of our reactor in Turkey in terms export mainly to China where of manufacturing capacity, we have a sales office with number of employees and transformers and harmonic export rate. Stating that filter products. We are along with increasing foreign heavily preferred by Chinese market share and business companies that want to export volume they stated 2019 as planning to start the progress General Manager of their products developed the “Year of Progress”, General of becoming the “Elektra using our transformers and Manager of Elektra Elektronik Elektronik R&D Center” by Elektra Elektronik harmonic filters manufactured Emin Armağan Şakar said 2020 as a result of industry- Emin Armağan Şakar in compliance with EU they decided to grow the university cooperation said they are planning standards.’’ production line of the factory projects. to start the progress of in Istanbul, Esenyurt. Stating becoming the “Elektra FOUNDED A COMPANY IN GERMANY that investments towards TURKISH BRAND SELLS DOMESTIC Elektronik R&D FOR DIRECT TRADE WITH EU doubling the capacity of the PRODUCTION TRANSFORMERS TO Center” by 2020 as COUNTRIES factory currently operating in CHINA a result of industry- Stating 40 percent of a 5 thousand square meters Stating that as Elektra university cooperation their export is made to indoors area is ongoing with Elektronik they export projects. Europe, Şakar said; “In order full force, Armağan Şakar said domestic production to perform direct trades that renovation and growth transformer and electronic with European countries, will be finalized by the end goods to nearly 60 countries mainly Germany with its of 2019. Stating they are also over 6 continents, mainly high potential, we founded focusing on TUBITAK joint being China, Spain, Germany, Elektra Power Quality projects in the year of progress France, Russia, New Zealand, company situated in Cologne, 2019, Şakar said they are Africa, Middle Eastern and Germany. This company is South American countries, a vital investment that will Şakar continued; “Alongside contribute greatly to our trade important projects such as operations abroad.’’ Performing 20 percent of export mainly to China with airports, rail systems, city transformers and harmonic filter hospitals in Turkey, our WILL EXPORT TO AMERICA WITH THE products, the company performs other 40 percent to Europe. products are also used abroad NEW INVESTMENT Emphasizing that they are the only company in Turkey with UL Certificate which makes it possible to export to America in low voltage transformer and reactor sector, Şakar said they are planning to add America, where they opened a new sales office in, to the list of export market countries with this new investment. Stating that they are planning to increase export rate to 70 percent with this factory investment, Şakar underlined the fact that they are going in the right path towards becoming a global brand. 62 Brands / Doruk

TECHNOLOGY THE GOAL IS TO BE A GLOBAL BRAND Doruk, a 21-year technology brand targeting 250 percent growth in 2019, plans to open offices in Germany and Japan in 2020 in addition to its US based Company.

oruk Technology countries and enter the Asian DCompany which built market in the medium and the digitization market and long term with ProManage, is a leader of this field in the only production Turkey is finishing the digital management system in the conversion of more than 300 world that is fully integrated factories worldwide with with augmented reality ProManage an intelligent and artificial intelligence production management technologies. system which is designed by Technology Company Turkish engineers according Doruk which has held the to international standards. first R & D activities in the Doruk has a company in industrial digitization area Chicago for partnership with in Turkey, is transforming the R & D of DMDII, the percent growth. Determining industrial enterprises in 20 Institute of Digital Production its future goal as “being a Determining its future countries into intelligent Design and Innovation which world brand” Doruk plans goal as “being a world and digital factories with its is established to strengthen to open offices in Germany brand”, Doruk plans registered ProManage, an the manufacturing industry and Japan by the end of to open offices in international production in the United States. Doruk 2020. Continuing its global Germany and Japan management system which achieved 100 percent growth expansion by targeting the by the end of 2020. originated from Turkey. Doruk in the first half of 2019 central countries where digital outstands with innovative compared to the same period transformation is a priority technologies developed in of the previous year and in the industry, Doruk aims digital conversion area for 21 aims to finish 2019 with 250 to spread to all European years, is becoming a global

AUGUST 2019 ISSUE 73 The Turkish Perspective 63

brand in the global market by Doruk International competent staff in the fields of Expansion Board using its industrial leadership Member Aylin Tülay augmented reality, machine Özden stressed, position in Turkey. “ProManage, a learning, artificial intelligence, digital production big data and analytics that management DORUK IS A R & D PARTNER system developed by form the basis of Industry 4.0 OF DMDII WHICH OBAMA HAS Turkish engineers and digitalization and said: from Doruk in ESTABLISHED TO STRENGTHEN the years when “We offer digital INDUSTRY IN AMERICA digitalization has transformation mentoring never been discussed Its central office located in industry, is services to industrialists being used in in Technopark, Istanbul, more than 300 around the world where Turkey, Doruk operates R&D leading industrial their current status in digital organizations intensively with its Antalya worldwide.” transformation is measured office in Teknokent and by digital methods and Izmir office in says Doruk development roadmaps are International Expansion prepared and transformation Board Member Aylin Tülay journeys are planned.” Özden and adds that Doruk is at the same time operates with FACTORIES ARE DIGITIZED IN 4 its Chicago based company TO 8 WEEKS, INVESTMENT COST for R&D partnership with transformation is a priority RECOVERED IN 2 MONTHS Digital Production Design and and they aim to spread to all Özden stated that it took only Innovation Institute DMDII European countries in the 4 to 8 weeks for companies (The Digital Manufacturing medium and long term and to to convert to digital with and Design Innovation enter the Asian market. ProManage, the digital Institute) which is established and intelligent production by the request of former US INTELLIGENT PRODUCTION management system of Doruk President Barack Obama to MANAGEMENT SYSTEM and concluded her speech as strengthen the manufacturing PROMANAGE IS USED IN MORE followed: industry in America. She THAN 300 FACTORIES AROUND THE “Industrialists can reclaim emphasizes that they aim WORLD their investment for about two to turn their companies Stressing that Doruk is months after using the digital established in the USA in the founder of market of and intelligent production 2017 into the center of Doruk’s “digitization production management system global R & D and expansion management” in Turkey ProManage. At the end of 2 operations. Özden adds this: months, a minimum of 10 “ProManage, a digital percent, but usually 20 250 PERCENT GROWTH TARGET WITH OFFICES IN GERMANY AND production management percent productivity increase IN 2019 JAPAN, DORUK AIMS TO EXPAND system developed by Turkish is provided. Considering the Özden said that Doruk INTO EUROPE AND ENTER THE engineers from Doruk in the year, for example, for an initiated a new growth ASIAN MARKET years when digitalization enterprise with an input cost operation in 2018 with a leap Underlining that they set has never been discussed in of 1 million Euros per month, of change and transformation their future goals as “being a industry, is being used in more the investment of 10 million and added these: world brand ” Özden states than 300 leading industrial Euros in 10 months decreases “We increased our annual that they are moving forward organizations worldwide. This to 8 million Euros and the growth rate from 20 percent with the goal of being the best concept is the only production plant saves 2 million Euros to 50 percent in 2018. In the Production Management management system in the per year. In summary, same year, we increased the System in the world. Ozden world that is fully integrated companies using Doruk’s share of our R&D investments states that they perform digital with augmented reality production management in our turnover from 30 conversion of the factories and artificial intelligence system ProManage can make percent to 55 percent. In the in the US, Russia, Belgium, technologies.” their production more first half of 2019, which is a Romania, Bulgaria, Algeria, efficient and agile, detect and very ambitious year in which Serbia and Tatarstan Turkey, DIGITAL TRANSFORMATION reduce losses and manage we began to reap the fruits of as well as in Turkey and until MENTOR OF INDUSTRIALISTS their costs and this move, we achieved 100 the end of 2020 they plan to Özden stated that Doruk, competitiveness. With percent growth compared open offices in Germany and a high-tech company ProManage, Turkish to the same period of the Japan. Özden says that they specialized in digital industrialists can compete previous year. We aim to finish aim to continue their global production management, with world companies in the the year with 250 percent expansion by targeting the provides high added value Industry 4.0 stage and lead by growth.” central countries where digital to the industry with its leading their own sectors.’’ 64 Figures

GERMANY 7.44 BELGIUM 1.65 EXPORTS TO TOP 20 NETHERLANDS FRANCE COUNTRIES BY TURKEY 2.50 3.86 (BILLION $)

UK Turkish exports to most 4.97 prominent 20 markets USA in the globe enjoyed a 3.84 SPAIN favourable month in 3.98 January-June 2019.

MOROCCO 1.11

POLAND 1.69

ROMANIA 1.95 RUSSIA 1.75 ITALY 4.64

BULGARIA 1.30 TURKEY CHINA IRAN 1.25 1.17

ISRAEL EGYPT 2.08 UAE 1.53 1.17 SAUDI ARABIA 1.68 IRAQ 3.47

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