The image of Turkish industrial products for export

Abstract

ABSTRACT Beginning from the year 1980, Turkey changed its economic development policy from `Import substituting Industrialization` to `Export Led Growth` strategy. Economy opened up to the world trade, expo promoting incentives were initiated (including tax exemptions, rebates and favorable credit terms), direct import controls have been eliminated, and quantity restrictions have been dismantled. State intervention in the Economy was reduced to minimum level. As a result of these efforts, Turkey has increased her share from the World Markets, from 0,15% in 1980 to 0,6% in the year 2004. Between 1980 and 2004 exports of Turkey has increased from 2,9 billion dollars to 63 billion dollars. Structure of exported goods has also changed mainly agricultural products and raw materials to higher value added industrial products. That's why, Turkey became a more and more open economy as time passed. Turkey's foreign trade gained momentum especially in 1990s. This period was affected by changes a developments in the world economy and political structure. Record rate of export growth in the year 2004 is due to influence of many factors. First of all, Turkish industrial production gained some competitiveness, despite appreciation of TL, as a result of low real wages and stagnant energy. Secondly, low real interest rates in comparison to previous years lowered borrowing cost to producers and exporters. Thirdly, technological improvements has increased either by transfers because of joint venture (esp. in Automotive industry) or imports of technology. Finally, productivity accelerated in recent years was stagnant until mid 2003, creating excess supply, which were in turn directed towards exports. In Turkish exports of intermediate and capital goods are important in production. So, due to the depreciation of $ against EURO, Turkey benefited from importing cheaper intermediate goods from countries where prices are set according to US Dollar (like East Asian countries - especially China-) and exporting final products mainly to EU countries. Briefly, Turkey's foreign trade has developed much in terms of quantity and quality since 1980s. Export Performance is spectacular especially in the last two years, thanks to both domestic developments and international developments. Turkey has been implementing new strategies to make this development sustainable and to diversify that has exports more on the regional and sectoral basis. Turkey aims to go beyond 500 billion of exports by the year 2023. This Thesis tried to explain one of the main disadvantage of that Turkey has, `IMAGE` on International base by presenting of problems, reasons, development of International Trade of Turkey, tools and finally solutions could also must be taken place as suggestion.