Imam SUN Turkey’s exports continued to grow in July and reached 18.6 billion dollars with an increase of 13.4 percent. Growing in the first 7 months of the year, exports exceeded 144 billion dollars in this period. The year-end target of 250 billion dollars is expected to be exceeded. The rising energy and commodity prices due to concerns about recession in the world, the Russia-Ukraine war, as well as the rise in demand in exports led to import winds. As a result of the increase in incoming orders and additional capacity and new investments, export targets have grown even more. Exporters are working diligently to ensure that the recent success is sustainable. Therefore, expectations for 2022 and beyond are quite high. So, what should exporters do to make Turkish exports more value-added, more profitable and sustainable? What are the strategies on the exporter’s desk? We have examined this issue in detail.
1-TARGET 2 DOLLARS PER KLOGRAM EXPORT
The export value per kilogram, which was $1.09 in 2020, rose to $1.37 last year. The average of the world’s top 10 economies is around 2.4. Japan is the leader in this field with about 4 dollars. Germany, South Korea, and the United States follow, respectively. Turkey’s primary goal is to reach the level of 2 dollars. At this point, value-added production should be prioritized. Turkey’s exports are still dependent on imports. This means that a lower profit remains in the country.
2-BRANDED EXPORT ATTACK
World giant companies have significant investments in many countries. At this point, it also manages the products to be purchased from a single center. Turkish companies need to increase their awareness in order to be on the radar of these companies. In addition, steps should be taken to become a global brand. Especially ready-made clothing companies have succeeded in making a certain progress in this regard. However, the emergence of a global brand from all sectors means more value-added exports. The works to be carried out by the Brand Council, implemented by the Turkish Exporters’ Assembly (TIM), are of critical importance.
3- WILL EXPORT DISTANCE CATCH THE WORLD AVERAGE?
The average export distance shows how far the distance has been reached by calculating the average of exports to the whole world. Exporting to approximately 220 countries, Turkey, on the other hand, managed to exceed the 3 thousand kilometer threshold last year for the first time in its history. Action is being taken to increase the export range, which is 3 thousand 65 kilometers on average, above the world average of 4 thousand 744 kilometers. By taking the traditional product-market structure of exports to the next level, focusing on new-product and new-market diversity, the route will be turned to distant countries. The Ministry of Commerce also shared the details of this issue with the “Farth Country Strategy” study.
4-NUMBER OF EXPORTERS “KNOWING THE EXPORT” MUST INCREASED
Today, the number of exporters registered with TİM has reached 105 thousand. According to the report of TİM; The total exports of the companies in the top 1000 in 2021 increased by 33.2 percent compared to the previous year and reached 123.3 billion dollars. The share of these companies in total exports rose to 54.7 percent. The exports of many of its member firms are not sustainable or are progressing at a symbolic level. The average survival time of companies that have just started exporting in Turkey is 4 years. This is a pretty low time. In this regard, export trainings are given for SMEs, especially the Ministry of Trade and TİM. Although it is not at the desired level yet, many companies have started to learn about qualified exports. As a result of the increase in foreign exchange prices due to the depreciation of the TL, the trade made to the foreign market attracted companies. In this period, companies mainly work on exports. Firms need to employ foreign trade experts, develop their export departments in finding new markets and examining competing products. TİM will focus on this issue and focus on making progress.
5- YOUNG PEOPLE WILL HAVE DIGITALIZED EXPORTS
Firms in Turkey have a conventional approach. There is often concern about handing over responsibility to the next generation. Recently, we see that young business people play an active role. The responsibility to be given to young people in companies will also accelerate the construction of more value-added business. Young TİM, implemented by TİM, is an example of these developments. In exports, the flag passes towards the Y and Z generations. The responsibilities that young people will take in their companies and exporters’ associations may turn into profitable exports with a snowball effect. On the other hand, the concept of e-export, which was reinforced during the pandemic period, enabled companies to invest in this field. Last year, 200 businesses said “hello” to e-export for the first time, and in 2022, this number exceeded 600. However, the share of e-exports in Turkey’s total exports is still around 1 percent. The world average of e-exports is between 3.5 and 4.5 percent of total exports. It is expected to reach the world average in a few years as companies increase their investments in e-export. We hear that TİM will focus on this issue in its strategy report.
6-QUALIFIED STAFF WILL BE RAISED
Turkey is the favorite of many countries with its cheap labor force. There are many foreign companies investing in Turkey with cheap labor. At the same time, by providing a lower pricing model, a competitive advantage is obtained in exports. However, qualified personnel are required for quality production. Many of the exporters state that they have employment problems in this regard. Many studies are being carried out to choose vocational branches in universities and high schools. At this point, more qualified personnel should be trained by improving wage and vocational education policies. Recently, we learned that many exporters’ unions will cooperate with universities.
7-SUPPORT TO DOMESTIC PRODUCTION
Export, which is the most important factor in the growth of the Turkish economy, is not yet at the desired profitability. Having an import-based export system can cause exports, which are in high demand, to gain from the release, so to speak. Many short-term attempts at import substitution failed to achieve the desired result. The poor work on getting opinions and suggestions from exporters was instrumental in this result. With the import substitution move that can be prepared with the relevant ministries and business world representatives within the framework of the culture of cooperation, more foreign currency will be earned for Turkey by determining the products that can be produced in Turkey and creating the necessary investment supports. There is a study on this issue on the exporter side and it is expected to be submitted to the Ministry of Trade.