Turkiye: The white goods sector balanced the decline in exports with domestic sales

According to the data of the Turkish White Goods Manufacturers Association (TURKBESD), domestic sales increased by 18% in 6 main product groups in the first 6 months of 2023, while the export volume decreased by 13%.

In the statement made by TURKBESD, the results of the sector in the first 6 months of 2023 were announced. Accordingly, in the first half of 2023, domestic sales of 6 main products increased by 18% compared to the same period of the previous year.

Exports of TURKBESD member companies decreased by 13% in this period.

TURKBESD President Gokhan Sigin, whose views are included in the statement, emphasized that the white goods sector, with its 33 million units of production and 26 million units of export performance, is the driving force in the growth of the economy by creating a large ecosystem not only with its production and sales network, but also with all other production and service sectors it is in contact with.

Stating that they continue to contribute to the national economy with 60 thousand direct and 600 thousand indirect employments, Sigin said, “The first 6 months of 2023 were a period when we felt the global economic impacts and we were shaken by the earthquake disaster as a country. We have largely prevented all these developments from having a negative impact on production and employment by achieving growth in our domestic sales. We managed to keep our production level almost at the same level as last year, with a 2% contraction.”

“The negative impact of the contraction in foreign markets on exports continues”

Sığın noted that the total sales of TURKBESD member companies, consisting of export and domestic sales, decreased by 6% in the first 6 months of the year, and noted that the negative effects of the contraction in foreign markets on exports continued. Stating that this decrease was mostly balanced in domestic sales until the end of June, Sigin continued:

“We have been able to maintain our production and employment structure so far. However, the continuation of this positive course in the domestic market is very important for our industry. For this reason, we are worried that developments that may put the dynamism in the domestic market at risk, such as reducing the number of credit card installments, increasing loan interest and commissions, or introducing tax regulations, will force our production and employment structure. The Turkish white goods sector has retained its employment and production capacity in all internal and external shocks, including the pandemic period, and has endeavored to increase this power with new investments. We have to carefully monitor the cyclical regulations that may adversely affect our production and employment.”

“It is critical to implement an Emissions Trading System compatible with the EU”

TURKBESD Deputy Chairman of the Board of Directors Fatih Ozkadi stated that the reporting period will start as of October, and that as an industry that uses the products covered by the EU’s border carbon regulation, the application has the potential to affect supply operations and underlined that they are following the process closely.

Drawing attention to the risks that will come to the agenda if the scope is expanded after the reporting period, Ozkadi said, “It is critical to implement an Emissions Trading System (ETS) compatible with the EU in our country and to transfer the funds generated to the green transformation of the private sector.”

In his speech, Ozkadi emphasized the critical importance of railway investments for the country and continued his words as follows:

“Connecting production centers and organized industrial zones to ports by railways and intermodal integration are extremely critical in Turkiye. When we take into account the EU’s Net-Zero Industry initiative, sustainability-oriented collaborations throughout the entire value chain become more and more important. It will be a strategic step for our country to strengthen its geographical position and to develop railway transportation in line with the urgent measures to be taken regarding global warming.”

“Policies specific to flat steel should be reviewed”

TURKBESD Board Member Mehmet Yavuz also stated that flat steel constitutes a significant part of the costs of the white goods industry.

Yavuz underlined that supply and demand imbalances due to global developments can cause price increases in flat steel products and said:

“In order to ensure sustainability in production against price fluctuations and uncertainty in delivery times, our companies operating in the white goods sector need to import with high protection rates from different sources. We think that this situation may cause inflation risk in the domestic market and pose a threat to our international competitiveness. We would like to emphasize that in this period when exports are negative, the policies specific to flat steel should be reviewed and customs duties on steel, which is one of the main inputs, should be abolished. While we always support the sustainable competitiveness of our country’s strong iron and steel industry as a sector, we consider it necessary to focus on green transformation in the sector, since practices such as carbon regulation at the border will be implemented in the coming period.”

“We are closely following the EU’s twin transformation legislation”

TURKBESD Board Member Semir Kuseyri made evaluations on the twin transformation (green + digital transformation), which is an important agenda item for the sector, and stated that the steps to be taken in the transformation process will both attract new investments and increase competitiveness in exports by providing a cost advantage.

Kuseyri said, “As the industry, we closely follow the twin transformation-based legislation developments in the European Union, which is our biggest export market. We are in strong cooperation with the relevant public institutions and organizations on the harmonization of these legislations in our country. In this context, we consider it extremely important for our industry to fully harmonize the legislation on artificial intelligence, cyber security, personal data and trade secret protection in our country with the EU.”

Source: AA / Prepared by Irem Yildiz

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