Defense industry demand fuels growth in machinery sector

ISTANBUL

Geopolitical tensions are accelerating defense industry investments, which in turn create strong indirect demand channels for the machinery sector, said Kutlu Karavelioğlu, president of the Machinery Exporters’ Association (MAİB).

He emphasized that defense production relies on a broad ecosystem of materials, machinery, and engineering and that these investments trigger not only the manufacturing of final defense systems but also the renewal of the entire industrial infrastructure through a powerful multiplier effect.

Karavelioğlu, however, warned that Türkiye’s machinery production has been declining, pointing to unfair competition from Chinese goods that dominate markets through one-sided trade and circumvent protective measures. He noted that annualized machinery imports rose to $46.5 billion in January, describing this as a clear threat to the sustainability of Türkiye’s civilian and military technology ecosystem. “Additional customs duties with significant rates now appear inevitable,” he said.

According to MAİB data, machinery exports in January–February increased by 4.5 percent year-on-year to $4.4 billion. Consolidated annualized machinery exports rose 2.6 percent compared to the previous 12 months, reaching $28.9 billion.

Germany was the largest export destination, with shipments rising 14.9 percent to $561 million. The U.S. followed with a sharp 57.6 percent increase to $370 million. Italy ranked third, surpassing the $100 million threshold with a 16.4 percent rise. In contrast, exports to Russia fell by 32 percent, while shipments to Iraq dropped by 44 percent.