Turkey’s trade ties bend Eastward, says strategist
ISTANBUL - Hürriyet Daily NewsTurkey’s trade ties are bending eastward as northern Iraq becomes a shining star for local exporters, according to a top executive at Accenture, the global management consulting, technology services and outsourcing company, with more than 244,000 people serving clients in more than 120 countries.
“Northern Iraq will soon become the biggest trade partner of Turkey, surpassing Germany,” Mark Spelman, managing director of Accenture’s strategy practice, told the Hürriyet Daily News in a recent interview on the sidelines of the first Uludağ Summit, in the northwestern province of Bursa.
The percentage of foreign sales among rapidly-developing nations in this period increased substantially, according to a recent report on the diversification of emerging economies’ exports between 2000 and 2010, he said.
Brazil’s exports to emerging economies reached 63 percent last year, up from 48 percent nearly 12 years ago.
Turkey will continue to increase its trade ties with other emerging economies, especially the Gulf and Middle Eastern countries, he predicted.
“My key observation is the diversification of Turkey’s exports,” said Spelman, adding that trade with Europe would be limited, but a greater opportunity for the county would lie in the Middle East, Africa and Asia.
“Creating brands is important; however, creating regional brands is also another way to be successful.”
The share in total exports of Turkey’s top export market, Germany, dropped to 10.4 percent last year from nearly 14 percent in 2004, according to official data.
Turkey’s southern neighbor Iraq became the second largest export market of Turkey with nearly $8.27 billion last year, rising from 9th place in 2004 with a volume of $1.85 billion. Trade with northern Iraq made up the lion’s share of this rise.
Exports to Iraq made up only a 2.9 percent stake in Turkish trade eight years ago, which rose to 6.1 percent in 2011. Acceleration of sales to Iraq jumped by 37 percent between 2000 and 2010 cumulatively, while the growth rate of exports to Germany in the same period rose by 9 percent.
Saudi Arabia tops list
The growth rate of Turkey’s exports to Saudi Arabia increased 38 percent, surpassing even Iraq.
The figure stands at 26 percent for Russia and 20 percent for Spain. Trade with the Western world paints the opposite picture, as the export growth rate to the United States increased only a modest 9 percent and to Germany just 16 percent. The rate to the United Kingdom stands at 16 percent.
In order to boost its exports to the region, the Turkish government should hand over operation of railroad transportation to the private sector, Lucien Arkas, chairperson of Arkas Holding, told the Daily News. By connecting the major harbors of the country with alternative railroads, Turkey could protect its export ties with the turmoil-hit Middle East and North Africa, he said.
Separately Spelman said their analysis showed that household income in the emerging market would increase more than $8.5 trillion between 2010 and 2020, representing nearly 60 percent of the total global increase.