Union of Chambers and Commodity Exchanges of Turkey

“Structural reforms must be implemented with all haste following elections”

12.02.2015 / İstanbul

The Union of Chambers and Commodity Exchanges of Turkey (TOBB) President M. Rifat Hisarcıklıoğlu stated that the period of no elections for 4 years following the elections would be a great opportunity for Turkey and said, “Structural reforms must be implemented with all haste following elections.”​

Hisarcıklıoğlu, at the İstanbul Chamber of Commerce (İTO) February Meeting, stated that the perception that the exports in Turkey are handled primarily by large companies, however, 59% of exports are being conducted by SMEs.


Pointing out that SMEs contribute greatly to the diminishing current deficit, Hisarcıklıoğlu, Turkey 40% of imports in Turkey are conducted by SMEs.


The rate of exports meeting imports in Turkey is 60% while the same rate stands at 90% for SMEs, stated Hisarcıklıoğlu and reported that SMEs are the least foreign dependent businesses.


Hisarcıklıoğlu said, “Solution to Turkey’s current deficit lies with SMEs. That is why we must provide support and strengthen SMEs.”


Emphasizing that 65% of exports are conducted cash against goods and that this represents a risk, Hisarcıklıoğlu said, “We are presenting an unsecured account. This is a great risk. This rate increases each year. Last year it was 61%, this year it’s 65%. Soon we may experience difficulty in collecting our money. Eximbank has resources to this end. We should be using Eximbank’s export insurance when exporting. Ideally, we would be trading against cash but there is too much competition. The opposite is true in imports. We buy 49% of imports with cash; we’re selling against credit but buying cash.”


Stating that currency and credit interest rates are very important for them, Hisarcıklıoğlu reported that these two factors directly burden them.


Touching on the issues presented by taxes on employment, Hisarcıklıoğlu reported that the tax burden in Turkey on employment is almost twice that of OECD. Turkey’s biggest issue is employment.


Hisarcıklıoğlu stated that TOBB, the Ministry of Labor and Social Security, the Ministry of National Education and the Turkey Employment Institution (İş-Kur) have taken on the burden of implementing the Specialized Vocational Training Centers (UMEM).


Pointing out that the province which makes use of UMEM the least is İstanbul, Hisarcıklıoğlu said, “In this regard, if you employ personnel through UMEM, your tax burden is decreased by 18%. What saddens me the most is the fact that the ones making use of this project the most are foreign companies. They know what’s going on, we don’t.”


- “Structural reforms must be implemented with all haste following elections”


Rifat Hisarcıklıoğlu spoke in regards to opportunities and risks presented by 2015, “Turkey is a country integrated with the world’s economy. That is why we are automatically effected by any changes happening in the economies of the world. The Fed’s currency decisions, if implemented, will push us into a period when finding money will be difficult. On the other hand, a decision which will provide advantages to countries like ours has been announced by the4 European Central Bank stating that they will revert to monetary expansion policies. This is very important for countries with current deficit like us.”


Stating that structural reforms must be implemented with all haste following the 2015 elections, Hisarcıklıoğlu said, “Between 1998 and 2002, per capita income in Turkey was 4,000$. In line with the structural reforms implemented in 2002, Turkey leapt forward. There was a 2.5 times increase in per capita income. There has not been another instance of time in Turkey’s past this achievement has been seen before. However, with the 2008 crisis, we came to a standstill. Trying to come out of the crisis, we forgot about structural reforms. We’ve been stuck at 10,000$ per capita income for the last 7 years. Following the July of 2015, there will be no elections for 4 years. Structural reforms are implemented in periods without elections. If structural reforms are implemented Turkey’s economy will gain new momentum.”


- İTO Board President Çağlar


TOBB Board Vice President and İTO Board President İbrahim Çağlar, touching on their visit to the President Erdoğan last week wherein he had expressed the importance he puts on İstanbul and İTO members, “I saw once again that his hard work and dedication for the country gives power to our efforts.”


Çağlar reported that they had found opportunity to relay their views and suggestions to the highest level during their visit to the Prime Minister Davutoğlu with the TOBB President Hisarcıklıoğlu.


Çağlar also touched on their efforts at the World Economic Forum held in Davos last month.


İbrahim Çağlar stated thatthey would be launching the 2015 Global Vision Project next week with a press meeting.


Commenting on the latest Trade Activity Index figures, Çağlar reported that increases are viewed in all fields; production, trade, service and general commercial activity.

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