north america and global economy trade report on turkey funda celikaksoy said diarra
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NORTH AMERICA AND GLOBAL ECONOMY
TRADE REPORT ON TURKEY
Funda CelikaksoySaid Diarra
COUNTRY PROFILE
The population is approximately 70 million in 2003
The population growth rate is 1.53%
The life expectancy is 68.7 years
The age distribution is:• 0-14 : 26.6%• 15-64: 66.8%• 65 +: 6.6%
COUNTRY PROFILE
Politics:
Turkey is a parliamentary democracy
The President is Ahmet Necdet Sezer and the Prime Minister is Recep Tayyip Erdogan
The President is elected by National Assembly for a seven year term
The Minister of Economy is Ali Babacan and the Minister of Industry and Trade is Ali Coskun
COUNTRY PROFILE
Ethnic composition: Turks: 80% Kurds: 20%
Religion: Muslim : 99% Christian and Jews : 1%
COUNTRY PROFILE GDP IN $US:
1999 2000 2001 2002 2003
GDP in$ US(per capita PPP)
6,135 6,730 6,046 6,448 6,718
GDP Real growth rate (%)
- 6.1 6.3 -9.5 7.9 5.9
GNP current prices (million $)
185,267 200,002 145,693
180,892
239,235
GNP per capita 2,879 2,965 2,123 2,598 3,383
COUNTRY PROFILE Structure of the
economy: GDP composition by sector
(%)1999
2000 2001 2002 2003 2004
Agriculture 16.0
15.4 12.8 13.0 13.4 24.3
Industry/Manufacturing
19.0
20.0 21.1 19.7 18.5 15.3
Services 64.9
64.6 66.1 67.3 68.2 61.0
COUNTRY PROFILE
Government finances:
The budget is constantly in deficit
The public debt ratio to GDP is 54.4%
The government expenditure is 39% of the GDP
The government revenue is 28% of the GDP
The public debt is 194,386,700 billion (TL) (194 billion
$CAN)
COUNTRY PROFILE
Balance of Payment:(million dollars) 2000 2001 2002 2003 2004Current Account
-9,819 3,390 -1,522 -8,037 -10,739
Goods balance
-21,959 -3,733 -7,283 -14,010 -18,772
Goods&service
-10,591 5,397 596 -3,505 -7,166
Goods&service& investment
-14,593 397 -3,958 -9,064 -11,658
Capital Account
9,584 -14,643
1,161 7,091 13,169
Balance -2,997 -12,924
-212 4,097 4,587
Official Reserves
2,997 12,914 212 -4,097 4,584
Country Profile Exchange rates : on March 4 2005; YTL/USD
1.2620, YTL/EURO1.6690, YTL/CAD 1.020 Foreign Exchange Reserves: On Feb 18 2005
total reserves is US$ 38,433.4 million, foreign currency reserves are held mainly in US dollars
Net international investment position by latest data in 2003 is US$ –111,225 million
Gross External Debt: US$ 153,160 million Foreign Debt to GDP ratio: 64%
COUNTRY PROFILE Global Ranking:
Growth Competitiveness: 66th out of 80
Business Competitiveness : 52nd out of 80
Public Institutions: 63rd
Corruption sub index: 75th
Microeconomic Competitiveness: 54th out of 80
Human development index: 88th
COUNTRY PROFILE
International organizations: NATO, Council of Europe, UN, OECD, UNESCO, WHO, WTO, IMF, World Bank
Trade Agreements: Customs Union with EU EFTA Euro-Mediterranean Partnership Economic Cooperation Organization Black Sea Economic Cooperation
COUNTRY PROFILE
Bilateral relations with Canada:
Turkey is a valued commercial and strategic partner for Canada
They both share common membership in numerous international organizations (UN, G20, OECD)
Turkey is Canada’s second largest trading partner in Central and Eastern Europe
It provides good opportunity to sell Canadian products/services
The total bilateral trade is positive and is expected to steadily increase
COUNTRY PROFILE
Bilateral relations with Canada:
Canada’s primarily exports commodities (coal, wheat, wood pulp)
Double taxation agreement was reached between the two countries
Canada-Turkey framework agreement (to ensure closer bilateral relationship)
Country Profile
Bilateral relations with the US
US is one of the major trade partners of Turkey Export items to the US: iron&steel, pearls and precious
stones, machinery and mechanic parts, tobacco and cement
Import items from the US: machinery, electrical equipments, pharmaceuticals, organic chemicals, aircraft and parts, optical and photographic instruments
Exports and imports share 8 and 5% respectively Turkey constitutes 0.2% of imports and 0.4 of exports of
the US
COUNTRY PROFILE
Bilateral relation with NAFTA:
Turkey mostly deal with Canada and the US but doesn’t have a significant relationship with Mexico
Turkey’s exports to NAFTA totaled more than $3.6 billion in 2004 (8.6% of total exports)
Turkey’s imports from NAFTA equaled more than $4.6 billion (5.4% of total imports)
INTERNATIONAL TRADE
Turkey’s exports: Total exports are US$ 56 billion in 2004 Main exporting partners are Germany, the US, the UK, Italy, France,
Spain, Holland, Russian Federation ( 80% of exports are directed to EU countries)
Main export products: Textile and clothing: $6.6 billion 23% of total exports Iron and Steel: $2.2 billion, 6.9 million tons Agriculture: Olive, cotton, tobacco, hazelnut Chemicals: $436 million, plastic raw materials
$ 289.6 million, soaps, detergent, cleaning products Glass and Ceramics: 5th in tiles production (world)
4th in Europe Gold jewellery Mining
INTERNATIONAL TRADE
Turkey’s imports: Total imports are US$ 87 billion in 2004
Main importing partners are Germany, The US, the UK, France, Russian Federation (88% of imports are from EU)
Main import products are: Machinery and equipment Chemicals Petroleum Pharmaceutical products
INTERNATIONAL TRADE
Capital Flows: Total FDI in Turkey amounted to US$ 32 billion by 2003,
there are 6584 foreign companies operating in Turkey, 108 out of top 500 companies list of Fortune magazine
The leading investors: France, Netherlands, Germany, UK, the US
EU accounts for 68% of foreign investment stock OECD accounts for 88%, 2% for Islamic countries, 1%
East European countries, 9% other countries Services represent 50-55% of the total stock of FDI Manufacturing sectors investments, 35-40% Agriculture and mining investments: 5%
INTERNATIONAL TRADE
International disputes:
Turkey has been involved in 12 cases
7 concerned Turkey’s trade measures
3 involved quantitative restrictions on imports of textile and clothing products
Turkey has been the complainant in 2 cases against Egypt and South Africa
INTERNATIONAL TRADE
International disputes with the US:
Generalized System of Preferences (GSP)
Intellectual Property Rights
Anti-Dumping & countervailing duties
Textiles trade
FDA regulations
TRADE POLICY
Influenced by WTO and trade relations with the EU
An export-oriented high value-added services and manufactured products
It also includes an emphasis on technology-intensive
Focuses on supporting export activities particularly of SME’s
Government's goal is to contribute to efficiency of free zones by dealing more with Middle East, Caucasian region and Central Asia
TRADE POLICY
Long term strategy contains 8 five year development plans for 2001-2005
Reduce state intervention by privatization of public enterprises
Promoting FDI Continue industrialization policy Finance exports through the Turk Eximbank Improve infrastructure for better
international trade relationships
TRADE POLICY
Recent modifications on domestic legislation on:
Intellectual property rights Telecommunication Customs Anti-dumping Banking Energy Government procurement
TRADE POLICY
It is not a signatory of the Plurilateral Agreements from the Uruguay Round
Interest in Doha Development Agenda: Future multilateral tariff reduction Simplification of tariff structure Elimination of non-tariff barrier Equitable agricultural trading environment
CONCLUSIONMany future opportunities with the future and official entry
in the EUAcquiring more knowledge with the machine they’re
importing
Multiple agreement in the region give them an increase level of trade because they deal with different type of market influence in “relationship know-how”
Stable political regime so less risk for making business Average ranking that gives it time to grow
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