No. 81 April 2008
 
 

OFFICE OF THE PRIME MINISTER, DIRECTORATE GENERAL OF PRESS AND INFORMATION
ECONOMIC BRIEFS
 
• Prime Minister Recep Tayyip Erdoğan praised Turkey's economic success in a speech on April 1. He said that Turkey has been growing for 24 consecutive quarters despite economic, political and global difficulties. "This is the first time Turkey has experienced such growth. This is an indicator of how resistant and robust our economy is," Erdoğan told his Justice and Development Party's parliamentary group meeting. He underscored that political stability and confidence are more important than ever for maintaining economic growth. "Everybody must understand this and take responsibility," Erdoğan stated. He said Turkey's economic growth had felt the impact of international turbulence and last year's elections, stressing that this performance should not be underestimated. "Turkey's national income reached $856.3 billion in 2007, which means we have exceeded the $500 billion threshold," Erdoğan said. "This is important. Now Turkey is a major league team."
 
• Kuwaiti Emir Sabah al-Ahmad al-Jabir al-Sabah's visit to Turkey will usher in a new era in relations between Turkey and Gulf countries, said President Abdullah Gül on April 2. Speaking at a Turkish-Kuwaiti Business Council Meeting in Istanbul, Gül stressed that al-Sabah's visit shows that they are encouraging cooperation between businessmen of the two countries. "We urge you to cooperate," Gül said. Also addressing the meeting, Foreign Economic Relations Board (DEIK) head Rona Yırcalı said that Turkey's economic relations with Kuwait could be better. "Relations have picked up in the past few years, but they're not at the level we want," Yırcalı said, adding that the bilateral trade volume is a mere $310 million. "We would be pleased to see more Kuwaiti investments in Turkey. In the past few years, Turkey has paid special attention to developing commercial relations with Gulf countries." He stressed that Turkish and Kuwaiti banks must establish direct contacts to help businessmen of both countries get letters of guarantee. In 2007, Turkey's exports to Kuwait amounted $220 million while its imports totaled $92 million. Turkish and Kuwaiti officials signed a cooperation agreement on April 2 to work together on mass housing and residential estate projects. Officials from Turkey's Housing Development Administration (TOKI) and Kuwait's Investment Bank signed the agreement. "The agreement will bring foreign capital to Turkey," said Ahmet Haluk Karabel, the deputy chair of Turkey's Housing Development Administration (TOKI). Turkish and Kuwaiti officials signed a memorandum of understanding on April 2 to work together on mass housing and residential estate projects. Officials from TOKI and Kuwait's Investment Bank (KIA) signed the pact. The pact is expected to be implemented in a year and is meant to attract Gulf capital to Turkey.
 
• The Turkish government aims to complete the Southeastern Anatolia Project (GAP) within the next five years, Prime Minister Recep Tayyip Erdoğan said on April 7. Addressing the Women's Branch of the ruling Justice and Development Party in Ankara, Erdoğan said GAP's infrastructure work would be completed soon. "GAP will have investments of $12.5 billion," he stated. Erdoğan added that Turkey's gross domestic product (GDP) recently reached $659 billion.
 
• Turkey's automotive exports rose 55 percent in the first quarter of 2008. Turkey earned $6.6 billion from its automotive exports in the first three months of 2008, a regional exporters' association said on April 1. This first quarter figure is more than all auto exports in 2002 ($4.8 billion), while Turkey only earned $4.3 billion from its automotive exports in the same period last year. According to the association, automobiles were the main auto products Turkey exported in the first quarter, followed by automotive by-industry products and trucks. Turkey sold its automotive products to 14 free zones and 167 countries and autonomous regions in the first quarter of 2008. Germany, France, Italy, Britain and Spain were the main European countries where Turkey exported automobiles and related products. Turkey's automotive exports were up $2.5 billion with a 34 percent rise in March, compared to only $1.7 billion last year.
 
• Turkey's national air carrier joined the Star Alliance network on April 1. Turkish Airlines (THY) was welcomed as the 20th Star Alliance member airline at a ceremony in Istanbul. With an additional 31 destinations, mainly in Turkey, Central Asia and the Middle East, customers now have more choice than ever before when traveling on the Star Alliance network. Overall, the world's most experienced aviation alliance now offers customers the choice of 18,000 daily flights serving 965 airports in 162 countries. "With Turkish Airlines, we have gained a new member carrier with a strong home market which is also one of the fastest growing economies in the world," said Jaan Albrecht, Star Alliance CEO, at Istanbul's Atatürk Airport. Albrecht said Star Alliance can now offer benefits to a large number of new travelers and simplify travel for its existing customers to many of the new emerging markets. Turkish Airlines is now offering the wide-ranging customer benefits of Star Alliance.
 
• Saudi officials on April 1 authorized a Turkish bank to open a branch in Saudi Arabia. Following Parliament Speaker Köksal Toptan's talks with Saudi King Abdullah, the Saudi Cabinet approved the opening of a branch by Ziraat Bankasi. "I believe this decision, which solves the biggest problem faced by Turkish contractors in Saudi Arabia, will greatly help to improve economic relations between our countries," Toptan said.
 
• The Turkish-Swedish Business Council, operating under Turkey's Foreign Economic Relations Board (DEIK), held a Turkish-Swedish Business Forum in Stockholm on April 1, during Prime Minister Recep Tayyip Erdoğan's visit to the country. The Swedish Trade Council (Exportradet) hosted the forum. "Turkey attracted $13 million in direct foreign investments from 2002 to 2007," the board said. The forum focused on opportunities for the countries to cooperate to open to third markets. The prime minister also addressed the forum.
 
• Italy is pleased with the selection of Milan to host Expo 2015, but respects its distinguished rival candidate Izmir, said the Italian Embassy in Ankara on April 1. According to the embassy, the competition between the two cities occurred within a framework of mutual respect, honesty and friendship. The competition contributed to excellent economic and cultural relations between Turkey and Italy, it added.
 
• The Baku-Tbilisi-Ceyhan (BTC) Pipeline that channels Caspian oil to world markets via Turkey continues to benefit all involved countries. To date, 333 million barrels have been pumped to Ceyhan, Turkey and from there to global markets. Turkey earned $1.5 billion from the shipments that began in June 2006. The daily capacity of the Ceyhan facilities is around 750,000 barrels. The BTC pipeline cost $3.4 billion to set up and is 1,776 kilometers long.
 
• State Minister Kürşat Tüzmen said on April 1 that Turkish exporters continue to increase their share of world markets. "In the first three months of 2008, Turkey's exports equaled all its exports from 2001," he said. Tüzmen stressed that, despite the global economic crisis, Turkish exporters have managed to boost exports. "In the first three months of 2008, Turkey's exports were worth over $30 billion," he explained. "This is equal to all our exports in 2001. This figure is an indication of how far Turkish exporters have come." Turkey's exports rose by 22.9 percent in March over the same month last year to reach $10.95 billion, the Turkish Exporters' Assembly (TIM) said on April 1. In a press conference, TIM head Oğuz Satıcı said Turkey's exports rose 36.2 percent in the first three months of 2008 to reach $31.4 billion. Turkey's exports over the past year rose 26.59 percent to $114 billion, Satıcı said.
 
• Turkey's exports reached $21.6 billion and imports rose to $32.2 billion in the first two months of this year, said the Turkish Board of Statistics (TUIK). Turkey's exports rose by 43.9 percent in February over the same month last year to reach $11 billion, while imports climbed to $15.9 billion, rising 40.1 percent. The foreign trade deficit grew 32.2 percent to reach $4.9 billion in February. The foreign trade deficit for the first two months rose 37.2 percent.
 
• On official visit to South Africa from March 31 to April 2, Energy and Natural Resources Minister Hilmi Güler attended a meeting of the countries' Joint Economic Commission (KEK). At the meeting, co-chaired by Güler and South African Trade and Industry Minister Mandisi Mpahlwa, participants discussed investment opportunities, chances for signing a free trade agreement and cooperation in such fields as energy, mining, agriculture, industry, transportation, health, technical collaboration, construction and consultancy. During his visit Güler also visited South African gold mines.
 
• Turkey participated in the Seventh Special Operations Forces Exhibition and Conference (SOFEX-2008) in Amman, Jordan. Twenty companies represented Turkey at the conference. Around 300 companies and 700 representatives from 60 countries also attended the fair. Bringing together the world's leading counter-terrorism and homeland security manufacturers with high-ranking defense officials and government decision makers, SOFEX is a unique global gathering for showcasing the latest counter-terrorism and homeland security solutions to combat today's ever-increasing security challenges. "We sought cooperation opportunities," Murad Bayar, Turkey's defense industry undersecretary, told reporters. "We had fairly good expectations and we have drawn pretty good interest at the fair." Jordan's King Abdullah paid a short visit to Turkish stand after the inauguration ceremony. Aselsan, TAI, Anel, BMC, Havelsan and Roketsan were among Turkish firms which showed their wares at the show, which lasted from March 31 to April 3. There are about 200 defense industry firms in Turkey with annual gross revenues of $2.5 billion. The industry has annual exports of $500 million, and spends $100 million on research and development. The Turkish defense industry is selling products to armies of many countries, including NATO member states. Turkey's defense industry also got the Best Country Representation and Design Special Award at the conference.
 
• The Fifth Bursa Automobile Fair was held on April 1-6 at the Bursa International Fair and Congress Center. TUYAP Fair's İlhan Ersözlü told reporters that significant automotive investments have been made in the western province of Bursa and surrounding provinces, making the region one of Turkey's top production centers. Twenty-seven carmakers showed their cars and trucks, and motor vehicles enthusiasts had the opportunity to see the latest models. Some 95 companies and company representatives from 10 countries attended the fair, many for the first time.

• After reaching $9,333 in per capita national income following a recent change in calculations of national income, Turkey climbed to number 54 on the International Monetary Fund's global gross domestic product (GDP) ranking, up from 64 from the previous list. The IMF economic outlook database for October 2007 said Turkey had climbed to 54, according to new figures, outpacing Uruguay, the world's 10th-biggest economy Brazil, Gabon, Botswana, EU member Romania, equatorial Guinea, oil-rich Venezuela, Mexico, oil- and natural gas-rich Russia and Seychelles. Turkey's GDP reached $658.8 billion thanks to the new calculations, staying at number 17, up from $482 billion.
 
• Economic success is a must for a good democratic system, said Foreign Minister Ali Babacan. "Economic progress without a well-functioning democratic system is impossible," Babacan said in a speech to an international economic conference in Ankara. Babacan also underscored the importance of meeting the Copenhagen and Maastricht criteria, and institutional reforms on the road to European Union membership. Citing EU values such as democracy, freedom, fundamental rights and the rule of law, he said implementing these values makes a country's economy more "predictable." "Our EU accession bid provides a significant foreign mainstay and a more predictable economy for Turkey," Babacan said. He added that Ankara's EU accession process is seen as a strong element of stability in the long term, and so most foreign investors want to know how Turkey's EU membership bid is going and whether Turkey will be a stable country five to 10 years from now.
 
• The Antalya Boatshow 2008 took place in the Mediterranean province on April 3-6. Maritime Undersecretary Hasan Naiboğlu told reporters that the Turkish ship and yacht construction industry, one of the most important branches of the maritime sector, has improved significantly over the last 20 years. Naiboğlu said in the last five years the industry has climbed from 23rd to fourth place in international rankings, and to third place in large yacht building. He added that Turkey exported yachts worth $137 million in 2005, and this figure climbed to $190 million in 2006. Large yachts worth $1-5 million were shown at the fair.
 
• Turkish and German unions agreed on April 3 to boost their cooperation. Four Turkish unions signed a declaration with the German Association of Trade Unions (DGB). The document is the fruit of a dialogue and cooperation project between Turkish and German unions launched almost a year ago. Under the declaration, the unions work to improve cooperation to promote better working conditions in Europe, provide laborers with all union rights (including collective bargaining and contracts and the right to strike), improve labor rights in Turkey, create a social Europe for laborers, and strengthen economic interests and social rights. Turkish unions signing the declaration were the Turkish Confederation of Labor (Turk-Is), Confederation of Revolutionary Workers Unions (DISK), Confederation of Turkish Real Trade Unions (Hak-Is) and Confederation of Public Sector Unions (KESK).
 
• There are no problems with cell phone coverage in large Turkish cities, but only in small residential areas, said Tayfun Acarer, the head of Turkey's Telecommunication Board, on April 3. "Out of over 38,300 residential areas in Turkey, only about 2,700 aren't covered by GSM operators," Acarer said, adding that the situation in those areas is getting better all the time. Acarer also spoke about the authority's work last year, as well as its plans for this year. He said the number of cell phones imported and registered in the system in 2008 would exceed 18 million by year's-end. Acarer said the status of the regions with no coverage, as well as providing continuous communication on railway and highway routes, are top priorities this year. Galip Zerey, another top official from the authority, said there would definitely be a tender on 3G technologies. He said the authority wants to grant a 3G license even if only one company bids.
 
• Yurdal Öztaş, deputy director general of the Turkish Oil Corporation (TPAO), on April 3  stressed  Georgia's  importance  for  Turkey's  energy  projects.  At  an international conference in Tbilisi on oil, gas, energy, Georgia focusing on energy routes and new projects, Öztaş said Georgia is key for Turkey's ambition to become an energy corridor for Europe. "Georgia has an important role in our energy link to Azerbaijan, and so we can't ignore Georgia because we want to become an energy corridor for Europe," he said. Turkey is cooperating with Georgia on the Baku-Tbilisi-Ceyhan (BTC) pipeline, a crude oil pipeline that covers 1,768 kilometers (1,099 miles) from the Azeri-Chirag-Gunesli oilfield in the Caspian Sea to the Mediterranean Sea. It connects Baku, Azerbaijan, Tbilisi, and Ceyhan, a port on Turkey's southeastern Mediterranean coast. It is the second-longest oil pipeline in the world after the Druzhba pipeline. The first oil that was pumped from the Baku end of the pipeline on May 10, 2005 reached Ceyhan on May 28, 2006.
 
• The 10th International ISAF Fair took place in Ankara on April 3-6. A total of 150 Turkish and foreign participants as well as more than 300 companies attended the 10th ISAF International Security, Fire, Emergency, Search and Rescue and Telecommunications Fair.
 
• The United States would like to bring agricultural technology to Turkey, US Agriculture Undersecretary Ralph Gifford said on April 3. Visiting the Third Mersin Agriculture Fair, Gifford said that the agriculture sector in Turkey should be encouraged. He said Turkey had a great agriculture potential both in quality and quantity. He pledged to tell US agriculture sector figures about the fair, and to try to strengthen relations in this area. "I think better marketing and promotion of Turkish agricultural products would help boost exports," Gifford added. In related news, James Fluker, commerce undersecretary of the US Embassy in Ankara, said foreign investors are growing more interested in Turkey. He said foreign investments in Turkey had climbed from $20 billion in 2006 to $22 billion in 2007.
 
• Turkey's natural gas and electricity is among the cheapest in Europe, Energy and Natural Resources Minister Hilmi Güler said on April 4. Speaking to reporters in Antalya, Güler said an automatic pricing system would soon be implemented in Turkey. He said that last year electricity consumption rose 1 percent in Europe, 8 percent in Turkey and 27 percent in Antalya. "The figures are always rising. Our duty is to meet this demand," he added. Güler also said there was a new project for solar energy in Antalya.
 
• There are 14 Turkish firms among the world's biggest companies, according to Forbes magazine. In Forbes' annual ranking of the world's 2,000 biggest companies, Turkey's İşBank was the top performer at number 37, followed by Akbank and Garanti Bankası. According to Forbes, İşBank has a market value of $12.9 billion.

• Turkish hazelnuts will be promoted with a large campaign in Russia. State Minister Kürşat Tüzmen told reporters on April 4 that Turkey's Hazelnut Promotion Group would start a campaign in Russia to introduce hazelnuts, one of Turkey's key exports. Tüzmen said the group was established 11 years ago, and thanks to its efforts, Turkish hazelnut exports have risen, especially to China and Japan. As hazelnuts are often used with chocolate, the major consumer is Europe, he added.
 
• Greek-Turkish Chamber of Commerce head Panagiotis Koutsikos said on April 4 that Turkish businessmen are making very good investments in his country. At the Boatshow Fair in the Mediterranean province of Antalya, Koutsikos said that cooperation between Turkish and Greek businessmen is strengthening, adding that Turkish businessmen attended more than 10 events in Athens last year. Koutsikos said that Turkish businessmen made important investments in many sectors in Greece and have been very successful. The bilateral trade volume rose from $200 million to $3 billion, he added.
 
• Foreign Minister Ali Babacan said on April 3 that Turkey had made a strategic decision to support and participate in the Nabucco project. After meeting with Romanian Foreign Minister Adrian Cioroianu on the sidelines of a NATO summit in Bucharest, Babacan told reporters that Turkey wants to implement Nabucco, an important project for dealing with Europe's energy problems. Work is underway on technical and financial details of the project, he said, adding that the trade volume between Turkey and Romania in 2007 was $7 billion and there are currently 7,000 Turkish companies operating in Romania. Turkey and Romania are close allies in the Black Sea Economic Cooperation and NATO, and Romania supports Turkey's EU membership, Babacan said. The Nabucco pipeline will make Turkey an energy terminal and connect Europe to the large natural gas reserves of the Caspian, Middle East and Egypt. The pipeline will be 3,300 kilometers long and cost around 5billion euros to complete. It would be completed by 2012. Once completed, the pipeline will carry 31 billion cubic meters of gas annually.
 
• Turkish Airlines (THY) has outpaced its European in terms of net operating profit, company CEO Temel Kotil said on April 5. Last year THY set a new record with a net operating profit of 546 million YTL, said Kotil. THY planes fly to 139 cities in 69 countries. "Last year we carried 19.6 million passengers, up 16 percent," added Kotil. "We hope to carry more than 23 million people this year. THY had great success last year, and we expect similar results this year."
 
• Turkey's shipbuilding industry grew 360 percent and its large yacht industry jumped to number three in the world, Maritime Affairs Undersecretary Hasan Naiboğlu said on April 3. The total capacity of the Turkish commercial maritime fleet has grown to 11 dwt (deadweight tons), with Turkish-flagged ships making up 7 million dwt of this, with the rest under foreign-flagged ships owned by Turkish entrepreneurs. "Turkish shipmakers have orders for new ships in process at local and foreign dockyards," added Naiboğlu. "In 2002 we ranked 23rd in the world shipbuilding industry. Now Turkey  is  third  after  South Korea,  Japan  and  China.  Turkey is also an important country for building large yachts. We moved up to third place in this sector. In the Antalya Free Zone alone, there are nearly 40 large yacht builders."
 
• Finance Minister Kemal Unakıtan paid a visit to Jeddah to attend a Turkish-Saudi Arabian Business Forum on April 5. Many businessmen also attended the forum, co-organized by the Turkish Union of Chambers and Commodities Exchanges (TOBB) and the Foreign Economic Relations Board (DEIK). The talks focused on eliminating double taxation as well as bilateral trade, international cargo transportation, health and tourism.
 
• There has been a remarkable rise in Turkey's borax exports. Export of borax and borax derivatives by Turkey's Eti Mine Works in the first quarter of 2008 were $104.5 million, a rise of 25.4 percent over the same period last year. Eti head Orhan Yilmaz said if this trend continues, by year's-end total borax exports would reach $500 million.
 
• The total value of Turkish investments in Albania reached €620 million in 2007, Albanian officials said on April 7, up from €35 million in 2002. The bilateral trade volume also grew fivefold over the last five years, officials added. There are currently 40 Turkish firms operating in Albania, and once an expected bilateral free trade agreement comes into effect, the customs tax on industrial imports from Turkey to Albania will be lifted, and other customs on Turkish products will drop 80 percent. Turkey is currently Albania's third-largest trade partner.
 
• Exports from Turkey's southeast rose 44.8 percent in the first three months of 2008 compared to the same period of 2007. The Southeastern Anatolia Exporters' Association (GAIB) said on April 7 that exports from the region this January to March amounted to nearly $876 million.
 
• Four companies submitted bids on April 7 to build a nuclear power plant in southern Turkey. The country's first nuclear power plant is set to be built near Akkuyu, Mersin. Canada's ECL, Japan's Hochu, Franc's Vinci, and Belgium's Suez-Tractabel all got specifications for the tender. "We expect Turkish companies to set up consortia with experienced foreign firms and join the tender," Energy and Natural Resources Ministry officials said. The tender for a 4,000-megawatt of nuclear power plant is set to conclude this October. The Turkish Energy Trade Commitment Corp. will buy the electricity generated at the nuclear power plant for 15 years.
 
• Israeli Ambassador to Turkey Gabby Levy on April 7 hailed the Erez industrial zone in the Gaza Strip as a project for peace. The Turkish Union of Chambers and Commodities Exchanges (TOBB) is pushing for the zone to be reopened. "We back the project, an initiative that will promote peace in the region," Levy told businessmen in Izmir. Levy underlined not only the economic but also the political importance of the project. Turkey annually exports goods worth $2.8 billion to Israel, and imports $2.1 billion in Israeli goods. In January 2006, Turkey, Israel and Palestine all signed pacts to revive the zone. Among the priorities of the zone is the construction of facilities to help produce goods. Erez should employ around 10,000 Palestinians.
 
• Hungary's top diplomat in Istanbul said on April 8 that his country, located at the heart of Europe, offers many opportunities for Turks. Visiting Bursa Governor Sabahattin Harput, Hungarian Consul General in Istanbul Maria Szekely said, "Hungary is looking for Turkish investors." Accompanied by Hungarian Commercial Attache Jozsef Kovacs, Szekely said, "With its advanced industry, Bursa carries a potential for trade with Hungary. We would like to develop cooperation among Bursa and Hungary. We are aware of Bursa's importance in terms of commerce and industry. Hungary and Turkey have special ties that go back for centuries. We look at Turkey as a friendly country. Turks have a special place in the hearts of Hungarians. We have excellent relations in all areas. We support Turkey's bid to join the European Union and expect Turkish businessmen from all regions to come to Hungary and invest," Szekely said. For his part, Governor Harput said, "The strength of Turkey's friends is our strength too. I believe we can implement many beneficial projects between Turkey and Hungary as well as between Bursa and Hungary."
 
• Deputy Prime Minister Hayati Yazıcı and other senior officials attended a ground-breaking ceremony for the modernization of the Kapikule Border Gate in the northwestern province of Edirne on April 8. Speaking at the ceremony, Yazıcı called Kapıkule "Turkey's gateway to Europe." "Last year Turkey's foreign trade volume with EU member states reached €99 billion and its exports to European countries were €46.9 billion," Yazıcı said. Necdet Budak, a deputy from the ruling Justice and Development Party, said modernization of the gate would ease bureaucratic procedures and boost trade. Rıfat Hisarcıkılıoğlu, chair of the Turkish Union of Chambers and Commodities Exchanges (TOBB), said the modernization would cost nearly $100 million and would be completed within a year.
 
• Energy and Natural Resources Minister Hilmi Güler on April 8 met with Hungarian Prime Minister Ferenc Gyurcsany to talk about the Nabucco pipeline project. Afterwards, Güler said that Turkey and Hungary want to work together to finish the project as soon as possible, adding that Gyurcsany gave his full support. Güler also met with Hungarian Economy and Transportation Minister Csaba Kakosy about the project and with Foreign Minister Kinga Goncz, who expressed support for Turkey's European Union membership. Speaking to reporters, Güler said work on Nabucco would accelerate. During his visit, Güler also attended the Eighth Turkish-Hungarian Energy Working Group meeting. Güler said he had very fruitful talks with senior Hungarian officials. "We clarified what has to be done on the Nabucco project," he explained. "We also signed a memorandum of understanding to implement joint projects between Turkey and Hungary on energy." Nabucco will carry Iranian, Azeri, Kazakh, Turkmen, Egyptian and Syrian natural gas from Turkey to Austria via Bulgaria, Romania and Hungary.
 
• Nearly 142,000 Turkish workers emigrated to 55 countries in 2005 and 2006, the Labor and Social Security Ministry announced on April 8. The number of Turkish citizens living abroad reached nearly 3.7 million at the end of 2006, and 1.2 million were working abroad, according to a ministry report. Russia attracted the most Turkish workers in 2005-2006, at nearly 44,000, followed by Saudi Arabia, Iraq and Kazakhstan.
 
• Turkish jewelers on April 8 signed a cooperation agreement with an international diamond authority to establish a laboratory in Istanbul. The Chamber of Jewelers in Istanbul and International Diamond Laboratories (IDL) will construct a full-fledged diamond laboratory to support this growing industry. The lab, the first of its kind in Turkey will be set up at the chamber's headquarters. A team of international experts will run the local operations. Under the agreement signed by the chamber head, officials of the international laboratory and a diamond market in Dubai, the chamber will begin offering advance diamond and jewelry certification courses on May 19. "We give a certificate for diamonds and tell customers about the type and color of the diamond, which helps them buy a trustworthy diamond," IDL's Peter Meeus said. The Istanbul Chamber of Jewelry represents 6,000 wholesalers and retailers from the Istanbul region, while IDL provides diamond and jewelry trade and jewelry retailers with quality reports of polished diamonds. It currently operates offices in Antwerp, Dubai and Mumbai.
 
• Turkey's industrial production index rose 7.5 percent in February 2008 compared to February 2007, the Turkish Board of Statistics (TUIK) announced. This February, the mining sector index rose 13.1 percent, the manufacturing industry sector index grew 6.6 percent, and the electricity, gas and water index climbed 12.4 percent year-on-year.
 
• President Abdullah Gül met with the secretary general of the Gulf Cooperation Council on April 9. The meeting between Gül and Abdurrahman bin Hamad Al-Attiyah took place behind closed doors at the Conrad Hotel in Istanbul. The Gulf Cooperation Council works for the six Arab states of the Persian Gulf to formulate similar regulations in areas such as the economy, finance, trade, and tourism as well as to foster scientific and technical process, set up joint ventures, encourage cooperation and strengthen ties. Created in 1981, the council is made up of Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates. A Gulf Cooperation Council common market was launched this January.
 
• The International Monetary Fund expects Turkey's gross domestic product (GDP) to grow 4 percent in 2008, and 4.3 percent in 2009. According to the IMF's World Economic Outlook report, Turkey's annual consumer inflation will be 7.5 percent this year and 4.5 percent in 2009. The report projected Turkey's current account deficit as a percentage of GDP as 6.7 percent for this year and 6.3 percent for 2009. The report was released ahead of the IMF and World Bank annual spring meetings.

 

• In 2010 Turkey and Ukraine should have a trade volume of $10 billion, Turkey-Ukraine Business Council head Sefa Gömdeniz said on April 9. "Locomotive sectors (in both countries) need to develop major projects" for this target to be met, he said in the opening speech of a council-hosted conference in Istanbul on customs procedures. Gömdeniz said Turkish businesses had signed contracts for the construction of housing, offices, hotels, bridges and highways. He said the total contracts of Turkish businessmen in Ukraine, currently amounting nearly $3 billion, would reach $5-10 billion in a couple of years. Also speaking at the conference, the Odessa Chamber of Commerce and Industry's Vladimir I. Spirko said Turkey was an important country for Ukraine. Spirko invited Turkish businesses to make investments in his country's energy, construction, tourism, mineral, and ship construction sectors. Saying that the investment atmosphere in Ukraine was not very healthy, Spirko said, "Investors from Turkey and other countries face serious difficulties, but we're trying to overcome them."
 
• At the Forum Istanbul 2008 on April 23-25, Turkey's stability and growth were discussed. Leading names from both Turkey and abroad spoke about how Turkey will pursue its economic and political stability together with sustainable growth in the face of both global economic fluctuations and geopolitical risks. Agriculture, a priority sector for the government, was also discussed. The forum was opened by Prime Minister Recep Tayyip Erdoğan and State Minister Mehmet Şimşek. Among the attendees were European Movement International President Pat Cox, IBM Vice President Nicholas Donofrio, World Bank Agriculture and Rural Development Department Manager Mark Cackler, FutureWorld South Africa CEO Neil Jacobsohn and IMF European Department Director Michael Deppler.
 
• A German bank will lend 90 million euros to small- and medium-sized enterprises (SMEs) in Turkey. The German Development Bank (KFW) will issue credits with the help of Turkish banks. KFW's Ankara Director Wolfram Erhardt said that the credits will help create new business opportunities and boost employment in Turkey. Turkish businesses will repay the loans in four years.
 
• Foreign Minister Ali Babacan said on April 9 that global fluctuations are having a negative impact on the economy. Addressing a meeting of the Turkish Businessmen's and Industrialists' Association (TUSIAD), Babacan said when global fluctuations are added to Turkey's domestic political problems, they hurt the economy. Babacan said the losses of finance organizations due the global crisis were estimated at $1 trillion. Babacan said both the government and the business world should be very careful and take measures to blunt this negative impact. Babacan also said any slowdown of Turkey's work for its European Union membership is out of the question. "Every step we take is a part of the EU membership process," he said. Asked to comment on relations with Africa, Babacan said Turkey would soon open embassies in 15 African countries, including Mozambique and Tanzania. "Turkey will open embassies in 10 countries in 2008 and five countries next year," he said. Babacan said representations in African countries would help Turkish businesses invest more easily.
 
• The Second Middle East Agriculture Fair took place in the southeastern province of Diyarbakir on April 10-13. Speaking at the fair's opening, Agriculture and Rural Affairs Minister Mehmet Mehdi Eker said farmers and producers would have the opportunity to see the latest technologies, advanced machinery and equipment at the fair, which 135 Turkish and 35 foreign companies attended. "The government is producing investment projects to support development of the region and implemented nearly 2,700 projects over the last two years," Eker added.
 
• The International Monetary Fund has full confidence that Turkey will meet all targets of the program and conclude the current standby deal successfully, IMF Managing Director Dominique Strauss-Kahn said on April 10. At a news conference in Washington, prior to spring meetings of the IMF and World Bank, Strauss-Kahn said that reforms in Turkey's program were necessary. Strauss-Kahn said relations between the Fund and Turkey were positive and expressed his belief that the program would be concluded successfully despite domestic legal problems and the global financial crisis.
 
• The Mediterranean city of Antalya will bring together businessmen from Mediterranean countries in May, a trade chamber said on April 10. Antalya's Expo Center will host 300 businessmen from 40 countries and Turkey on May 15-16 to help them forge or boost relations, Antalya Chamber of Commerce and Industry Chairman Kemal Ozgen told reporters. "We want to create a trade volume of $1 billion during the Mediterranean Business Partneria," he said. Ozgen said the event was an opportunity to establish partnerships, export and import ties, and investment possibilities. Countries set to participate in the event are Georgia, Kazakhstan, Kyrgyzstan, Turkmenistan, Belarus, Azerbaijan, Ukraine, Russia, the United Arab Emirates, Jordan, Algeria, Morocco, Egypt, Libya, Germany, Bulgaria, France, the Netherlands, Croatia, Britain, Italy, Spain, Hungary, Portugal, Romania, Greece, Albania, Slovakia, Slovenia, Tunisia, Sudan, Bosnia-Herzegovina, Syria, Lebanon, Kuwait, Israel, Iran, Iraq, Palestine and Afghanistan. Most of the participating firms operate in areas such as construction and construction materials; boat and yacht production; hotel and house equipment; marine tourism; electrical equipment and devices; marine trade and logistics; food, agriculture and agricultural equipment; textile, leather and shoes; chemicals and plastics; and jewelry. The Mediterranean Business Partneria aims to be one of the biggest matchmaking events for national and international companies from Turkey and abroad. Along with business meetings and interviews, there will be also opportunities to network on special trips or enjoy the pleasures of Antalya's natural beauty and cultural and historical treasures.
 
• Turkey's automotive industry output rose 42.2 percent in the first quarter of 2008 over the same period last year. Turkey's carmakers manufactured nearly 351,000 motor vehicles in the first three months of the year, Turkey's Automotive Industry Association (OSD) said on April 10. More than half of this amount were passenger cars. OSD said demand growth and export rises made for a significant upswing in automotive output. The auto industry's share in Turkey's total exports in Q1 stood at 23 percent. Ford Otosan shipped over 71,000 light commercial vehicles, Oyak Renault nearly 70,000 cars, Tofas 65,000 motor vehicles and Toyota 42,000 vehicles.
 
• The government isn't worried about global economic problems, said State Minister for Foreign Trade Kürsat Tüzmen on April 10. "Our economy is now stronger, more vigorous and shock-resistant than ever," he said. "There is a slowdown in global growth, increasing inflationary pressures and an expectation of declining capital inflow to developing countries. But we're not worried, despite all these difficulties and the downward trend in global indicators. Because we're well-prepared and we have a stronger economy." Turkey's economy grew 7 percent in 2003-2007, but last year's growth rate dropped to 4.5 percent.
 
• Ankara should continue its efforts for reforms and an improved investment atmosphere, a senior World Bank official said on April 9. Ahead of the International Monetary Fund and WB annual spring meetings in Washington, WB Vice President for Europe and Central Asia Region Shigeo Katsu told reporters Turkey has a more resilient economy now than in the past. Asked about the economic impact of a case to close down the ruling Justice and Development Party (AKP), Katsu said they have monitoring developments on the matter and that the Turkish market has partially absorbed it.
 
• The 11th Eurasian Economic Summit will take place on May 1-3 at Istanbul Chamber of Commerce headquarters. Attending the event will be one prime minister, three deputy premiers, over a dozen state ministers, three former presidents, high-level bureaucrats, academics and businessmen. Energy issues will be the focus of the first day of the summit, followed by the economy the second day, and dialogue for peace on the last day. Leading Turkish figures expected to attend are former President Süleyman Demirel, Parliament Speaker Köksal Toptan, Tourism and Culture Minister Ertuğrul Günay, Energy and Natural Resources Minister Hilmi Güler, Industry and Trade Minister Zafer Çaglayan, and state ministers Kürsad Tuzmen, Nimet Cubukcu and Said Yazıcıoğlu. The summit, held annually by the Marmara Group Economic and Social Research Foundation, aims to explore ways of enhancing relations between the European Union and the countries of Central Asia, the Caucasus, and the Middle East. Some 150 dignitaries and other officials from 29 different countries attended last year's summit.
 
• A water forum in Istanbul on April 15, co-organized by Turkey's Architects' Association and German engineering firm Steinbacher-Consult, focused on the economical use of water resources, management of water enterprises, and advanced technologies. Representatives from 20 Bavarian companies also spoke about the latest technological advances in the sector.
 
• State Minister Said Yazıcıoğlu on April 11 addressed a meeting to strengthen economic relations between Turkey and Azerbaijan. Speaking at the Turkish-Azerbaijani Joint Economic Commission (KEK) meeting in Istanbul, Yazıcıoğlu said that a preferential trade agreement expected to be signed soon would be "a turning point" in boosting economic and trade ties between the two countries. "The agreement will be an important catalyst in developing relations in all areas in the economy and particularly mutual investments, and it will lay the groundwork for a free trade deal between Turkey and Azerbaijan," Yazıcıoğlu said. He also called for the establishment of an arbitration board between the two countries to resolve business disputes.
 
• Parliament Speaker Köksal Toptan visited an international marble fair in Shanghai, China on April 11. Addressing Turkish businessmen at the fair, Toptan said that Turkey was one of the leading countries in world marble production, with exports exceeding $1 billion a year. "Over the last 20 years Turkey has made remarkable successes in its opening up policy," he added. "The latest International Monetary Fund report says Turkey has the world's 16th-largest economy."
 
• The Foreign Economic Relations Board (DEIK) will introduce investment and cooperation opportunities in Turkey to Canadian businessmen. DEIK said in a statement that the Canadian-Turkish Business Council would host a meeting on emerging markets and opportunities in Turkey for Canadian companies on April 17 in Toronto, Canada's culture, entertainment and trade center. Opportunities are particularly encouraging in sectors like energy, agriculture and agrifood, transportation, mining, housing and communications technologies. But entrepreneurs can also find potential in Turkey's aerospace and defense, environment, media, finance and education sectors.
 
• Visiting China, Parliament Speaker Köksal Toptan on April 10 met with Liu Yungeng, chairman of the Shanghai Standing Committee of the People's Congress. Toptan said at the meeting that Turkey and the People's Republic of China could make joint investments. "We have many businessmen here in China, and there is a significant number of Chinese investors in Turkey," Toptan said.
 
• The Second Middle East Agriculture Fair was held in the southeastern province of Diyarbakır on April 11. Speaking at its opening ceremony, Agriculture and Rural Affairs Minister Mehmet Mehdi Eker said farmers and producers would have the opportunity to see the latest technologies, advanced machinery and equipment at the fair, which 135 Turkish and 35 foreign companies attended. Eker added that government has investment projects to support the region's development and has implemented nearly 2,700 projects in the region so far.
 
• Prime Minister Recep Tayyip Erdoğan said on April 11 that Turkey is well ahead of at least 10 EU member states. Speaking at the Turkey-EU Joint Consultation Committee meeting, he said that there are countries in the EU that have not yet met the requirements of the Copenhagen political criteria and the Maastricht economic criteria. "There are EU members that have not yet met the requirements of the EU acquis," Erdoğan said. "We plan to make all the necessary legal arrangements in Turkey to be in harmony with the EU acquis by 2013."
 
• Turkish State Railways (TCDD) has started selling special tickets for football fans to travel to Switzerland and Austria, host countries of the Euro 2008 finals. The Euro 2008 Promotional Interrail Pass allows fans to travel to both countries with a single ticket. Euro 2008 will take place in Austria and Switzerland on June 7-29. Interrail's special train pass is valid for May, June and July. Special tickets are available at TCDD offices in Istanbul and Ankara starting from 125 euros for minors and 189 euros for adults.
 
• Turkish exporters are seeking ways to settle the current foreign trade deficit between Turkey and Russia, which recently reached $15 billion Sabahattin Yavuz, representative of the Turkish Exporters' Union in Russia, briefed exporters on the Russian market at a meeting held in the Aegean province of Izmir on April 12. "Turkey's imports from Russia amount nearly $20 billion, while its exports to this country are only $5 billion," Yavuz said. Speaking about the Russian economy, he said Russian consumers have a "great tendency to spend money." He also said, apart from the capital Moscow, Russia has 12 cities with populations of over a million each. He said these cities are seeking foreign investors. Yavuz said that countries such as France and Italy, which have a strong position in the Russian market, opened logistics centers in this country in order to conduct their commercial activities, and Turkey urgently needs such a center as well. During the first two months of 2008, Russia was the number one exporter to Turkey, with goods of over $5 billion entering the country. Turkey's exports to Russia during the same period reached $954 million.
 
• State Minister Kürşat Tüzmen on April 12 compared Turkey's export figures in the first 100 days of 2007 and 2008. He said Turkey earned $10 billion more from its exports on the first 100 days of 2008 over the same period of 2007. "Exports are on the rise, despite some economic problems," Tüzmen told reporters. Tüzmen said Turkey earned more than $35 billion from its exports in that period, adding that this indicates Turkey will achieve its year-end export target of $125 billion. Exports were up almost 23 percent in March 2008 over the same month of 2007. Turkey earned almost $11 billion from exports in March 2008. Exports in 2007 exceeded $105 billion.
 
• State Minister Kürşat Tüzmen said on April 14 that Turkey's exports to the US had dropped. He told reporters that the US is one of the top exporters to Turkey, but the reverse is not doing as well. "This year our exports to the US dropped," he told the 27th American-Turkish Council conference in Washington. He said that the bilateral trade volume had risen, but this rise stems mostly from exports to Turkey. Tüzmen said that the reasons for the drop in Turkish exports are the overvalued Turkish lira, the US dollar's falling value in international markets and Turkey, and the US importing many goods from the Far East, especially textiles.
 
 • An association of American companies and the US Embassy in Turkey co-hosted a reception in Istanbul on April 13 for US companies operating in Turkey. Speaking at the reception, US Consul General Sharon Wiener in Istanbul said the US expects "a significant boost" in trade relations between Turkey and the US, adding that Turkey made economic important in recent years. Representatives of nearly 70 US companies attended the reception.
 
• A Turkish company will construct the largest shipyard on the Mediterranean in the Yumurtalık district of the free zone in the southern province of Adana. The shipyard will be built on an area of 320,000 square meters. Nearly 100,000 ships can be repaired and maintained in the shipyard per year. Construction of the shipyard has a price tag of nearly $100 million and should be completed within three years.
 
• Prime Minister Recep Tayyip Erdoğan said on April 15 that the US economic crisis had yet to impact the Turkish economy, but added that the outlook is not clear. Speaking to Turks living in Qatar, where he held talks for two days, Erdoğan said global capital this year has been skeptical. "Everybody I spoke with started the conversation with skepticism," he said. "But I tried to convince them." Economic indicators in Turkey are quite well, he said, adding, "There is no problem, but we have to be cautious." Erdoğan said Turkey's Central Bank has $72 billion in reserves that the credit risks of Turkish banks have fallen from 35 percent to around 2.5 percent. "By paying its debts on time, Turkey inspires confidence in other parties," he added.
 
• A parliamentary committee head said on April 15 Turkey imports energy worth $33 billion each year. Mustafa Öztürk, the head of the Parliament's Global Warming and Water Resources Committee, said that Turkey imports 73 percent of its energy resources. "Turkey is highly dependent on foreign resources for its energy needs," Öztürk said. "53 percent of natural gas imported by Turkey is utilized in the production of electricity. Accordingly, the cost of electric production is high in Turkey."
 
• Foreign investors put $1.5 billion into Turkey in the first two months of 2008. "International net direct investments were down 80.4 percent in the first two months of 2008 over the same period of 2007, and dropped to $1.5 billion," Turkey's Treasury Undersecretariat said  on  April  16.  According to the undersecretariat, $976 million in foreign investments was made in January, dropping to $616 million in February. In comparison, Turkey attracted $8.1 billion in direct foreign investments in the first two months of 2007.
 
• Turkey is competing with Romania to be the most attractive country in the world for foreign investors, according to Ernst & Young Southeastern Europe Attractiveness Survey. Romania currently ranks first with 52 percent and Turkey ranks second with 50 percent, said Ernst & Young Turkey head Osman Dinçbaş. The survey said Turkey has a balanced attractiveness profile in terms of its domestic market, transportation and logistic infrastructures, telecommunications, quality of life, working cost, transparency and stability. Romania, Turkey, and Bulgaria are the three most attractive countries of southeastern Europe, the survey said, and suggested that Turkey maintain political stability to keep investors' confidence and sharpen its attractiveness.
 
• Turkish and Chinese industrialists met on April 15 to seek ways to develop trade relations between the two countries. Senior figures from the Turkish Industrialists' and businessmen's Association (TUSIAD) and a Chinese delegation from the country's Shaanxi region met in Istanbul. Speaking at the meeting, TUSIAD Chairwoman Arzuhan Doğan Yalçındağ said developing countries should boost cooperation to overcome a possible global crisis with minimum damage. Yalçındağ said Turkey's remarkable economic performance in recent years had attracted global and it was no coincidence that Shaanxi chose Turkey to develop trade and investment relations with.
 
• The seventh conference of transportation and communication ministers of the Economic Cooperation Organization (ECO) was held in the Mediterranean province of Antalya on April 17. Besides Turkey, representatives from ECO member countries such as Iran, Azerbaijan, Pakistan, Afghanistan, Kazakhstan, Kyrgyzstan, Tajikistan and Uzbekistan attended the conference. Speaking at the opening of the meeting, Transportation Minister Binali Yıldırım said Turkey had been pursuing important transportation infrastructure projects which would connect Europe to Asia. "I believe Turkey is the key to regional cooperation, international peace, stability and prosperity," he said. Yıldırım said the ECO is an important tool for boosting the region's standards of living as well as maintaining sustainable development and peace. He said they place great importance on framework agreement on transit transportation among ECO member states meant to facilitate the transportation of goods and people in ECO countries and lift obstacles to transportation.
 
• Energy and Natural Resources Minister Hilmi Güler told reporters on April 17 that Ankara had begun talks with Iraqi officials to get the Turkish Petroleum Corporation (TPAO) added to a list of companies allowed to explore for new oil reserves in Iraq. Asked why the Iraqi Oil Ministry didn't include TPAO on the list of 35 foreign companies so authorized, Güler said lists can always get changed. "We began talks with Iraqi officials to get TPAO added to the list of companies that can search for oil in Iraq," he said. "I hope we get onto the list. The list isn't final yet."
 
• A senior US official on April 16 described the arrival of 60 US companies in Turkey in order to attend a conference on trade as a bold development. A conference titled "Trade Winds Europe" co-organized by the Turkish-American Business Association (TABA) and the US Commerce Department was held in Istanbul on April 14-16. Speaking at the conference, Israel Hernandez, the Commerce Department's assistant secretary for trade promotion, said that 60 companies from 25 US states were in Istanbul to attend the meeting. Those companies' arrival was an enterprising development for Turkey, and US firms are definitely interested in doing business with their Turkish counterparts, Hernandez said. He also said Istanbul was selected as the venue of the conference as Turkey is at the crossroads of the East and the West. Hernandez said Turkey has a unique position in this regard. The conference brought together experts and trade representatives from across Europe for a unique chance to provide US businesses with the knowledge necessary to take advantage of new opportunities in growing European markets, especially Turkey.
 
• More than 1,000 African businessmen from 54 countries are set to attend the Third Turkish-African Foreign Trade Program in Istanbul on May 13-15. The program will be held at Istanbul's Trade Center and will provide an opportunity for Turkish businessmen to hold direct talks with their African counterparts. The event is being sponsored by the Turkish Businessmen's and Industrialists' Confederation.
 
• Global fluctuations have affected Turkey to some extent, said State Minister for the Economy Mehmet Şimşek on April 25. "The global fluctuations have affected Turkey in the areas of commerce and financing," Şimşek told a conference on sustainable growth in Ankara co-hosted by the Treasury and the World Bank. "When we consider the Turkish economy's dependence of world markets, this is to be expected. Continued fiscal discipline, higher growth rates, the strong financial sector, improved investments climate and economic reforms have made the economy more resistant to foreign risks. The progress in macroeconomic variables and flexibility has helped the Turkish economy to be less vulnerable to international developments than in the past. It's not wrong to say that the Turkish economy is viewed by international investors as a safe harbor." He added that economic reforms, democratization, the rule of law, respect for human rights and freedom of thought and expression, and entrepreneurship all have a special place for the Turkish government. Turkey will continue to pursue reforms in all these areas in line with its EU accession process. He also said the government plans to continue its privatization slate with due speed. Also addressing the conference, WB Country Director for Turkey Ulrick Zachau said the Turkish people are better off now thanks to the high growth of recent years. Zachau said the WB supports Turkey's efforts to raise its per capita income to level of developed economies by sharing its experience and know-how as well as by alloting $6.2 billion for future development projects. Zachau said the WB, in its projections, forecasted that Turkey would  maintain  its  current  trend  of  stability  and  rowth. He said Turkey has had a high rate of sustainable economic growth since 2002 thanks to macroeconomic reforms and an economy sustained by the private sector. The fallout from the US mortgage crisisis being felt in Turkey as well but to a limited extent since Turkey has an independent Central Bank with a floating exchange rate policy, Zachau said. Stressing that Turkey needs to create jobs, boost productivity and raise the education level of its population for sustainable development, he said that the government's employment package could help create more jobs. Zachau also stressed that a rise in Turkey's productivity, which lags behind EU countries, could sharpen Turkey's competitiveness, adding that this can be only achieved through innovation and improving current technologies.
 
• Turkish Industrialists' and Businessmen's Association (TUSIAD) head Arzuhan Doğan Yalçındağ said on April 25 that the European Union negotiation process and International Monetary Fund-backed adjustment program were important vehicles to cushion economic blows to the country. At TUSIAD's Chairmanship Council meeting in the southeastern province of Sanliurfa, Yalçındağ said Turkey's IMF standby deal would expire in May and that the Turkish people had lost interest in the EU process. Yalçındağ said the absence of those vehicles, which had held importance for Turkey, posed a very big risk to the economy and urged perseverance in disinflation as a main policy. She said monetary policy should be flexible (to facilitate adjustment to changing international conditions), the budget deficit should be kept under control, and sidetracked reforms should be taken up again. "The EU negotiation process is a fundamental tool for implementing Turkey's microeconomic reforms," she explained. "Our reactions or support to the EU process should not be shaped according to short-term political developments. Progress on the way to EU full membership is not something imposed by external sources but an expression of society's willingness for prosperity, democracy and social development. Our ultimate goal is to ensure Turkey's evolution from an emerging country to a developed country."
 
• State Minister for the Economy Mehmet Şimşek said on April 26 that once completed, the Southeastern Anatolia Project (GAP) will employ 3.8 million people. Speaking to members of the ruling Justice and Development Party in the southeastern province of Gaziantep, Şimşek stressed, "GAP will be completed in 4-5 years." He added, "GAP is not merely about irrigation and energy. It also has transportation and education dimensions."
 
• A World Bank official on April 25 said that agriculture has a bright future in the 21st century. Mark Cackler, the head of the World Bank's Agriculture and Rural Development Department, said that agriculture is still vitally important. Speaking at Forum Istanbul 2008, Cackler urged countries to care about agricultural production to reduce poverty, increase economic growth and protect the environment. He said that there was a growing interest in agriculture in the world, adding that this had coincided with sharp rises in food prices. At the Forum Istanbul 2008 on April 23-25, Turkey's stability and growth initiative were the main topics. State Minister for the Economy Mehmet Şimşek, European Movement International President Pat Cox, and IMF European Department head Michael Deppler were among the participants at the forum.
 
• State Minister Kürşat Tüzmen said on April 25 that over the last 12 months Turkey's exports had reached $117 billion. Speaking at the opening of the Business Machines and Construction Technologies Fair (ANKOMAK) 2008 in Istanbul, Tüzmen said that the fair was the biggest of its kind in the region. "Turkish exports of business machines have exceeded $1 billion," Tüzmen said. "The Turkish economy is the 15th-biggest economy in the world, just behind South Korea. As of today, Turkish exports over the past 12 months have reached $117 billion. Despite a number of problems, Turkish export gains since January have risen 37 percent compared to the same period last year." He added, "Turkish contractors took up projects worth $20 billion in 2007 overseas. With revenues of $20 billion from foreign construction projects and $20 billion from tourism, Turkey looks at the near future with confidence despite global economic problems."
 
• The Central Bank decided to tighten its monetary policy due to the risk of rising inflation. After its April 17 meeting, the CB's Monetary Policy Board said rising food and energy prices and global financial uncertainties had led to the risk of worsening inflation. These risks should be taken into account in projections about future inflation rates, it added. Central Bank head Durmuş Yilmaz said the bank expected that inflation would drop to 4.9 percent in 2010 and 4.0 percent in 2011. The board said the deterioration in inflation expectations might require a tight fiscal policy for a considerable period but added that prudent monetary policy in itself was not sufficient to attain price stability. It said support from fiscal policy and structural reforms were critical in this respect. "Sound fiscal policy had been one of the main factors in driving inflation to single digits. The role of fiscal policy will continue to be critical on the road to price stability," it said. Yılmaz said on April 30 that year-end inflation was expected to be 9.3 percent, and year-end inflation for 2009 would be somewhere between 4.9 percent and 8.5 percent, with a 70 percent probability of 6.7 percent. Yılmaz also said it would take more than two years to approach a targeted 4 percent rate in the medium term, but added this would not mean the bank would pursue a loose policy.
 
• Turkish Treasury Undersecretary İbrahim Çanakçı said on April 24 he forecasts a slowdown in growth this year due to the recent global economic crisis, predicting that it might be 4.5 percent, down from a previous forecast of 5.5 percent. Çanakçı told a conference organized by Forum Istanbul 2008 that inflation forecasts had climbed to 8 percent, adding that the current account deficit would be around 6-6.5 percent, up from 5.7 percent last year. "Soaring oil and food prices have a negative impact on the Turkish economy," he said. "This is more important when we consider Turkey's dependence on foreign energy and the key place of food prices in the consumer price index. However, I would like to underline that the overall picture for Turkey is quite positive." Çanakçı also said that Turkey's top priority for the mid-term was still macroeconomics and financial stability. "The overall economy and financial stability are the core element of our success over the past six years and will continue to beso," he said. Çanakçı also said that short-term concerns should not overshadow this goal, adding that another priority for Turkey was to control the current account deficit and maintain fiscal continuity.
 
• Prime Minister Recep Tayyip Erdoğan attended the First Turkish-Syrian Economic Forum in Damascus on April 26. The forum was also attended by Erdoğan's Syrian counterpart Naji al-Utri. Speaking at the forum, al-Utri said, "Relations between Turkey and Syria have strengthened in recent years. We want to develop ties with Turkey in the areas of soil improvement, a natural gas pipeline and border trade." He added, "After completing our infrastructure work, our relations with Turkey developed in the fields of agriculture, irrigation, banking, customs and tourism. We call on Turkish entrepreneurs to make joint investments with their Syrian counterparts." He explained, "We're working to make the Turkish-Syrian border a center of global attraction. Once all the land mines have been removed from the border, the region will gain more prominence." Erdoğan, for his part, called the people of Syria and Turkey inseparable brothers. "Terms like 'friend' and 'relative' are insufficient to describe relations between the peoples of Syria and Turkey," Erdoğan said. "There were some disagreements between the two countries in the past. I am thankful to former President Ahmet Necdet Sezer, Syrian President Bashar al-Assad, current President Abdullah Gül and Syrian Prime Minister Naji al-Utri for overcoming these disagreements. We have submitted a bill to Parliament to remove all mines from the Turkish-Syrian border. Once the mines are gone, the soil in this region will be used to benefit the peoples of both countries." He added, "I believe that our new era with Syria will bring fruitful results. Although things in Ankara are very busy, I could not decline al-Utri's invitation to visit Damascus. There is a political will on both sides to develop economic cooperation. We see the development of Syria and the region as greatly important. We're closely watching Syria's efforts for liberalization and appreciate them." He said, "The bilateral trade volume has reached $1.2 billion. We are working to boost our bilateral trade volume to $2 billion by year's-end. Beginning with energy and transportation, there are important areas for investments in both countries. Our free trade agreement with Syria has contributed positively to commercial relations." Erdoğan also extended an invitation to al-Utri, saying that next year's Turkish-Syrian forum meeting should take place in Turkey. "We want peace and stability in the region, and these are interrelated. I hope that the forum will benefit our peoples." Erdoğan also met with Syrian President Bashar al-Assad on April 26 in a meeting that lasted over an hour. Assad later hosted a luncheon in Erdoğan's  honor . In  related  news,  the  second  term  protocol  of the Turkey-Syria Partnership Council was signed in Damascus on April 27. State Minister for Foreign Trade Kürşat Tüzmen and Syrian Economy and Trade Minister Amir Husni Lutfi signed the protocol. Tüzmen said that red tape needed to be cut from bilateral trade. Stressing the importance of Turkish-Syrian cooperation in the logistics sector, Tüzmen said if such cooperation is forged, transit transportation between the two countries will double. Tüzmen said that the bilateral trade volume rose 70 percent in the first months of this year. He added that that Syrian experts would be trained in Turkey about commerce. Tüzmen also held meetings with Syrian Deputy Premier for economic affairs Abdallah al-Dardari and Finance Minister Muhammad Al-Hussein. Problems between the two countries as well as the views of Turkish companies were discussed in the meetings. Tüzmen and al-Dardari delivered closing speeches at the Turkish-Syrian Business Forum in Damascus. "We're determined to develop relations with Turkey," said al-Dardari. "It will benefit Syria to develop ties with Turkey. I understand that some Turkish companies face difficulties in Syria. But please rest assured that I will solve all these problems." Tüzmen said that in the past there were many problems between Turkey and Syria and the trade volume was very low. "Today our problems with Syria have decreased while trade relations with it increased. We hope to reach a trade volume of $2 billion with Syria by year's-end," Tüzmen said. Following the forum, Syrian firm Dirimland and Turkish companies Alp and Aksiyon Group signed a contract worth $314 million. Under the contract, the Turkish firms will construct residential units, hotels, tourism facilities and shopping malls in Syria. All construction will be completed in 36 months. Tüzmen discussed economic issues pertaining to the two countries with al Hussein. "Developing relations with Turkey is a priority," said al Hussein stressed. "We reduced the travel tax for Syrian citizens traveling to Turkey to $11. Syrians traveling to other neighboring countries face higher taxes. After this decision, the number of Syrians visiting Turkey rose sharply. We are presently working on making the exchange of goods and people with Turkey much easier."
 
• Treasury officials held meetings both in Ankara and Brussels to promote the Country Partnership Strategy (CPS) and the Country Economic Memorandum (CEM). The first meeting took place in Ankara on April 25, while the second was held in Brussels three days later. This February the World Bank Executive Board affirmed the CPS for Turkey, which forms the framework for the WB's financial and technical assistance from 2008 to 2011. The bank also prepared a CEM for Turkey addressing issues such as the sustainability of rapid growth and efforts to boost employment, competitiveness and productivity.
 
• Officials of the Warsaw Stock Exchange on April 25 invited Turkish companies to take part in public offerings in Poland. A conference on "Public offerings on the Warsaw Stock Exchange: Opportunities for Turkish investors and companies" co-organized by the Warsaw Stock Exchange, Stock Exchange Investor's Association and Turkey-Poland Chamber of Commerce, was held in Istanbul. Experts from Turkish and Polish capital markets and business executives attended the conference.
 
Speaking to the conference, Warsaw Stock Exchange Deputy Chair Lidia Adamska said  the  effect  of  the global liquidity crisis on Polish markets and its public offerings
was minor. "The financial opportunities we will create for Turkish investors will be big. We want Turkish companies to be part of the Warsaw Stock Exchange," said Adamska. She said public offerings on the exchange are simple, plain and inexpensive. Adamska said Poland has a good understanding of Turkey's path to EU membership. "We went through similar stages. We support Turkey's EU bid," she added.
 
• Prime Minister Recep Tayyip Erdoğan and several Cabinet ministers responsible for the economy, finance and industry convened on April 8 at a meeting that focused on measures to cushion the impact of the global economic slowdown. External global developments had an impact on Turkey's current account deficit despite a 36 percent rise in exports, said a statement released after the meeting. Among those attending were Deputy Prime Minister Nazım Ekren, State Ministers Kürşat Tüzmen and Mehmet Şimşek, Finance Minister Kemal Unakıtan, Industry and Trade Minister Zafer Çağlayan, and Foreign Minister Ali Babacan. The statement said economic growth in Turkey had been maintained and industrial output increased. "An upturn in agricultural output, which declined last year due to severe drought, will push economic growth this year," the statement said. It also said that a review of Ankara's standby arrangement with the International Monetary Fund is expected to be completed soon. "Due to ongoing economic problems, vigilance in macroeconomic policies remains important," it said.
 
• Once Turkey's current standby agreement with the IMF ends on May 10, a program follow-up or a cautionary standby may follow, according to analysts. A new agreement to replace the current program will definitely be signed although it will not include financial support because an external anchor was vital for Turkey in floating global economic conditions, analysts said. International credit rating agencies are also closely tracking the prospective deal between Turkey and the IMF, and a cautionary standby deal seems more probable considering global liquidity positions, analysts said. Farouk Soussa, Turkey analyst with Standard and Poor's, said that the IMF was still a major actor for Turkey to sustain market credibility and called for the continued relations with the Fund at a time of a global financial turmoil. "Despite its strong economic record, Turkey needs the IMF as an important foreign anchor to regain investors' confidence which still remains fragile," he said. Turkey's standby agreement with the Fund ends in May and an IMF delegation was in Ankara in early April to hold meetings as part of the last review talks under the current deal. "You need to have either a strong domestic or a foreign anchor to preserve fiscal discipline and credibility, and Turkey would have a difficult time restoring financial market confidence," Soussa added. In related news, Turkey sent its Letter of Intent to the IMF. The letter was finalized after the latest round of review discussions under the current standby agreement with the Fund. The Treasury said in a statement that the IMF Executive Board was expected to discuss and approve the review on May 9. Approval of the review will enable Turkey to draw an immediate $3.7 billion loan tranche.
 
• Industry and Trade Minister Zafer Çağlayan said on April 30 that he was continuing his meetings with international automakers. Speaking at a meeting of the Turkish-Qatari Business Council in Istanbul, Çağlayan said that trade volume between Turkey and Qatar had risen in the last five years from $26 million $480 million. Çağlayan said that 15 out of 1,000 vehicles worldwide were being produced in Turkey. Stressing that Turkey has the 17th biggest economy in the world, he added that Turkey produces one vehicle per 24 seconds, and exports one every 30 seconds. Çağlayan said that his meetings with carmakers were underway, adding that most want to invest in Turkey. He added that Turkish contractors undertook projects worth more than $5 billion in Qatar over the last five years. He said that a €800-million automotive investment might take place in Turkey, thereby creating 5,000 jobs, but declined to name the company. "Turkey is moving towards becoming a world automotive center. The government took many measures in order to enable free markets rules to prevail and improve the investment atmosphere." A group of Qatari businessmen led by Turkey-Qatar Business Council Co-chair Khalid Almoayed attended the meeting.
 
• State Minister for Foreign Trade Kürşat Tüzmen said on April 29 that Turkish contractors' investments in Turkmenistan this year would total $5 billion. Tüzmen met with Turkmenistan's Deputy Pirme Minister for Trade, Commerce, Textiles and Customs Hodjamomhammed Mohammedov and a high-level accompanying delegation in Ankara. "Last year the bilateral trade volume between Turkey and Turkmenistan reached $700 million. Turkish contractors will make investments worth $5 billion this year," Tüzmen said. He told reporters that Mohammedov and he had discussed bilateral relations and problems involving companies operating in both countries. For his part, Mohammedov said Turkmenistan values its ties with Turkey greatly, adding, "Turkey and Turkmenistan are like brothers. 480 Turkish firms operate in Turkmenistan."
 
• Finance Minister Kemal Unakıtan said on April 30 that Turkey's current inflation rate is not expected to go down quickly. Speaking at Marmara University's Faculty of Economics, Unakıtan said that no one in Turkey should expect inflation of 4 percent. Touching on the US economic crisis, Unakıtan said that Turkey has to closely watch developments there. "Over the past five years, Turkey made great structural changes, and so our economy began to be more influenced by global economic developments," Unakıtan stressed. "Things happening outside of Turkey will have an impact on our economy. This is unavoidable. However, if the Turkish economy gets stronger, it can effectively deal with global developments. Turkey has come a long way since the 2001 economic crisis. It has become an economy worth $650 billion. Per capita income rose significantly." He added, "Developments outside Turkey pose a threat to our economy. Growth outside Turkey is going down, inflation is rising, and capital is growing scarcer. Such conditions do have a negative impact on the Turkish economy. Inflation in Turkey will not go down rapidly. We must understand this. Inflation may go up or down, but no one should expect inflation of 4 percent. We have to be realistic." Unakıtan said, "Growth in Turkey will not be like in the past. Growth of 7, 8 or 9 percent will not be seen. Just like the whole global community, we are also affected by economic developments." Pointing to the importance of reasonable sustainable growth, he stressed that measures to help prevent economic shrinkage are needed.
 
• Turkey has become Georgia's biggest trade partner. Georgia's state statistics committee said on April 29 that Turkey had become the country's biggest trade partner of Georgia this January-March. The committee said the bilateral trade volume rose 7.3 percent in January-March compared to the same period last year. Georgia's total trade volume in January-March was $1.7 billion.
 
• Chinese automotive giant Chery Group has plans to produce cars in Turkey. Chery Group Vice President Zhou Biren said on April 28 that the company would produce its Kimo, Tiggo and Alia brand cars in Turkey in cooperation with Turkish Mermerler Group. Biren said that Chery's cars were sold in 64 countries worldwide, and Chery was the fastest-growing company in the international auto sector. Biren said that Turkey was a big market for their company and also a strategic country as a bridge between Asia and Europe. Biren added that they aimed to get to Europe via the Turkish market. He said that they were conducting a feasibility study regarding a factory of the Mermerler Group, adding that the amount of the investment would be set following completion of the study. The Chery Group, founded in 1997, owns seven factories in China, and sells 700,000 cars annually. The group ranks fourth in the Chinese automotive market.
 
• Turkey will launch the construction of a 76-kilometer part of the Baku-Tbilisi-Kars railway project, also known as the Iron Silk Road. Transportation Minister Binali Yıldırım said on April 28 that the construction of the section on Turkish territory would start in the end of May or beginning of June. Yıldırım said that in the tender for the project last fall, the Çelikler-Özgün Construction Group won with a bid of nearly 290 million YTL. He said that the project, which has strategic and economic importance for Turkey, would be completed in three years. Turkey has reserved 380 million YTL for construction of its part of the project. Georgia will construct the 29-kilometer section from the Turkish border to Ahilkelek and also renovate the existing railway from Ahilkelek to Tbilisi. The ground-breaking of Georgia's part was held last November, and the whole project is targeted to be completed by 2010. Moreover, when Marmaray (rail tube tunnel and commuter rail mass transit system) on the Istanbul Straits is completed along with the Baku-Tbilisi-Kars Railway, freight will be able to be transported by railway from Europe to China without interruption.
 
• The European Union forecasts that Turkey's economic growth will be around 4.7 percent in 2009, up from 4.3 percent of execrated growth this year. "Due to its sizeable financing needs, Turkey may be more vulnerable to the current financial turbulence than most EU member states or other candidate countries." said the European Commission's spring 2008 economic forecast. "Turkey should be able to increase export growth – in particular in tourism – while the tight monetary and fiscal policy mix will start supporting the disinflation process. Overall, economic activity is expected to rise only gradually from 4.3 percent in 2008 to 4.7 percent in 2009." The report also forecast that unemployment would fall from around 10 percent this year to 9.8 percent in 2009, adding, "As from mid-2008, inflationary pressures are expected to fall slowly. 12-month consumer price inflation is expected to fall below 8 percent by year's-end and to 6 percent at the end of 2009."
 
• Industry and Trade Minister Zafer Çağlayan said on April 28 that Turkey was the world's most secure energy corridor and offers the best opportunities for Turkmenistan to get its natural gas and oil to Western markets. Speaking at a Turkey-Turkmenistan Joint Economic Commission (KEK) meeting in Ankara, Çağlayan said trade volume between Turkey and Turkmenistan reached $750 million last year. "But this falls short of our potential. Turkey and Turkmenistan can cooperate in energy, contracting business and transportation services," Çağlayan told the meeting. Turkmenistan's Deputy Prime Minister for Trade, Commerce, Textiles and Customs Hodjamohemmed Mohammedov, who co-chaired the meeting, said that several Turkish companies were operating in Turkmenistan and that Turkmen officials want Turkish firms to expand their operations in the country.
 
• Speaking on April 28 at the Turkish Capital Markets Forum organized by Turkish-British Business Council in association with the Financial Times, State Minister for the Economy Mehmet Şimşek said the world faces an unprecedented situation in facing three simultaneous crises. "A recession has begun, and the prices of goods and food are rising," Şimşek said. Inflation in March was 9.2 percent and will likely stay high due to procurement shocks from abroad, he said. "We have better expectations about inflation in the medium term. We have always had a firm monetary policy and we will maintain this policy," Şimşek said. He said that over the past six years Turkey's annual growth had been nearly 7 percent, a "great performance." The Capital Markets Forum provided new ideas and insights into how the economy and financial markets are developing in Turkey. Gathering key international and local decision-makers, the event identified key areas of growth, tracked the latest trends in the corporate and investment climate, and appraised strategies to raise domestic and international capital.
 
• Leading GSM operator Turkcell has become an institutional member of the Center for European Policy Studies (CEPS). Turkcell said in a statement on April 28 that the Brussels-based think-tank does state-of-the-art policy research leading to solutions to the challenges facing Europe today. Founded in Brussels in 1983, CEPS is among the most experienced and authoritative think tanks operating in the EU today. CEPS serves as a leading forum for debate on EU affairs, and aims at achieving high standards of academic excellence and maintain unqualified independence, providing a forum for discussion among all stakeholders in the European policy process, and building collaborative networks of researchers, policymakers and business representatives across the whole of Europe. It has 120 corporate members and 130 institutional members. Turkcell is the leading mobile communications provider in Turkey, with 35.4 million subscribers as of January 1. It is not only the leading operator in Turkey, but also the second-biggest GSM operator in Europe in terms of subscriber numbers.
 
• Central Bank head Durmuş Yılmaz said on April 25 that the country's economy had grown more resistant to international fluctuations. "The current impact of the international financial crisis remains limited compared to May-June 2006 when global liquidity conditions deteriorated. And that suggests that our country's economy has become more resilient and flexible in the face of international shocks," he told a CB general assembly meeting. But he also warned that despite reduced fragility, nobody should jump to the conclusion that there are no risks. Yilmaz said that the international financial crisis had started to make an impact on the real economy, citing an increased expectation of a recession in the US. Durmuş also urged strict fiscal discipline and structural reforms in case risk perceptions become worse.
 
• Speaking to reporters after an April 30 Turkish-Bahraini Business Council meeting in Istanbul, Industry and Trade Minister Zafer Çağlayan said direct foreign capital continues to be interested in Turkey. Stressing that attracting foreign capital to Turkey was very important, he added that creating employment opportunities as well exporting to the world were also very important. Çağlayan also said that thanks to a project of the Small- and Medium-Sized Industry Development Organization (KOSGEB), they would grant 900 million YTL in loans to 2,000 small- and medium-sized businesses enterprises in Turkey. Touching on relations between Turkey and Bahrain, he said despite the boost in the past five years, economic relations could be better still. He added that mutual visits and meetings would add momentum to relations. Speaking to the council meeting, the council co-chair said that Bahraini businessmen should also invest in the sectors of industry and services along with the real estate sector. He said that the bilateral trade volume rose to $200 million in the last two years.