DEİK President Olpak evaluates 2023 and shares 2024 forecasts

DEİK has prepared its roadmap for 2024 together with its 152 business councils, which serve as the compass for the private sector in global trade through its commercial diplomacy activities.

While new trade and energy corridors stand out in DEİK's 2024 agenda, which continues to accelerate foreign economic relations with a vision of more trade, green economy and digital economy topics will also be on the radar of commercial diplomacy.

DEİK President Nail Olpak met with journalists at the DEİK Headquarters at a meeting where he evaluated 2023 and shared their 2024 agendas.

Providing information about DEİK's commercial diplomacy activities, Olpak said that they are working for more trade with a broad projection that touches the world from the USA to Africa, from China to England, and from Japan to Russia, and that they are opening the right doors for the Turkish private sector before the right counterparts in foreign economic relations.

Stating that there is a new process in the global economy where growth has decreased slightly, global inflation continues to have an effect, and transformations are taking place in trade and investments, Olpak expressed that as the Turkish business world, they need to open up to new markets with high value-added products and expand their opportunity fields with investments suitable for trends.

Making country and region-based evaluations regarding new trade corridors and cooperation mechanisms, Olpak stated that as business world representatives under the umbrella of DEİK, they are now talking about the concepts of green economy and digital economy more loudly on every platform, and that in addition to these transformations, they are also closely following new cooperation mechanisms in global trade.

Touching on the regional topics that stand out in DEİK's 2024 roadmap and agenda, Olpak reported that they have created a new roadmap with an approach that also addresses sectors separately for every country and region on their radar as DEİK. Stating that they have divided the world into 6 regions, Olpak explained DEİK's commercial diplomacy efforts in these regions.

Olpak stated that they have restructured their commercial diplomacy activities in the USA with state-based committees and announced that they have an export target of at least 1 billion dollars for each state.

"We must take precautions regarding the Belt and Road project"

Nail Olpak stated that China is trying to evolve into the world's factory for branded products, noting that China has left contract manufacturing behind and is now moving towards a strategy of abandoning the production of medium-technology products.

Olpak said the following regarding the "Belt and Road" project:

"China wants to deliver that product in its hands to the wealthy market faster. If we leave aside America, which is one of the wealthy markets and with which it is in conflict, the European market... Today, the average time for China to deliver its goods to the European market can take 40-45 days. China's goal in the Belt and Road Project is to deliver its goods to Europe within 1 week. What does this mean for us? My biggest advantage today is my logistics advantage. A product leaving Gaziantep is delivered to any city in Europe within 48 hours. 48 hours is a very serious advantage compared to 45 days. But when it drops to 1 week, our logistics advantage drops to 5 days. We have such a picture in front of us, we need to see this well. Even if this project seems too sympathetic, we need to read the picture well.

China is investing a lot of money in this project. It stands behind this project. We are not in a position to prevent it. Let's be clear, we don't have that kind of power, but we have to take precautions. When we cannot take precautions, the results of the project we applaud will unfortunately cause a picture that will set us back within ourselves today. So what should we do? Those wagons are probably not going to go back empty. What will we fill them with? If I have the chance to fill them with high value-added products, the project will be meaningful for us."

"Inflation will also be the most decisive factor of 2024"

DEİK President Olpak stated that Turkey will again differentiate positively in 2024, which will be a difficult year globally, and said that inflation will decline with the disinflation program implemented, and at the same time, growth will be contributed to with policies supporting production, investment, and exports.

Reminding that Turkey entered the year with a 5 percent growth target, Olpak estimated that although the earthquakes centered in Kahramanmaraş affected the growth performance, Turkey would close the year with a growth of over 4 percent.

Drawing attention to the importance of the contribution of exports to growth, Olpak said, "I see investment expenditures and machinery orders as important in growth. I want to say that there is no negative picture at this point. Especially when we look at it quarter by quarter, Turkey's orders are going well. We see this in the PMI data as well. We also see it in the Purchasing Managers' Index."

Olpak stated that inflation has been one of the most decisive factors for both Turkey and the world since 2022, and said that he expects inflation to be the most decisive factor of 2024 as well.

Reminding that the President of the Central Bank of the Republic of Turkey (TCMB) Dr. Hafize Gaye Erkan recently attended the DEİK Board of Directors Meeting, Olpak noted the following:

"The main task of the Central Bank is already price stability. We also discussed these issues at our meeting. There is inflation that we expect to go down from its peak as of the second quarter of the year. The Ministry of Treasury and Finance will have implementations. There are also some things in people's minds regarding after the March elections. Will loans be opened? Will they be closed? How will it be? We are following it closely just like you. Will 2024 be a very difficult year? I mean, it won't be a very easy year, but I don't want to say it will be a very difficult year either. Let me make such a general evaluation."

- "(Decreasing trade with Israel) One should not underestimate this reaction within 2 months"

Nail Olpak gave the following response to a journalist's question regarding the effects of the embargo imposed by the USA on Russia on Turkey:

"The USA may have a desire to give directives regarding the embargo. Turkey clearly reveals its stance in this framework, both politically and commercially. There is indeed a product that should be subject to an embargo and can be used in war. It can say, 'If you are buying this from me, you will not send it there.' Turkey would understand this, but if it tries to go beyond that, you gave the Iran example, we all know how they traded with Iran under the table or indirectly during embargo processes, including European countries. At that point, we listen to the revenues, we don't have a situation like closing the door to those who come, but excuse me, we continue with our own commercial interests. There was no such thing as blocking trade anyway. Our trade and exports with Russia have also increased significantly this year."

Expressing that Israel has caused images in Gaza that the human heart cannot bear, Olpak continued his speech as follows:

"Many things can be said about where this issue started. At the point reached today, even if there are some differences in trade figures, I would like to say that there is an important picture that this business is psychologically spread over many more years and that it is not in Israel's favor either. When we come to the commercial side, without anything being said by the public, by the state, or by institutions, associations, which was not said. It was not said, 'Let this trade with Israel not be done anymore.' But we observe that there has been a serious decrease and contraction within the approximately 2-month period that has passed. We see that the commercial contraction is in the 30-40 percent band. This is the reaction that these firms and people directly gave in this process. One should not underestimate this reaction within 2 months.

Sometimes we see it. Like, this much is still going there, but one should also see that it is not possible to completely stop such trade. Why? I mean, there may be trade that will continue despite everything. If diplomatic relations between the two countries are to be completely severed, if nothing is to be done in any way, that is another matter, but the rest is taking its course. But there will be a serious decline."

Stating that as DEİK, they did not conduct a survey with their members regarding commercial relations with Israel, Olpak said, "I think the boycott issue against Israel, which is on the agenda, is in a different position than the old boycotts. The reaction around the world is not like that either. I mean, there is a reaction different from what we have experienced so far. We are going through a very different process. 2-month statistics will not be very decisive, it should be seen after a few months. It is not my right, individually or institutionally, to ask why someone who is still trading is doing it, but it is extremely normal to expect it to be like this. It is always easy to change trade figures in some way. You compensate, our trade with Israel decreases today, it goes somewhere else tomorrow. These can also happen, but one needs to think well about the tragedy dimension of the matter. There is no compensation for that in any way."

"We are receiving investment signals"

Nail Olpak stated that he did not want to make any predictions regarding the wage to be determined regarding the ongoing minimum wage negotiations, and evaluated, "I think we should not necessarily handle this issue in the context of exports. Will our exporter be affected? Of course, they will be affected. But just because this will be affected or that will be affected, some indispensable things will not be removed from the minimum wage. How much the welfare share will be is being discussed. I think we will overcome that process at the export point even if we are forced."

Upon a journalist's question regarding Turkey's potential to attract foreign direct investment, Olpak said the following:

"We should wait for foreign investments, but it would be wrong for us to ask each other why it didn't come next month. For example, we will see that the investments coming from the United Arab Emirates are spread over time. If you ask whether we are receiving signals of investment in our meetings with other countries, yes, we are. It would be limited to say only the Middle East; we are also receiving investment signals from Europe and the USA.

I can say that energy, digitalization, food and agriculture, and health sectors are areas that are talked about a lot. At this point, they will follow how much of the targets of the new economic policies announced by the new economic management are realized. First of all, they will wait for the closing of the year. They will probably wait a bit for the local elections in March, even if it is not said. It is not said, but let me express my feeling."

News Source: 12punto