With a view to decreasing the impact of imports on the trade deficit and current account deficit, Turkey has launched a localization move to manufacture intermediary industrial goods, most of which are supplied from abroad.
Science, Industry and Technology Minister Faruk Özlü said they have launched the Project for the Localization of Imported Product in order to close Turkey's foreign trade deficit. Noting that among intermediate goods Turkey imports, they have detected 978 products in the first stage, and that the number of products to be localized will rise to 2,600, Özlü said product contracts will be made in 2018, and the first products will be seen at the end of next year. Pointing out that Turkey has about $134 billion worth of intermediate goods imports, including industrial products worth $105 billion, Özlü said a localization board will be formed as part of the project, adding that the board will operate under the auspices of Deputy Prime Minister Mehmet Şimşek and its secretariat will be run by the ministry. Özlü said the project focuses on chemicals and pharmaceuticals, semiconductors and electronics, machinery and equipment, food, beverages and tobacco, and motor vehicles and will prioritize localization of products in these areas. He said about 2,600 units of intermediate goods imported by Turkey are scanned one by one. Özlü stressed that two criteria will be applied in the selection of the products to be localized: "First, we will prioritize products that we can easily localize and contribute to the economy in a short period of time. We will produce the products that will take a few years to localize and require large investment later. The second criterion is the selection of which companies to localize the products. We are currently determining these criteria."
Explaining that the localization board will be chaired by Şimşek after determining the criteria, Özlü said after the approval of intermediate goods by the board, products will be integrated into the global system and localized by the ministry, the Scientific and Technological Research Council of Turkey (TUBİTAK), Small and Medium Enterprises Development Organization (KOSGEB), the Turkish Patent and Trademark Office (TÜRKPATENT) and the Turkish Standards Institution (TSE). Özlü recalled that manufacturing industry products constitute 94 percent of foreign trade in Turkey. "The foreign trade deficit is $56.1 billion. Our exports are $142.5 billion, and our imports are $198.6 billion, according to last year's figures. There's a $56.1 billion gap between them," Özlü said. "Our objective with the Localization of Imported Products is to close the foreign trade deficit of Turkey."
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