Already enjoying strong economic relations, Turkey and Germany can make joint investments in third countries by benefitting from Turkey’s proximity to lucrative markets and Germany’s know-how, a trade official said.
The issue came to the forefront after German Chancellor Angela Merkel’s farewell visit to Turkey on Saturday. President Recep Tayyip Erdoğan welcomed the outgoing German chancellor in Istanbul where the two leaders – who share a close working relationship spanning nearly two decades – discussed bilateral ties and regional issues.
Ankara and Berlin are major trading partners, with Germany heading the list as a top Turkish import source and export destination for decades. The two countries also share deep cultural ties due to the presence of some 5 million people with origins from Turkey in Germany, while Turkey is among the top tourism destination of Germans along with housing tens of thousands of German expatriates.
The European country ranked first in Turkey's exports last year, with exports to Germany amounting to $15.9 billion.
Germany also took first place in Turkey's 8-month exports this year. In the January-August period, $12.4 billion worth of goods were exported to the country. Germany ranks second after China in Turkey's imports.
The products that Turkey exports the most to Germany include automotive, machinery, knitted clothing, non-knitted clothing and electrical devices. Machinery, automotive, electrical devices, plastics and pharmaceuticals are prominent among the imported products.
Germany has a direct investment of $19.4 billion in Turkey as of end-2020 data, which corresponds to 14% of international direct investments in Turkey. More than 7,600 German companies currently operate in the country.
Foreign Economic Relations Board (DEIK) Turkey-Germany Business Council Chairperson Steven Young, on the bilateral business relations, told Anadolu Agency (AA) that Germany is Turkey's largest commercial partner and one of the largest foreign investors in the country with its investment volume.
Stating that the trade volume of the two countries reached $37.7 billion at the end of last year, Young said: “We have experienced a slight decrease due to the COVID-19 pandemic, but according to this year's data, our bilateral trade will reach the highest level in its history by exceeding $40 billion.”
“The bilateral trade target is $50 billion. There is great potential to improve commercial relations and it is not difficult to reach this target,” he said.
Pointing out that Turkey has many attractive aspects in terms of foreign investments, Young said that he sees “the current period as the most favorable period for foreign investments in the country.”
“Especially considering the change in the post-pandemic 'produce in China, sell in the West' model, it is necessary to develop bilateral economic cooperation not only between Turkey and Germany but also between Turkey and Europe,” Young underlined.
“The global supply chain has undergone a major change and the chance to turn the increase in regional supply demands into an advantage is quite high,” he stressed.
Young also pointed out that Turkey is positioned as a regional center for investments due to its strong access to neighboring markets.
“It is very easy to access markets with emerging economies such as the Middle East, North Africa and Central Asia through Turkey,” he said.
Young added that German-Turkish partnerships can also be made in those third countries.
“This is one of the projects we follow as the Council. We met with our German counterparts and observed that there are great opportunities for partnerships in the African and Middle East markets. We know that the different skills of Turkish and German companies are complementary elements in terms of cooperation. Accordingly, we think that a cooperation model in which German companies will provide technology infrastructure and financial support and Turkish companies will undertake construction works and operation management will be successful in joint projects in third countries,” he explained.
There are many areas where the cooperation between the two countries can be improved in terms of investments, Young said. He mentioned that they have an important project that will encourage Turkish companies to invest in Germany in addition to cooperating in third markets, sectoral partnership projects and projects in the field of digitalization.
“This project will both increase the Turkish-German investment partnership and ensure that German technology and 'know-how' enter our country indirectly,” he also said.
President Erdoğan on Sunday also commented on Turkey-Africa business relations. Erdoğan held a press conference at Atatürk Airport State Guest House before his departure to Luanda, the capital of Angola, where he will be visiting to make various contacts.
“The business forum to be held in Luanda will bring together the private sector representatives of the two countries. We will also take important steps in the defense and security aspects of our bilateral relations,” Erdoğan said.
Erdoğan stated that the last stop of his tour to Africa will be Nigeria, one of the important members of the Organisation of Islamic Cooperation (OIC), the African Union Economic Community of West African Countries, the Organization of Petroleum Exporting Countries (OPEC) and the Economic Cooperation Organization D8. Stating that they will exchange comprehensive views on how they can take Turkey-Nigeria relations further during this visit, Erdoğan said, “Nigeria became our largest trade partner in Sub-Saharan Africa with a trading volume of $2 billion last year. We want this figure to reach $5 billion."
Turkey has also developed relations with Nigeria in the fields of military, defense industry and counter-terrorism, Erdoğan said.
"We continue to bring Turkey and Africa closer in every field. With our diplomatic network that is expanding day by day on the continent and with our trade volume exceeding $25 billion as of the end of 2020, Turkey stands out as a strategic partner for African countries,” the president said.
The 3rd Turkey-Africa Business Forum, meanwhile, will be held in Istanbul on Oct. 21-22, followed by the Turkey-Africa Partnership Summit in Istanbul on Dec. 17-18.
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