Emerging problems in the supply chain around the world following the outbreak of the new coronavirus could provide an advantage for Turkey in the long term once the crisis is over, German-Turkish Chamber of Commerce and Industry (AHK) Secretary-General and board member Thilo Pahl said.
In an interview with Anadolu Agency (AA), Pahl said: “In the long run, this virus crisis offers a great opportunity to reposition Turkey in the global supply chain.”
Pahl pointed out that the effect of the coronavirus on the international economy is already huge, while, “Extraordinary circumstances can offer unexpected opportunities for sectors that can quickly increase the capacity of their economy or operate below capacity,” he stressed.
He said automotive suppliers and the textile industry are among the sectors that come to mind first, through which Turkey can reposition itself in the global supply chain.
The emergence of the coronavirus late last year in China has already pushed various firms toward searching for new markets and production centers since the East Asian country took steps such as closing down factories and locking down cities to curb the spread of the virus. However, the pandemic has already spread worldwide, and Europe is now officially the virus’s epicenter, giving further ambiguous signals on the future of world trade and the global economy.
Pahl noted that although it is difficult to predict the extent of the problem to be experienced in the supply chain from the coronavirus effect, “It is clear that some sectors will be particularly hit hard,” as fairs, events and travel arrangements are canceled worldwide, and employees have started to work from home.
Turkey attractive market for Germany
Pahl further highlighted that Turkey has a geostrategic position that stands out with a growing and freely spending population. “Turkey remains an attractive market and investment target for German small- and medium-sized enterprises (SMEs). The pragmatic and flexible structure in Turkey is completed in harmony with corporate professionalism in Germany. The result is impressive: more than 7,000 German companies employ 140,000 people, including SMEs. The potential is even bigger,” he added.
Pahl said many German SMEs are aware of the attractive Turkish market but expect regional uncertainties for further investment, adding that the Turkish economy offers many opportunities in the medium and long term. He further stressed that Germany remains one of the leading allies of Turkey, based on its long-standing relationship and $33 billion in trade volume with Turkey in 2019.
Pahl underlined that German companies investing in Turkey stay even in difficult times because they see the strategic advantages of the Turkish market, adding especially in the automotive and machinery sectors, the availability of the necessary factors, like a qualified workforce, and low production costs attract investment in Turkey.
“The two countries are important commercial and economic partners for each other,” he continued, noting that in addition to deep bilateral relations, the establishment of a cooperation structure for third countries will inevitably increase the export volume, consequently leading to a positive impact on growth rates. In case the models are determined for different opportunities, this cooperation will bring high efficiency and sustainability.”
Africa dynamic place for cooperation
AHK Secretary-General also said Turkey wants to partner with Germany in Africa for many important sectors in the near future, explaining that Africa is a dynamic place for entrepreneurs and opportunities.
“Food, agriculture, energy, infrastructure, construction and materials, health, durable consumer goods and construction machinery sectors are key areas in which we seek partnership and cooperation,” he noted.
He stressed that since there is rapid urbanization in Africa that requires urgent housing, infrastructure and electricity needs with major projects worth $50 million or more, “Turkish contractors and energy companies, together with their German partners, can offer information-based solutions for difficult construction works within the scope of the projects they will do with the right budget and time.”