Social Network

Turkey

Turkey targets defense and aerospace exports to counter growing national deficit

The Turkish government is reportedly pressuring its defense and aerospace industries to boost exports as part of an aggressive strategy…

Turkey targets defense and aerospace exports to counter growing national deficit

The Turkish government is reportedly pressuring its defense and aerospace industries to boost exports as part of an aggressive strategy aimed at addressing the country’s account deficit and plunging national currency.

 

“Exports are increasingly important for the sustainability of the [local] industry,” said Murat Ceran, head of the International Cooperation Department at the Presidency of Defence Industries, the government’s procurement agency.

 

In recent years, Turkey’s defense and aerospace industries reported an average export increase of 8 to 10 percent annually. Only in the past six years, Ceran said, have defense and aerospace exports risen by 61 percent, while Turkey’s overall exports rose by 10.5 percent.

 

“We are working to boost exports in a total of 130 countries. We are monitoring over 500 programs in 70 countries,” he said.

 

Turkey’s defense and aerospace exports have risen from an annual $1.388 billion in 2013 to $2.035 billion in 2018, according to the Turkish Exporters’ Assembly. In comparison, total sales (both foreign and domestic) grew from $5.076 billion in 2013 to $6.693 billion in 2017 (sales growth for 2018 was unavailable via the Turkish Exporters’ Assembly by press time).

 

“We are seeking new [export] deals in the Asia-Pacific region,” Ceran said. Presently Turkey’s top market is the United States, with annual sales of $726 million reported in 2018.

 

Other top markets are Germany with $226 million; Oman with $153 million; Qatar with $83 million; and the Netherlands with $75 million. India, Azerbaijan, the U.K., Poland and France are also included in the top 10 export markets.

 

In a breakthrough deal in 2018, Turkish Aerospace Industries won a $1.5 billion deal to sell a batch of 30 T129 helicopter gunships to Pakistan. TAI produces the 5-ton T129 under license from the Italian-British AgustaWestland. The Philippine government said it may also order a batch of T129s.

 

Also last year, private Turkish company Baykar signed a deal to sell six drone systems to Ukraine, a first for the Turkish industry.

 

Only in the past couple of years Turkish companies won $800 million worth of contracts in Qatar to sell armored vehicles, drones, training ships and coast guard boats.

 

Some Balkan countries also showed interest in commissioning Turkish shipyards for naval upgrade programs, in addition to others eyeing Turkish-made corvettes and frigates. And Pakistan and Malaysia have been identified as potential customers for Turkish-made naval systems.

 

Procurement officials in Turkey have pointed to electronic and electromechanical systems, management systems, information management software, cybersecurity solutions, and flight simulators as potential export items.

 

 

“The local industry is becoming more and more competitive,” according to Özgür Ekşi, a senior analyst with C4Defence. “Most prospective products are armored vehicles, drones, boats and ships, trainer aircraft as well as the emerging new-generation tank (the Altay) and the T129,” he said.

 

But analysts warn that licensing problems may overshadow Turkey’s export efforts.

 

“Critical parts, like engines, in many Turkish systems are Western-made, and countries like the United States and Germany may be reluctant to issue export licenses for these parts,” an Ankara-based defense analyst said.

 

For instance, the T129 is powered by two LHTEC T800-4A turbo-shaft engines. Each engine can produce 1,014 kilowatts of power. The T800-4A is an export version of the CTS800 engine. LHTEC, the engine’s makee, is a joint venture between the American company Honeywell and the British firm Rolls-Royce. If the U.S. refused to issue export licenses for that engine, it could mean the end of the Turkish-Pakistani T129 deal.

 

Similarly, BMC, a Turkish company that won a multibillion-dollar contract for the mass production of the Altay, is seeking foreign suppliers for an engine and transmission for the Turkish tank, on the condition that export licenses would belong to the Turkish producer.

 

Excerpt only, Defense News

Banner

Related News

Related News