As the sweeping reciprocal tariffs U.S. President Donald Trump unleashed final week have despatched world markets right into a tailspin, business figures and economists in Türkiye have begun to glimpse a silver lining to the financial storm clouds.
Türkiye was hit with a baseline 10% tariff in Trump’s announcement, in contrast with larger tariffs for a lot of different international locations, elevating the prospect that the world’s seventeenth largest economic system may leverage a bonus from the tariff regime.
Treasury and Finance Minister Mehmet Şimşek stated Monday that the nation’s give attention to home demand fairly than exports would imply a extra restricted affect on the economic system.
“Türkiye has free trade agreements with a total of 54 countries outside the U.S. and the EU,” he said, adding that “68% of our exports go to those international locations.” Türkiye has a customs union with the European Union that removes commerce restrictions.
Speaking Friday, the day after Trump’s announcement, Şimşek stated Türkiye’s “comparatively low tariff charge could present a comparative benefit in some sectors.”
Trade Minister Ömer Bolat known as the tariffs on Türkiye the “best of the worst,” given larger levies on different international locations, however nonetheless stated that the federal government wished to barter with the U.S. to elevate the brand new levies.
Can Selçuki, managing accomplice of Istanbul Economics Research, stated the principle damaging impact on Türkiye would probably be by way of intermediate items it provides to international locations or entities that export to the U.S. which might be topic to larger charges, such because the EU, which is topic to a 20% tariff.
Turkish exports to the U.S. have been $16.7 billion in 2024, in accordance with the Office of U.S. Trade Representative. It imports the same stage of products and providers from America.
This stage is dwarfed by exports to the EU, which President Recep Tayyip Erdoğan stated in January reached $108.7 billion final 12 months.
“Any loss of competitive power of EU products inevitably impacts Türkiye because Türkiye exports intermediate goods to input to final EU products,” Selçuki said. “This is the obvious damaging half.”
Türkiye, nonetheless, may exploit the brand new world commerce atmosphere to its benefit.
“A lot of manufacturing production will have to be relocated and the picture Trump is drawing is telling everybody to rethink their supply chains,” Selçuki added. “Türkiye, with its robust manufacturing base and closeness to the EU, is in a novel place to utilize this reorganization.”
The baseline tax took impact on Saturday. The larger charges are as a consequence of take impact on Wednesday. European Union imports will face a 20% tariff, whereas Chinese items will likely be hit with a 34% tariff, bringing Trump’s whole new levies on China to 54%.
On Monday, Trump vowed extra 50% levies if Beijing doesn’t withdraw retaliatory tariffs on the U.S. Beijing stated on Tuesday it might by no means settle for the “blackmail nature” of U.S. threats.
Şekib Avdagiç, president of the Istanbul Chamber of Commerce (ITO), steered that firms primarily based in international locations with larger tariff charges, reminiscent of China, could search to open factories in Türkiye to export to the U.S. at a decrease charge.
“Türkiye’s use of this chance will depend upon its technique to develop its export sectors and discover new markets,” he instructed the Anadolu Agency (AA).
Gürkan Yıldırım, head of the Turkish Young Businessmen Association, added that “if Türkiye affords an acceptable funding atmosphere, it will possibly appeal to the investments of those firms.”
Selva Bahar Baziki, an economist at Bloomberg Economics in Ankara, famous that even contemplating oblique commerce by way of third international locations, lower than 2% of Türkiye’s gross home product (GDP) was uncovered to U.S. demand.
The most threatened industries could be these exporting metals and textiles.
Addressing the volatility that has beset the Turkish lira in recent times, which influenced excessive inflation, Baziki added that tariffs would produce “no inflationary stress from change charge actions associated to commerce insurance policies.”
Source: www.dailysabah.com