Nane, speaking at a press conference yesterday, criticized a bill on shopping malls, large stores and chain stores that was prepared in 2001 and has been brought to the agenda recently. The bill, if it becomes law, will undermine the growth of the sector, he opined, reducing both employment and investment and eventually negatively affecting the overall economy. Defining the organized retail sector as a “dynamo of employment,” he explained that the number of workers directly employed in the sector grew by 2 percent to 450,000 last year despite the fact that the overall unemployment level increased in the country due to the global economic crisis. Including the 1.35 million employees that indirectly work for the sector, Nane said, total employment rises to 1.8 million. Closing malls on Sundays, he said, could result in an 18 percent drop in the employment level in the organized retail sector, which means 81,000 active workers would be laid off.
The organized retail sector is important to the economy because of its high potential in drawing foreign direct investment (FDI) to the country along with its contribution to the Treasury with the high levels of taxes it provides, he said. Currently there are a total of 236 malls in Turkey, which it is estimated have drawn in at least $10 million in FDI. The sector has an annual turnover of $70 billion, resulting in at least $7 billion in value-added tax (KDV), Nane noted.
Opposing the idea that large stores such as hypermarkets and supermarkets pose a direct threat to the existence of smaller stores, he said these two types of retail businesses can indeed coexist and as AMPD they are ready to support small stores to keep them above water during this “period of transformation from tradition to modern that Turkey is undergoing.” The transformation is taking place in line with customer demands, Nane remarked, stressing that it is unfair to make legislation that goes against what customers want.
The bill also forces large stores and chain stores to manufacture their own private label products if they amount to more than 20 percent of their total sales. This article, according to the AMPD head, will seriously damage small and medium-sized establishments (SMEs), as most large stores carry out their production through these units instead of setting up their own production units.
