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Exporters lament loss of competitive power due to high value of TL
Turkish Exporters Assembly (TİM) President Mehmet Büyükekşi, speaking to the Anatolia news agency yesterday, noted that the Turkish lira’s high value causes a cash flow into the country. In an effort to prevent this, a Tobin tax of between 1 and 5 percent may be levied on short-term capital movements, he said, stressing, however, that it would only be an outcome of the current situation and not something they desire. “All we want is an exchange rate enabling us to compete [in the global markets].”
With a currently high exchange rate of the Turkish lira against the euro and the US dollar, it is impossible for Turkish exporters to remain afloat, Büyükekşi said. Reiterating remarks made by Central Bank of Turkey Governor Durmuş Yılmaz, who called on exporters to increase their efficiency to address this problem, he said exporters can no longer tighten their belts or increase efficiency further. “Turkey cannot be an export haven in this way. It is not only exporters who are suffering from the current situation. Turkey’s current account deficit is on the rise. The main reason for this is that exporters prefer importing intermediary goods rather than producing them themselves,” he said.
Turkey should free itself from the current high pressure on exchange rates, the TİM head said, stressing the necessity of an anchor like a Tobin tax or the rate of exports over imports.
İstanbul Textile and Apparel Exporters’ Union (İTKİB) President İsmail Gülle also said that they have been asking the government for a reduction in input prices and the real exchange rate. “They continue to not grant us what we want from them and we continue to increase exports. All this means is that this will go on like this,” Gülle said.
Erdal Bahçıvan, chairman of the İstanbul Chamber of Industry (İSO), also complained about the fiscal policy Turkey has been implementing for the past 20 years, claiming that the policy aimed at attracting cash inflow but does not extend enough support to industrialists, exporters and producers. The situation worsened, especially with measures taken after the 2001 economic crisis, he said, stressing on the necessity of a new fiscal policy. However, Bahçıvan does not expect radical changes in fiscal policy before the 2011 general elections.
İstanbul Leather and Leather Products Exporters’ Union (İDMİB) Chairman Lemi Tolunay said exporters had suffered serious losses this year due to an increase in the value of the Turkish lira against foreign currency rates. For instance, he said, his company made its business deals one year before, fixing the euro to the Turkish lira exchange rate at TL 2.2, the level at the time. However, the exchange rate dropped to around TL 1.92, causing a loss to the business. Tolunay said that nearly every exporter is unfortunately in the same situation.
Turkish Constructors’ Union board member Edip Yenigün, like Tolunay, said they have been seriously affected by developments in currency rates, as they take on projects in US dollars or the euro. Last year Yenigün’s business worked on the construction of an Ikea project in Omsk, Russia, half in the Russian ruble and half in the euro. As the value of the euro dropped dramatically to around TL 1.9, the company suffered a loss of 1.5 million euros.
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