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Inflation should act in parallel with the exchange rate, and our exports are decreasing due to earthquakes and energy costs.

Deputy Chairman of the Turkish Exporters' Assembly (TIM) and Chairman of the Board of Directors of Istanbul Iron and Non-Ferrous Metals Exporters' Association (IDDMIB) Çetin Tecdelioğlu and members of the board of directors held a meeting.

Inflation should act in parallel with the exchange rate, and our exports are decreasing due to earthquakes and energy costs.

Istanbul Iron and Non-Ferrous Metals Exporters' Association (IDDMIB) Chairman of the Board of Directors Çetin Tecdelioğlu and the members of the board of directors attended the meeting and talked about the ongoing studies after the earthquake, the sector's strategies for 2023, what can be done to compensate for the losses in exports in parallel with the developments.

He stated that in order to be competitive in global markets, it is necessary to comply with market conditions in energy cost prices and the importance of the interest rate policy in exports.

Exports decreased by 6.4 percent compared to the same month of the previous year and amounted to 18.6 billion dollars. In the same period, exports of the Ferrous and Non-Ferrous Metals sector amounted to 2 billion dollars in the January-February 2023 period, with a decrease of 13 percent compared to the same period of the previous year.

Stating that the earthquake region had an 8 percent impact on the decrease in general exports in February, IDDMIB Chairman Çetin Tecdelioğlu said, "It is not correct to attribute the entire decrease in export figures to the earthquake. When we look at the headlines, exchange rate policy, interest rate, energy, which is not at competitive tariffs, affect us a lot. There is also an increase in imports due to the low exchange rate. It would be appropriate to make changes in the interest rate policy in order for exports to reach the targeted point."

And he added "Because our manufacturing companies are experiencing problems in the products they can compete with in the goods they sell on a TL basis. There is also an increase in imports due to the low exchange rate. Our exchange rate expectation is that it always goes in parallel with inflation. In other words, whatever inflation is in the country, the exchange rate should increase in the same parallel with inflation, it should act with the same trend."

The earthquake has one direct effect and one indirect effect

Expressing that 43 days have passed after the earthquake and they are mobilizing for the earthquake victims living in the region, Tecdelioğlu said, “We faced a great disaster.

"Turkey has shown its own unity and fusion to the whole world. There is nothing back to normal yet, we will continue to support together and we will get through this difficult period," he said. Tecdelioglu, who stated that there are very serious problems in terms of human resources due to migration in earthquake regions, said, "The earthquake has direct effects and indirect effects."

The direct effects of the services to the domestic and foreign market that our exporting companies have already performed in that region. The indirect effects are the effects of companies working as a subsidiary industry to large companies such as Istanbul, Izmir, Ankara, where they are suppliers, on the supply chain. We need to continue producing and exporting as soon as possible.

We need to make it possible to produce the human resources that will provide migration and employment there. We need to reach permanent residences. I hope that in a year there will be those residences and employment and production in those regions will return to the old days." he added.

Tecdelioglu stressed that real interest and energy costs are very high;

Noting that there is an interest rate of over 30 percent in reality, Tecdelioğlu said, "The conditions for using credit are very aggravated. The equities of the enterprises are not enough. As industrialists, we made very serious investments in 2019, 2020 and 2021, we increased our capacities, but our equity, namely our working capital, is not enough."

"This time, when we cannot get raw materials, we are unable to achieve the production we want and the capacity we want. We do not have such profitability with these high interest rates. Energy prices decreased by 15-20-25 percent. But when we compare these figures with energy prices in the world, Turkey is very expensive and we are still not competitive."


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