Machinery manufacturers who are members of the Machinery Manufacturers Association (MİB) came together with the General Manager of Industry Prof. Dr. İlker Murat Ar at the Consultation Meeting held in Istanbul. During the meeting, MİB members had the opportunity to share the problems of the sector and their solution proposals.
The Machinery Manufacturers Association (MİB), which has been operating since 1990 to protect the interests of domestic machinery manufacturers in the entire machinery sector and to support domestic machinery production, continues to take responsibility for the development of the machinery manufacturing sector and increasing its global competitiveness.
The problems of the sector and solution proposals were shared within the scope of the Consultation Meeting held in Istanbul with the participation of the General Manager of Industry Prof. Dr. İlker Murat Ar and MİB members.
“It is going to be a difficult year in terms of sales”
Speaking at the meeting, MIB President S. Emre Gencer said, “We are going through a difficult year in terms of our domestic and international sales.
Excluding the pandemic period, domestic machinery and equipment investments have shrunk by a high rate of 5.6 percent as of the third quarter for the first time in the last decade. The information we receive from our members indicates that this situation will continue in the rest of the year. Unfortunately, we are also observing a similar shrinkage in our exports. Indeed, in the first 7 months of the year, our machinery exports have shrunk by 2 percent despite the dollar/euro parity being in favor of our exports. This decline is likely to continue in the rest of this year due to the economic recession experienced in our main markets, the EU and the UK. The shrinkage experienced in our domestic and foreign markets is expected to continue in the first It is highly probable that it will continue until the middle of the year. As domestic machinery manufacturers, we are trying to close this problematic period with the least possible damage. We are reducing our expenses as much as possible; we are having difficulty even continuing our critical investments. We have to continue our investments in order to survive in our main markets with the Far East and old Eastern European countries. In order to achieve this, we need more public support than ever. We can say that it is not possible for us to make new investments with the current credit costs,” he said.
“Our internationally competitive manufacturing companies may experience temporary liquidity problems”
“We understand from the information conveyed to our Union that we could not benefit from the YTAK program, which is perhaps the only support element we can benefit from in the financing of our investments in this period,” said S. Emre Gencer, “First steps should be taken in this regard by rapidly allocating YTAK resources to three machinery investment projects with an investment amount of over 1 billion Turkish liras approved within the scope of the HAMLE program. 18 machinery investment projects have been approved within the scope of the HAMLE Program to date. Only 3 of these projects have an investment value of over 1 billion Turkish lira. The vast majority of the remaining 15 projects consist of investments with a total investment amount of less than 500 million Turkish lira.
As is known, it is stated in the new Medium Term Program that the YTAK program will be implemented more effectively. In the studies to be carried out within this scope, our proposal to provide resources for the 15 machinery projects I mentioned, which were approved within the scope of the HAMLE Program, should be evaluated. Another issue that we should emphasize is the fact that our internationally competitive manufacturing companies may experience temporary liquidity problems during this period when the stability program is being implemented. We think that a credit guarantee program for manufacturing industry companies may need to be established in the later periods of the OVP. Another important issue is Eximbank loans. I would like to state with pleasure that important steps have been taken in the last year regarding rediscount credits. However, I should also state that there has been no significant development to date regarding the support of our machinery exports with credit programs that can compete with Western export credit institutions, which is also included in the OVP,” he said.
“Domestic Goods Circular Should Be Put Into Force as Soon as Possible”
Drawing attention to the problems experienced regarding Domestic Goods documents, Gencer said, “Our observation is that unfortunately, machines and facilities known to be imported can often benefit from the discounts within the scope of this legislation in practice. In disputes regarding the subject, the courts make decisions based on the Domestic Goods documents issued by the Chambers of Commerce and Industry for the product in question. The same courts reject requests for the examination of the documents in question by the public authority on the grounds that they are not foreseen by the legislation. We know that our Ministry of Industry and Technology is making great efforts to solve this problem. As a matter of fact, our Ministry has prepared the new Domestic Goods Circular draft, which we believe will eliminate the problems and deficiencies in this regard, and has also received the opinions of NGOs. As the MIB, our expectation is for the said circular to come into force as soon as possible. As domestic machinery manufacturers, our ‘must-have’ in this regard is; He said, “The Ministry is authorized to examine the Domestic Goods Certificates ex officio or upon complaint, including the place of production.”
“Exports to Russia have come to a standstill”
Drawing attention to the problems that have started to be encountered in machinery exports to Russia since the beginning of this year, Gencer said, “As of last year, Russia had become the second country to which we exported the most machinery. Unfortunately, we could not continue this positive development in the first half of 2024 and our machinery exports to this country decreased by 20 percent. It will not be a surprise if our export losses exceed thirty percent by the end of this year. The main reason for this negative development is that we have not been successful as a country in managing the increasingly harsh sanctions imposed by Western countries on Russia during this period. As a result of the heavy pressures that US institutions have put on our companies and banks doing business with Russia, an increasing number of our companies have become unable to trade with this country. Finally, 19 of our sector companies have been included in the SDN list. Companies included in the SDN list cannot conduct any financial transactions within the banking system. What is even worse is that the companies included in the list have been forced to stop their commercial activities with Western suppliers or buyers. We bring up the need for urgent measures on this issue on every occasion. We expect the conditions to be created for our country to be able to export to Russia without any problems within the framework of our international obligations, except for defense industry products. Otherwise, we say that our exports in the machinery sector will come to a standstill and the gap left by our companies in the Russian market will be filled by companies from Far Eastern countries.”
The machinery sector is very critical for us
Speaking at the meeting, General Manager of Industry Prof. Dr. İlker Murat Ar said, “The machinery sector is a very important and critical sector for us. We need to progress very quickly here. I believe that we will create our roadmap together step by step on this issue and sign beautiful works.”
Following the meeting, steps were taken to establish a joint working group.
