In this context, Turkey has devised various development strategies towards the neighboring and surrounding countries and the sub Sahara African states with a view to contributing to the economic development of these countries.
Distinguished Guests:
Foreign trade is an important determinant in the Turkish economy, forming 57 percent of its GDP.
Following the transformation of Turkey’s economic and trade policies in the early 80’s, our foreign trade has continuously expanded, reaching a value of 225 billion dollars in 2006. We expect this figure to settle at around 250 billion dollars at the end of 2007.
During this period, Turkey established a free market economy, liberalized its foreign trade and highly integrated with the global economic system.
The foreign trade policies shaped, as a result of this transformation process have been based on an export-oriented industrialization model.
When we observe the general trend and especially the last four years, we see that Turkey has taken a huge leap forward in increasing its merchandise exports.
The exports that were 36 billion dollars in 2002 reached 85.5 billion dollars in 2006, marking an increase of over 100 percent in the mentioned period. We project that exports will exceed 100 billion dollars by the end of this year.
Looking to the structure of exports, we can say that, Turkey has a diversified export base with manufacturing goods dominating a high percentage of its exports.
Clothing and textiles, automotives, electric and electronics, machinery, iron and steel industries are the main leading sectors.
Similarly, when we analyze the growth trend of our merchandise imports, we see a steep increase during the last few years. Merchandise imports that were 52 billion dollars in 2002 reached 139.5 billion dollars in 2006.
This is largely due to the fact that 70 percent of our imports comprise of primary and intermediary products utilized as inputs for the export industries.

Considering the soaring commodity price and high growth rate of the GNP, we expect imports to realize as 150 billion dollars by the end of this year.
Distinguished Guests:
Today, the membership to the WTO and the customs union established with the EU are Turkey’s important economic involvements, which to a certain extent influence the direction of Turkey’s foreign trade.
On the other hand, we assess that regional integrations have positive overall impacts on international trade, and are complementary instruments to the multilateral trading system.
In line with this policy, Turkey, is presently pursuing accession negotiation with the EU, and having a customs union relation has largely harmonized its trade regime, offering a free and fair trading environment for foreign partners.
As the main trading partner, the EU covers close to half of the total trade volume of Turkey.
Since the establishment of the Customs Union in 1996, our trade with the EU countries increased around 170 percent reaching 97.7 billion dollars in 2006.

Germany is the leading trading partner with a share of 25 percent in our trade with the EU. The volume of trade with Germany was realized as 24.3 billion dollars in 2006.
Besides its stance within the EU, the bilateral and regional perspective of Turkish foreign trade policy is equally important, when considering that Turkey bridges different group of countries with respect to their production patterns, economic and political structures, and different geographies and cultures.
This fact has urged us to formulate regional oriented strategies with a view to further developing trade and investment and also contributing to the economic development, stability and welfare of the region.
Within this context, the “Trade Development Strategy with the Neighboring and Surrounding Countries” was initiated in the year 2000.

This strategy that incorporates 50 countries having historic and cultural ties with Turkey has yielded positive results, raising our trade volume with these countries from 19.9 billion dollars in 2000 to 74.4 billion dollars in 2006.
Besides our neighborhood policy, a similar strategy towards the African countries was also put into implementation in 2003 and the results attained so far in terms of trade and investment development seems to be much promising.
Trade with the African countries that was 5.5 billion dollars in 2003, increased 109 percent reaching 11.9 billion dollars in 2006.
On the other hand, the US continues to be one of the major trading partners of Turkey. Our trade that was 7 billion dollar in 2000 reached the level of 10.9 billion dollars by the end of this year.
This shows an increase of a mere 50 percent in the last 6 years, while Turkey’s trade with the rest of the world increased 172 percent in the same period. (18)
The slide showing the increase rate of Turkey’s trade with the ten largest economies of the world, since the year 2000, is particularly interesting in highlighting the trends and performance of commercial transactions between Turkey and these countries.
These strategies, of course, are also closely coordinated with regional cooperation initiatives and preferential trade arrangements to which Turkey is an active member.
Ladies and Gentlemen:
Now, with your permission, I would like to talk about the Trade Development Strategy we have launched towards the Asia Pacific region in 2005.
This strategy incorporates countries of mainly the Far East and Pacific region and integrated within our development strategy implemented towards the neighboring and surrounding countries.
First of all, I would like to comment as to why we devised such a strategy?
Primarily, the Asia- Pacific is the most dynamic region of the world in terms of social and economic development. We expect this region to become the main driving force and the axis of the global economy in the decades to come.

The Asia Pacific countries took a quarter share of the global output and world merchandise exports last year and the five economies among the top fifteen of the world are located in this region.

These facts alone justify the potential of the growing and flourishing markets of Asia of which Turkey must take advantage.

Secondly, the Asia-Pacific region countries have different and diverse economic and social structures. While some countries are well developed, others remain in the middle to low-income category.

Hence, this diversity possesses important challenges as well as opportunities in terms of enhancing our trade and investment relations with the region countries.

As of today, where does Turkey stand?

Well, the steady growth and development of the region and its high share in world trade naturally paved the way for increased interaction between Turkey and the regional countries.

Today, especially, merchandise trade has gained an important momentum accounting for close to 12.1 percent of Turkey’s total trade volume. But when it comes to analyzing the trade structure, we see a huge inflow of imports creating substantial trade deficits.
Turkey’s merchandise exports to the region were realized as 3 billion dollars, while our imports were increased to a record high level of 24.3 billion dollars in 2006.

Subsequently, our trade deficit with China was surpassed 8.9 billion dollars in 2006, while deficits with Japan and South Korea were reached 2.9 and 3.3 billion dollars respectively.

On the other hand, total of trade deficits with India, Malaysia, Indonesia and Thailand was realized as 4 billion dollars as of the end of 2006.

We can say that 40 percent of our foreign trade deficit is generating from our trade with the region.

These developments, of course, have urged us to revise our market access and entry strategies, re-assess constraints and barriers to trade, update market research studies, and to devise different regional, sub-regional and sector oriented policies with the view to give a boost to Turkish exports and investments in the region.

Our new strategy towards the region has not only been designed to enhance exports, but also to further promote business opportunities in different fields such as banking, contracting and consultancy services, defense industries, free zones, transportation and telecommunication, tourism, and small and medium sized enterprises.

Hence, we attribute special importance to complete the legal framework with the relevant countries of which the legal infrastructure has not yet been fully established.

With this strategy, we give precedence to fact-finding missions and trade promotional activities such as trade delegation programs, buyer’s missions, fair participations, and the meetings of business councils.

We also give priority to visits of contractor and investment delegations, with the view to seek opportunities for direct investment and joint venture operations in the region.

Since the inception of the strategy in 2005, we have organized 9 trade missions, invited 21 buyers’ delegations to Turkey and have participated to 26 fairs in the form of national participation.

Distinguished Guests:

Within the context of this strategy, allow me to say a few words on the current situation of commercial and economic relations between Turkey and China.

First of all, we are happy to witness that there is a strong dialogue between the two countries, reflecting the will and desire to promote the overall relations.

It is also noteworthy to observe that the legal framework for the commercial relations between the two countries was concluded.

Within this well-designed legal framework, trade and economic relations between our countries have been displayed a considerable increase during the last five years.

Within this trend, our trade volume reached the historical amount of 10.3 billion dollars in 2006. However, it is for sure that bilateral trade relations have been conducted by Turkey’s importation from China.

In other words, Turkey has been experiencing an increasing trade deficit in its commercial relations with China over the years.

The trade deficits encountered by Turkey during the last two consecutive years were realized as 6.4 and 8.9 billion dollars respectively.

Indeed, the 17% of the total trade deficit of Turkey stemmed from its commercial relations with China in 2006.

Besides, when we analyze the structure of Turkish exports to China, we observe that Turkish exports are mainly comprised of raw materials and limited to a few products , while Turkish imports from China are mainly consumer goods and finished products.

With these figures, China stands as the 29th partner of Turkey in terms of exports, the 3rd partner of Turkey in imports, the 7th partner of Turkey in total trade volume and the 2nd source of trade deficit of Turkey.

This situation confirms the fact that bilateral commercial relations between our countries are driven by the Turkey’s imports from China and needs to be re-defined and developed on sustainable and healthy basis.

That being the case, the Turkish Government decided to implement a “Multi-Dimensional Trade and Economic Policy” towards China with a view to promoting the relations on mutually beneficial basis in the coming years.

Within this context, the trade promotional activities especially aimed at increasing the Turkish exportation to China in the first stage were designed and put into implementation in the last two years.

As an important step in this regard, Minister of Foreign Trade of Turkey paid an official visit to Beijing and Shanghai in September 2006 with a trade mission comprising of the leading representatives of Turkish business community.

In return, H.E. Bo Xilai, Minister of Commerce of China paid an official visit to Istanbul and Ankara with a trade mission in June 2007.

During this visit, 15th Session of the Turkish-Chinese Joint Economic Committee Meeting was also realized.

As a result of the mutual visits and meetings, both Sides decided to implement multi-dimensional trade and economic policies in their relations.

Firstly, considering the economic potential of their respective economies, the Turkish and Chinese authorities agreed to conclude a “Strategic Partnership Agreement” which will constitute the basics of the multi-dimensional cooperation in different economic fields.

Secondly, a comprehensive “Market Promotion Program-MPP” will be put into implementation in 2007 to have sustainable developments in bilateral commercial relations.

As a part of the “Market Promotion Program”, the Turkish Trade Offices will be established in Shanghai and Beijing respectively before the end of first half of this year.

Besides improving commercial relations, accelerating the bilateral economic cooperation is the main target of Turkish and Chinese authorities.

It is no doubt that joint ventures between our respective companies constitute the most important initiative to have sustainable and healthy economic relations. (45)
In this context, the two Governments decided to encourage their companies to have joint ventures especially in industrial fields, including the establishment of economic and commercial cooperation zone in Turkey and China.

The fact-finding investment missions have been realized and as a result, the China International Institute of Multinational Corporations announced three leading Turkish cities namely, ?zmir, Ankara and ?stanbul as the “Best Foreign Cities to Be Invested by Chinese Enterprises”.

Besides, with a view to deepening the investment relations between the two countries, Turkey decided to participate in the “11th China International Fair for Investment and Trade-CIFIT” as a “Focus Country, which is the one of the leading investment fairs of the world.

On the other hand, constituting one of the promising areas, the Turkish and Chinese contracting companies should examine the cooperation possibilities in infrastructure projects not only in Turkey and China, but also in the third markets.

It is evident that there is a huge potential for Turkish and Chinese companies to work together in the infrastructure projects of Turkey in the fields of energy and railway and highway construction.

The involvement of a Turkish-Chinese consortium in the Istanbul-Ankara Speed Train Project and the credit facility extended by the Chinese Eximbank for the project constitute an exemplary case of cooperation in this regard.

It is our belief that Turkish and Chinese companies should transfer this kind of cooperation initiatives to third countries, especially in the field of contracting and consultancy services.

Distinguished Guests,

Tourism constitutes one of the most potential fields of economic cooperation between our countries.

As you may appreciate, Turkey, as being an attractive destination, welcomed 20 million tourists while China, with its great potential, sent 31 million tourists to abroad in 2006.

Unfortunately, the number of Chinese tourists visiting Turkey was recorded as only 50.000 in the same year.

On the other hand, Far East countries including China have become one of the popular destinations for Turkish tourists during the last five years.

That being the case, Turkish and Chinese authorities should work together with a view to promoting their countries among the Turkish and Chinese tourists.

It is our belief that the first step to be taken in this regard is to establish necessary transportation facility by increasing direct flights between Turkey and China

Before concluding, I would like to reiterate my pleasure for being in Urumqi and express my conviction that the forum and the meetings of the businessmen to be realized during the fair will contribute to the enhancement of the commercial and economic relations among the participating countries.

Thank you.