TIM President Mustafa Gültepe: "It's a great problem... It is a big problem for many of our sectors"

While TIM President Mustafa Gültepe was explaining the steps to be taken to increase high-tech exports, he received the news of a 500 basis point interest rate increase. It is a big problem for many of our sectors."

Mustafa Gültepe, President of the Turkish Exporters Assembly (TIM), and I were in a chat meeting yesterday afternoon to talk about the Innovation Week organized to increase the added value of Turkish exporters when the news of the CBRT's 500 basis point interest rate hike came. While explaining the leverage effect of high technology in exports, Gültepe said, "It's a big problem. It is a big problem for many of our sectors."

"I was expecting a lower rate increase"

Gültepe underlined that the last step taken by the Central Bank in rediscount credits is very positive: "We convinced the Governor of the Central Bank on the plane to Ankara. We explained, we got the policy interest rate and rediscount interest rates fixed. At that time, the interest rates were 25 percent.

The interest we received was 36 or 37 percent. We explained. The Governor of the Central Bank receives information from the field, takes notes and writes it down." After the latest interest rate hike, the interest rate of the rediscount credit of exporters will be 35 percent plus 36.5 percent with commissions. This is what demoralizes Gültepe: "I was expecting a lower rate increase.

With 35 percent, 36.5 percent, you will get money, you will use it, you will produce, how will you make money? Who will deal with it?

Exporters have already been suffering from the contraction in Europe, the main market, for some time. The situation for Turkish exporters is much more difficult because their losses in this market are much higher than the overall recession in the market. Gültepe gives an example from ready-to-wear: In the UK, the recession in the market is 15 percent, while the contraction in Türkiye's exports to this market is around 25 percent.

Germany, the American market is always like this... Purchases from Türkiye decreased by 15 to 25 percent. The TIM President attributes the fact that these markets are experiencing a loss of 5 to 10 points above the general recession to the decrease in their competitiveness. While competitors took steps to reduce costs with strategic decisions in order to capture Türkiye's market share, there was a big increase in the costs of producers in Türkiye.