TURKEY: Textile Crisis Begins to Affect Giants
Source: CCPIT TEX Date: 2006-02-28
The Turkish textile Sector, known as the locomotive of export, has begun to feel the affects of the crisis due to the competition against China, high taxes and high valued YTL.
Some companies have moved their factories abroad and some others have deviated to alternative sectors like tourism and construction. The sector representatives will meet with Turkish Prime Minister Recep Tayyip Erdogan on February 28 and seek solutions for their problems. Eleven factories were closed in Gaziantep while Akkok Group halted the production in its factory in Yalova. The crisis has also shown its affects on big companies. Yesim Textile Company’s owner Cavit Caglar announced he may have to lay off 15,000 employees.
Abdulkadir Konukoglu, who is the owner of Gaziantep centered Sanko Holding, gave leave without pay to its employees. Izmir Fabric Industry and Izmir Cotton Textiles halted their production, displaying the severity of the crisis. The factory of Ren Holding, which belongs to Giraud Family, was one of the oldest factories of Turkey.
Ready Wear and Confection realized USD 13,095 mln export in 2004 and this number reached USD 13,700 mln in 2005 increasing by 4.68 percent. Ready wear constituted 18 percent of Turkey’s USD 73,400 mln export. Textile and raw material export was USD 4,500 mln two years ago and reached USD 4.8 bn increasing by 6.5 percent. The comparison of the statistics of last year and two years ago reveals the stagnation the sector is suffering from. Ready wear and Confection sector had realized a 14.01 increase in 2004 and textile and raw materials had realized a 24.88 percent increase. This negative picture results in the companies’ moving their investments abroad as about 20 companies preferred to make their investments abroad in the 2003-2006 periods.
The slow down in the increase of the export rate intensified the worries of the textile and ready wear sector about the crisis. As the producers in the main industry began to move their investments abroad, a 50 percent decrease was seen in endorsements.
By Abdulhamit Yildiz
zaman.com
