The "Industrial Cooperation Program in Public Procurement Conference," organized to ensure the effective implementation of the Industrial Cooperation Program Regulation enacted by the Ministry of Science, Industry and Technology, was held at the Ankara Chamber of Commerce (ATO).
The conference, organized under the auspices of the Ministry of Science, Industry and Technology, in collaboration with the ATO Public Procurement Domestic Contribution and Offset Practices Special Commission and OSTİM, was attended by bureaucrats, representatives of civil society organizations and the private sector, as well as members of the ATO Board of Directors and Assembly.
Speaking at the opening of the conference, Yunus Emre Karaosmanoğlu, Deputy Undersecretary of the Ministry of Science, Industry and Technology, stated that public procurement plays a significant role in the industrial policies of developed countries. Karaosmanoğlu reminded the audience that the Industrial Cooperation Program Regulation, which they prepared to increase the production capacity of high-tech products in Turkey through public procurement of goods and services and to promote innovation, localization, and technology transfer in industry, came into effect on February 15, 2015. Highlighting the importance of the Industrial Cooperation Program, Karaosmanoğlu said, “Here we are discussing the future of our country. If we want to live our future in a more prosperous, peaceful, and secure way, let's seriously consider the meaning of this conference.” Karaosmanoğlu emphasized that accelerating the development of the manufacturing industry and increasing the share of high value-added technological products in exports are of great importance for Turkey to have a strong economy and avoid the danger of the middle-income trap. Karaosmanoğlu explained that 94 percent of Turkey's exports are based on manufacturing industry, and noted that industrial strategies and sectoral strategies are being prepared under the coordination of the Ministry in order to guide the industry and raise the value-added production structure to higher levels.
Karaosmanoğlu stated that the Ministry of Transport, Maritime Affairs and Communications is trying to implement the Industrial Cooperation Program in the construction of high-speed trains and metros, and that the Ministry of Health and the Ministry of Energy and Natural Resources are also working in this direction, adding, “However, unless this becomes a law or a concern for every individual, we don't have much chance of implementing these in the field. We should all make this a concern.” He reminded that similar applications are made in all European Union countries, in America, and in many countries around the world, and said, “Unfortunately, in our country, it is implemented with great difficulty.”
Karaosmanoğlu explained that the new building of the Ministry of Science, Industry and Technology is equipped entirely with domestically produced technologies, noting that domestic production in Turkey has now caught up with the technological advancements achieved by Europe, America, and other countries around the world. Stating that there is a race to use foreign technology products in Turkey, Karaosmanoğlu said, "If we, as individuals, were to eliminate our negative contribution to the current account deficit, there would be no current account deficit in Turkey."
“Current account deficit is our Achilles' heel”
In his speech, ATO Board Chairman Salih Bezci stated that the Industrial Cooperation Program is an industrial policy and is used in many countries around the world to develop domestic industry and technology. Pointing out that Turkey needs to increase its high-quality and high-tech production, Bezci said, “The current account deficit is our Achilles' heel. If we remain a country that incurs a current account deficit to produce and borrows to grow, we cannot achieve stable and high growth.” Recalling that the Industrial Cooperation Program Regulation came into effect on February 15, 2015, Bezci stated, “With this regulation, in public procurements exceeding $10 million undertaken by foreign companies, which are of the nature of ‘innovation, localization, technology transfer,’ contributions can be obtained from Turkish companies or imports can be made under various criteria.” Expressing that the Industrial Cooperation Program will make a significant contribution to technological transformation in Turkey, Bezci added:
“In order to leave a prosperous country to our young generations, of whom we are proud as a nation, we need to lift our economy out of the middle-income trap and achieve great success in exports. The average value of 1 kilogram of Turkey's exports is 1.6 dollars. If we increase this figure to 3 dollars, our per capita national income will increase. We need to work tirelessly to develop our technology, to possess and master technology, and to produce and sell high-tech products.”
Bezci added that Ankara would become a high-tech production center through the Industrial Cooperation Program.
“This is a war of liberation”
Ankara Chamber of Industry (ASO) Chairman Nurettin Özdebir, in his speech, stated that the Industrial Cooperation Program should not remain on paper but should be implemented. Referring to Turkey's current account deficit problem, Özdebir noted that every individual who uses imported goods contributes to the formation of the current account deficit. Recalling the "Buy American" law in the US, which aims to increase the use of domestically produced goods and is implemented by the public, Özdebir said, "We love to give speeches. When nationalism is mentioned, we all become like lions, but unfortunately, we cannot say that we act that way in our lives. From the vehicles we use to our clothes, we prefer foreign products in many areas." Expressing that everyone should contribute to the implementation of the Industrial Cooperation Program in public procurement, Özdebir said, "This is a war of liberation. It is the key to escaping the middle-income trap. It is a battleground. I believe with all my heart that 78 million Turkish citizens will do their best to contribute to this." Özdebir added that Turkey needs to produce higher value-added and more technologically advanced products to increase its per capita national income.
OSTİM President Orhan Aydın also emphasized the importance of implementing the conference's content, stating, "We cannot achieve development by importing our needs from abroad." He noted that the offset application in public and private procurement has been discussed for a long time but has not been implemented, adding, "We will pursue those who don't implement it. We will fight to make it happen." Recalling that the Ministry of Transport, Maritime Affairs and Communications announced that 60% of the high-speed train could be built with domestic contributions, Aydın said, "With small efforts, the face of Turkey will change. There is no other way out, no other solution. We have slept too much; now we need to work 24/7, three shifts."
Musa Pireci, Chairman of the ATO Public Procurement Domestic Contribution and Offset Practices Special Commission, stated in his speech that Turkey's most important economic problem is the current account deficit. He noted that controlling public spending is necessary to reduce the current account deficit, saying, "Public procurement constitutes a significant share of public spending. The state, being the largest buyer of goods and services in the economy, can direct markets to achieve many goals through tenders." Pireci explained that the offset practice has been successfully implemented in the defense industry in Turkey, and added the following:
“The Ministry of Health plans to make $130 billion in foreign purchases over the next 9 years. If offset applications are implemented only in the Ministry of Health, Turkey will transfer approximately half of this $130 billion, around $65 billion, to domestic industry. If we can succeed in developing offset applications in the fields of health, energy, and transportation, we foresee that the amount our country will transfer to domestic industry will be at least around $200 billion over the next 9 years, and this amount will remain within the country, contributing to the resolution of the current account deficit problem and capacity development in these areas.” (Source: Ankara Chamber of Commerce)
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