Turkey could emerge stronger from the coronavirus crisis, President of the European Bank for Reconstruction and Development (EBRD) Suma Chakrabarti told members of Turkey’s Foreign Economic Relations Board (DEİK) in a speech to a webinar on Wednesday.
Chakrabarti urged the Turkish private sector to seize opportunities following the COVID-19 outbreak. “One of the most important consequences of the pandemic and the disruption it has inflicted on global supply chains is much greater scrutiny of supply chains.
“In the new world we are now entering, companies will be putting considerable emphasis on resilience and diversification. Turkey, with its strong potential to significantly scale up exports, is one of the countries that stands to gain most from this new dynamic,” he said.
An EBRD study found that of over three dozen countries where the bank invests, Turkey has a “revealed comparative advantage [RCA]” in 189 product groups, the largest of any country in the EBRD regions.
RCA, defined as the ratio of a product’s share in a country’s total exports and the share of that product in global trade, helps measure the extent to which countries could benefit from a shift of supply chains away from China, currently the dominant global supplier.
President Chakrabarti also argued for a modernization of the Turkey-EU customs union to ensure that it works better for both parties – and allows Turkey to make the most of the diversification trend.
“In a world of increased regionalization of economic activity, shortening supply chains and geopolitical uncertainty, the development of closer relationships between Turkey and the EU would benefit both parties,” he said.
Chakrabarti called on the Turkish authorities to address EU concerns, including internal polarization and wider regional stability.
He also reconfirmed the EBRD’s strong commitment to Turkey, where the bank has invested €12.4 billion over the past decade.