The 39th TOBB Turkish Defence Industry Assembly Meeting Held in Eskisehir

Tarih: Issue 90 - February 2019

The 39th meeting of the TOBB Turkish Defence Industry Assembly was held on January 28, under the chairmanship of Minister of National Defence Hulusi AKAR at the 1st Air Supply and Maintenance Center in Eskişehir. In addition to the Minister of National Defence, President of Defence Industries Prof. İsmail DEMİR, Deputy Minister of National Defence Muhsin Dere, Eskişehir Governor Özdemir ÇAKACAK, President of TOBB M.Rıfat HİSARCIKLIOĞLU, 1st Air Supply and Maintenance Center Commander Air Force Brigadier General Gürhan ERGÜRHAN, President of the TOBB Turkish Defence Industry Assembly Yılmaz KÜÇÜKSEYHAN, and a large number of military personnel and representatives of the private sector also participated in the meeting.

Taking the floor at the assembly meeting, President of the TOBB Turkish Defence Industry Assembly Yılmaz KÜÇÜKSEYHAN stated that the sector will continue to grow in the new period without losing speed and that the problems stemmed from the exchange rate in 2018 were met with swift measures taken by KOSGEB as well as the Minister of National Defence, the President of Defence Industries, related institutions, and organizations. KÜÇÜKSEYHAN also stated that Minister of National Defence Hulusi AKAR noted the requests and wishes voiced by the members of the sector at the 38th Assembly consultation meeting held on October 30, 2018, in Kırıkkale: “When we called the relevant departments of the ministry in the afternoon of October 31 regarding the mentioned problems, I learned that they received instructions from you personally and began to work on them. In this respect, we are a very lucky sector. Mr. President, we solve our problems with your direct support and the President of Defence Industries.” KÜÇÜKSEYHAN also provided information about the activities carried out since October 30: “In this context; we elaborated on the STANAG documents (standardization agreements) and provided necessary information. Studies on order quantities for localization and nationalization continue. The Facility Security Clearance and production permit issues were addressed during the study on the controlled materials list which was updated in December 2018. We are also focusing on intellectual property rights and patent issues, in this context, under the auspices of SaSaD and TOBB, a specialist from Sabancı University will provide training on February 11.”

Sharing his suggestions with Minister AKAR about the current problems and solutions in the sector, KÜÇÜKSEYHAN stated that the high-interest rates increased the credit, product and service costs for the actors with working capital shortages and thus companies faced with conditions which can cause losses in fixed-price contracts and, as a solution to this issue, they suggested that the payment schedule in the running contracts should be arranged in a balancing way with advance and milestone payments so that the companies do not need to apply for loans.

HİSARCIKLIOĞLU: “Domestic and national production gained momentum”

TOBB President Rıfat HİSARCIKLIOĞLU said that the rate of foreign dependency in the defence industry, which was 80% in 2002, dropped to 35% today and the turnover of the Turkish Aerospace and Defence Industry reached US$7 Billion.

 HİSARCIKLIOĞLU pointed out that four Turkish companies entered the list of the 100 largest companies in the world: “We also progressed in global competition at the same time. Defence industry exports exceeded US$2 Billion in 2018. We are now exporting UAVs to Ukraine, which produces the world’s largest aircraft like Antonov. I am proud of the Ministry of National Defence, the Presidency of Defence Industries, the Turkish General Staff and the defence industry companies for their contribution to this success. Neither the Private sector without public support nor the public without the determination and diligence of the private sector could have accomplished this success.”

Underlining that the Turkish defence industry has the potential to achieve much more than it has ever done in the fields of production, export and technology development, Rıfat HİSARCIKLIOĞLU emphasized that defence industry companies should include SMEs in the production processes to the maximum extent to achieve this. Mr. HİSARCIKLIOĞLU said: “The big actors of the sector and the SMEs positioned around them need to act together. The remarks of Mr. President ‘We will reach our targets in the defence industry with the dynamism of the private sector. We will not import any products from abroad’ created a new enthusiasm and motivation for Turkish companies to increase domestic and national production. Our goal is to turn Turkey into a global actor with advanced technology that it can design and manufacture on its own. I do believe that we will achieve these goals. All we need is to join hands and work together with a shared mindset and consideration.”

HİSARCIKLIOĞLU also stated that the Minister of National Defence Hulusi AKAR had previously gathered with assembly members at the Kırıkkale Ammunition Factory: “We have conveyed the requests of the sector to the Dear Minister in Kırıkkale. Mr. AKAR gave the necessary instructions immediately after the meeting and our problems were solved. STANAG documents (standardization agreements) started to be published on the Ministry’s website. Studies on localization and nationalization were initiated. The facility security clearance and production permits were made easier to obtain. I would like to express our gratitude to Dear Minister for his effective administration which solved the problems of our sector.”

 HİSARCIKLIOĞLU concluded his speech by stating that, under the authorization of Minister AKAR, 12 companies signed a Strategic Cooperation Agreement and thus domestic and national production gained new momentum.

Minister of National Defence Hulusi AKAR: “Our F-35 Aircraft will be Maintained at the 1st Air Supply and Maintenance Center” 

Indicating that when Turkey receives ownership of the F-35 planes we will have more than 100 aircraft and the supply & maintenance of the aircraft will be carried out here, where they came together today the 1st Air Supply and Maintenance Center, Minister of National Defence Hulusi AKAR made the following statement: “We have a promising situation right now. By providing all the assistance we can, we will raise our industry to a much more advanced level and breath a sigh of relief. When we receive the property of our F-35 aircraft, we will then have more than 100 aircraft. The supply & maintenance of the aircraft will be carried out at the 1st Air Supply and Maintenance Center. We are still working on this, so far we have conducted a fair amount of successful activities in all our factories. We will do better than what we’ve accomplished. We will overcome our shortcomings, correct our mistakes and will be open to consultation, discussion and suggestion. Without losing any time, we need to develop strategies and make plans with a solid understanding in the medium and long term and we need to take firm steps forward with confidence.”

AKAR: “Exports should be the main focus of producing goods and services”

Noting that the defence industry needs to work on high-technology projects, Minister AKAR stated that the sector should use its current potential: “If the defence industry organizes its plans only for the domestic market, this will cause contractions and difficulties after a certain period of time. The defence industry should be based on high-technology. Exports should be the main focus of producing goods and services. While the total turnover of the aerospace and defence industry was US$3 Billion in 2009, it exceeded US$7 Billion in end of the year 2018. The exports initially amounted to US$781 Million, but today has risen to US$2.5 billion. Moreover, the number of projects reached 640 from the previous  year’s 194 projects. These are not the figures that will satisfy us, but it shows that we are on the right track and the tip of the vector is pointing upward. We will continue to work relentlessly with perseverance and determination.”

Following the speeches, the meeting continued with a Q&A session which was closed to the press.