Foreign interest in logistics sector decreasing while Turkish players become stronger abroad

ISTANBUL

DHA photo

While Turkish logistics companies have raised their bids abroad, foreign companies’ interest in the Turkish market has been decreasing amid uncertainties, a leading sector player has told daily Dünya. 

Leading global players had showed great interest in the Turkish logistics sector until quite recently, but interest has fell due to escalating uncertainties and security risks, said the head of the Istanbul-based International Transportation and Logistics Services Providers Association (UTİKAD), Turgut Erkeskin. 

The Turkish logistics market decreased three points to 18 in terms of foreign connectivity ranking of the Agility 2016 New Emerging Markets Logistics Index, while the United Arab Emirates, Malaysia and China rank top three. Turkey has also decreased by one point to 11 in the “Most Important Logistics Markets of the Future” ranking of the same index. 

“Until a few years ago, we saw many global players come to us and said they wanted to make business and investment in Turkey by acquiring local players or opening offices. We now see such attempts have almost [ended] as our sector seeks economically and politically safer places in the world,” Erkeskin said, as quoted by daily Dünya. 

Despite decreasing interest among foreign players in the Turkish market, local players have raised their bid abroad, he noted. 

“We have seen at least 10 local players that have been growing quite rapidly in foreign markets. The same trend is also case in port management sector. Turkish companies run ports across many countries, from Ecuador to Italy... In our sector, the volume matters a lot. As you can increase your capacity you can decrease your costs per unit by benefiting from the scales of economics,” he added.

Erkeskin also noted that 2015 was not a good year for the sector.

“When we meet representatives from the sector, we have seen there was no growth last year, especially for larger companies,” he said, adding that the sector grew 16 percent in 2014.