Turkey looks to more than double trade with Latin America, Iran

SANTIAGO - Reuters

Economy Minister Mustafa Elitaş. DHA Photo

Turkey aims to boost trade with Latin America more than two-fold by 2023, in a bid to diversify away from its traditional export markets in the troubled economies of Europe and the Middle East, Economy Minister Mustafa Elitaş said on Feb. 1.

The minister spoke to Reuters in the Chilean capital while accompanying President Recep Tayyip Erdoğan and a large business delegation on a tour of the region that will also include visits to Peru and Ecuador.

“Bilateral trade with Latin America currently stands at a little over $8 billion ... for 2023 which is our Republic’s 100-year anniversary, we want to reach $20 billion,” Elitaş said in an interview late on Feb. 1.

Citing the advantages of having a free trade agreement with Chile that aims to yield $1 billion in bilateral trade this year, Elitaş said Turkey will ask Peru and Ecuador to “speed up” the finalization of bilateral free trade agreements.

Elitaş saw Turkey benefiting from the emergence of neighboring Iran from years of economic isolation as world powers lift crippling sanctions in return for the Islamic Republic’s compliance with a deal to curb its nuclear ambitions.

“Turkey will be one of the countries that benefits the most,” Elitaş said, adding that Turkey-Iran trade reached $22 billion in 2012 before the steep slide in oil prices pushed that figure down to $14 billion last year.

“Our objective is to reach $30 billion (in trade) with Iran by 2023,” Elitaş said.

Asked if Turkey would now have to compete with Iran in order to attract foreign investment from Europe and elsewhere, Elitaş said Tehran was not a rival.

“Turkey is the most democratic country in the region and foreign investments will go to democratic nations, to countries that can guarantee those investments,” said Elitaş. 

“If Iran advances with its economy then they could become a rival.”

Turkey’s Deputy Prime Minister Mehmet Şimşek, in charge of the economy, has said battling inflation will be this year’s main challenge.

But a sharp rise in the minimum wage, hikes in electricity prices and taxes, and President Erdoğan’s preference for low interest rates to boost growth were all obstacles.

Elitaş also said Turkey should avoid excessive increases in interest rates.

“It’s important not to hike interest rates too much ... this does not create an environment that is conducive to investments ... currently interest rates in Turkey are not low, in fact they are high,” said Elitaş.