TURKISH PLASTICS INDUSTRY Barbaros Demirci Secretary General HIGHLIGHTS : The plastics industry is one of the youngest and most rapidly developing industries of Turkish manufacturing industry. The industry has grown by an annual average of 15 % during 2002 2007 and it s growth rate decreased to 4% due the global economic crises in 2008. The industry comprise nearly 7.000 companies, out of which 5.400 are producing and supplying inputs to the main exporter industries such as automotive, electrics, electronics, packaging, textile, construction etc. 98% of the companies are comprising of small and medium sized enterprises. 82 % of those manufacturing companies are producing plastics products, raw materials, tools and semi finished products while 18 % are producing plastics and rubber processing machines and equipments. The industry is currently employing more than 200.000 people and creating employment opportunities for 20.000 new employees each year. Around 130 companies have jont ventures. As far as the distribution of the foreign capital is concerned, Germany leads the way with 21 % and is followed by Netherland with 11 % and USA, France and Italy with 7 %. The total processing capacity of Turkish plastics industry is increasing dramatically. In terms of plastics processing capacity, Turkey ranks 5 th in the EU with UK. Turkey ranks second in synthetic fibers and third in PVC profiles and fifth in total plastics processing capacity in EU. As established by PAGEV and PAGDER, the plastics industrial vision for the 9 th 7-year Development Plan is to cause the Turkish plastics industry to rank at least 3 rd among the EU countries with its plastic processing capacity in 2014 as a leading industrial branch producing technology and having its technology accepted in the world markets Although Turkey enjoys double the worldwide average in terms of plastic consumption per capita ( 64 kg) it is way behind developed country averages. This serves to prove that the potential demand for plastics is great in Turkey. In Turkey, the use of plastics is mostly guided by the packaging and construction sectors with ratios of 40 % and 22 % respectively while electric appliances claims third place with 10 %. In spite of the rapid growth trend enjoyed by plastics production, consumption and exports in Turkey, the domestic plastic raw material production capacity fails to meet the growing demand. Consequently, about 85 % of the plastic raw material demand is met by imports. The majority of plastics finished-products manufactured by using modern production technologies are exported in Turkey. The industry s direct exports in 2008 amounted to a total of USD 3,5 billion comprising of USD 0, 5 billion of raw materials and USD 3 billion of finished-products. The plastics industry manufactures semi-finished products for the main exporter industries such as the automotive, white goods, electric appliances, textiles and footwear and the majority of plastics products are indirectly exported by means of the said industries In terms of finished products and packaging included within the exports realized by the said industries, indirect exports exceeded USD 4, 5 billion in 2008. Turkey exports plastic finished-products to 172 countries. Russia, Romania, Germany, Ukraine and Iraq are the top 5 countries with the greatest share in Turkey s plastic product exports. In 2008, the first 15 countries accounted for 66 % of total plastics product exports. Plastic industry s exports rank second among the total chemical industry exports with about 30 %. Turkey is net exporter of plastics finished products. 19 % of total production was exported while 9 % of domestic consumption was met by imported goods in tons in 2008.
Turkish Plastics Industry Profile NO. OF COMPANIES OPERATING ABOUT 6.000 ( MOSTLY SMS S ) NO OF COMPANIES WITH FOREIGN SHARE 128 ANNUAL PROCESSING CAPACITY AVARAGE ANNUAL GROWH RATE OF THE PRODUCTION ( 2003 2008 ) OUTPERFORMS GNP GROWTH RATE OF 4,5 5,1 MILLION TONS/YEAR Very significant production of synthetic fibers, PVC profiles, BOPP films % 14 EMPLOYMENT OVER 200.000 PER CAPITA CONSUMPTION ANNUAL TURNOVER VALUE ADDED TO GNP 64 KG 15 BILLION USD 6 BILLION USD RAW MATERIAL DEMAND COVERED BY THE LOCAL PRODUCTION 15 20 % DIRECT EXPORTS INDIRECT EXPORTS 3,5 BILLION USD 4,5 BILLION USD PLASTICS INDUSTRY TOTAL PRODUCTION VALUE / GNP 3 % PLASTICS INDUSTRY EXPORTS / TOTAL CHEMICAL EXPORTS 30 % Supply & Demand Equilibrium in Finished Plastics Products 1.000 TONS MILLION $ 2007 2008 % INCREASE 2007 2008 % INCREASE PRODUCTION 4.900 5.100 4,1 13.830 16.054 16,1 IMPORTS 379 385 1,6 1.852 2.064 11,4 EXPORTS 826 940 13,8 2.332 2.948 26,4 DOMESTIC SALES 4.453 4.545 2,1 13.350 15.170 13,6 BALANCE OF TRADE 447 555 24,2 480 884 84,2 EXPORTS / PRODUCTION ( % ) 17 18 17 18 IMPORTS / DOM. SALES ( % ) 9 8 14 14 EXPORTS / IMPORTS ( % ) 218 244 126 143
Main Export Markets EXPORT MARKETS % Share in Total Exports Russian Fed. 9 Romania 8 Germany 6 Ukrain 5 Iraq 5 U.K. 4 Bulgaria 4 Azerbeycan 4 France 4 Gürcistan 3 Israil 3 Kazakistan 3 Iran 3 Libya 3 Greece 2 TOTAL 15 COUNTRIES 66 OTHER 157 COUNTRIES TOTAL 44 The Processing Capacity of Turkish Plastics Industry 6.000 5.000 4.000 1.000 Tons 3.000 2.000 1.000 0 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 1.000 Tons 1.487 2.021 1.678 2.359 2.698 3.317 3.748 4.300 4.900 5.100
Comparison of Turkish Plastics Industries Processing Capacities 12,0 10,0 Million Tons 8,0 6,0 4,0 2,0 0,0 Germany Italy France Spain Turkey UK Poland Million Tons 11,0 9,1 6,0 5,1 5,1 4,9 3,3 Plastics Consumption By Industries In Turkey Construction 22% Electric & Electronics 10% Farming 6% Wearing 4% Packaging 40% Automotive Others 4% 14%
Plastics Consumption By Polimer Types In Turkey 2000 2008 PP 28 28 PE 27 25 PVC 19 18 PS 6 6 PET 2 4 ABS 2 1 OTHERS 16 18 TOTAL 100 100 Annual Average Growth Rates of the Polymer Consumption Since 2000 Annual Growth Rate 2000 2008 PP 10,5 PE 9,6 PVC 9,4 PS 11,5 PET 17,3 ABS 8,4 OTHERS 12,1 TOTAL 10,5 Foreign Dependence in Plastics Raw Materials ( % Share in Total Supply ) IMPORTS PRODUCTION 2006 2007 2008 2006 2007 2008 PP 91 90 90 9 10 10 PE 63 67 66 37 33 34 PVC 82 82 81 18 18 19 PS 100 100 100 0 0 0 PET 100 100 100 0 0 0 ABS 100 100 100 0 0 0 OTHERS 100 100 100 0 0 0 TOTAL 87 88 88 13 12 12
WHY INVEST IN TURKISH PLASTICS INDUSTRY? Turkey is a boomıng country wıth cummulatıve GDP ıncrease of 122 % over the last 4 years totaly more than 400 bıllıon USD Qualıfıed, cost efectıve and motıvated labor force ( 4th largest labor force ın comparısıon to the 27 european countrıes, wıth over 25 mıllıon people ) Instıtutıonalızed economy fueled by more than 20 bıllıon usd of fdı annualy for the last 2 years and ranked the 13 th most attractıve country ın the world Lıberal and reformıst ınvestment clımate wıth hıghly competıtıve ınvestment condıtıons ın eu customs unıon sınce 1996 and an eu accessıon country sınce october 2005 Dynamıc and mature prıvate sector wıth over 85 bıllıon usd worth of exports and an ıncrease of 240 % ın the last 4 years Easy access to the diversified markets In a four hour flight, one fourth of the world s GNP and one fourth of the world s population. Turkey ıs turnıng ınto an ımportant energy termınal and corıdor ın europe whıch connects east and west Plastıcs productıon ıs shıftıng from europe to eastern countrıes Turkey is the only country in its own region having already established a well-advanced plastics industry and it has proven itself to be a successfull one in exporting every kind of products to EU and developed countries. Therefore, the plastics industry is strategically important both for Turkish and foreign companies that will invest in Turkey, a country which provides ; o 5,1 million tons of processing capacity o Developed suppliers industry with the power to compete o Young, educated and motivated man - power o Entrepreneurs ambitious to succeed o Adopted legislation in line with the international rules of free trade within the context of customs union and WTO o Easy access to potential emerging markets o Competitive labour cost and culture of productivity. PAGEV TURKISH PLASTICS MANUFACTURERS RESEARCH, DEVELOPMENT & EDUCATIONAL FOUNDATION PAGEV was founded in 1989 and currently operates in Istanbul with more than 300 members. The foundation continually developed to become a highly prestigious establishment representing the Turkish Plastics Industry both in Turkey and abroad as a reference point for local and overseas companies. Main Objectives: In line with developments worldwide, PAGEV aims to meet the organizational needs of the rapidly growing Turkish plastics industry which comprise mostly of SME s, The main objectives of PAGEV are ; To establish a substructure to ensure that the industry is integrated with the global plastics industry, To enhance vocational training, quality, technology, productivity and competitive power, To promote the image of plastics by improving relations with the public opinion and public organizations,
To cause the industry to earn qualified manpower and technological superiority by contributing to the vocational training and research efforts, To lead the industry in all issues and areas. Vision: PAGEV s vision is to become one of most powerful plastics non profit organizations in Europe, by successfully representing the Turkish plastics industry as a whole both in Turkey and abroad and acting in an environmentally-conscious manner. Mission: PAGEV s mission is to gather the Turkish plastic manufacturers under the same umbrella, to organize industrial events both in Turkey and abroad to ensure that the companies in the industry attain the contemporary technological level, to co-operate with educational institutions related to the Foundation s field of activity, to monitor new developments in the international plastics industry, to enhance and proliferate plastics education in Turkey with a view to train technical personnel and to ensure that quality is adopted as a way of life in the world of plastics. PAGEV is an active member of the; EuPC - European Plastics Processors Association, PlasticsEurope - European Plastics Raw Material Manufacturers Association and PlasticsEurope Mediterranean Advisory Board, CIPAD - Council of International Plastics Associations Directors and IVETA - International Vocational Education & Training Association Activities: In order to attain its objectives based on its mission, PAGEV successfully conducts the following activities that embrace all sub- industries such as raw materials & auxiliaries, products / semi finished products, plastics processing machineries & equipments, including moulds and dies. PAGEV strongly devotes to the vocational education by pioneering in plastics educational infrastructure investments and constructing of the vocational schools devoted to plastics education, Develops plastics business activity in Turkey by guides its members in improving their technology, quality, productivity and competitiveness, Organizes the domestic and international fairs and international fair tours to present the technical and competitive power of the Turkish plastics industry in global markets, Ensures information exchange and promotes open dialogue with all parties, by its publications such as ; the bimonthly Plastics Magazine, The bimonthly Plastics News newspaper, Communicates through it s interactive web site, Carries out business surveys studies and research projects in all aspects of the plastics processing industry, publishes technical books, industry reports, Ensures technical and industrial information by a comprehensive and up to date sectoral database and publishing Turkish Plastics and Rubber Directory and Member s Catalogue, Ensures technical information by organizing seminars and meetings Represents the industry on the domestic and international platforms by cooperating with public opinion, public and non profit organizations.
PAGDER PLASTIC INDUSTRIALISTS ASSOCIATION Established in 1969 to gather the manufacturers operating in the Turkish plastics industry under the same umbrella, PAGDER the Plastics Industrialists Association, has been successfully implementing its mission for nearly 50 years. Vision: To be an exemplary industrial non profit organization capable of representing the entire industry in national and international platforms, of protecting its rights and of acting in a pioneering, determined and assertive manner in the face of developments. Mission: To create the environments and opportunities required to develop the Turkish plastics industry as a whole and to make Turkey into one of the leading production and supply centers of the global plastics market by supporting its members with the strength born out of unity. Activities Aiming to become an efficient and authoritative non profit organization in the plastics industry, PAGDER established the following strategies for the implementation of its industrial vision within the framework of the 9 th 7-year Development Plant; To improve the association s representative powers and industrial efficiency by increasing the number of members and participation to the association s activities, To increase cooperation among members, To make PAGDER into a center of attraction in the plastics industry by rendering services to fulfill the members changing needs and by increasing the quality of services, To defend and promote the interests of the Turkish plastics industry, To voice the industry s opinion towards the government & non-governmental organizations, To provides effective industry solutions for plastics - related issues, To maintaine relationships with corresponding organizations in Turkey, Europe and worldwide. To organise industrial visits to the main worldwide plastics and machineries fairs. PAGDER is a member of EUROMAP PAGDER also establishes technical, commercial and educational relations with industrial associations making use of plastics and plastic products in countries which are potential markets and promotes the advanced technological production capabilities of Turkish plastics industry in those global markets. PAGEV and PAGDER are currently implementing projects to establish the raw material, machinery, production technology, substructure and man power requirements of the plastics industry in the next ten and twenty years.