Turkey sets out highly ambitious defence industry target for 2023

Turkey has laid out ambitious targets and strategies for its defence industry, unveiling its goals in he 11th Development Plan submitted to Parliament for discussion on July 8, which covers the years between 2019 and 2023.

Defence and aerospace turnover is planned to reach $26.9 billion in 2023 from $6.7 billion last year while exports of defence products will be increased to $10.2 billion from just $2 billion last year by 2023.

Moreover, localisation of defence products, currently 65 percent, will be increased to 75 percent by 2023, which is the centenary of the Turkish Republic.

Under the plan, employment in the defence industry sector by 2023 has the goal of over 79,000 people, compared to the current 44,700.

Advanced version of locally developed products will be manufactured while dependency abroad on systems and sub systems will be reduced at a maximum level.

Third generation Altay main battle tanks (MBT), locally developed air defence systems, as well as naval platforms are set to be included in the inventory of the Turkish Armed Forces (TSK) by 2023.

The number of unmanned aerial vehicles (UAVs) in the inventory will be increased and UAV engine prototype and land vehicle engines are planned to be delivered to the TSK during the same period.

Financial support will be given to all companies, including the medium and small-scale enterprises (SMEs) operating in the defence industry, under the Defence Industry Investment and Development Activities Support Program.

The management of the transformation in the defence industry technologies will be ensured and multi-use will be expanded in sectors that are capable of technologically feeding each other.

Projects and investments based on basic and advanced technologies will be realised to create a fully national defence industry in critical technologies and shape concept  of war for the future.

The 11th Development Plan sets out goals and strategies by 2023 for all sectors in the country.

Yet, critics state that the plan, as a whole, admits to failure in the economic field by President Recep Tayyip Erdoğan and his Justice and Development Party  (AK Party).

Fikret Bila, in an article for independent news site T24 on 10 July, noted that while the government does not accept the economic crisis, documents released to this end admit financial failure.

“One of the most important documents revealing this fact is the 11th Development Plan. Turkey, with high inflation and high interest rates, a higher exchange rate, as well as high unemployment is going through a severe economic crisis. The Turkish economy is shrinking severely,” Bila wrote.  

The goals of the state have dropped nearly 50 per cent, he said, adding that, this means that the government admits to the fact that the Turkish economy is in a serious crisis and shrinking.

The question, against a backdrop of Turkey’s worrying state of the economy, is whether Turkey will meet the stated goals and strategies in the defence industry sector, which has been a long-time lucrative business despite the ongoing economic crisis.  

Turkey’s current defence industry trends demonstrate that even if it cannot meet its highly ambitious targets in defence exports and turnover set for the coming four-year period, it may perhaps come closer to these figures than in any previous year.

The Stockholm International Peace Research Institute (SIPRI), for instance, in a report in December stated that the arms sales of Turkish companies rose by 24 percent in 2017.

In its 29 April 2019 report SIPRI also said that military spending in Turkey increased by 24 percent in 2018 to $19 billion, the highest annual percentage increase among the world’s top 15 military spenders.

As a matter of fact, the Turkish defence industry has registered a 57.3 percent increase in defence and aerospace exports in the first quarter of this year, compared to the same period in 2018. This marks the highest export percentage increase among all sectors.

Similarly, Turkey Exporters Assembly (TIM), released a report on June 4 covering the sectoral export data, and noted that the first 5 months of 2019 saw the highest increase in foreign sales of defence and aviation sector compared to the same period last year.

According to the same report, Turkey’s military exports to the United States totalled $352.6 million during the same period.

Turkish defence exports to the United States mainly cover defence items that Ankara has been building for F-35 joint strike fighters as part of Lockheed Martin’s industrial participation commitment to Ankara. 

However, with the arrival of Russian S-400 Surface-to-Air-Missiles (SAM) to Turkey, Ankara faces sanctions from Washington, as well as ejection from the F-35 fighter jet programme.

Another repercussion for the purchase of the Russian system will be Turkish companies’ inability to continue building parts for this fifth generation stealth fighters.