Krasnikov P. D., Krasnikova N. O., Bondar O. E.
Oles Honchar Dnipropetrovsk National University
TURKISH EXPERIENCE OF EFFECTIVE REFORMS IN CONTEXT OF LIBERALIZATION
The important role in the development of countries is played by a national development strategy which converts country’s potential to real progress. One of those countries is Turkeywhich has evolved from a traditionally agricultural country with limited natural resources into the successful market economy in a relatively short time. Turkey belongs to newly industrializing countries, and there are some compelling arguments for that. Today Turkish economy ranks in the top twenty. Since 1980 the GDP per capita has increased more than 4 times and started to exceed the world average in 2005.
Eventually, Turkish economy is becoming more functionally open. The share of foreign trade in the economy has steadily increased since 1980. Foreign trade volume amounted to 8.6 % of GDP in 1970, in 1980 and 1990 this figure was 15.7 % and 23 4 % respectively, in 2000 and 2012 – 43.1 % and 57 9 %. At the same time, the export quota was 26.4 % in 2012, and import – 31.5 % [1]. Since 2003, Turkey has had a negative trade balance.
Turkey’s accession to the Customs Union with the EU in 1995 was an additional incentive for foreign investors. So, large Japanese and South Korean firms are intersted in investing in Turkey because they can deliver their products free of duty to the EU market.
The level of export growth in the pre-crisis years occurred under the influence of many factors. First, industrial production in Turkey has received a definite competitive advantage due to the lower real wages and prices for energy (mainly electricity). Second, low real interest rates compared to previous years have reduced borrowing costs for producers and exporters. Third, the number of technological improvements that cause the exchange with joint venture partners (especially in the automotive industry) or import innovations, increased. Finally, the performance of production has increased in recent years, while consumption remained at a constant level. Creating an additional proposal it has become a significant incentive for access to foreign markets.
The structure of exports has also changed significantly: agricultural products, textiles, clothing and raw materials gained a leadership position of industrial products with high added value. The share of industrial products in total exports in 2012 amounted to 93.9 %.
Modern economics of Turkey and Ukraine are classified as economics of «open type» which are oriented to foreign markets. The strategy of economic development of Turkey is based on using an enough tough selective protectionism and on promotion of foreign investments in export-oriented industries and high-tech production. Objectively Ukraine didn’t have opportunities to defend high protectionist barriers for foreign commodities while entering WTO; however Ukraine adapted to the conditions of the world market which shows us that our country has a large margin of safety in forming foreign economic policy.
Ukraine and Turkey have long close relationships. Turkey is in top five of importers of Ukrainian agricultural commodities and in top 3 of Ukrainian non-agricultural commodities. However, the interaction in metallurgical industry demonstrates certain negative trends for Ukraine. Increasing duty-free Ukrainian export of ferrous metals to Turkey is forming cheap raw material base of the country for development of metallurgical processing and engineering.
The experience of the Turkish model of export development can be an example for forming a strategy of foreign economic policy of our country.
The list of references:
1. Production general directorate of economic research [Electronic resource] // Monthly economic indicators – november 2013. – Mode of access: http://www.treasury.gov.tr/default. aspx?nsw= EilDPQez15w=-SgKWD+pQItw =&mid=740&cid=26&nm=756