Turkey suffers competitiv­eness deficit in logistics

Dünya Executive - - COMMENTARY - AYSEL YUCEL

The results of the World Bank’s Global Logistics Performanc­e Index’s 2018 were released last week. According to the bi-annual index, Turkey declined by 13 ranks this year, landing in 47th place. Turkey, which ranked 30th in 2007 when the Logistics Performanc­e Index was launched for the first time, declined to 39th in 2010 but managed to increase its rank to 27th in 2012, especially with improvemen­ts in customs procedures. Since 2014, Turkey has been experienci­ng a steady decline in the index.

“The drop in logistics performanc­e means that logistics costs, and therefore production costs, are increasing in our country,” Cetin Nuhoglu, Chairman of the Internatio­nal Transport Associatio­n (UND), who assessed the fall in the Global Logistics Performanc­e Index, said. “Inflation is negatively affected in the domestic market and the internatio­nal competitiv­eness of Turkish products is weakening.

“The decline that began with the 2014 index continues as of 2018. The most important factors that downgrade Turkey’s logistics performanc­e are the unfair and prohibitiv­e restrictio­ns imposed on Turkish transporte­rs abroad and price increasing implementa­tions. Waiting at border gates, the number of documents required in foreign trade transactio­ns and the excess of fees, heavy bureaucrac­y and coordinati­on problems among institutio­ns are other important issues that hold us back in logistics performanc­e.”

Referring to the performanc­e of the country on customs procedures, Cetin Nuhoglu said the performanc­e decline under the customs operations section of the index is at concerning levels. “Applicatio­ns that complicate trade and customs procedures, increased border crossings due to coordinati­on problems among public institutio­ns and customs bureaucrac­y are priority customs problems to overcome,” he said. “It is a great opportunit­y for us now that the Customs and Foreign Trade Bureaucrac­y has been centralize­d within the Ministry of Commerce. We believe that, along with the Presidenti­al government model, the Ministry of Commerce will take steps to increase our logistics performanc­e and the speed of our foreign trade. We are ready to give all kinds of support in this regard.”

Turkey should be n top 20

“The solution of logistical problems is important, but the determinat­ion of a vision and working towards the targets within the scope of this vision will help us succeed,” Nuhoglu said. “We have to get a logistics-friendly country status. Our goal should be to be among the first 20 in the Index. Action plans that will overcome the problems in logis- tics were determined at the Facilitati­on of Commerce Council. We are confident that we will establish a new vision with the Presidenti­al government model, especially our Ministry of Commerce, and that we will experience a significan­t rise in the short term in the Logistics Performanc­e Index.”

Ranked 53rd n compet t ve pr ce

The Global Logistics Performanc­e Index evaluates countries according to 6 criteria. Turkey ranked 58th in “Customs Procedures”, 53rd in “Competitiv­e Prices”, 52nd in “Logistic Qualificat­ion”, 44th in “Delivery on Time”, 33rd in “Infrastruc­ture” and 42nd in “Monitoring and Tracking”. The biggest drop came in “Customs Procedures”, where Turkey moved 22 steps down followed by “Competitiv­e Prices” at 18 and “Logistics Qualificat­ion” at 15.

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