Turkey has achieved remarkable success in industrialisation and this is considered to be the fundamental factor in Turkey’s development.

The initiation of the Turkish machinery industry dates back to the 1950’s. In 1950 the first large-scale industrial investment in the Turkish Republic came through MKEK (Machinery, Chemical Industry Institution), a completely governmental institution.

Development of the machinery industry accelerated especially in late 1960s with the establishment of both state and private enterprises of manufacturing plants for sugar processing machinery, pumps and diesel motors, boilers, ovens, hoisting and conveying machinery, storage tanks, pressurised tanks and machine tools. Although the machinery industry was initiated and established by state enterprises, currently private enterprises dominate the industry. The share of state companies in the sector is 6% with 360 companies.

Today, share of the machinery manufacturing industry production is 2.2 % within overall manufacturing industry.

The product range of the Turkish machinery industry consists of internal combustion engines and turbines, boilers and burners, building machinery, heavy industrial machinery, machine tools, milling machines, drilling machines, cutting and bending machines, woodworking machinery, pumps and compressors, hand tools, air conditioning units, textile machinery, food processing machinery, hoisting and conveying machinery, sewing machines, refrigerators and washing machines (both domestic and industrial), valves, gears and bearings. The Turkish machinery industry is able to produce almost all of the parts and accessories for the above named items with competitive prices and of high quality. The average local input content in the production stage is around 80-85 %. The machinery manufacturing industry has particular importance for Turkey due to its promising export potential.

Manufacturing firms in this field made production mainly for the domestic market until 1990. After 1990, rapid developments in the sector were observed and the sector has directed its attention to foreign markets also.

Strong automotive and autoparts sector of Turkey resulted in a high production capacity for engine and spare parts. This capacity has been directed to exports and the sector has shown a significant export performance in last year. The engine and spare parts exports were US $ 391 million in 2001 and increased to US $ 447 million in 2002.

The rapid increase in the population and living standards in Turkey have resulted in the need to produce more and better quality white goods. The sector has been rapidly adapting itself parallel to the consumer preferences by modern production technology. Turkey has about 11 million households, which indicate a huge market for white goods. According to the data provided by White Goods Manufacturers’ Association, the quantity of refrigerators, washing machines and dish washing machines produced were 3,31 million units, 1.65 million units and 345.8 thousand units respectively in 2002. The exports of the sector are mainly directed to the UK, France, Algeria, Spain, Germany, Greece, Italy, Belgium-Luxembourg and Bulgaria. The major export products in households sector are refrigerators. The exports of refrigerators totalled to US $ 274 million in 2002. The other promising export products in the sector are washing machines and export of washing machines reached US $ 139 million in 2002. The UK, France, Algeria, Spain, Germany and Greece were the major markets for refrigerators and washing machines in 2002.

Turkish-made construction and mining machinery are exported to almost 130 countries in the world. Major export markets are Italy, Germany, the United Kingdom, the USA, Algeria, France, Morocco and the Netherlands.

Major export markets are: France, Syria, Ukraine, Azerbaijan and Egypt in agricultural machinery; the USA, Italy, Mexico and South Africa in tractors.

Besides supplying the Turkish domestic market the textile machinery and equipment industry also has great importance for Turkey due to its promising export potential. Textile machinery and equipment exports have increased rapidly since five years and reached 47.1 million dollars with a share of 2.2 % in total machinery exports in 2002. The sector exports are directed to about 100 countries. Major markets in order of rank are Germany, Syria, Iran, Bangladesh, Egypt, Switzerland and Romania.

Turkey with its traditional good quality workmanship, efficient infrastructure, advantageous labour costs and liberal economic policies is attracting the interest of developed countries for investment purposes. A significant number of medium and large-scale companies have “know-how” license agreements with well-known international companies. Turkish companies welcome foreign investors through joint-ventures with the transfer of technology, making use of skilled labour to be competitive in the world markets. According to July 2003 statistics of Turkish Treasury there are 28 foreign capital companies in non-electrical machinery industry.

The Turkish machinery manufacturers/exporters follow European and international standards and norms.

Companies exporting to the European Union affix the “CE Mark” under the “New Approach” Directives. The obligation to affix the “CE Mark” also started in the Turkish domestic market in 2002.

Turkish machinery sector products are more competitive in international markets due to relatively flexible production and good engineering skills in Turkey. Turkish machinery industry has recorded a substantial increase in exports compared to Turkey’s overall exports. In 2001, the export value of the machinery industry was US $ 1.745 billion, indicating a 19.5 % increase compared with 2000 figures. In 2002 total exports of machinery manufacturing industry exceeded US $ 2.124 billion, up 17.8 % compared with the year before.

In 2002, a breakdown of countries importing machinery from Turkey shows that Germany is the main customer. Germany is followed by the United States, Italy, France, the United Kingdom (UK), Spain, Algeria, Belgium-Luxembourg, Russian Federation, Holland, Iran, Greece, Romania, Israel, Bulgaria, Egypt, Azerbaijan, Austria, Tunisia, TRNC (Turkish Republic of Northern Cyprus), Syria, UAE, Uzbekistan and Kazakhstan are the other important markets for Turkish machinery exports.

The most important items in exports were engine and spare parts, refrigerators, construction and mining machinery, metal and wood processing machinery, agricultural machinery and equipment, washing machines, pumps and compressors and food processing machinery. The export values for engine and spare parts, refrigerators, construction and mining machinery, , washing machines, metal and wood processing machinery, pumps and compressors, agricultural machinery and equipment, and textile machinery exported in 2002 were US $ 447 million, US $ 381 million, US $ 168 million, US $ 153 million, US $ 111 million, US $ 74 million, US $ 57 million and US $ 47 million, respectively.

The products of Turkish machinery industry are exhibited in international and national fairs organised in Turkey.