Page 97 - Global Power Turkish Defence Industry

The US$25bn defence-exports target might be unrealistic, but the direction of travel is clear. Over the next
decade, Turkey will likely continue to rely on imports and licence-production agreements for significant
components, while also making progress with initiatives currently under way to develop indigenous
alternatives.
Many platforms currently entering service with the Turkish armed forces are being licence produced or
imported, but it is probable that over the next two decades a higher proportion of equipment will be of a
local design. Many of these systems may then be offered for export.
Challenges and setbacks
Despite progress, the Turkish defence and aerospace industry still faces challenges. The value of the lira has
fallen and the economy is at risk of a recession. The crackdown that followed the failed coup in 2016, as well
as other policy differences, such as the acquisition of Russia’s S-400 (SA-21 Growler) air-defence system,
has meant that relations with the United States and other suppliers have been strained further. Turkey
may find it increasingly difficult to obtain and afford crucial foreign subsystems to equip its platforms and
those it is trying to export. For example, in 2017, AVL cancelled a contract with TÜMOSAN to help develop
a power pack for the Altay main battle tank because of an Austrian arms embargo following the Turkish
government’s response to the failed coup. As Turkey’s relations with fellow NATO members continue to be
fragile, such obstacles may appear more frequently.

Another cause for Turkish concern recently highlighted is the ’brain drain’ of young, skilled workers from
the Turkish defence industry to foreign companies, typically in Europe and the US, with higher salaries
and better conditions cited as prime motivators for such migration. A wider economic downturn may see
this movement accelerate, preventing grand ambitions to almost treble the number of defence industry
workers. As Turkey exports larger and more sophisticated equipment, it may find that the difficulties it faces
in doing so may be as complex as the systems themselves.

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