Global connectedness spurring Turkey’s economic growth
Turkey is the most globally connected country in South and Central Asia, according to the latest DHL Global Connectedness Index (GCI), having had the 10th greatest gains in international connectedness out of 169 countries in 2017-2019, moving up 10 places to 55th spot.
Located at the crossroads of Europe and the Middle East, Turkey is close to the Balkans, Russia and Central Asia, and has a geographic advantage as it acts as strategic stopover point between Africa and Europe.
And that strategic location has helped supercharge Turkey’s elevation in both economic growth and global connectedness throughout the pandemic, having been one of very few countries worldwide to have experienced economic growth in 2020.
Driven in part by the near doubling of lending by the country’s state banks, Turkey’s economy expanded 1.8% in 2020, outperforming all emerging market and G20 peers except China, and is expected to further grow by 4.8% this year.
“Against the backdrop of a difficult economic situation, the contribution of international flows to Turkey’s economy has grown significantly. Turkey’s GCI gains were broad-based, across trade, capital, information and people flows,” explained Mustafa Tonguç, DHL Express Turkey’s country manager.
Exports hit all-time high in December
According to data by the Turkish Trade Ministry, Turkey exported to 226 countries and territories in 2020, with exports hitting an all-time monthly high of US$17.84bn in December 2020. Such export gains were especially notable in the 2020 GCI Index, with figures for both goods and services growing significantly as a share of Turkey’s GDP.
“Turkey launched a program to boost the country's value-added exports and to assist firms to expand production capacity, investing nearly $260m (€213.9m) to support exporters during the pandemic,” adds Tonguç.
Turkey also plans to establish strategically-placed, new foreign logistics centres in Africa, the Americas, Europe, Far East and Russia.
In January this year, Turkish Exporters Assembly (TIM) chairperson Ismail Gülle revealed plans for the centre in the US, which is expected to accelerate local exporters’ access to markets and boost Turkey’s foreign sales volume.
“We have carried out a detailed study for the logistics centre we plan to open in the USA. We have a target of $100 billion in foreign trade volume with the country. We believe that the logistics centre to be opened is of great importance for us to achieve this goal quickly”, Gülle says.
E-commerce and digitalisation
Rapid digitalisation and growing e-commerce are further factors in Turkey’s economic growth, with small and medium-sized businesses having rapidly adjusted to meet current consumer trends. Turkey’s e-commerce trade volume is expected to grow by more than US$3bn to US$28.9bn by 2022, with online shopping snatching up 38% of retail sales.
“As the pandemic transforms behaviour, companies have started focusing on hygienic delivery and customer support and are investing in digitalisation and e-commerce,” says Tonguc, adding that moving forward, there’s an opportunity for Turkey to become “even more connected and successful, taking advantage of our connections around the world to boost the amount of business that flows”.
Netherlands is world’s most globally connected country
Europe topped the rankings with the most globally connected countries boasting 8 out of the 10 most blobally connected countries located there, leading on both trade and people flows, though North America secure top spot for information and capital flows. The Netherlands was again at the top of the ranking, followed by Singapore, Belgium, the UAE and Ireland.
However, the UK boasts the most global distribution of flows than any other country worldwide. The report further found that Southeast Asian economies were punching well above their weight when it came to international flows including Cambodia, Singapore, Vietnam and Malaysia.
G7 Summit guide: What it is and what leaders hope to achieve
Unless you’ve had your head buried in the sand, you’ll have seen the term ‘G7’ plastered all over the Internet this week. We’re going to give you the skinny on exactly what the G7 is and what its purpose on this planet is ─ and whether it’s a good or a bad collaboration.
Who are the G7?
The Group of Seven, or ‘G7’, may sound like a collective of pirate lords from a certain Disney smash-hit, but in reality, it’s a group of the world’s seven largest “advanced” economies ─ the powerhouses of the world, if you like.
The merry band comprises:
- The United Kingdom
- The United States
Historically, Russia was a member of the then-called ‘G8’ but found itself excluded after their ever-so-slightly illegal takeover of Crimea back in 2014.
Since 1977, the European Union has also been involved in some capacity with the G7 Summit. The Union is not recognised as an official member, but gradually, as with all Europe-linked affairs, the Union has integrated itself into the conversation and is now included in all political discussions on the annual summit agenda.
When was the ‘G’ formed?
Back in 1975, when the world was reeling from its very first oil shock and the subsequent financial fallout that came with it, the heads of state and government from six of the leading industrial countries had a face-to-face meeting at the Chateau de Rambouillet to discuss the global economy, its trajectory, and what they could do to address the economic turmoil that reared its ugly head throughout the 70s.
Why does the G7 exist?
At this very first summit ─ the ‘G6’ summit ─, the leaders adopted a 15-point communiqué, the Declaration of Rambouillet, and agreed to continuously meet once a year moving forward to address the problems of the day, with a rotating Presidency. One year later, Canada was welcomed into the fold, and the ‘G6’ became seven and has remained so ever since ─ Russia’s inclusion and exclusion not counted.
The group, as previously mentioned, was born in the looming shadow of a financial crisis, but its purpose is more significant than just economics. When leaders from the group meet, they discuss and exchange ideas on a broad range of issues, including injustice around the world, geopolitical matters, security, and sustainability.
It’s worth noting that, while the G7 may be made up of mighty nations, the bloc is an informal one. So, although it is considered an important annual event, declarations made during the summit are not legally binding. That said, they are still very influential and worth taking note of because it indicates the ambitions and outlines the initiatives of these particularly prominent leading nations.
Where is the 2021 G7 summit?
This year, the summit will be held in the United Kingdom deep in the southwest of England, with Prime Minister Boris Johnson hosting his contemporaries in the quaint Cornish resort of Carbis Bay near St Ives in Cornwall.
What will be discussed this year?
After almost two years of remote communication, this will be the first in-person G7 summit since the novel Coronavirus first took hold of the globe, and Britain wants “leaders to seize the opportunity to build back better from coronavirus, uniting to make the future fairer, greener, and more prosperous.”
The three-day summit, running from Friday to Sunday, will see the seven leaders discussing a whole host of shared challenges, ranging from the pandemic and vaccine development and distribution to the ongoing global fight against climate change through the implementation of sustainable norms and values.
According to the UK government, the attendees will also be taking a look at “ensuring that people everywhere can benefit from open trade, technological change, and scientific discovery.”