[REVISION HISTORY]

Turkey early deindustrialisation risk

Updated 2 times since CLSTR started tracking revisions of this situation.

What changed

2026-08-20 11:07 UTC → 2026-08-22 10:14 UTC · added ~~removed~~

In late July 2026, the Istanbul Chamber of Industry warned that Turkey is heading toward early deindustrialisation, noting that manufacturing now contributes less than 20% of GDP and is dominated by low-technology production, limited equity, and heavy reliance on imported inputs. The chamber’s president cited a global slowdown, rising protectionism, and a weak European market as external pressures, and called for reinforcement of the economic programme through the new Strategic Transformation Centre and a Value-Focused Digitisation and Growth Program. By early August, the same warning was reiterated, emphasizing a possible “U-turn” that could reverse recent gains in industrial exports. The chamber outlined four priority areas to revive growth: expanding high-technology manufacturing in defence, electronics, semiconductors, biotechnology, and artificial intelligence; increasing R&D spending and fostering university-industry collaboration; upgrading vocational and technical education to meet industry needs; and accelerating digital transformation via factory automation, robotics, and the Internet of Things. In late August, Erdal Bahçıvan, president of the Istanbul Chamber of Industry, expanded his critique to include domestic monetary policy. Speaking at the 10th Istanbul Ready-to-Wear and Fashion Fair, Bahçıvan argued that economic programs over the last several years have prioritized inflation reduction at the expense of the industrial sector. He stated that high interest rates and financing costs are placing a heavy burden on manufacturing, which requires significant investment and working capital. Bahçıvan warned, “We are sacrificing Turkish industry for the sake of inflation. It has reached a breaking point,” and urged policymakers to prioritize production and exporter sustainability in the upcoming Medium-Term Program. Adding to these concerns, Abdurrahman Aslantaş, President of the Gebze Chamber of Commerce, identified high financing costs and economic contraction in the European market as primary challenges.

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