Some five major projects in Ankara, Istanbul, Bursa and Adana will be receiving government support, according to a presidential decree published on Thursday in the Official Gazette.
The total investment amount of these projects to be supported within the scope of the Project-Based Incentive System will be around TL 14 billion, said Industry and Technology Minister Mustafa Varank.
"A total 3,000 people will be provided new jobs with these projects. Once put into effect, these investments will make an annual $1.4 billion contribution to the reduction of foreign trade deficit," Varank noted.
Among these projects will be a propylene manufacturing plant to be implemented by Ceyhan Polypropylene Üretim AŞ at the Ceyhan Petrochemical Industry Zone located in the Mediterranean province of Adana. The project with fixed investment of TL 8.23 billion will have an annual production capacity of 450,000 tons. It is projected to provide employment to some 590 people.
It will increase the capacity of plastic raw materials that are being used in many areas of strategic importance for Turkey, including the automotive industry, textile, packaging and plastic products, said a statement by the Industry and Technology Ministry. The propylene investment is expected to prevent imports of $75 million and contribute $175 million to exports.
Kalyon Güneş Teknolojileri AŞ's solar panel production facility to be established in the capital province of Ankara will be the second investment that will benefit from the incentive system.
The photovoltaic solar panel production plant with a total fixed investment amount of some TL 2 billion and 500 megawatt peak (MWp) annual capacity will provide additional employment to 982 people.
The facility, which will contribute to both the diversity of environmental resources and security of supply in energy, will reduce dependence on foreign sources and increase exports. It will prevent imports of $39 million and make a $58 million contribution to exports.
Another project to receive support in the capital will be the wind tunnel facility with a fixed investment amount of TL 1.4 billion by Turkish Aerospace Industries Inc. (TAI).
The wind tunnel that will serve many strategically important sectors such as defense, automotive and aerospace, will drop the costs of companies that will benefit from wind tunnel testing services, reducing foreign dependence and saving foreign exchange. This investment will prevent imports up to $96 million.
STEEL SUPPORT TO BURSA
With the project to be realized by Asil Çelik Sanayi ve Ticaret AŞ in Bursa for the machinery, automotive, transportation, and energy sectors with a total fixed investment of TL 852 million, a production facility to forge high-grade steels and super-alloy materials will be established. The plant, which will have an annual capacity of 60,000 tons, will provide 173 new jobs.
It will supply rail car axles, shafts, aircraft landing gear, construction machinery, light and heavy commercial vehicle axles, turbine shafts for power plants and semi-finished products that are especially needed in the production of turbine blades.
This investment will prevent imports of $97.1 million and contribute $64.7 million to exports. This decision will accelerate the transition to investment in the region, which was declared an industrial zone in May.
INCENTIVES FOR BAYKAR'S UAV FACILITY
Leading unmanned aerial platform developer Baykar Makina will receive government support for the unmanned aerial vehicle (UAV) and systems production facility.
The company aims to invest TL 600 million for the facility that will increased its production of UAVs. The new plant will be providing new employment to some 1,112 people.
The production of UAVs with local resources will reduce the external dependence, boost exports and reduce the foreign current account gap. The investment will prevent imports worth around $393 million, while its contribution to exports is expected to be around $413 million.
According to the presidential decree, the investment will enable the company to double its production of Bayraktar TB2 drone, one of the world's best-armed UAVs, to 92 units per year. It will also add the capacity to manufacture 24 Akıncı armed drones, an upgraded version of the trademark platform Bayraktar TB2, and 36 other combat drones.
The Project-Based Incentive System was launched in 2016 with five main objectives, namely reducing import dependency, leading the employment of qualified labor force, providing supply security, realizing technological transformation, and supporting innovative, R&D-intensive and high value-added projects.
With the system, 19 projects worth TL 40 billion have been decided in the fields of defense industry technologies, medical devices and health technologies, petrochemicals and integrated metallurgy investments.
INCENTIVE FOR TL 4.5 BILLION AEROSPACE INVESTMENT
According to data compiled from the Industry and Technology Ministry, Turkey's efforts in the field of aerospace have gained momentum recently, while a significant amount of incentives has been provided for the planned investments in these sectors.
In the last five years in the aerospace sector, 41 projects with a fixed investment amount of TL 4.5 billion were given investment incentive certificates by the ministry. Once completed, these projects are projected to add employment for 3,223 people.
In the 2014-2018 period, incentive certificates were issued for a total of 26,450 projects in the energy, services, manufacturing, mining and agriculture sectors. In this context, a total of TL 615 billion worth of fixed investment and 911,789 new jobs were envisaged.
In the aerospace sector, incentive certificates were issued for 17 projects with a fixed investment amount of TL 1.9 billion last year, while incentive certificates were prepared for eight projects with a fixed investment amount of TL 347 million in the first half of this year.
The investments that received incentives this year include the production of UAVs, the manufacture of aircraft and helicopter parts, the maintenance and repair of components other than aircraft engines, the components and parts of air and space vehicles, the electronic control panel, the production of test equipment for aircraft, aircraft projects such as the production of body and wing parts.
The projects granted investment incentive certificates benefit from incentives such as value-added tax (VAT) exemption, customs duty exemption, tax deductions and insurance premium employer share support.