Assistant Secretary of Commerce Michael C. CamuÑez
Market Access and Compliance
Remarks to Istanbul Chamber of Commerce
Friday, January 28, 2011
As prepared for delivery
Good afternoon. Iyi gunler dilerim. Thank you President Yalcintas for your gracious introduction. It is my great pleasure to be here with you and with this distinguished gathering of Turkish corporate leaders. The Istanbul Chamber of Commerce has been an important advocate for the advancement of the U.S.-Turkish economic and commercial relationship. Thank you all for your presence and for the opportunity to address you. Before I proceed further, I’d like to also recognize our distinguished Consul General, Scott Kilner, who is such a great representative of our government and the people of the United States here in Istanbul.
As you may know, I have only been in my current position for three months. Previously, I had the great honor of serving as Special Counsel to President Obama at the White House. I am now privileged to serve as Assistant Secretary of Commerce, where I have the opportunity to strengthen the United States’ economic and trade relationship with our partners around the world. This is my first trip to Europe in my new role. And I wanted my first visit to Europe to be to Turkey, because of the special bond of friendship, and the special strategic relationship, that exists between our countries.
A Deep and Abiding Friendship
The relationship between Turkey and the United States is strong. Our countries share a deep and abiding friendship. Our political and military alliance has endured for years. Today, Turkey remains one of the United States’ most important NATO allies and bears a great and growing responsibility in this critical region of the world. Our people also share important cultural ties. Americans have a deep respect and admiration for Turkey’s great cultural history and come by the thousands each year to visit this incredible country. Similarly, many Turks and their descendants have come to the United States, strengthening the rich and diverse fabric of our nation. Turks have made a significant impact on virtually every aspect of American life, particularly in business. You need look no further than one of the great and iconic American corporations, the Coca Cola Company, to find Mr. Muhtar Kent, an American of Turkish heritage, at the helm. Millions of Americans rely on the sage medical advice of the author and television personality Dr. Mehmet Öz, or, simply, “Dr. Oz,” as he is known in the U.S.; and being from Los Angeles, which is home of the world famous NBA Lakers, I can tell you that millions of fans are all too aware of the talent that Hedo Turkoğlu displayed on the basketball court when he and his team the Orlando Magic played the Lakers in the 2009 NBA Finals. And, as we speak, over 13,000 Turkish students are studying in the U.S., across many academic fields and institutions, in nearly all fifty American states, more than from any other European or Middle Eastern country.
Our Economic Relationship has Not Kept Pace
But as strong as our strategic and cultural relationship has been, the truth is that the economic aspect of our partnership lags behind. In recognition of this fact, our two Presidents set about creating a new strategic framework through which to develop greater economic cooperation between us—we call it the Framework for Strategic Economic and Commercial Cooperation. This framework elevates to the highest levels of our governments the responsibility for shepharding a new direction in our bilateral economic engagement. I was pleased to attend the inaugural meeting of that strategic framework in October, and I was here this week with my good friend Assistant Secretary of State, Jose Fernandez, to continue moving that agenda forward. Together Assistant Secretary Fernandez and I co-chair a government wide working group that has identified Turkey as an important priority market for the United States. Although I understand that it is unusual for two Assistant Secretaries from two different agencies to travel together, we wanted to come together to send a strong message about how we view this relationship.
The “Framework” is Critical to the Economic Growth of Both Turkey and the U.S.
Let me be clear: the strategic framework is critical to the future of both of our nations. The world has never been as competitive as it is today, leaving us both facing the same fundamental challenge: how do we make our economies, and our people, more competitive globally? And can we do it in a manner that advances the economic well being of the people of both nations?
In the U.S., we are keenly aware of the reality of global competition and of the hard work that lies ahead. Just this week, in his State of the Union address, President Obama challenged Americans to “spark the creativity and imagination of our people” through greater investment in education, modernization of our nation’s infrastructure, and the resolution of laws and regulations that hinder the growth of American industry, reminding us that we must engage with the world as we compete, as he put it, for the future.
Turkey has likewise embarked on an important strategy to build an innovative and competitive society. In fact, Prime Minister Erdoğan has set the ambitious goal of establishing Turkey as one of the top 10 economies in the world by 2023, the 100th anniversary of the modern Turkish state—an aspiration worthy of your country’s great and honorable founder, Ataturk. He believed, as we do, that the Turkish people can achieve anything to which they aspire because, as he said, “The character of the Turkish nation is worthy and noble, the Turkish nation is industrious, and the Turkish nation is intelligent.”
The United States is fully supportive of Turkey’s aspirations, and we are encouraged to see how much progress has already been realized. Turkey boasts one of the strongest and most financially healthy banking sectors in the world. In fact, it is the only OECD country that did not have to raise depository insurance caps during the recent international banking crisis. Turkey has over thirty world-class construction firms, earning a number two ranking on World Engineering Records’ annual survey. But Turkey’s success is not limited to the construction industry. In other critical sectors, Turkey boasts some of the most profitable and successful companies in the world—companies like Turkish Airlines, the sixth most profitable airline in the world, with whom I was honored to have visited yesterday. Turkey has embarked on significant legal and regulatory reforms, including the recent passage of the updated Commercial Code and, importantly, a renewable energy law that seeks to encourage investment in Turkey’s renewable sector. For these and many other reasons, Turkey can proudly boast that it is one of the fastest growing economies in the world and the fastest growing economy in all of Europe.
Important Work Remains to Be Done
As I said, the United States fully supports and wants to work with Turkey to further strengthen and grow its economy. Economic growth is good for Turkey, it is good for the United States, but it is also good for the world to have a vibrant, stable, and growing economy in what is one of the most important democracies in this region.
But for Turkey to realize its goal, it must create a business environment that has the kind of predictable, transparent and consistent regulatory environment that is the hallmark of the world’s most competitive economies. Doing so will inspire investor confidence, attracting foreign direct investment and encouraging innovation. Innovation is about ideas. Unless entrepreneurs, businesses and investors are confident that their ideas, their research and development, and their innovative practices will be protected from piracy and unfair competition by strong intellectual property rights, they will not be drawn to Turkey at the rate that other market conditions suggest that they should.
The truth is, Turkey has more work to do in each of these areas. These issues are central to the strategic framework we are here to advance, as well as to our broader bilateral trade policy agenda.
Turkey and the U.S. Are Working Postively Together Toward Important Economic Goals
Earlier this week, in Ankara, and now here in Istanbul, I’ve had the privilege of meeting with your ministries of foreign trade, finance, foreign affairs and others who are our counterparts in this partnership, including the private sector, and we have had extremely positive and productive discussions. We have agreement on many fronts, and we recognize many common objectives. We have had an honest and constructive dialogue about the need to improve the balance of trade between our nations, and the need to resolve, on both sides, some longstanding bilateral trade irritants. But more importantly we have agreed to work hard together in the coming months to identify tangible and concrete steps to turn our joint aspiration for a model economic partnership into a shared reality.
And, the fact is, we are already making significant progress.
- We have agreed to promote greater foreign direct investment in both countries. Just this week, in Ankara, we signed an important Memorandum of Intent between our Department of Commerce and the Investment and Support Promotion Agency of Turkey (ISPAT). More than just signing agreements on paper, we are actively strategizing with leading U.S. corporations as to how we can foster and promote joint ventures and foreign direct investment that brings technology, resources and jobs to Turkey, and vice versa;
- We have worked together to develop a plan for how to provide financing and technical assistance in a range of sectors that will advance our strategic goals;
- We have agreed to create a U.S.-Turkey Business Council that will enable U.S. and Turkish companies to provide direct input and advice at the highest levels of our governments regarding how to improve our economic and commercial relationship—and we look forward to hearing from your government soon regarding the members of the Council’s Turkish section;
- We are collaborating on efforts to help foster innovation through entrepreneurship—to that end, Istanbul will host the second annual Global Entrepreneurship Summit this year, which was launched last year by President Obama; and
- We are also working hard to help Turkey achieve its renewable energy goals. Our hope is to schedule two trade missions to Turkey this year focused on the energy sector.
Looking Behind the Numbers in Our Balance of Trade
I would not be intellectually honest if I did not candidly address the challenges we face with respect to the balance of trade between our countries. Yes, there is a trade imbalance, and yes, we want to work with you to address it. No country is more open and transparent than the United States, and no country has greater balance of trade challenges than we do—just look at our own trade deficit with the rest of the world. While the trade imbalance with Turkey is a challenge, I’m convinced that it is not a permanent situation, and more importantly, it is not a situation that will be improved by erecting barriers to trade. To the contrary, as I’ve discussed, Turkey’s continued liberalization will only strengthen its competitive position and will, in time, strengthen Turkey’s strategic trade advantage. A great example of this potential can be seen in Karsan Otomotiv, a Turkish design company with over forty years of experience as a multi-branded commercial vehicle producer. Karsan USA has recently been named as one of three finalists by New York City Mayor, Michael Bloomberg, in a bid to design the next generation of New York City taxis. The competition is an open and transparent one, and I have no way to predict the outcome. But I can think of no more emblematic example of the burgeoning economic ties between our countries than a Turkish firm being among the finalists for the iconic New York City taxi cab.
But there is more to our bilateral trade numbers than meets the eye. And, in fact, U.S. exports to Turkey often advance Turkey’s own export goals. Take General Electric’s joint venture with Tulomsash in Eskisehir. This partnership is taking locomotive kits made in Pennsylvania, assembling them in Turkey, and then exporting them to the Caucasus and Central Asia where Turkish firms have been very successful. Jobs and wealth are created in both of our countries as we play to the strengths of American technology and Turkish marketing and service—a “win win,” as we say in America.
Or take Turk Technic’s joint venture with Pratt & Whitney to do jet engine maintenance, repair and overhaul right here in Istanbul. Aircraft from airlines throughout the region now come to Turkey for this service, thanks to the value provided in this aviation sector joint venture. And just today, I had the privilege of meeting with the director of New York’s state office in Istanbul—yes, the State of New York has a trade promotion office in Istanbul, and they are doing great work here to promote bilateral trade and investment between New York State and Turkey. The director told me about an exciting new initiative that is coming together that further illustrates my point—and she told me that I could share it with you: A former Turkish food processing plant that was shut down and void of employees is being retooled to become a solar energy assembly facility. U.S. solar panels and components—made in the U.S. with our latest technology—will be exported to Turkey. Once here, they will be incorporated with Turkish-manufactured components and assembled into solar panels that will then be sold in third countries throughout the Middle East and Africa, capitalizing on Turkey’s strategic location and deep ties in the region. A once empty factory will be transformed into a high tech assembly facility, creating new jobs in Turkey in a growing and critical sector of the economy.
These examples are not unique. Whether in the health care, construction, transportation or other sectors, U.S. exports are not only helping to build Turkish businesses, create Turkish employment, and improve Turkish competitiveness, they are actually supporting Turkish exports. In short, my friends, while the trade balance sheet suggests one dimension of our relationship, as with all things there is much more to the story, and in this case the story is one of an economic partnership that is positioned for continued growth and mutual benefit.
I’d like to close by telling you that I am profoundly optimistic not only about the future of Turkey, but about the future of our relationship. As we build this economic partnership, we should not forget that things do not happen over night. Just as it took us many years to build and solidify our military and strategic partnership, our economic partnership will take time too. But it is moving quickly, and we are the better for it. For, as Ataturk said, “National sovereignty should be supported by financial independence. The only power that will propel us to this goal is the economy. No matter how mighty they are, political and military victories cannot endure unless they are crowned by economic triumphs.”
This is my first trip to Turkey, but I assure you it will not be my last--Inshallah. The United States is committed to this relationship, and we’re in it for the long-term. It is my great honor and privilege to be with you today, and I thank you for your kind hospitality, and for your attention.
Thank you; Tessekkur ederim.
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