İzmir hit hard by the crisis

Several factories are for sale or lease in the Atatürk Industrial Zone in the Aegean port city, known as the heart of İzmir’s industry. The excessive decline in scrap and iron prices has led some factories in İzmir’s Aliağa, one of Turkey’s top three iron-steel production zones, to take extra measures, such as introducing double shifts or halting production. Only 20 of the 100 factories in the Menemen Leather Free Zone are operating.

Chemical industrialists are facing a strain on imports due to a foreign exchange hike, and firms in the plastics and packaging industry are unable to see what is yet to come in the near future. Increasing stocks lead cement factories to halt production while new investments are suspended. Some 10 firms in the Tire Industrial Zone have delayed investment decisions, said Kamil Porsuk, chairman of the zone. In line with global contraction, the automotive sector is also reducing production.

Kemeraltı, known as Western Anatolia’s trade center with its 9,000 workplaces, is also experiencing a major slowdown. “There is a decline of 25 percent in turnover. Our most important concern is the rent increase that is expected to take place in January. Some 70 percent of the artisans are tenants and rent will increase 20 percent. Many businesses may close down after January,” said Mehmet Gülaylar, chairman of the Kemearltı Guild.�

Measures expected
Although industrialists in İzmir are not experiencing mass layoffs, they are expecting the government to take preventive measures. Companies that are members of the Aegean Exporters’ Associations, whose exports total nearly $15 billion, argued exporters should be supported by loans from Eximbank, a fully state-owned bank acting as the Turkish government’s major export incentive instrument. They also have demanded a delay in social security premiums and energy costs.

There is pressure on exports and it will grow in January, said Jak Galiko, chairman of the Aegean Leather and Leather Products Exporters’ Association. The export losses in automotive and iron-steel may be balanced out by textiles, leather and agriculture, he said. Unless support is provided, the decline in exports may reach 15 percent, he said.

Photo: DHA