BrazilTurkey turns to BCG to help boost US economic trade
The Government of Turkey has been working with Boston Consulting Group to realise a major bilateral trade deal with the US. The proposed deal is hoped to help plug the massive trade gap left by deteriorating relations between the US and China.
In the autumn of 2019, the governments of Turkey and the US stepped up efforts to speed up the completion a $100 billion trade target. A meeting in Washington was attended by Turkey-US Business Council (TAİK) Chairman Mehmet Ali Yalçındağ, American-Turkish Council (ATC) Chairman General James Jones, and US Chamber of Commerce and Boston Consulting Group (BCG) officials.
A year on, TAIK has asserted that export demand from Turkey could help make up for the import potential blocked by the US’ imposition of tariffs on China. With tensions between China and the US having continued to grow, the chairman of TAIK, Mehmet Ali Yalçındağ, commented that alongside the current Covid-19 pandemic, Turkey is also in line to benefit from a major shift in supply chains following the outbreak.
“We believe that these changes will also create very positive opportunities for Turkey-U.S. relations. But we need to take action as soon as possible to take advantage of these opportunities,” he said. “To this end, we have started a new comprehensive study with BCG. In this study, we are evaluating the opportunities that will arise from the loss of China's trade with the United States and determine the steps Turkey needs to take to replace China.”
TAIK has already been working with BCG to find ways to achieve a bilateral trade volume of $100 billion between the two countries. According to the study by BCG’s global trade experts and research teams, the contraction in the trade corridor between the US and China in 2019 represent a major opportunity to do just that, especially as this will likely deepen further in the years to come.
The US reduced its imports from China by $91 billion to $472 billion in 2019, and still has a trade deficit with China of around $350 billion. The US last year turned to importing more from other countries such as Vietnam, Mexico and Taiwan. Its imports from these countries increased by $18 billion, $12 billion and $9 billion, respectively.
Commenting on this, Yalçındağ said, “Turkey, on the other hand, increased its exports to the US by around $400 million in 2019 and did not get the share of the pie to the extent it wanted… By 2023, the trade corridor between the United States and China is projected to narrow further by $150 billion to $200 billion. This presents extremely important opportunities for other countries.”
