Turkey is now in a new political era, with both opportunities and challenges.
Business leaders and experts expect significant effects to be felt on the Turkish economy through efforts at reconstruction and changes in workforce.
Turkish cement and construction sectors will lead rebuilding efforts
Following the news of Assad’s removal, shares in Turkish cement and construction companies surged.
Bursa Cimento, Oyak Cimento, and Iskenderun Celik, a steel maker, both saw increases of 10%.
Analysts attribute this growth to the expectation that Turkish firms will play a key role in rebuilding war-torn Syrian towns.
Yakup Toktamis, of Trive Yatirim said that “Cement manufacturers like Limak Dogu Anadolu Cimento (Limak Dogu Anadolu Cimento) and Oyak Cimento will benefit from the boom. Meanwhile Enka Insaat Construction is expected to be leading large-scale construction projects.”
The proximity of Turkey to Syria and its existing commercial ties give it an advantage in securing contracts for the reconstruction of the infrastructure that was destroyed during the civil war.
Yusuf Dogan, a broker with Info Yatirim, added that “Cement, steel and other metals will play a key role in Syria’s rebuilding, opening up long-term business opportunities for Turkish firms.”
Investor expectations may be tempered by the timeframe for project completion.
As Syrians begin to return home, economic challenges are looming in Turkey
The trend has caused concern among Turkish firms that are dependent on Syrian workers, who have become the cornerstones of many industries including textiles and agriculture.
As stability is returning to Syria, many Syrian refugees are now heading home.
Over 108,000 Syrians were granted work permits by Turkey in the past year.
This workforce’s departure could put pressure on industries that rely heavily on cheap labor. Costs will rise and profitability may be reduced.
Analysts in the industry warn that companies could struggle to pass these costs on to consumers due to the weak demand at home.
Some business leaders are optimistic despite these challenges.
Mehmet Kaa, the president of Diyarbakir Chamber of Commerce stated that “Syrians make up a very small part of Turkey’s labor force.” They have either started businesses or taken on white-collar jobs, which suggests that not everyone will be leaving.
Fikret Kileyci, of Anatolian Exporters’ Association, said that in Gaziantep – a center for Syrian business and industry – Syrians make up only 3% of labor.
Adnan Unverdi is the president of Gaziantep Chamber of Commerce. He echoed Adnan Unverdi’s view and noted that Syrian owned businesses employ primarily Syrians.
Unverdi stated that “if they returned, there might be short-term interruptions in operations, but the companies could easily fill any gaps by hiring unemployed Turkish workers.”
Reviving bilateral trade is anticipated
The bilateral trade between Turkey & Syria is set to recover. It peaked in 2010 at $2.3 Billion, but plummeted to $565 M in 2012 because of the war.
Cemal Demirtas, from Ata Yatirim, said that the trade between Turkiye (Turkiye) and Syria would gain momentum.
Exports of cement, steel and other materials could be boosted by the reconstruction project in Syria.
The pace and scale of the revival depends on what happens in Syria, both politically and economically.
Although demand for Turkish products may increase, geopolitical and global economic risks can temper gains.
Geopolitical Dynamics: A boon to Erdogan’s Agenda
Bashar al Assad’s downfall is seen by Recep Tayyip Erdoan as a major strategic victory for his government, which has supported Syrian opposition groups during the entire conflict.
Ankara’s influence could grow in Syria with Assad out of the picture. This would allow Ankara to secure its southern border and curb Kurdish rebels in northern Syria.
Timothy Ash, an economist at the University of Pennsylvania’s School of Business and Economics, described Erdogan’s move as “a genius one,” highlighting both its strategic and economic advantages.
Investment outlook: cautious optimism
Construction and cement indices have seen strong gains.
Analysts urge caution due to the lengthy timelines of infrastructure projects in Syria and possible volatility within its political landscape.
Serhat Baskurt, of ALB Yatirim, highlighted the importance firms such as Enka Insaat or Bursa Cemento. He said that Enka Insaat’s international experience makes it a leading player in Syria’s rebuilding, and Bursa’s cement production capabilities give it an advantage.
Investors remain optimistic, but the broader economic implications of the post-Assad era for Turkey – from the labor market to the trade dynamics – highlight the difficulty in navigating this new era.
As new information becomes available, this post Assad’s Fall opens Doors for Turkish Businesses while Raising Labour Market Concerns may be updated.
