TEPAV: “Vehicles” sector performed better, “Color TVs” lagged behind TEPAV's study revealed that out of fifteen sectors, seven increased both relative prices and market share. Among these, manufacturing of diesel motor vehicles and manufacturing of cotton apparels sectors demonstrated the best performance.

ANKARA - TEPAV's research on the changes in the prices and market shares of export goods revealed that out of fifteen sectors, seven increased both relative prices and market share. Among these, manufacturing of diesel motor vehicles and manufacturing of cotton apparels sectors demonstrated the best performance.

TEPAV evaluation note titled "How does the rise in export prices affect the market share?" Training and Research Institute for Public Policy Director Assoc. Prof. Dr. Ümit Özlale and Economic Policy Analyst Burcu Afyonoğlu was published. Emphasizing that understanding the price and market share movements in the prominent export sectors for Turkey is critical to devise prospective export strategies in the face of the constant intensification of the global competition, the note said: "Identification of the sectors which maintained (even increased) the market share despite increasing prices more than the rivals - due to the factors like quality improvement - will give hints that can guide the policy makers for an effective export strategy." The note continued:

"The most striking point revealed in the analysis of the ten sectors that generated highest export revenues between 1998 and 2007 is that agricultural products such as nuts and cotton are no longer among the top-ten sectors and are replaced by the motor vehicles sector and its subsectors. It is also possible to conclude that the technological content of the top export sectors has been improved. On the other hand, it is seen that textile and steel-iron sectors maintained their importance over the last decade."

TEPAV's study analyzed how prices and market shares changed compared to export leader countries in respective sectors. In this regard the sectors fueling Turkey's exports were divided into four categories. The note in this respect maintained:

"Winner sectors: The most prominent sectors among those that increased both relative prices and market shares are manufacturing of diesel motor vehicles and manufacturing of cotton apparels sectors. These are followed by manufacturing of rods, manufacturing of passenger motor vehicles with diesel motors and manufacturing of spark ignition motor vehicles (1000cm3<1500 cm3) sectors. Considering the fact that input costs and exchange rate effect in the listed sectors will not change at high degrees compared to other export sectors, it can be argued that these winner sectors produce higher-quality products and/or enjoy more efficient export policies. The success of these sectors deserves more comprehensive analysis for the identification of suitable export strategies to be implemented in the future.

Sectors that Lost Competitiveness: In this group which lost market share after increasing relative prices are knitted textiles and nuts sectors. In the textiles sector, the world leader China held a market share of 33.2% in 2007 whereas Turkey ranked the third with a market share of 4.7% and competed with the countries in the low-income group. In that respect, it is evident that the sector can be strengthened and fueled via structural measures. In the nuts sector in which Turkey was the world leader with a market share of 66.7% in 2007, market share appears to have decreased upon negligible increase in prices. However, it should also be noted that despite the drop in the market share, Turkey's exports in this sector increased.

Price-competitor sectors: In this group that cut relative prices and increased the market share are sub-sectors of petroleum by-products, diesel/semi-diesel motor vehicles (capacity < 5 tons or 1500 < engine capacity = < 2500cm3), and     spark ignition motor vehicles. Turkey has maintained the competitiveness and improved the market share in the petroleum by-products sector in which a market share of 0.2-0.4% is held and in the above mentioned sub-sectors of the motor vehicles sector which are dominated by developed countries. This fact can be associated with keeping relative prices low given the presence of economies with high scales advantage.

Loser Sectors: This group includes sectors that lost both competitiveness and share in the global market despite offering lower relative prices. Color TV receivers and parts sector, the export revenues of which tended downwards, is among the sectors in this group."