Harvard Center for Textile & Apparel Research

Harvard Center for Textile & Apparel Research 

Overview of the Turkish Textile and Apparel Industry 

by 

BARIS TAN 

Last revision: December 2000 

Graduate School of Business, Koç University 

Rumeli Feneri Yolu, Sariyer, 80910 Istanbul, Turkey 

e-mail: btan@ku.edu.tr. 

Harvard Center for Textile and Apparel Research 

Harvard University 

29 Oxford Street, Pierce Hall 309 

Cambridge, MA 02138 

Telephone: (617) 495-1508 

Fax: (617) 495-9837 

E-mail: muriel@deas.harvard.edu 

Funding for this project was provided by a grant from the Alfred P. Sloan Foundation

B.Tan Overview of the Turkish Textile and Apparel Industry 2 

Table Table of of Contents 

Contents 

Table of Contents................................................................................................................. 2 

List of Tables........................................................................................................................ 3 

List of Figures....................................................................................................................... 5 

1. Introduction...................................................................................................................... 6 

2. Imports and Exports....................................................................................................... 11 

2.1. Destinations for Turkish Textile and Apparel Exports............................................. 15 

2.2. Product Mix of Turkish Textile and Apparel Exports .............................................. 18 

2.3. The Textile and Apparel Trade with USA................................................................ 19 

3. Production Capacity and Utilization .............................................................................. 23 

4. Production and Demand................................................................................................. 25 

5.1. Cotton Textiles...................................................................................................... 26 

5.2. Woolen Textiles..................................................................................................... 28 

5.3. Man-made Textiles................................................................................................ 29 

5.4. Apparel Production ............................................................................................... 32 

5. Industry Structure .......................................................................................................... 33 

6. Competitiveness of the Textile and Apparel Industry .................................................... 38 

7.1. Cost Structure .......................................................................................................... 38 

7.3. Lead Times and Delivery Performance ..................................................................... 44 

7.4. Flexibility and Quality ............................................................................................. 46 

7. Assessment of Competitiveness of Turkish Textile and Apparel Industry...................... 47 

References........................................................................................................................... 50


List List of of Tables 

Tables 

Table 1. Macroeconomic Indicators of Turkey 7 

Table 2. Relative price changes in textile and apparel. 10 

Table 3. World’s Largest Textile Exporters (1998) 12 

Table 4. World’s Largest Apparel Exporters (1998) 12 

Table 5. European Union’s Top Five Textile and Apparel Suppliers 13 

Table 6. Turkey’s Apparel and Textile Exports 13 

Table 7. Turkey’s Apparel and Textile Imports 14 

Table 8. Regional Export Destinations for Turkey’s Textile Exports 15 

Table 9. Regional Export Destinations for Turkey’s Apparel Exports 15 

Table 10. Largest Markets for Turkey’s Textile Exports 16 

Table 11. Largest Markets for Turkey’s Apparel Exports 17 

Table 12. Turkey’s Largest Textile Suppliers 17 

Table 13. Turkey’s Largest Apparel Suppliers 18 

Table 14. Product Mix of Turkish Textile and Apparel Exports (1999) 18 

Table 15. Product Mix of Turkish Textile and Apparel Imports (1999) 19 

Table 16. Textile and Apparel Trade with USA 19 

Table 17. Product Mix of Turkish Apparel Exports to USA (1999, Jan-Nov) 21 

Table 18. Turkish Textile Exports to USA in Quota-Restricted Categories (1999) 22 

Table 19. Turkish Apparel Exports to USA in Quota-Restricted Categories 22 

Table 20. Textile Machinery Capacity (1996) 23 

Table 21. Textile Machinery Imports (Million $) 23 

Table 22. Capacity Utilization Ratios (%) in Textile and Apparel Industry 24 

Table 23. Summary of Production and Demand in Turkish Textile and Apparel Sector 25 

Table 24. Cotton Production and Demand in the World 26


Table 25. Cotton Production, Consumption, Import and Export in Turkey 27 

Table 26. Cotton Yarn Production, Demand, Import and Export 27 

Table 27. Cotton Woven Fabric Production, Demand, Import and Export 27 

Table 28. Wool Production, Consumption, Import and Export in Turkey 28 

Table 29. Woolen Yarn Production, Demand, Import and Export 29 

Table 30. Woolen Fabric Production, Demand, Import and Export 29 

Table 31. Man-Made Fiber Production and Demand 30 

Table 32. Man-Made Fiber Export and Import 30 

Table 33. Man-Made Yarn Production and Demand 31 

Table 34. Man-Made Yarn Export and Import 31 

Table 35. Man-Made Fabric Production, Demand, Import and Export 31 

Table 36. Product Mix of Turkish Apparel Exports 32 

Table 37. Size Distribution of the Establishments in the Apparel Industry (as % ) 34 

Table 38. Size Distribution of the Establishments in the Textile Industry (as % ) 34 

Table 39. Distribution of the Number of Employees in the Apparel Industry (as % ) 35 

Table 40. Distribution of the Number of Employees in the Textile Industry (as % ) 35 

Table 41. Index of Production Workers in Manufacturing Industry (1997=100) 35 

Table 42. Index of Production Workers Hourly Wages in Manufacturing Industry 

(1997=100) 36 

Table 43. Production Index of Manufacturing Industry 36 

(Weighted by Value Added 1997=100) 36 

Table 44. Number of Foreign-Owned Firms in Textile and Apparel Industry 37 

Table 45. Number of Foreign Investment Licenses 37 

Table 46. Government Investment Incentives to the Textile/Apparel Industry 37 

Table 47. Comparison of the Labor costs ($/hour) in the Textile Industry 38 

Table 48. Comparison of Industrial Electricity Prices ($/kwh) 39 

Table 49. Cost Structure in Different Countries 40


Table 50. Comparison of Production Costs (Index: Italy=100) 41 

Table 51. Value Added, Labor Productivity and Wage Rates (at current prices, in US$) by 

Manufacturing Branch 43 

Table 52. Annual Growth Rates During 1980-1996 44 

Table 53. Comparative Lead Times in the European Market 45 

List List of of Figures 

Figures 

Figure 1. Turkish Textile and Apparel Exports 1970-1999................................................... 8 

Figure 2. Map of Turkey..................................................................................................... 33 

Figure 3. Geographical location of Turkey.......................................................................... 44 

Figure 4. Comparative Delivery Times to the European Union......................................... 45 

Figure 5. Allocation of the money paid by a customer in the supply chain of an apparel 

product.........................................................................................................................48


1. . Introduction 

In Turkey, the textile and apparel industry has been a very important driving force 

for the economy. Today, the textile and apparel industry has a major importance in 

Turkish economy. As an industry that generates around $20 billion a year, it accounts for 

10.4% of the GNP, 39% of industrial output, 47.5% of manufacturing output, 21% of the 

total industrial employment, 10% of the total employment, and 37.4% of all the exports 

[11]. Table 1 summarizes some macroeconomic indicators for Turkey [14]. 

The textile and apparel industry in Turkey dates back to the Ottoman Empire era. 

Production and processing of cotton and yarn was an important part of the manufacturing 

activities of the empire. When the empire collapsed, the new Turkish Republic that was 

founded in 1923 inherited 8 factories and 10,000 looms [1]. The new republic designated 

the textile and apparel sector as one of the protected sectors and invested heavily in the 

sector by opening new factories and forming State Economic Enterprises. Under the 

protection of the state, the industry flourished rapidly and started exporting textile 

products in 1960s. The share of textile and apparel exports as a percent of total exports 

was only 2.96% in 1970. 

The liberalization of the economy in 1980s and export-oriented government strategies 

and incentives accelerated the exports of the textile and apparel to the global markets. 

Turkey became a major exporter of yarn and unprocessed fabric to Europe in 1980s. 

Although Europe imposed quotas limiting Turkish textile exports to European countries in 

these years, Turkey continued to be the major supplier of cotton yarn until late 1980s. As a 

result of the emergence of Asian competitors and also an antidumping tax of 12% that was 

charged on Turkish yarn by the European Union, Turkey lost its leadership position. The 

industry then moved towards more value-added products such as finished cotton, synthetic 

fiber fabrics, and ready ware.


Table 1. Macroeconomic Indicators of Turkey 

1995 1995 1995 1996 1996 1997 1997 199 1998 199 1999 1999 

1999 

GDP at market prices 

(TL bn) 

7,926 14,320 28,721 53,523 83,198 

GDP 

(US$ bn) 

173 176 189 205 199 

Real GDP growth 

(%) 

6.7 7.3 7.6 3.2 -5.1 

Consumer price inflation 

(av; %) 

89.1 80.4 85.7 84.6 65.1 

Population (m) 60.6 61.5 62.5 63.5 64.4 

Exports of goods fob 

(US$ m) 

21,975 32,446 32,647 31,220 29,326 

Imports of goods fob 

(US$ m) 

35,187 43,028 48,005 45,440 39,773 

Current-account balance 

(US$ m) 

-2,338 -2,437 -2,638 -1,983 -1,364 

Foreign-exchange reserves 

excl gold (US$ m) 

12,442 16,436 18,658 19,489 23,340 

Total external debt 

(US$ bn) 

73.8 79.6 84.9 96.9 101.8 

Debt-service ratio, paid 

(%) 

27.7 21.9 19.5 21.2 30.5 

Public-sector borrowing 

requirement (% of GNP) 

6.7 13.9 13.1 15.9 23.3 

Consolidated government 

budget balance (% of GD)- 

-4.0 -8.6 -7.8 -7.1 -10.9 

Exchange rate 

(av; TL:US$) 

45,845 81,405 151,865 260,724 418,783 

Source: The Economist Intelligence Unit Limited, EIU Country Report: Turkey (July 2000) 

Enjoying the availability of raw materials, especially, cotton, relatively low labor 

costs, proximity to Europe, and then the customs union agreement with the European 

Union, the textile and apparel industry increased its exports almost thirteen-fold in twenty 

years: from $777 million in 1980 to $9.9 billion in 1999 [16]. The textile and apparel 

industry is the leading export-generating sector, generating $9.8 billion, which is 36.1% of 

the total exports in 1999 [16]. Figure 1 depicts the growth of Turkish textile and apparel 

exports since 1970.


Export values (1000 $) 

12,000,000 

10,000,000 

8,000,000 

6,000,000 

4,000,000 

2,000,000 

- 

Textile 

Apparel 

Textile and Apparel 

1970 1975 1980 1985 

Year 

1990 1995 2000 

Figure 1. Turkish Textile and Apparel Exports 1970-1999 

This increase is mainly a result of high growth in the apparel industry. The apparel 

exports had a record annual increase of 24% in 1988. The share of the apparel industry in 

the total textile and apparel exports increased from 36% in 1984 to 74% in 1999. 

Turkey is the largest textile supplier and the second largest apparel supplier of the 

European Union [17]. In the world market, Turkey ranks as the sixth largest apparel and 

the fifteenth largest textile exporter (1998). Although the share of Turkey in the world’s 

export markets is 0.4%, the share of the Turkish textile and apparel sector is 4.1%. 

The industry is composed of 44,000 mostly small- to medium-size establishments. In 

1997, there were 105 large textile and apparel companies among the Turkey’s largest 500 

industrial firms. After the privatization of the most of the state owned enterprises, the 

private sector is currently dominating the industry. 

Despite its accomplishments over the last years, the Turkish textile and apparel 

industry is currently facing a number of crucial challenges. The competitiveness of the 

industry is decreasing due to rising labor costs, inefficiencies and quality problems, and the


emergence of other low-cost suppliers in the Far East and Eastern Europe. The changes in 

world trade, heavy reliance on the European market (56% of Turkey’s textile exports and 

66% of its apparel exports in 1999), and recent Asian and Russian crises also create 

uncertainty for the industry’s future. 

With the Customs Union agreement with the European Union that has been in effect 

since 1996, the industry was filled with great enthusiasm and exaggerated expectations. In 

this environment, the companies reacted to these challenges by substantial investment in 

production capacity without considering its impact and sources of financing. During 1990- 

1995, the textile industry invested around $6 billion to purchase textile machinery. This 

made Turkey one of the largest customers of the textile machinery. However, this sudden 

increase in investments without coordination created an overcapacity in the sector. In 

addition to this overcapacity, stagnant European markets, depreciation of the Euro against 

the dollar, and rising production costs reduced the capacity utilization ratio for the textile 

industry from 81% in 1995 to 77% in 1998, and for the apparel industry from 90% in 1995 to 

80% in 1998 [17]. 

This report presents an overview of the Turkish textile and apparel sector. In order to 

emphasize the position of the Turkish textile and apparel industry globally, Section 2 gives 

a summary of the industry’s imports and exports, major suppliers and customers, and the 

composition of the imports and exports in recent years. The Turkey-USA textile and 

apparel trade is analyzed separately in Section 3. The production capacity and the 

utilization of it in the textile and apparel industry are discussed in Section 4. Then the 

production numbers for fiber, yarn, and fabric output from cotton, woolen, and man-made 

sources and clothing are given together with the corresponding demand, import, and export 

figures in Section 5. The industry structure is discussed in Section 6. Section 7 analyzes 

the competitiveness of the industry by focusing on its cost structure, delivery performance, 

flexibility and quality. Finally, a brief assessment of the competitiveness and conclusions 

are given in Section 8.


Note that, in the report, the numbers for apparel and textiles combined are the sum of 

the corresponding numbers for textile and apparel given separately. This summation is 

done without any adjustment according to the relative price changes of the two categories. 

The wholesale prices indices from 1980 to 1998, given in Table 2, show that the wholesale 

apparel prices have increased more than the wholesale textile prices. 

Table 2. Relative price changes in textile and apparel. 

Wholesale Price Index (1980=1) 

32 321 322 p321/p322 


and 

Apparel Textile Apparel 

1982 1.3 1.3 1.4 0.931288 

1983 1.8 1.8 1.9 0.903674 

1984 2.5 2.5 2.6 0.962363 

1985 3.4 3.3 3.2 1.035824 

1986 4.7 4.5 4.4 1.019223 

1987 6.9 6.8 6.7 1.010993 

1988 11.8 11.6 12.3 0.946467 

1989 19.6 19.5 21.4 0.910012 

1990 29.5 29.2 32.9 0.885462 

1991 43.9 43.1 50.2 0.857617 

1992 70.1 68.5 81.9 0.836574 

1993 107.9 101.5 138.8 0.731527 

1994 249.4 246.6 285.0 0.865102 

1995 471.2 442.0 593.8 0.744319 

1996 748.6 676.4 999.2 0.676984 

1997 1378.0 1249.5 1856.9 0.672871 

1998 2287.1 2073.9 3082.1 0.672871


2. . Imports Imports and and Exports Exports 

Exports 

Turkey is the world’s sixth largest apparel exporter, and the fifteenth largest textile 

exporter in the world (Table 3 and 4). Turkey is also the largest textile and the second 

largest apparel supplier to the European Union (Table 5). (According to the Turkish 

Clothing Manufacturers Association (TGSD) export figures, Turkey was the fifth largest 

apparel exporter in the world and the largest textile supplier of the European Union.) 

Although the share of Turkey in the world’s export markets is 0.4%, the share of the 

Turkish textile and apparel sector is 4.1%. The textile and apparel industry in Turkey 

depends heavily on exports. Turkey’s exports account for, approximately, 58% of the 

woven textiles output, 70% of the apparel output, and 63% of the textile and apparel 

output (Dunya, 1998). 

In addition to these export figures, a substantial amount of textile and apparel has 

been bought by small traders who travel back and forth from Russia, Ukraine, other former 

Soviet republics, and Eastern Europe. This so-called “suitcase trade” is estimated to 

account for $8.8 billion in 1996. After the Russian crisis, this number is estimated to have 

dropped to $3.6 billion in 1998, and $1.7 billion in 1999 according to the Turkish Treasury’s 

numbers. 

Turkey’s textile exports have increased by 97% from 1990 to 1998. During this time, 

the apparel exports increased by almost 150%. The percentage of textile and apparel 

exports in total exports has been over 36% for the last five years (Table 6). Although the 

growth of the textile and apparel exports has been quite steep in the last twenty years, in 

1999, Turkey faced a drop in the total export value for the first time after almost thirty 

years. This was caused by the earthquake, economic problems, problems in the world 

markets, and currency fluctuations. Since 66% of apparel exports are sent to European 

Union, the depreciation of EURO against USD affects the Turkish export performance. 

While 1 EURO was equivalent to $1.16 in January 1999, its value went down to $1.01, or


13%, in December 1999. Therefore, a part of the decrease in apparel exports in 1999 can be 

attributed to the depreciation of EURO against USD. 

Table 3. World’s Largest Textile Exporters (1998) 

Country 

Value 

($ million) 

Share in World 

Exports 

(%) 

% of economy’s 

total merchandise 

exports 

1 Germany 13,263 8.79 2.50 

2 Hong Kong 13,040 8.64 5.70 

3 Italy 13,033 8.63 5.40 

4 China 12,817 8.49 7.00 

5 South Korea 11,279 7.47 8.50 

6 Taiwan 11,020 7.30 10.00 

7 USA 9,216 6.11 1.40 

8 France 7,569 5.01 2.50 

9 Bel-Lux 7,442 4.93 4.20 

10 Japan 5,971 3.96 1.50 

11 UK 5,428 3.60 2.00 

12 India 5,243 3.47 15.30 

13 Pakistan 4,302 2.85 50.60 

14 Netherlands 4,084 2.71 2.10 

15 15 Turkey Turkey 3,549 3,549 

2.35 13.70 13.70 

13.70 

Source: World Trade Organization 

Table 4. World’s Largest Apparel Exporters (1998) 

Country 

Value 

($ million) 

Share in World 

Exports 

(%) 

% of economy’s 

total merchandise 

exports 

1 China 30,048 16.73 15.60 

2 Italy 14,742 8.21 7.00 

3 Hong Kong 22,164 5.38 18.70 

4 USA 8,793 4.89 0.70 

5 Germany 7,684 4.28 1.90 

6 Turkey Turkey Turkey 7,058 7,058 

3.93 25.70 

25.70 

7 Mexico 6,603 3.68 1.40 

8 France 5,747 3.20 2.20 

9 UK 4,922 2.74 1.60 

10 South Korea 4,651 2.59 12.10 

11 India 4,343 2.42 14.10 

12 Thailand 3,560 1.98 12.20 

13 Portugal 3,462 1.93 21.30 

14 Taiwan 3,170 1.76 5.90 

15 Netherlands 2,888 1.61 1.70 

Source: World Trade Organization


Source: EURATEX [15] 

Table 5. European Union’s Top Five Textile and Apparel Suppliers 


1997 1998 1999 

(1000 Euros) (1000 Euros) (1000 Euros) 

Turkey 1437.7 1657.1 1770.4 

India 1674.2 1657.3 1637.1 

China P.R. 1253.3 1365.9 1413.5 

U.S.A. 1379.7 1484.8 1317.5 

Switzerland 1154.2 1203.3 1136.5 


1997 1998 1999 

(1000 Euros) (1000 Euros) (1000 Euros) 

China P.R. 5369.7 5559.3 6556.2 

Turkey 3940.2 4368.7 4567.8 

Hong Kong 2591.3 2598.1 2767.1 

Tunisia 2013.7 2284.3 2377.1 

Morocco 1874.7 2037.4 2114.4 

Total 

Exports 

(1000 $) 

Table 6. Turkey’s Apparel and Textile Exports 

Value 

(1000$) 

Textile Apparel Textile and Apparel 

% in total 

Turkish 

exports 

Value 

(1000$) 

% in total 

Turkish 

exports 

Value 

(1000$) 

% in total 

Turkish 

exports 

1980 2,910,000 106,000 3.6 671,000 23.1 777,000 26.7 

1981 4,703,000 302,000 6.4 915,000 19.5 1,217,000 25.9 

1982 5,746,000 367,000 6.4 1,069,000 18.6 1,436,000 25 

1983 5,728,000 544,000 9.5 1,055,000 18.4 1,599,000 27.9 

1984 7,134,000 989,000 13.9 1,181,000 16.6 2,170,000 30.4 

1985 7,958,000 936,000 11.8 1,151,000 14.5 2,087,000 26.2 

1986 7,457,000 1,069,000 14.3 1,043,000 14.0 2,112,000 28.3 

1987 10,190,000 1,728,000 17.0 1,133,000 11.1 2,861,000 28.1 

1988 11,662,000 2,127,000 18.2 1,334,000 11.4 3,461,000 29.7 

1989 11,625,000 2,448,000 21.1 1,338,000 11.5 3,786,000 32.6 

1990 12,959,289 2,898,349 22.4 1,424,249 11.0 4,322,598 33.4 

1991 13,593,539 3,219,350 23.7 1,374,357 10.1 4,593,707 33.8 

1992 14,365,414 4,009,615 27.9 1,369,322 9.5 5,378,937 37.4 

1993 15,345,000 4,157,997 27.1 1,457,490 9.5 5,615,487 36.6 

1994 18,107,000 4,490,043 24.8 1,944,818 10.7 6,434,861 35.5 

1995 21,637,041 6,188,502 28.6 2,130,665 9.8 8,319,167 38.4 

1996 23,224,465 6,344,252 27.3 2,352,142 10.1 8,696,394 37.4 

1997 26,261,072 7,088,669 27 2,730,421 10.4 9,819,090 37.4 

1998 26,973,952 7,644,051 28.3 2,811,763 10.4 10,455,814 38.8 

1999 26,588,264 7,145,053 26.9 2,733,641 10.3 9,878,694 37.2 

Source: The Undersecretariat of Foreign Trade, The Republic of Turkey, Prime Ministry Reports (2000)


Table 7. Turkey’s Apparel and Textile Imports 

Apparel Textile Apparel and Textile 

Year Value (1000$) 

% in Total 

Imports Value (1000$) 

% in Total 

Imports Value (1000$) 

% in Total 

Imports 

1990 17,984 0.08 1,049,012 4.70 1,066,996 4.78 

1991 26,516 0.13 872,912 4.15 899,428 4.28 

1992 35,067 0.15 1,189,310 5.20 1,224,377 5.35 

1993 47,473 0.16 1,591,948 5.41 1,639,421 5.57 

1994 36,586 0.16 1,600,698 6.88 1,637,284 7.04 

1995 59,279 0.17 2,621,797 7.34 2,681,076 7.51 

1996 169,658 0.39 2,812,672 6.45 2,982,330 6.84 

1997 230,597 0.47 3,380,520 6.96 3,611,117 7.43 

1998 230,892 0.50 3,305,229 7.20 3,536,121 7.70 

Source: The Undersecretariat of Foreign Trade Reports (1998) 

The Customs Union agreement with the European Union that was signed in 1996 

made it easy to export and import intermediary goods between the European Union and 

Turkey and reduced Turkey’s average tariff rates to 3.6%. The Customs Union agreement 

is a part of the process for Turkey’s membership in the European Union where Turkey is an 

official candidate. The EU’s quantity restrictions on Turkish textile and clothing were 

eliminated after the Customs Union. The Customs Union Agreement also includes the 

Law on the Protection of Competition within the Frameworks of the Integration with the 

World Markets and Customs Union with the EU; The Law on the Protection of the 

Consumer; The Protection of Industrial Designs, The Protection of Brand Names, etc. The 

agreement is expected to increase the competitiveness of all the industries faced with global 

competition. The Turkish apparel and textile industry has been expecting an increase in 

exports from the agreement. But so far only a 5% increase in the exports has been realized. 

Turkey’s textile and apparel exports have been constrained by the Multi Fiber 

Agreement (MFA). Elimination of all the quotas according to General Agreement on 

Tariffs and Trade (GATT) between the countries of WTO, by January 1, 2005 introduces 

new opportunities and also challenges for Turkey’s textile and apparel industry, especially, 

in the United States market.


2.1. 2.1. Destinations Destinat 

Destinat ions for Turkish Turkish Textile Textile and and Apparel Apparel Exports 

Exports 

It is estimated that Turkish apparel industry supplies 20,000 points of sale 

destinations in Turkey and 200,000 destinations worldwide [11]. European Union is the 

main destination for Turkish textile and apparel exports followed by the United States. 

Other major textile export destinations are East Europe, Middle East, and North Africa 

following the European Union and the United States. Russia is also a major destination for 

Turkey’s apparel exports following the European Union and the United States (Tables 8, 9). 

In 1999, the European Union accounted for 56% of Turkey’s textile exports and 66% of 

its apparel exports. Turkey is the second largest textile supplier of the European Union 

according to EURATEX [15]. Turkey is also the second largest apparel supplier of the 

European Union, with total exports of 4.39 Billion Euros and a share of 11%, following 

China (Table 5). 

Table 8. Regional Export Destinations for Turkey’s Textile Exports 

Value (Million $) Share 

1998 1999 1998 1999 

EU 1296 1316 52% 56% 

USA 195 222 6% 8% 

East Europe 157 169 6% 7% 

Middle East 281 262 11% 10% 

North Africa 90 163 3% 6% 

Other 556 331 21% 13% 

Source: The Undersecretariat of Foreign Trade Reports (1998) 

Table 9. Regional Export Destinations for Turkey’s Apparel Exports 

Value (Million $) Share 

1998 1999 1998 1999 

EU 5,174 5,063 63% 66% 

USA 807 928 10% 13% 

Russia 374 130 5% 2% 

East Europe 418 227 5% 3% 

Others 1,342 1,236 16% 16% 

Source: The Undersecretariat of Foreign Trade Reports (1998)


Although the apparel exports haven been concentrated mainly in the European Union 

and USA with a combined share of 78% of Turkish apparel exports, textile exports are more 

distributed across the European Union, USA, East Europe and Middle East with a share of 

81%. 

The textile exports to North Africa increased almost 80% in 1998, possibly, because of 

increasing apparel exports from North Africa to Europe with Turkish textiles. 

Italy is the largest market for Turkish textiles with a market share of 12% in 1999. 

Germany is the largest market for Turkish apparel and the third largest market for textiles 

(Table 10 and 11) with 8% share of textiles and 38% of apparels in 1999. 

The United States is the second largest market for the Turkish apparel following 

Germany (Table 11). Turkey is the twentieth largest apparel (1997) and the twelfth largest 

textile supplier of the United States (1999). The exports to the United States have been 

increasing in recent years. 

The major textile suppliers of Turkey are Germany with a share of 13% in Turkey’s 

textile imports followed by Italy, S. Korea, and USA (Table 11). Most of Turkey’s apparel 

imports are from Italy with a share of 26% of Total apparel imports followed by China, 

England, and Germany (Table 12). 

Table 10. Largest Markets for Turkey’s Textile Exports 

Value % in Turkey’s Textile Exports 

1997 1998 1999 1997 1998 1999 

Italy $319,420,783 $320,641,158 $340,327,710 12% 11% 12% 

England $269,207,554 $253,182,304 $233,633,323 10% 9% 9% 

Germany $219,759,213 $214,743,923 $228,918,321 8% 8% 8% 

USA $176,467,209 $194,617,114 $221,781,655 6% 7% 8% 

France $132,279,100 $164,689,800 $144,685,900 5% 6% 5% 

Algeria $23,194,211 $54,875,943 $80,290,678 1% 2% 3% 

Israel $55,089,707 $67,587,312 $79,475,948 2% 2% 3% 

Belgium-Lux. $60,887,168 $77,440,407 $76,537,066 2% 3% 3% 

Spain $48,336,351 $54,486,369 $75,600,261 2% 2% 3% 

Greece $41,859,670 $58,339,246 $74,321,838 2% 2% 3% 

Saudi Arabia $72,099,398 $66,764,419 $62,397,977 3% 2% 2% 

Syria $105,766,818 $100,163,440 $60,417,810 4% 4% 2% 

Source: The Undersecretariat of Foreign Trade Reports (1999) [8]


Table 11. Largest Markets for Turkey’s Apparel Exports 

Value ($) % in Turkey’s Apparel Exports 

1997 1998 1999 1997 1998 1999 

Germany 2,807,852,650 2,894,327,936 2,704,059,649 40% 38% 38% 

USA 690,501,525 807,135,558 928,417,400 10% 11% 13% 

England 489,931,534 571,623,542 667,548,099 7% 7% 9% 

France 442,755,131 493,734,172 494,573,050 6% 6% 7% 

Holland 360,832,931 406,292,847 385,299,540 5% 5% 5% 

Belgium-Lux 163,749,854 231,584,339 211,481,709 2% 3% 3% 

Italy 133,851,448 170,970,423 161,484,648 2% 2% 2% 

Russia 676,608,447 373,544,063 129,758,000 10% 5% 2% 

Denmark 80,393,041 100,820,151 107,526,827 1% 1% 2% 

Tunisia 23,516,787 203,457,751 106,639,747 0% 3% 1% 

Libya 70,556,392 73,969,580 102,983,682 1% 1% 1% 

Austria 106,223,159 107,644,817 96,839,419 1% 1% 1% 

Poland 149,909,541 180,974,211 94,665,380 2% 2% 1% 

Sweden 68,427,549 90,782,482 94,082,318 1% 1% 1% 

Egypt 36,731,537 80,632,540 87,781,220 1% 1% 1% 

Source: The Undersecretariat of Foreign Trade Reports (1999) [8] 

Table 12. Turkey’s Largest Textile Suppliers 

Value ($) % in Turkey’s Textile Imports 

1997 1998 1999 1997 1998 1999 

Germany 440,622,472 376,043,694 348,234,898 13% 11% 14% 

Italy 343,991,506 324,942,763 298,235,258 10% 10% 12% 

S. Korea 213,343,053 257,223,252 169,857,938 6% 8% 7% 

USA 281,216,459 335,763,227 140,568,477 8% 10% 5% 

China 156,337,570 151,404,371 139,718,596 5% 5% 5% 

Greece 155,399,353 92,411,740 126,784,760 5% 3% 5% 

France 121,674,476 117,663,813 102,466,346 4% 4% 4% 

England 100,316,594 109,183,110 97,031,313 3% 3% 4% 

Holland 73,290,462 81,902,105 83,988,971 2% 2% 3% 

India 133,016,599 101,988,166 81,280,358 4% 3% 3% 

Belgium-Lux. 81,136,670 66,991,023 59,951,762 2% 2% 2% 



Table 13. Turkey’s Largest Apparel Suppliers 

Value ($) % in Turkey’s Apparel Imports 

1997 1998 1999 1997 1998 1999 

Italy 58,956,444 68,455,570 48,467,873 26% 30% 24% 

China 8,467,592 13,440,597 22,640,126 4% 6% 11% 

England 29,278,621 20,939,138 21,934,886 13% 9% 11% 

Germany 29,244,979 28,303,022 21,440,116 13% 12% 11% 

Spain 8,174,482 20,562,488 20,051,087 4% 9% 10% 

France 21,669,442 22,956,933 16,096,196 9% 10% 8% 

Holland 8,238,841 7,340,565 5,733,662 4% 3% 3% 

Hong Kong 1,566,604 3,633,037 4,527,722 1% 2% 2% 

India 4,336,267 4,945,439 4,236,158 2% 2% 2% 

USA 28,636,805 6,769,742 3,720,921 12% 3% 2% 

Portugal 549,911 89,765 2,397,153 0% 0% 1% 


2.2. 2.2. Product Product Mix Mix of of Turkish Turkish Textile Textile 

Textile and and Apparel Apparel Exports Exports 

Considering the shares in the total textile and apparel exports, knitted apparel has the 

highest share with 38%, followed by woven apparel, 24%, and made-up textile article 8% 

(Table 14). 

Turkey imports mainly cotton, man-made, and wool fiber, yarn, and fabric lead by 

cotton with a share of 24% in total textile and apparel imports (Table 15). As shown in 

Table 36, the apparel industry produces more knitted than woven products ones and more 

basic items such as unstructured tops and bottoms than tailored garments. 

Table 14. Product Mix of Turkish Textile and Apparel Exports (1999) 

Share in Total Textile 

and Apparel Exports 

Share in Total Exports 

Knitted Apparel and Accessories 38.34% 14.24% 

Woven Apparel and Accessories 24.43% 9.08% 

Made-up Textile Articles 9,56% 3.55% 

Cotton (Fiber, Yarn, woven fabric) 7.87% 2.92% 

Man-made staple (Fiber, yarn, woven, fabric) 6.13% 2.28% 

Man-made filament (Fiber, yarn, woven, fabric) 4.09% 1.52% 

Carpets and floor coverings 2.73% 1.02% 

Knitted Fabrics 2.26% 0.84% 

Special woven fabrics 1.89% 0.70% 

Coated laminated fabrics 1.27% 0.47% 



Table 15. Product Mix of Turkish Textile and Apparel Imports (1999) 

Share in Total Textile Share in Total 

and Apparel Imports Imports 

Cotton (Fiber, Yarn, woven fabric) 24.21% 1.65% 

Man-made filament (Fiber, yarn, woven, fabric) 23.07% 1.57% 

Man-made staple (Fiber, yarn, woven, fabric) 19.93% 1.36% 

Wool (Fiber, Yarn, woven fabric) 8.08% 0.55% 


2.3. 2.3. The The Textile Textile and and and Apparel Apparel Trade Trade with with US USA US 

The textile and apparel trade between Turkey and the United States has been 

increasing steadily for the last decade, reaching $1.15 billion of exports and $144.3 million 

of imports in 1999. The growth rate of Turkish apparel exports to the United States was 

higher than that of Mexico and China in 1998. 

Year Quantity 

( ton) 

Table 16. Textile and Apparel Trade with USA 

Apparel Trade Textile Trade 

Export Import Export Import 

Value 

(Million $) 

Growth rate Quantity 

(Value: %) 

(ton) 

Value 

(Million $) 

Quantity 

(ton) 

Value 

(Million $) 

Growth rate Quantity 

(Value: %) 

(ton) 

Value 

(Million $) 

1996 15,696 597.6 259.9 7.3 19,788 145.9 30,289 112.4 

1997 19,729 690.5 15.5% 370.2 28.6 30,259 176.5 21.0% 120,045 281.2 

1998 27,727 807.1 16.9% 117.8 6.8 34,951 194.6 10.3% 157,892 335.8 

1999 34,975 928.4 15.0% 126.4 3.7 49,258 221.8 14.0% 49,543 140.6 


The breakdown of Turkish apparel and ready-made article exports is provided in 

Table 17. As a result of the quota restrictions, as opposed to the general product mix of 

Turkish apparel exports, woven products have a higher share in Turkish exports to the 

United States led by denim and cotton pants, shirts, and man-made apparel.


The United States has quotas on textiles and apparel from Turkey. Canada also 

imposes quotas on selected categories. The quota-restricted categories and the percentage 

of these quotas filled in textiles and apparel are shown in Tables 18 and 19. In textiles, 

cotton yarn, made-up sheets, and other cotton products have the highest quota fill rates of 

the quotas with fill rates of 88%, 85%, and 83% respectively. In apparel, knitted shirts; 

nightgowns and pajamas; and dressing gowns and robes have the highest quota usage rates 

of the quotas with rates 98%, 93%, and 86% respectively. 

The quotas are distributed according to certain regulations by the regional exporter 

associations. The way these permits are distributed includes conditions regarding the past 

performance of the company, i.e., the export volumes in the previous years, whether the 

company violated any of the regulations in the previous years, etc., and the type of the 

company, i.e., whether it is a trader or manufacturer. Once the permit is obtained, it can 

be used to export, transferred (or sold) to another company, or returned to the association 

for partial credit for next year’s calculation of the past performance. These regulations are 

set by the associations after the quota levels are determined between Turkey and the 

United States and Canada. 

These exporters associations report to the Undersecreteriat of Foreign Trade in the 

Prime Ministry. The fill rate information of all the categories is available at these trade 

associations. For example, the largest trade association in Turkey, Istanbul Textile and 

Apparel Exporters Association (ITKIB), communicates this information through its web 

site (www.itkib.org.tr). Once a company gets a permit to export from an exporter 

organization, that company can export directly to the United States without obtaining 

another permit from US agencies.


Table 17. Product Mix of Turkish Apparel Exports to USA (1999, Jan-Nov) 

Knitted products 

Quantity Value ($) Unit value 

Cotton knitted T-shirt 17,189,868 63,603,736 3.70 

Cotton knitted Men’s Shirt 5,634,950 27,546,713 4.89 

Cotton socks 4,743,741 1,997,775 0.42 

Cotton women’s nightgown 5,115,099 27,023,902 5.28 

Cotton women’s cardigan, sweater 4,600,937 23,117,559 5.02 

Cotton women’s pants 4,539,471 22,836,666 5.03 

Men’s cardigan, vest 1,971,109 11,487,679 5.83 

Cotton women’s shirts 2,152,168 11,449,568 5.32 

Cotton women’s sweater 2,515,336 11,169,547 4.44 

Cotton women’s pajamas 1,810,795 10,914,474 6.03 

Woven products 

Quantity Value ($) Unit 

value 

Denim men’s pants 15,761,691 132,015,436 8.38 

Cotton men’s pants 11,599,933 119,491,137 10.30 

Cotton men’s shirts 12,701,245 117,893,316 9.28 

Cotton women’s pants 9,936,718 89,273,186 8.98 

Man-made women’s pants 8,856,820 80,046,262 9.04 

Cotton women’s prof. pants 8,383,094 73,721,168 8.79 

Man-made women’s blouse 9,207,248 71,532,773 7.77 

Man-made women’s jacket 

blazer 

4,550,059 63,003,097 13.85 

Man-made women’s prof. 

pants 

6,459,806 53,024,823 8.21 

Man-made men’s prof. pants 5,751,030 45,952,492 7.99 

Ready-made articles 

Quantity Value ($) Unit 

Man-Made knitted tulle 

curtains 

3,583,022 12,364,510 

value 

3.45 

Man-made tulle curtains 1,848,789 5,734,815 3.10 

Man-Made knitted curtains, 

drapery, bedskirt (farbela) 

1,764,310 5,136,226 2.91 

Man-Made woven curtains, 

drapery, bedskirt (farbela) 

642,437 1,757,501 2.74 

Man-made woven tablecloths 1,004,583 1,471,952 1.47 

Man-made knitted curtains 155,788 1,210,204 7.77 

Woven blankets 115,663 843,196 7.29 

Woven tulle curtains 308,574 735,192 2.38 

Man-made toilet/ kitchen 

cloths 

479,410 557,246 1.16 

Man-made woven curtains 61 479,547 7.83 



Table 18. Turkish Textile Exports to USA in Quota-Restricted Categories (1999) 

Category Content Quota Level Quota 

Filled 

(%) 

200 Yarns put up for retail sale and sewing thread 1,843,054 kg 19.5% 

219 Duck 43,680,621 m2 71.8% 

300/301 Carded cotton yarn, Combed cotton yarn 10,588,966 kg 88.0% 

313 Sheeting 51,775,602 m2 3.5% 

314 Poplin&broadcloth 31,061,775 m2 0.8% 

315 Printcloth 41,739,262 m2 0.5% 

317 Twills 43,680,621 m2 15.3% 

326 Sateens 4,853,401 m2 8.4% 

361 Made-up Sheets 2,431,329 No 85.5% 

369-S Other cotton manufactures 2,263,146 Kg 83.3% 

Woven fabric, MMF fabric woven, containing 

410/624 more than 15% but less than 36% wool 1,119,683 M2 Yarn containing 85% or more by weight synthetic 

76.0% 

604 staple fiber 2,311,800 Kg 53.3% 

611 

Woven fabric containing 85% or more by weight 

artificial staple 57,834,003 M2 13.9% 

617 Twills&sateens 29,120,416 M2 3.1% 

Poplin&broad cloth of staple/filament fiber 

625 combination 8,908,799 M2 55.6% 

626 Print cloth of staple/filament fiber combination 7,865,424 M2 12.9% 

627 Sheeting of staple/filament fiber combinations 7,865,424 M2 0.3% 

Twills&sateens of staple/filament fiber 

628 combinations 7,865,424 M2 1.5% 

629 Other fabrics of staple/filament fiber combinations 7,865,424 M2 5.7% 

Source: US Customs Service Textile Status Report, 31.12.1999 

Table 19. Turkish Apparel Exports to USA in Quota-Restricted Categories 

Category Content Quota Level Quota 

(dozens) Filled (%) 

335 W&G coats 387,457 15.8% 

336/636 Dresses 912,676 26.8% 

338/339/63 M&B knit shirts, W&G knit shirts&blouses, M&B 

8 knitshirts 6,448,741 98.0% 

340/640 M&B shirts, not knit 1,489,429 10.0% 

341/641 W&G shirts&blouses, not knit 1,638,402 14.8% 

342/642 Skirts 

M&B trousers, breeches&shorts, W&G trousers, 

1,015,998 22.5% 

347/348 breeches&shorts 6,522,707 45.5% 

350 Robes, dressing gowns,etc 651,136 85.9% 

351/651 Nightwear and pajamas 1,167,155 92.8% 

352/652 Underwear 3,052,871 69.5% 

448 W&G trousers, breeches&shorts 38,420 38.0% 

Source: US Customs Service Textile Status Report, 31.12.1999


3. . Production Capacity and and Utilization 

Turkey is currently one of the top ten countries in terms of its capacity in fabric 

spinning and weaving. It accounts for 2.78% of the world’s capacity and 41.45% of the 

Europe’s capacity in ring spinning in short staples, 4.44% of the world’s capacity and 

10.15% of the Europe’s capacity in long staples. It also accounts for 4.62% of the world’s 

capacity and 9.26% of the Europe’s capacity in open-end rotors [9]. 

Table 20. Textile Machinery Capacity (1996) 

Share of the Installed Capacity 

(units) World Europe 

Short Staple Spindles 4,544,000 2.78% 41.45% 

Long Staple Spindles 743,000 4.44% 10.15% 

Open End Rotors 349,800 4.62% 9.26% 

Shuttle-less looms 18,000 2.65% 6.39% 

Shuttle Loom 40,000 2.34% 41.43% 

Filament looms 3,000 0.50% 6.78% 

Wool looms 6,250 4.16% 10.67% 

Source: ITMF International Textile Machinery shipment Statistics 1997 [17] 

Before the announcement of the customs union on January 1, 1996, the textile and 

apparel industry invested heavily in production capacity and technology with the 

expectation that exports to Europe would increase substantially after the customs union. 

This expectation brought substantial investment in textile machinery (Table 21). 

Table 21. Textile Machinery Imports (Million $) 

1989 1992 1995 1996 1997 1998 

408 834 1,544 2,362 1,989 1,345 

Source: State Institute of Statistics reports (1998) 

During the three-year period before the customs union, the ring spinning capacity 

increased by 10.6% to 4.5 million spindles in the short staple sector, and increased by 5.53% 

to 740,000 spindles in the long staple sector. Similarly, open-end fabric spinning capacity 

increased by 79.2% to 350000 rotors, and the number of shuttle-less looms increased by 65% 

to 18,000. Especially in the open-end production, the new investments created excess 

capacity


A study on the age distribution of the machinery used in the spinning and weaving in 

Turkey reveals that 78.8% of the open-end and 38.8% of the ring machines were six-years 

old or newer [20]. 

U.S. textile machinery exports to Turkey totaled only $6 million in 1998, a 78.3 

percent decline from the $27.6 million in exports during 1997. However, Turkey imported 

$15.8 million worth of textile machinery in 1999 for a 162.8 percent increase over 1998. 

Thus, in 1999, Turkey was the eleventh largest market for this industry sector in U.S. 

Although, a domestic textile machinery industry exists, it is not developed enough to 

support the textile and apparel industry. Heavy reliance on imported textile machinery 

creates additional problems for the industry such as increased costs, availability, timeliness 

and cost of after sales technical service, etc. 

In addition to this over capacity, mainly stagnant European markets, depreciation of 

the Euro against the dollar, and rising production costs reduced the capacity utilization 

ratios for textiles from 81% in 1995 to 77% in 1998, and for apparel from 90% in 1995 to 

80% in 1998 (Table 22). 

Table 22. Capacity Utilization Ratios (%) in Textile and Apparel Industry 

Textile Apparel 

Year Public Private Total Public Private Total 

1995 58.4 82.6 81.4 81.80 90.50 89.80 

1996 60.3 83.9 82.9 59.70 83.70 85.50 

1997 62.5 83.9 82.9 67.10 84.20 82.70 

1998 55.2 78.1 77.5 59.40 82.1 79.60 

1999 (Jan-Sep) 34.8 70.9 69.8 36.80 78.50 73.60 

Source: State Planning Organization: Fundamental Economic Indicators [3]. 

Materials such as buttons, zippers, and tags are also produced locally at medium to 

high quality levels. The apparel industry uses both domestic and imported supply in 

production. Chemicals used in dyeing and finishing are mainly imported.


4. . Production Production Production and and Demand Demand 

As a result of the availability of raw materials and early industrialization of the sector, 

Turkey is now one of the major producers in all segments of the industry from fiber 

production, to textiles, and apparel. Table 23 summarizes the production and demand in 

Turkey’s textile and apparel industry. Since Turkey is one of the largest producers of cotton 

in the world, the textile and apparel industry is mainly based on cotton. However, as a 

result of similar trends in the world markets, man-made yarn and fabric production is 

gaining more importance. 

Turkey has one of the world’s leading spinning industries with its installed capacity of 

approximately 5 million spindles equivalent. With the investments in the recent years, 

open-end spinning of short-staple fibers is particularly advanced. 

Turkey is self-sufficient, even a net exporter in all fibers except fine wool (worsteds) 

and viscose rayon that are freely imported from anywhere in the world. A variety of yarn 

production including twisted yarns, fancy yarns etc. are available in Turkey. 

Table 23. Summary of Production and Demand in Turkish Textile and Apparel Sector 

1997 1998 (est.) 

Production Demand Production Demand 

Cotton Cotton (1000 ton) 779 1,032 796 1042 

Yarn (1000 ton) 758 729 790 754 

Woven Fabric (Million meter) 1,386 1,334 1455 1379 

Woolen Yarn (1000 ton) 122 126 128 132 

Fabric (Million meter) 68 75 69 76 

Man-Made Yarn (1000 ton) 75 66 79 67 

Fabric (Million meter) 60 172 73 177 

Knitted Goods (1000 ton) 185 35 201 35 

Ready-Made Garments (1000 ton) 237 38 260 39 

Source: Developments in Economic and Social Sectors (1998), State Planning Organization [17]


5.1. 5.1. Cotton Cotton Textiles 

Textiles 

Turkey is the sixth largest producer and the fifth largest consumer of cotton (Table 

24). Especially, the cotton produced in the western part of Turkey, around Izmir, is 

considered to be the best quality cotton in the world markets. However, when the overall 

production is considered, a study on the dirtiness of cotton conducted by ITMF 

(International Textiles Manufacturers Federation) in 1998 ranks Turkey third after India 

and Pakistan. This is regarded as one of the most important problems of cotton yarn 

industry [13]. 

Table 24. Cotton Production and Demand in the World 

Production (1000 ton) Demand (1000 ton) 

Country 98/99 99/00 98/99 99/00 

China 4,501 4,000 4,300 4,350 

U.S.A 3,030 3,674 2,280 2,221 

India 2,771 2,975 2,729 2,822 

Pakistan 1,343 1,700 1,530 1,581 

Uzbekistan 999 1,160 150 170 

Turkey 882 899 1,000 1,100 

Australia 726 704 N/A N/A 

Argentina 425 403 780 850 

Brazil 385 380 125 130 

Source: Cotton Outlook, December 1999 [4] 

Although cotton production cannot meet demand now, it is expected to exceed the 

demand in coming years after the completion of the South Anatolian Project (GAP). The 

South Anatolian Project is a $32 billion project which includes the construction of 22 dams 

and 19 hydroelectric plants on the Tigris and Euphrates Rivers and the irrigation a dry area 

of land the size of Austria to transform it into a fertile area. With the completion of this 

project, cotton production is expected to double by 2005. New projects including the one to 

produce colored cotton have been planned in the project. 

Turkey has been producing more cotton yarn than its demand for a number of years 

(Table 26). It is expected that this trend will continue and there will be a cotton yarn 

surplus in coming years. Following this trend, cotton yarn exports haven been increasing 

while the imports have been decreasing (Table 26).


Table 25. Cotton Production, Consumption, Import and Export in Turkey 

Year Production 

(ton) 

Demand 

(Ton) 

Amount 

(kg) 

Export Import 

Value ($) Unit 

price 

($/kg) 

Amount 

(kg) 

Value 

(Million $) 

Unit 

price 

($/kg) 

1990 654,600 540,000 112,938,000 176,940,323 1.56 79,107,673 137,447,432 1.73 

1991 561,227 625,000 117,672,282 183,964,757 1.56 49,115,715 80,526,961 1.63 

1992 573,706 625,000 47,388,007 57,126,697 1.20 152,703,576 194,320,107 1.27 

1993 602,238 700,000 149,192,750 156,080,636 1.04 201,666,433 247,693,927 1.22 

1994 628,286 850,000 47,106,227 51,334,095 1.08 149,063,000 240,000,360 1.61 

1995 851,487 950,000 31,341,894 37,792,935 1.20 186,552,193 383,139,977 2.05 

1996 784,047 1,050,000 108,846,258 158,021,794 1.45 169,890,951 303,768,081 1.79 

1997 831,672 1,150,000 71,597,885 90,726,367 1.27 362,892,152 632,521,995 1.74 

1998(est.) 802,195 1,200,000 112,938,000 176,940,323 1.56 79,107,673 137,447,432 1.73 

Source: Ministry of Agriculture and Rural Affairs reports, ITKIB/DTM reports [17] 


(ton) 

Table 26. Cotton Yarn Production, Demand, Import and Export 

Demand 

(Ton) 

Amount 

(kg) 

Export Import 


price 

($/kg) 

Amount 

(kg) 

Value 

(Million $) 

Unit 

price 

($/kg) 

1990 515,000 477,700 68,101,946 247,625,506 3.63 30,810,147 94,377,427 3.06 

1991 520,000 490,800 56,983,951 186,767,275 3.27 27,667,024 85,695,886 3.09 

1992 512,000 506,200 32,866,030 101,982,047 3.10 26,943,420 80,405,495 2.98 

1993 517,600 548,100 31,637,030 75,272,181 2.37 62,132,504 167,796,466 2.70 

1994 560,300 526,800 86,801,731 250,517,059 2.88 53,288,824 167,247,198 3.13 

1995 600,000 619,000 39,733,257 137,878,668 3.47 58,795,323 221,607,817 3.76 

1996 690,000 689,000 44,547,108 139,254,031 3.13 43,184,176 150,090,817 3.48 

1997 758,000 729,000 70,025,960 224,328,546 3.20 41,164,945 137,180,691 3.33 

1998(est.) 790,000 754,000 68,101,946 247,625,506 3.63 30,810,147 94,377,427 3.06 

Source: State Planning Organization reports, ITKIB/DTM reports [17] 

Table 27. Cotton Woven Fabric Production, Demand, Import and Export 


(million 

meter) 

Demand 

(million 

meter) 

Amount 

(kg) 

Export Import 


price 

($/kg) 

Amount 

(kg) 

Value 

(Million $) 

Unit 

price 

($/kg) 

1990 1,088.2 1,060.1 28,572,720 163,211,940 5.71 16,515,426 71,975,988 4.35 

1991 1,097.0 1,063.5 29,737,792 157,300,867 5.28 12,967,616 57,585,984 4.44 

1992 1,100,3 1,068.2 34,172,823 181,941,058 5.32 13,781,037 65,239,190 4.73 

1993 1,150.0 1,173.8 38,121,003 174,999,998 4.59 26,860,065 112,308,109 4.18 

1994 1,180.0 1,137.1 62,707,886 299,636,877 4.77 29,769,093 141,908,964 4.76 

1995 1,210.0 1,244.0 50,876,914 330,535,631 6.49 48,536,459 281,156,378 5.79 

1996 1,296.0 1,264.0 54,400,954 346,548,599 6.37 38,807,510 266,884,175 6.88 

1997 1,386.0 1,334.0 60,718,744 358,581,471 5.91 38,772,918 275,773,586 7.11 

1998(est.) 1,455.0 1,379.0 

Source: State Planning Organization reports, ITKIB/DTM reports [17]


The cotton woven production and demand in Turkey have been very close to each 

other. While in some years, the production could not meet the demand; in other years, the 

production exceeded the demand (Table 27). As a result of the capacity increase in recent 

years, it is expected that production will exceed demand in the future. The total value of 

the cotton woven fabric exports has been increasing. The export of woven fabric reached 

$360 million in 1997. After the customs union in 1996, the imports of woven fabrics 

increased with a higher increase in unit price. 

5.2. 5.2. Woolen Woolen Textiles 


Although Turkey is one of the big wool producers, most of the production is not of the 

desired quality for the textile and apparel sector. As a result, the industry is a net importer 

of high quality wool (Table 28). The production and demand of woolen yarn have been 

increasing with the demand being slightly above the production (Table 29). 

The demand for woolen fabric has been exceeding the production for the last five 

years (Table 30). The export and import volumes have been increasing during the same 

time. However, the unit price of the exported fabric has been above the unit price of the 

imported one. Following the customs union, the amount and also the value of woolen fabric 

imports almost tripled. 

Table 28. Wool Production, Consumption, Import and Export in Turkey 


(1000 ton) 

Demand 

(1000 

ton) 

Amount 

(kg) 

Export Import 


price 

($/kg) 

Amount 

(kg) 

Value 

(Million $) 

Unit 

price 

($/kg) 

1990 42.0 66.1 1,072,360 3,815,697 3.55 34,594,640 105,340,872 3.04 

1991 40.0 63.8 2,054,943 7,154,313 3.48 34,037,431 79,358,295 2.33 

1992 38.0 64.2 1,461,096 2,742,614 1.97 36,197,723 97,870,720 2.70 

1993 38.0 71.8 1,228,590 1,820,235 1.48 46,447,775 101,581,495 2.18 

1994 38.0 57.3 5,571,750 7,966,278 1.42 29,132,918 75,848,446 2.60 

1995 40.5 77.5 3,307,723 5,454,866 1.64 46,188,322 156,682,985 3.39 

1996 41.5 80.5 9,202,316 9,657,451 1.05 44,980,636 132,651,338 2.95 

1997 42.5 82.5 14,124,641 18,917,025 1.34 47,378,242 145,326,704 3.07 

1998 44.0 85.0 

1999 45.0 86.0 

Source: World Market for Wool/ the Economist Intelligence Unit, ITKIB/DTM reports [17]


Table 29. Woolen Yarn Production, Demand, Import and Export 


(1000 ton) 

Demand 

(1000 

Ton) 

Amount 

(kg) 

Export Import 

Value 

($) 

Unit 

price 

($/kg) 

Amount 

(kg) 

Value 

(Million 

$) 

Unit 

price 

($/kg) 

1990 96.0 96.4 454,940 3,881,128 8.53 823,872 12,734,947 15.45 

1991 99.0 99.9 300,236 1,887,659 6.28 1,078,565 16,249,552 15.06 

1992 107.3 108.8 204,959 1,254,844 6.12 1,735,278 25,260,599 14.55 

1993 110.0 113.0 314,937 2,916,007 9.25 3,342,608 35,073,290 10.49 

1994 105.7 107.1 620,806 5,622,156 9.05 2,031,958 26,757,832 13.16 

1995 110.0 113.0 696,749 5,552,796 7.96 3,631,801 47,867,883 13.18 

1996 115.0 120.0 575,910 4,701,352 8.16 5,311,886 64,381,126 12.12 

1997 122.0 126.0 929,470 8,128,683 8.75 4,498,316 55,603,310 12.36 

1998(est.) 128.0 132.0 


Table 30. Woolen Fabric Production, Demand, Import and Export 


(million 

meter) 

Demand 

(million 

meter) 

Amount 

(kg) 

Export Import 


price 

($/kg) 

Amount 

(kg) 

Value 

(Million $) 

Unit 

price 

($/kg) 

1990 60.5 61.1 403,269 11,319,168 28.06 667,998 10,656,990 15.95 

1991 62.5 62.1 480,114 13,195,707 27.48 647,591 10,231,385 15.79 

1992 64.3 64.7 907,995 25,985,938 28.61 1,066,953 19,221,901 18.01 

1993 65.5 67.6 1,254,291 31,191,391 24.86 2,050,521 27,923,652 13.61 

1994 66.0 65.4 1,595,747 39,160,579 24.54 1,270,884 23,156,015 18.22 

1995 70.0 68.0 2,379,476 64,369,561 27.05 1,584,448 34,392,867 21.70 

1996 68.0 72.0 2,295,630 69,801,026 30.41 4,622,227 108,052,986 23.38 

1997 68.0 75.0 2,645,134 74,843,609 28.29 5,818,663 122,230,656 21.01 

1998(est.) 69.0 76.0 


5.3. 5.3. 5.3. Man Man-made Man Man made Textiles 


Turkey is also an important producer of synthetic fibers and yarns with an estimated 

capacity of 500,000 tons per year. However, the production cannot meet demand and 

nearly 30% of the demand is met from imports. 

Man-made fibers have been produced in Turkey for more than sixty years. Although 

the production of man-made fiber has been increasing steadily in the last decade, the 

demand has been increasing more, and as a result, the gap between the production and the 

demand has been widening (Table 31). Therefore, the import of man-made fibers is 

expected to increase (Table 32).


Although the production of man-made yarn was sufficient to meet the demand in 

early 90s, as a result of rapid increase in the demand, it is expected that the production of 

man-made yarns will not meet the demand except polyamide yarns (Table 33). After the 

customs union, the total value of man-made yarns increased by 85% (Table 34). 

The production of man-made fabric was sufficient to meet the demand at the 

beginning of 90s. However, the man-made fabric production has been decreasing, while the 

demand has been increasing (Table 35). It is expected that demand for man-made fabrics 

will be 104 million meters higher than production in 1998. However, the amount of both 

the man-made fabric exports and also the imports have been increasing in the last decade. 

It is observed that Turkey has been exporting man-made fabrics with higher unit prices 

while importing the cheaper ones (Table 35). 

Table 31. Man-Made Fiber Production and Demand 

Acrylic Fiber Polyamide Fiber Polyester Fiber Polypropylene Fiber 

Year Production Demand 

(1000 ton) (1000 ton) Production Demand 

(1000 ton) (1000 ton) Production Demand 

(1000 ton) (1000 ton) 

Production Demand 

(1000 ton) (1000 ton) 

1990 129 165 2 5 47 53 16 17 

1991 133 133 1 3 40 52 28 28 

1992 139 161 1 4 46 63 29 29 

1993 145 203 2 7 48 67 30 31 

1994 150 163 2 5 58 63 26 27 

1995 173 185 2 9 69 72 32 33 

1996 185 201 3 9 75 87 33 35 

1997 201 222 3 9 91 110 33 35 

1998(est.) 200 210 4 14 100 110 35 38 


Table 32. Man-Made Fiber Export and Import 

Export Import 

Year Amount Value ($) Unit price Amount Value Unit price 

(kg) 

($/kg) (kg) (Million $) ($/kg) 

1990 40,461,954 77,629,024 1.91 124,804,143 234,563,537 1.87 

1991 42,437,587 69,490,902 1.63 92,493,489 175,906,271 1.90 

1992 27,763,777 44,649,547 1.60 110,522,521 195,231,909 1.76 

1993 21,544,933 31,389,267 1.45 147,411,366 226,719,972 1.54 

1994 55,118,761 79,181,945 1.43 115,773,111 170,299,443 1.47 

1995 55,771,935 103,651,382 1.85 139,890,882 277,811,354 1.99 

1996 55,069,740 85,808,791 1.56 146,464,582 297,845,175 2.03 

1997 50,212,795 81,863,387 1.63 173,985,609 306,308,387 1.76 



Table 33. Man-Made Yarn Production and Demand 

Polyamide Yarn Polyester Yarn Polypropylene Yarn 

Year Production Demand Production Demand Production Demand 

(1000 ton) (1000 ton) (1000 ton) (1000 ton) (1000 ton) (1000 ton) 

1990 25 36 85 67 18 18 

1991 38 33 95 70 19 19 

1992 46 40 102 87 19 20 

1993 46 42 115 126 20 20 

1994 42 31 107 83 17 19 

1995 42 33 140 142 24 26 

1996 43 41 170 161 24 27 

1997 44 40 187 203 30 33 

1998(est.) 45 43 195 270 30 35 

Source: State Planning Organization reports [17] 

Table 34. Man-Made Yarn Export and Import 

Export Import 

Year Amount Value ($) Unit price Amount Value Unit price 

(kg) 

($/kg) (kg) (Million $) ($/kg) 

1990 67,323,097 229,629,614 3.40 48,870,346 201,116,959 4.11 

1991 80,594,456 271,801,835 3.37 40,742,695 169,953,525 4.17 

1992 86,504,969 316,025,843 3.65 63,132,483 236,958,706 3.75 

1993 81,898,388 256,808,875 3.13 98,442,823 281,605,703 2.86 

1994 118,143,049 322,930,202 2.73 81,169,960 243,761,520 3.00 

1995 102,945,186 340,471,193 3.30 125,929,316 450,822,172 3.58 

1996 114,219,917 350,873,104 3.07 132,092,412 478,802,612 3.62 

1997 133,850,808 395,143,060 2.95 142,917,650 445,105,003 3.11 

Source: ITKIB/DTM reports [17] 

Table 35. Man-Made Fabric Production, Demand, Import and Export 


(million 

meter) 

Demand 

(million 

meter) 

Amount 

(kg) 

Export Import 


price 

($/kg) 

Amount 

(kg) 

Value 

(Million $) 

Unit 

price 

($/kg) 

1990 120.9 120.3 12,391,689 124,438,431 10.04 10,177,714 64,566,705 6.34 

1991 111.8 122.7 11,677,115 115,071,956 9.85 12,458,954 81,882,524 6.57 

1992 100.1 126.4 15,869,231 173,351,143 10.92 18,404,906 121,603,101 6.60 

1993 94 172.3 20,736,091 225,579,602 10.87 34,469,217 187,564,070 5.44 

1994 84 166.2 31,232,208 303,179,424 9.70 42,589,104 221,512,300 5.20 

1995 68 258 36,269,323 519,457,619 14.32 74,218,126 416,509,240 5.61 

1996 80 158 36,134,066 444,455,666 12.30 72,159,037 448,027,116 6.76 

1997 60 172 54,262,754 522,867,948 9.64 72,869,554 527,637,158 7.24 

1998(est.) 73 177 



5.4. .4. Apparel Production 

The apparel industry produces more knitted products than the woven ones and more 

basic items such as unstructured tops and bottoms than tailored garments. A closer look at 

the apparel exports shows that the apparel exports has a product mix of around 60% 

knitted and 40% woven products (Table 36). The main export items are t-shirt, sweatshirt, 

underwear, sleeping wear, socks, men shirts, and pants. However, due to decreasing 

competitiveness in basic items, there has been a trend towards increased production of 

structured garment production, i.e., jackets, suits, coats, etc. in the industry. The recent 

investments in weaving and in processing (dyeing, printing, finishing) of woven fabrics also 

support this trend. Table 36. Product Mix of Turkish Apparel Exports 

1996 1997 1998 1999 

Knitted T-Shirt 13.0% 14.4% 16.8% 17.9% 

Pullover 18.0% 16.2% 16.7% 15.9% 

Pants, jackets 9.4% 9.4% 9.2% 8.5% 

Underwear 8.6% 10.1% 8.2% 7.0% 

Shirts 5.7% 5.3% 5.2% 4.0% 

Socks 3.9% 3.9% 3.7% 3.9% 

Others 3.4% 3.4% 3.0% 2.9% 

Outwear 0.3% 0.4% 0.3% 0.3% 

Total 62% 63% 63% 63% 63% 63% 60% 

60% 

Woven Pants, jackets 18.8% 19.2% 20.9% 23.5% 

Shirts 8.3% 8.0% 7.1% 5.9% 

Underwear 3.4% 3.6% 3.8% 4.2% 

Others 3.5% 2.9% 2.5% 3.7% 

Outwear 3.5% 3.2% 2.6% 2.3% 

Total 

Source: Undersecreteriat of Foreign Trade reports (1999) 

38% 37% 37% 37% 37% 40% 40% 

In recent years, a number of foreign manufacturers have formed license agreements. 

Currently, more than 10 foreign brands of denim jeans, including Levi’s, Lee, Jordache, 

Lois, and Fronti, are produced in Turkey and exported to foreign markets. 

In addition to apparel, Turkey is also a major producer of home textiles. However, 

the statistics on home textiles are not widely available. It is estimated that approximately 

6.5 million duvets, 1.5 million sheets, 2.5 million tablecloths and 1.5 million blankets are 

produced annually (IBS, 2000).


5. . Industry Industry Structure Structure 

Structure 

Textile and apparels are produced by a number of private firms and state-economic- 

enterprises (SEE). The textile and apparel industry flourished as a state-protected industry 

in Turkey. In 1930s, after the republic was founded in 1923, the state owned all the textile 

and apparel factories as a part of the largest SEE, Sumerbank. As a part of the ongoing 

privatization program, the privatization of all state-owned enterprises in the textile and 

apparel industry has been planned. The privatization of Sumerbank started in 1995 and 

still continues. As a result of the transformation from a state economy to a more liberal 

economy, privately owned companies constitute the majority of textile and apparel firms 

today. 

Most of the firms are small to medium size. The number of establishments in the 

textile and apparel is 44,192 according to a study by the Ministry of Labor in 1997. Most of 

these companies are family owned and managed. The textile and apparel production is 

concentrated on the west, south, and central parts of Turkey around Istanbul, Izmir, Bursa, 

Denizli, Adana, Gaziantep Kahramanmaras, Eskisehir, Ankara, Corlu, Malatya, and Usak. 

A map of Turkey is provided in Figure 2. 

Figure 2. Map of Turkey


The Ministry of Labor’s number for the number of employees in the textile and 

apparel industry was 505,153 in 1999. However, it is not possible to obtain exact statistics 

due to the fact that many small firms that employ unregistered workers to avoid taxes are 

not included in the studies. According to the estimates of unions, it is estimated that there 

are more than 2,000,000 workers employed in the Turkish textile and apparel industry 

(Dunya, 1998). 

The State Statistics Institute collects information on establishments that have more 

than 10 employees. The distribution of the number of establishments that employ more 

than 10 employees in the textile and apparel industry is given in Tables 37 and 38. Tables 

39 and 40 give the distribution of the number of employees in different size establishments. 

The average number of employees in a textile establishment was 135 and the average 

number of employees in an apparel establishment was 69 in 1995. 

Table 37. Size Distribution of the Establishments in the Apparel Industry (as % ) 

Size No. of 

employees 

1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 

5 10-24 62.9 47.4 39.0 34.1 31.1 30.6 30.5 48.1 44.3 41.1 34.8 

6 25-49 19.3 24.6 26.9 28.6 30.9 31.2 31.3 25.5 27.7 28.7 31.7 

7 50-99 9.4 15.0 19.0 20.6 20.2 20.5 20.4 14.2 14.6 15.2 16.1 

8 100-199 5.1 8.7 9.6 9.6 11.0 10.3 11.7 8.1 8.6 9.4 10.5 

9 200-499 2.5 3.4 4.1 5.3 5.1 5.8 5.0 3.5 4.2 4.8 5.4 

10 500-999 0.6 0.5 1.0 1.4 1.4 1.1 1.1 0.6 0.5 0.7 1.3 

11 1000- 0.1 0.5 0.4 0.5 0.3 0.4 0.1 0.1 0.1 0.1 0.1 

Average size: 6.23. Source: State Statistics Institute 

Table 38. Size Distribution of the Establishments in the Textile Industry (as % ) 

Size No. of 

employees 

1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 

5 10-24 21.6 13.3 9.5 7.5 6.8 6.7 7.0 13.6 12.1 10.7 8.1 

6 25-49 15.4 14.6 13.9 13.6 14.3 14.3 15.3 16.8 17.5 17.0 16.1 

7 50-99 15.1 17.6 19.8 19.4 18.8 19.3 20.3 18.5 18.1 17.4 16.1 

8 100-199 16.5 20.8 20.4 18.0 19.8 18.5 22.6 21.0 21.0 21.2 20.8 

9 200-499 17.3 19.0 18.9 20.5 20.0 22.9 21.1 20.3 22.0 23.9 24.3 

10 500-999 10.5 4.6 8.9 12.3 13.4 10.1 10.7 7.1 5.7 7.3 11.6 

11 1000- 3.6 10.1 8.7 8.7 6.8 8.2 3.1 2.7 3.6 2.5 3.1 

Average size: 6.4. Source: State Statistics Institute


Table 39. Distribution of the Number of Employees in the Apparel Industry (as % ) 

Size No. of 

employees 

1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 

5 10-24 21.6 13.3 9.5 7.5 6.8 6.7 7.0 13.6 12.1 10.7 8.1 

6 25-49 15.4 14.6 13.9 13.6 14.3 14.3 15.3 16.8 17.5 17.0 16.1 

7 50-99 15.1 17.6 19.8 19.4 18.8 19.3 20.3 18.5 18.1 17.4 16.1 

8 100-199 16.5 20.8 20.4 18.0 19.8 18.5 22.6 21.0 21.0 21.2 20.8 

9 200-499 17.3 19.0 18.9 20.5 20.0 22.9 21.1 20.3 22.0 23.9 24.3 

10 500-999 10.5 4.6 8.9 12.3 13.4 10.1 10.7 7.1 5.7 7.3 11.6 

11 1000- 3.6 10.1 8.7 8.7 6.8 8.2 3.1 2.7 3.6 2.5 3.1 

Source: State Statistics Institute 

Table 40. Distribution of the Number of Employees in the Textile Industry (as % ) 

Size No. of 

employees 

1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 

5 10-24 6.3 5.1 4.2 3.6 3.2 3.0 3.1 4.8 3.8 3.4 3.3 

6 25-49 6.4 6.1 5.6 5.3 5.2 5.1 6.4 7.4 7.3 6.9 6.8 

7 50-99 7.3 6.9 6.5 6.3 6.1 6.1 7.3 9.0 8.4 8.8 8.1 

8 100-199 8.5 8.8 9.4 9.4 9.5 10.0 9.9 11.9 12.2 13.0 13.5 

9 200-499 17.1 15.6 15.8 15.5 16.0 18.2 19.9 19.9 23.9 22.2 21.9 

10 500-999 16.7 17.7 18.4 16.0 16.5 14.4 15.7 14.9 15.7 18.4 18.4 

11 1000- 37.7 40.0 40.2 44.0 43.5 43.2 37.8 32.1 28.7 27.4 27.8 

Source: State Statistics Institute 

Tables 41, 42, and 43 give the index of production workers, wages, and production 

relative to their levels in 1970. Employment in textile and apparel has been decreasing in 

the public sector as a result of privatization programs. In the private sector, employment 

has dropped slightly as a result of drop in total production. 

Table 41. Index of Production Workers in Manufacturing Industry (1997=100) 

Year 

Textile Apparel 

Public Private Total Public Private Total 

1995 120.1 82.4 84.1 154.8 84.7 89.4 

1996 102.8 91.3 91.7 114.7 92.5 94.0 

1997 100.0 100.0 100.0 100.0 100.0 100.0 

1998 90.8 98.7 98.4 67.4 99.1 97.1 

1999 86.4 88.0 87.9 57.9 84.9 83.2


Table 42. Index of Production Workers Hourly Wages in Manufacturing Industry 

(1997=100) 

Source: State Planning Organization 




1995 32.4 27.4 28.6 26.3 23.3 24.1 

1996 48.0 54.1 53.9 46.0 48.8 48.8 

1997 100.0 100.0 100.0 100.0 100.0 100.0 

1998 208.8 176.1 177.2 167.5 163.0 162.1 

1999 428.2 329.8 333.6 252.2 296.2 292.1 

Table 43. Production Index of Manufacturing Industry 

(Weighted by Value Added 1997=100) 




1995 126.6 82.6 83.7 168.4 93.2 94.9 

1996 104.7 91.7 92.0 153.3 97.9 98.9 

1997 100.0 100.0 100.0 100.0 100.0 100.0 

1998 80.1 93.9 93.6 65.6 107.9 106.7 

1999 52.5 87.8 87.0 44.8 103.7 102.0 

In 1996, the government started giving a special “sector foreign trade company” status 

to organizations that bring together a number of small- to medium-size companies. These 

companies specialize in areas related to foreign trade such as financing, logistics, 

distribution, insurance, and provide these services to their members to help them in 

exports. Among 26 of these companies in Turkey, 10 of them are in textile and apparel. 

The customs union, the South Anatolian Project, proximity to Europe, low labor 

costs, among others, started attracting foreign investment. Among 1028 foreign owned 

companies in manufacturing, there are 137 apparel and 49 textile firms in 1998 (Table 44). 

The government is continuing providing incentives to companies that invest in Turkey. 

Compared to the other sectors in manufacturing, the textile and apparel industry has not 

attracted considerable foreign investment in recent years (Table 45). Foreign direct 

investment in apparel industry is about 1% of all foreign investment in Turkey (IBS, 2000)


Table 44. Number of Foreign-Owned Firms in Textile and Apparel Industry 

Apparel Textile 

Year Number of firms 

Capital (Million 

TL.) Number of firms 

Capital (Million 

TL.) 

1990 58 44,686 26 62,817 

1991 74 211,081 32 51,045 

1992 84 224,054 32 51,045 

1993 88 276,592 31 140,090 

1994 99 416,429 35 153,437 

1995 108 672,224 33 127,920 

1996 121 916,516 39 202,635 

1997 135 1,258,853 47 1,751,036 

1998 137 2,631,069 49 2,695,485 

1999 158 11,300,000 56 4,500,000 

Source: Turkish Treasury reports [17] 

Table 45. Number of Foreign Investment Licenses 

No. of licenses Foreign Capital Share in total Manufacturing 

(million $) No. of licenses Capital 

1994 63 23.9 14.4% 2.2% 

1995 65 40.9 15.8% 2.0% 

1996 54 40.9 15.3% 6.5% 

1997 83 85.7 18.8% 9.9% 

1998 65 52.3 14.3% 5.1% 

1999 34 23.9 11.3% 2.6% 

Source: State Planning Organization: Fundamental Economic Indicators [4]. 

The government also supports the industry by providing investment incentives that 

ease the financial burden of investment by deferred tax payments, reductions, etc. The 

textile and apparel industry has been utilizing these incentives to grow. The majority of 

the investment incentives in manufacturing are given to firms in textile and manufacturing 

(Table 46). In nominal terms, investments in textile and apparel industry reached its peak 

point in 1995. 

Table 46. Government Investment Incentives to the Textile/Apparel Industry 

Government Investment Incentive Certificates Given Investment Levels (Million TL) 

Production Textile and 


% of Textile and 

Apparel in 

Production 

Production Textile and 


% of Textile 

and Apparel 

in Production 

1995 3,745 2,360 63 1,915,498,755 1,555,159,116 81 

1996 3,305 1,124 34 1,424,368,000 676,150,880 47 

1997 3,180 1,214 38 2,034,412,000 763,930,056 37 

Source: Turkish Treasury reports [17]


6. . Competitiveness Competit 

iveness of the Textile and Apparel Apparel Industry Industry 

7.1. 7.1. Cost Cost Structure 

Structure 

When the price of cotton in Turkey is compared to world cotton prices, it is observed 

that the price in Turkey has been above the world prices. One of the reasons for this 

deviation is the government’s policy of giving support to cotton production. In recent 

years, the gap between the local and global prices has been diminishing [17]. 

The labor costs in textile industry increased steadily from $0.95/hour in 1980 to 

$4.44/hour in 1993. After the devaluation of Turkish lira in 1994, the labor costs went 

down to $2.48 in 1998 (Table 47). 

Table 47. Comparison of the Labor costs ($/hour) in the Textile Industry 

1990 1991 1993 1994 19 1996 19 

96 1998 

Germany 16.46 16.96 20.50 20.77 21.94 21.48 

Italy 16.13 17.31 16.20 15.65 16.65 15.81 

U.S.A. 10.02 10.33 11.61 11.89 12.26 12.97 

Greece 5.85 5.75 7.13 7.68 8.92 7.99 

Taiwan 4.56 5.00 5.76 5.98 6.38 5.85 

Hong Kong 3.05 3.39 3.85 4.40 4.90 5.65 

Turkey 1.82 3.12 4.44 2.31 2.02 2.48 

Morocco 1.28 1.37 1.47 1.54 1.92 1.89 

Tunisia 2.82 2.82 2.97 2.30 1.89 1.76 

China 0.37 0.34 0.36 0.48 0.58 0.62 

India 0.72 0.55 0.56 0.58 0.56 0.60 

Pakistan 0.39 0.38 0.44 0.45 0.43 0.40 

Indonesia 0.25 0.28 0.43 0.46 0.52 0.24 

Source: Internationalisation of European Textiles and Clothing Production/Textiles Intelligence, Werner [17] 

Although the labor cost in Turkey is lower than the labor costs in countries like 

Germany, Italy, USA, Taiwan and Hong Kong, it is more than four times higher than the 

costs in China and India, and higher than the costs in Morocco and Tunisia which have 

similar proximity to Europe, Turkey’s largest market. As a result of increase in labor costs, 

some companies are shifting the production to areas with lower labor costs in Turkey. A 

similar research on wages in the apparel sector is not available.


The electricity prices in Turkey are also higher than its competitors (Table 48). In 

addition to the cost of electricity, power cuts that are becoming more frequent as a result of 

insufficient supply affect the industry. In order to tackle this problem, integrated plants 

have started to build their own power sources while small- to medium-size companies are 

still exposed to production loss. The government offers 25 to 50% discount in electricity 

prices in the Eastern and Southeastern parts of Turkey to attract investments to the region. 

Table 48. Comparison of Industrial Electricity Prices ($/kwh) 

1994 1995 1995 1996 1997 

1997 

Japan Japan 

0.172 0.185 0.157 0.146 

Switzerland Switzerland 0.106 0.125 0.120 0.102 

Portugal Portugal Portugal 0.116 0.122 0.112 0.097 

Italy Italy Italy 

0.091 0.093 0.101 0.094 

Austria Austria 0.072 0.081 0.081 0.081 

Turkey Turkey 

0.077 0.076 0.085 0.077 

Germany Germany Germany 0.089 0.100 0.086 0.072 

England England 0.067 0.068 0.065 0.065 

Denmark Denmark 0.063 0.069 0.073 0.064 

Spain Spain 

0.078 0.081 0.080 0.064 

Ireland Ireland 

0.061 0.066 0.066 0.063 

Netherlands Netherlands 0.065 0.075 0.071 0.063 

Belgium Belgium 0.059 0.068 0.065 0.055 

Finland Finland 0.052 0.063 0.062 0.055 

Hungary Hungary 0.046 0.045 0.048 0.054 

Greece Greece 

0.055 0.062 0.059 0.053 

Czech Czech Republic Republic Republic 0.056 0.061 0.059 0.052 

France France 

0.053 0.060 0.057 0.049 

Mexico Mexico 

0.047 0.031 0.038 0.048 

U.S.A. U.S.A. 

0.047 0.047 0.046 0.044 

Korea Korea 

0.068 0.072 0.068 0.040 

Poland Poland 

0.035 0.040 0.040 0.036 

Sweden Sweden 0.036 0.039 0.045 0.034 

Source: OECD, Energy prices and Taxes, 1 st quarter 1999 [17]


The International Textile Manufacturers Federation (ITMF) conducts a biennial study 

to compare the production costs for different production processes in different countries. 

The 1998 study compared the production costs in Indonesia, India, Turkey, Brazil, S. 

Korea, USA, and Italy. The comparison considers labor costs, electricity costs, costs 

related to construction, machines, operation time of factories, cost of financing, cost of 

cotton, etc (Table 49). By using these parameters, the study provides a production cost 

index for each country for the cases the raw material cost is included and excluded (Table 

50). The study reveals that although most of the recent investments were made in 

purchasing open-end machinery, the production costs for this type of production are among 

the highest in the group. 

Master workman cost 

($/hr) 

Skilled-labor cost 

($/hr) 

Labor-cost 

($/hr) 

Electricity 

(cent/kWh) 

Cost of building 

construction ($/m2) 

Building depreciation 

time (year) 

Machine depreciation 

time (year) 

Annual operation 

time of a factory 

(hour) 

Custom fees, etc. 

(%) 

Cost of financing 

(%) 

Cotton price 

($/kg) 

Table 49. Cost Structure in Different Countries 

Indonesia India Turkey Brazil S.Korea USA Italy 

1.17 1.09 3.85 7.86 8.14 14.05 22.06 

0.48 0.79 2.31 4.02 5.24 11.63 19.95 

0.30 0.71 1.62 2.89 3.53 9.83 19.44 

5.65 9.92 7.00 5.70 5.33 5.00 8.02 

97 141 132 524 533 700 595 

20 30 24 30 40 32 30 

9 10 7 10 8 7 8 

8500 8420 7100 7500 8280 7900 7600 

20 0 3 21 5 5 0 

17.0 18.0 9 13 12.0 8.3 11.5 

1.82 1.44 1.83 1.80 1.79 1.59 1.75 

Source: ITMF International Production Cost Comparison Report (1998)


Type of 

production 

Ring yarn 

Open-end 

yarn 

Weaving 

Knitting 

Table 50. Comparison of Production Costs (Index: Italy=100) 

Raw 

material 

Indonesia India Turkey Brazil S.Korea USA Italy 

Not inc. 72 72 76 77 74 80 100 

Included 85 76 88 99 86 85 100 

Not inc. 91 91 96 87 84 84 100 

Included 98 87 100 95 93 87 100 

Not inc. 47 59 55 67 68 74 100 

Included 

(Ring) 

Included 

(open-end) 

70 69 74 79 78 80 100 

74 74 79 82 81 81 100 

Not inc. 47 47 52 60 59 75 100 

Included 

(Ring) 

Included 

(open-end) 

81 72 83 84 82 83 100 

91 81 94 100 89 86 100 

Source: ITMF International Production Cost Comparison Report (1998) 

By one estimate, in Turkey’s apparel industry, the costs of fabrics and other raw 

material inputs account for 60% of a small- to medium-sized producer’s revenues while the 

labor cost is 20% of the revenue, water, electricity and heat is 6%, transportation is 5% and 

the remaining 9% is overhead, interest, and other costs [7]. However, in Turkish textile 

industry, the cost of raw materials, mostly cotton yarn, constitute 64% of the total costs, 

the direct labor costs and the energy costs represent 17% and 8% of the remaining costs 

respectively [19]. 

The textile and apparel industry relies heavily on bank loans to finance its operations. 

Especially, the high investment in machinery around 1995 was made by using short-term 

loans, which brought an extra burden on the companies in the following years. The 

industry is thus very vulnerable to an increase in interest rates. As a result of investments 

with high finance costs, the average current liability/total assets ratio in the apparel 

industry increased from 61% to 69% and the share of interest expenses in net sales increased 

from 4.7% to 7.4% from 1992 to 1995 [17].


7.2. 7.2. Productivity 

Productivity 

Analyzing the productivity of the Turkish textile and apparel industry is instrumental 

to assess its competitiveness. Table 51 reports the results of a UNIDO study on the value 

added, value added per employee and wage rates for textile, apparel industry and for total 

manufacturing in United States, Turkey, China, and Mexico. The wages and salaries per 

employee in Turkey and in Mexico are quite close to each other. As the table shows, the 

value added per employee in Turkish textile industry is very close to the one in Mexico and 

higher than in China. However, the value added per employee in the US textile industry is 

almost three times higher than the value added per employee in Turkish textile industry. 

In the apparel industry, the value added per employee in Turkey is almost twice of the one 

in Mexico. 

Note that, this is a very simplistic comparison of value-added per employees in these 

countries. Either because of some sort of demand and supply shocks in the particular years 

or by a mere speculative buble in foreign exchange rate markets the values may be under- 

or over-estimated 

Furthermore, the ratio of real value added per employee is a simple, non-parametric 

measure of productivity. However, since it measures the contribution of a single factor, it 

cannot evaluate the effects of other factors such as technical efficiency and capital 

accumulation on the productivity 

Filiztekin (2000) presents a thorough study of the dynamics in Turkish manufacturing 

industry before and after the liberization of the economy. He measures labor productivity 

defined as the ratio of real value added to labor input and total factor productivity defined 

as the residual after the contribution of accumulation of all factors is removed from output 

growth, for each sector. He reports that there is an improvement in the productivity 

performance of Turkish manufacturing industry after the economy is opened to free trade 

and productivity growth accounts for nearly 50% of value added growth. The analysis, 

summarized in Table [52], shows that the textile and apparel industry sustained a high


value-added growth rate during 1980-1996. The employment in the apparel industry 

increased substantially while the increase in the textile industry was relatively low during 

the same period. In the same period, the labor productivity and total factor productivity in 

textile and apparel industry grew around 5% and 3.5% per year respectively. Although this 

is a significant growth rate, it is lower than the average productivity growth rate of all 

manufacturing for the same period. As a result of increase in real wages after 1988, the 

firms increased their efficiency and productivity of existing inputs through substitution of 

capital for labor. 

Table 51. Value Added, Labor Productivity and Wage Rates (at current prices, in US$) by 

Manufacturing Branch 

United States 

Value Added Value Added Wages and Salaries 

Branch (ISIC) 

(million US$) 

1985 (1) 1998*(1) 

per employee 

1985 1998* 

per employee 

1985 1998* 

TOTAL MANUFACTURING(300) 996440 2171730 57188 123668 22681 38582 

Textiles(321) 26910 48421 32074 64109 15221 26210 

Wearing apparel, except footwear(322) 22150 

Turkey 

29153 24972 50176 11116 19310 


Branch (ISIC) 

(million US$) per employee per employee 

1985 (2) 1998*(2) 1985 1998* 1985 1998* 



Wearing apparel, except footwear(322) 146 

China 

2212 5136 16264 1292 4267 


Branch (ISIC) 

(million US$) 

1985 (3) 1997 (3) 

per employee 

1985 1997 

per employee 

1985 

TOTAL MANUFACTURING(300) 78389 189478 2636 3077 384 ... 

Textiles(321) 8588 13470 2031 1845 345 ... 

Wearing apparel, except footwear(322) 1717a/ 5595a/ 10279 a/ 2294 a/ 357a/ ... 

a/ 322 includes 324 (Footwear) 

Mexico 


Branch (ISIC) 

(million US$) 

1985 (2) 1998*(2) 

per employee 

1985 1998* 

per employee 

1985 1998* 



Wearing apparel, except footwear(322) 215 203 6588 8377 2510 4755 

Source: Based on data supplied by OECD with estimates by the Statistics and Information Networks Branch, UNIDO. 

Note: (1) = Factor values (2) = Producer’s prices (3) = Unspecified valuation, Note: An asterisk (*) next to year denotes 

provisional figures estimated by UNIDO.


Table 52. Annual Growth Rates During 1980-1996 

Textiles Clothing 

(incl. Footwear) 

All Manufacturing 

Real Value Added 7.47 18.86 9.55 

Employment 2.86 13.90 3.45 

Labor Productivity 4.60 4.96 6.10 

Total Factor Productivity 3.40 3.61 4.59 

Source: “Openness and Productivity Growth in Turkish Manufacturing” [5] 

7.3. 7.3. Lead Lead Times Times and and Delivery Delivery Performance 

Performance 

One of the advantages of Turkey is its geographical location, as a country located 

between Europe and Asia, it is close to the European market as well as the Middle East, 

and newly developing markets in the former Soviet Republics. Figure 3 depicts the 

geographical location of Turkey. 

Figure 3. Geographical location of Turkey. 

Proximity to Europe is a major advantage over the competitors in the Far East in 

the European Market. Truck transportation is the main mode of transportation since the


railways are not well developed and air transportation is quite costly. The transportation 

companies are quite developed and provide satisfactory logistics services. It takes 4 days, 

on the average, for a truck to travel from Istanbul to Germany, that is the largest market 

for Turkish apparels. 

A recent study compares the delivery times, including the transportation and 

manufacturing times, to the European Union [7]. The study shows that Turkey still has an 

advantage over the new low-cost competitors in Eastern Europe due to shorter 

manufacturing lead times. 

weeks 

14 

12 

10 

8 

6 

4 

2 

0 

Europe 

Transportation 

Manufacturing 

Turkey 

Japan 

Eastern 

Europe 

Southeast 

Asia 

Figure 4. Comparative Delivery Times to the European Union. 

Another study shows a similar conclusion for the advantage of Turkish apparel 

exporters in the European market over the competitors in the Far East, but not over the 

competitors in the Eastern Europe and Northwest Africa (Table 53) . 

Source: Textile Asia [18]. 

Table 53. Comparative Lead Times in the European Market 

Source First order Repeat Order 

Eastern Europe, Maghreb, 3-6 weeks 

Turkey, Greece 

3-6 weeks 

Other EC 2-4 weeks 2-4 weeks 

China 6-7 months 3 months 

Other Far East 4-5 months 3-5 months 

China


Marine transportation is also available from some authorized and equipped harbors. 

However, truck transportation is preferred over marine transportation for the European 

destinations due to its flexibility, availability, cost, and ease of arrangements. However, for 

the United States, marine transportation is the preferred mode of transportation. On the 

average, it takes 16 days for a ship to deliver to the United States. As a result of increasing 

exports to the US market, a direct ship service to the United States has started recently. It 

takes 10 days to deliver by using this service. 

7.4. 7.4. Flexibility Flexibility and and Quality 

Quality 

There is no thorough study on the flexibility and quality of the Turkish textile and 

apparel industry. Especially, since the apparel industry is composed of thousands of 

small- to medium size companies, orders of different sizes, from very small to very large, can 

easily be accommodated by contracting some of the work outside or by adjusting the work 

hours when it is needed. Existing of a competitive textile industry also allows the fabric 

producers to adopt new models within a short time period and feed the apparel industry. 

It can be argued that as one of the major contractors of world brands, the textile and 

apparel industry accumulated knowledge and experience to produce quality products. 

Furthermore stringent end-product quality standards of the buyers and also the 

requirements of European Union on process quality, e.g., ISO 9000 standard, had a positive 

impact on the quality of the products produced. 

Continuing export-oriented production also increased the source of skillful workers. 

However, the supply of white-collar employees including qualified managers, engineers, 

designers, etc. is still limited. 

In addition, the production in Turkey complies with internationally accepted 

ecological standards and does not use harmful materials in dyeing. These standard are 

regulated by laws that are in accordance with the ones in the European Union. 

Furthermore Turkey meets social audit requirements.


7. . Assessment of Competitiveness of Turkish Textile and Apparel Industry 

Considering the contribution of the textile and apparel industry to the Turkish 

economy, sustaining and increasing the competitiveness of Turkish textile and apparel 

industry is of vital importance for Turkey. 

The advantages of the Turkish textile and apparel industry include high production 

capacity, availability of raw materials, experience and knowledge in the industry, short 

lead-times, quality production, fair costs, and flexibility in volume, time, and variety of 

products. Furthermore, the Customs Union agreement provides access to the European 

markets without quota restrictions. 

In addition to being a major cotton and wool producer, Turkey has the advantage of 

having both textiles and also apparel industry that are globally competitive. Considering 

the whole supply chain from fiber to textiles, apparel, and retail, this coverage is an 

important asset compared to those countries that do not have such an exposure. For 

example, as the main apparel supplier of the United States, Mexico imports cotton from the 

United States. Similarly, the low cost competitors of Turkey in the European market such 

as the Eastern European and Northwest African countries actually import the textiles to be 

used in apparel from Turkey. 

However, the missing link in the whole supply chain, namely, retailing is where the 

most of the value generated. For example, consider a Victoria`s Secret Stretch Cotton 

Lingerie that is sold for $25 in USA but produced in Turkey. Figure 5 below depicts the 

allocation of the money paid for this lingerie in the supply chain from the cotton, yarn, 

fabric producer and the ready wear supplier in Turkey, to the brokerage, distributor, and 

retailer in USA [19]. As the figure shows the most of the value in the chain is captured by 

the latter part of the chain, i.e., the USA retailer/contractor/brokerage captures 71.6% of 

the money paid by the customer while the remaining 28.4% is shared among the cotton, 

yarn, fabric, and apparel producers in Turkey. Clearly, there are opportunities for the 

industry to expand the exposure in the chain by better coordination and integration.


Retailer 

Distributor 

Brokerage 

Ready Wear 

Fabric Producer 

Yarn Producer 

Cotton Producer 

$2.6 

$1.4 

$1.5 

$1.6 

$0.3 

Figure 5. Allocation of the money paid by a customer in the supply chain of an apparel 

product. 

As the previous section shows Turkish textile and apparel industry is losing its cost 

competitiveness. Namely, there are now competitors with cheaper labor costs, cheaper 

cotton, and cheaper electricity prices. Given those, it is not viable for Turkey to compete 

on price alone for basic items. Similarly the lead-time advantage can be matched in the 

European Market by the countries in Eastern Europe and Northwest Africa. 

The industry has realized the need to compete with other features in addition to the 

cost. Service quality and due-date performance have been considered as very important to 

compete in the markets. Furthermore, some companies are following the route to expand 

the supply chain exposure to retailing, especially, by branding. Given the textile 

infrastructure, another possible way is to develop specialized products and compete in the 

markets by differentiation. This route requires substantial investment in research and 

development. Until now, the research and development has been neglected in the industry. 

The total research and development expenditures of the companies in textile and apparel 

$6.3 

$0 $5 $10 $15 $20 $25 

$11.3 

USA 

Turkey


industry was around $2.9 million in 1996 while during the same year the total exports 

reached $8.9 billion. 

Removal of all the quotas set by the Multi Fiber Agreement according to General 

Agreement on Tariffs and Trade by January 1, 2005 between the countries of WTO will 

introduce new opportunities and threats for the industry. Since, there are no quotas for the 

largest market of Turkey, i.e., the European Union, these opportunities and challenges will 

involve the trade with the United States. Since the Turkish exporters are negatively 

affected by the stagnation of the European market in recent years, the United States is now 

seen as the major destination for further growth. 

Acknowledgement 

This research is conducted at the Harvard Center for Textile and Apparel Research. The 

author thanks J.T.Dunlop and F.H. Abernathy, J.H. Hammond, D.Weil, for their valuable 

comments and Burcu Batur for her research assistance.


References 

References 

[1]. Dunya Newspaper Special Issue: The Turkish Economy at the 75 th Year of Republic 

(1998) 

[2]. Evaluation of the First Four Months Performance of the Turkish Clothing Industry 

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[3]. Export Performance Evaluation of Turkish Apparel and Garments Industry in 1999 

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Association. 

[4]. Export Performance Evaluation of Turkish Textile Industry in 1999, by Parilti, H. 

and Turkant, B. (2000), (in Turkish), Istanbul Textile and Apparel Exporters 

Association. 

[5]. Filiztekin, A. (2000), “Openness and Productivity Growth in Turkish Manufacturing”, 

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[6]. IBS - Doing Business in Turkey - (4.6) Textiles and Leatherware (April 20, 2000, IBS) 

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[13]. ‘The Clothing Industry in Turkey,” by Bodgener, J. (1997), Textiles Outlook 

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[14]. The Economist Intelligence Unit Limited, EIU Country Report: Turkey (July 2000)


[15]. The European Textile and Apparel Organisation (EURATEX) Statistics 

http://www.euratex.org/statistics.html 

[16]. The Undersecretariat of Foreign Trade, The Republic of Turkey, Prime Ministry 

Report (2000) 

[17]. Turkish Textile and Apparel Sector in 1990s, by Turkant, B., (1998), (in Turkish), 

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[18]. “Turkey’s Clothing Industry Observed,” by Sung, K. (1994), Textile Asia, August, 

pp. 10-15. 

[19]. ‘Turkey`s Textiles and Readywear: A New Age on Competition’, by Kornosor, A. S. 

(2000), Competitive Advantage of Turkey project: Textile and Apparel Cluster 

Report. 

[20]. Turkiye Sinai Kalkinma Bankasi Pamuklu Tekstil Raporu (1997) 

[21]. US Customs Service Textile Status Report, 31.12.1999 

http://www.customs.gov/quotas/1999/trtxtrpt.htm

Harvard Center for Textile & Apparel Research

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