Turkish Maritime Industry Marco Rensma Director MEYS Emerging - - PowerPoint PPT Presentation

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Turkish Maritime Industry Marco Rensma Director MEYS Emerging - - PowerPoint PPT Presentation

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Business opportunities in Turkish Maritime Industry Marco Rensma Director MEYS Emerging Markets Research Istanbul, 24 May 2012 www.meys.eu Content presentation 1. Introduction MEYS Emerging Markets Research 2. Global trends seaborne trade

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Business opportunities in Turkish Maritime Industry

Marco Rensma Director MEYS Emerging Markets Research Istanbul, 24 May 2012

www.meys.eu

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Content presentation

1. Introduction MEYS Emerging Markets Research 2. Global trends seaborne trade and shipbuilding 3. Economic developments Turkey 4. Turkish maritime industry: 4.1 Developments seaborn trade Turkey 4.2 Trends in Turkish shipbuilding 4.3 Market of tankers and bulk carriers 4.4 Market of mega yachts 4.5 Market of naval ships 4.6 Market of offshore supply vessels 5. Outlook maritime industry Turkey 2012 - 2014

www.meys.eu

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  • 1. Introduction MEYS Emerging

Markets Research

www.meys.eu

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www.meys.eu

− International market research and advisory for Dutch companies − Focus on the emerging markets of:

  • Romania

Turkey

  • Hungary

Morocco

  • Czech Republic

Vietnam − Business clients from industry, construction, trade & logistics, transport − Official partner TurkeyDesk - Fenedex − Writing articles on emerging markets for:

  • Fenedexpress, monthly magazine Fenedex
  • Romania Magazine, quarterly magazine Dutch Romanian Network

− Presentations for companies, business associations, and universities on emerging markets and globalisation − Parttime lecturer Global Marketing, The Hague University of Applied Sciences

What we do

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  • 2. Global trends seaborne trade and

shipbuilding

www.meys.eu

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Increased volume world seaborne trade

www.meys.eu

  • 500

1.000 1.500 2.000 2.500 3.000 1980 1985 1990 2000 2005 2006 2007 2008 2009 2010 2011 International developments seaborne trade (millions of tons loaded) Oil Main bulks* Other dry cargo Container

Source: UNCTAD Note: (*) Iron ore, grain, coal, bauxite/alumnia and phosphate

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Growth rate world seaborne trade could become lower after 2011

www.meys.eu

20 35 50 65 80 95 110 125

  • 6
  • 4
  • 2

2 4 6 8 10 12 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012f 2013f 2014f

USD/barrel Growth rate (%)

Seaborne trade Global economy Oil prices (R-axis)

Source: UNCTAD, IMF, own calculations

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Declining world volume new orders and order books

www.meys.eu

50 100 150 200 250 300 350 400 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

World volume (million GT)

New orders Order books

Source: SAJN

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Declining demand tankers and bulk carriers; small increase container ships

www.meys.eu

20 40 60 80 100 120 140 160 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 World order book (mill. DWT) Tanker < 200.000 DWT Tanker > 200.000 DWT Capesize 1.000 2.000 3.000 4.000 5.000 6.000 7.000 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 World order book container ships (mill. TEU)

Source: RS Platou

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Falling prices for new tankers, bulk carriers and container vessels

www.meys.eu

30 40 50 60 70 80 90 100 2008M01 2008M04 2008M07 2008M10 2009M01 2009M04 2009M07 2009M10 2010M01 2010M04 2010M07 2010M10 2011M01 2011M04 2011M07 2011M10 2012M01 2012M04

Million USD

Suezmax Capesize 3.000 TEU

Source: RS Platou

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Lower demand mega yachts

www.meys.eu

214 90 114 108 20 218 261 213 195 176 53

50 100 150 200 250 300 2007 2008 2009 2010 2011 2012*

Numbers

New orders Deliveries

Note: (*) Jan. - April Source: Camper and Nicholson, Boat International, SuperYacht Times

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Increasing demand for offshore supply vessels (excl. tugboats)

www.meys.eu

500 550 600 650 700 750 800 850 900 2007okt 2008jan 2008apr 2008jul 2008okt 2009jan 2009mei 2009aug 2009nov 2010feb 2010mei 2010aug 2010nov 2011feb 2011mei 2011aug 2011nov 2012feb

Volume world order books OSVs (number)

Source: Marcon International

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Increasing overcapacity at shipyards worldwide

www.meys.eu

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10 20 30 40 50 60 2008 2009 2010 2011e 2012e 2013e 2014e 2015e

Million CGT

Completions Shipbuilding capacity Overcapacity

Source: POSCO Research Institute

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  • 3. Economic developments Turkey

www.meys.eu

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Turkey higher economic growth rate than EU-27

www.meys.eu

  • 6,0
  • 4,0
  • 2,0

0,0 2,0 4,0 6,0 8,0 10,0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Economic growth rate (GDP, %)

EU-27 the Netherlands Turkey

Source: IMF

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www.meys.eu

50,0 100,0 150,0 200,0 250,0 300,0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Total foreign trade Turkey (billion euro)

Source: Turkstat

Strong increase total foreign trade

Economic liberalisation

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www.meys.eu

0% 20% 40% 60% 80% 100% 120%

Turkey Greece France Italy Spain United Kingdom Portugal Romania Finland Norway Croatia EU-27 Poland Germany Sweden Denmark Switzerland Austria Latvia Bulgaria Slovenia Lithuania Czech Republic Belgium Netherlands Slovakia Estonia Hungary Malta Ireland

Exports, 2011 (% of GDP)

Turkey relatively small export sector

Source: Eurostat

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www.meys.eu

  • 10
  • 5

5 10 15

Turkey Greece Iceland Portugal New Zealand Spain Italy United States Czech Republic Canada France Australia United Kingdom Slovenia Finland Belgium Israel Ireland Slovak Republic Austria Japan Korea Estonia Germany Denmark Sweden Netherlands Switzerland Norway

Current account balance, 2011 (% GDP)

Turkey large deficit current account

Source: IMF

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www.meys.eu

  • 5,0

0,0 5,0 10,0 15,0 20,0 25,0 30,0 2009M01 2009M03 2009M05 2009M07 2009M09 2009M11 2010M01 2010M03 2010M05 2010M07 2010M09 2010M11 2011M01 2011M03 2011M05 2011M07 2011M09 2011M11 2012M01 2012M03

Inflation Turkey 2009 – 2012 (%)

Total Food Energy

High inflationary pressure

Source: Eurostat

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Weak Turkish Lira

www.meys.eu

80 85 90 95 100 105 01-2008 04-2008 07-2008 10-2008 01-2009 04-2009 07-2009 10-2009 01-2010 04-2010 07-2010 10-2010 01-2011 04-2011 07-2011 10-2011 01-2012

Real effective exchange rate TRY (2010 = 100)

Source: Bank International Settlements

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Turkey Central Bank (still) holds interest rate relatively low

www.meys.eu

5,00 5,50 6,00 6,50 7,00 7,50 2010M05 2010M06 2010M07 2010M08 2010M09 2010M10 2010M11 2010M12 2011M01 2011M02 2011M03 2011M04 2011M05 2011M06 2011M07 2011M08 2011M09 2011M10 2011M11 2011M12 2012M01 2012M02 2012M03 2012M04

Policy rate (%)

Source: Central Bank Turkey

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Economic outlook Turkey 2012 – 2014 positive

www.meys.eu

0,0 2,0 4,0 6,0 8,0 10,0 2010 2011 2012 2013 2014

Growth rates for Turkey (%)

GDP Private consumption Exports Government consumption

Source: EIU

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Turkish current account deficit remains high after 2011

www.meys.eu

  • 10,0
  • 8,0
  • 6,0
  • 4,0
  • 2,0

0,0 2010 2011 2012 2013 2014

Balance current account Turkey (% GDP)

Source: IMF

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  • 4. Turkish Maritime Industry

www.meys.eu

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4.1 Developments seaborne trade Turkey

www.meys.eu

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Turkey strategically located for international seaborne trade

www.meys.eu

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Ports are located all along Turkish coast

www.meys.eu

Source: ISPAT

  • 175 Ports
  • 90 per cent private operated
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Busy times at Turkish seaports

www.meys.eu

50 100 150 200 250 300 350 400 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Volume goods handled at Turkish seaports (million tons)

Total volume Export/import

Source: UMA

Cabotage

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Slowing down growth rate seaborne trade

www.meys.eu

  • 60%
  • 40%
  • 20%

0% 20% 40% 60% 2009M01 2009M03 2009M05 2009M07 2009M09 2009M11 2010M01 2010M03 2010M05 2010M07 2010M09 2010M11 2011M01 2011M03 2011M05 2011M07 2011M09 2011M11 2012M01 2012M03

Growth rate seaborne trade Turkey(%)

Exports Imports

Source: Turkish customs

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www.meys.eu

5 10 15 20

Sweden Viet Nam France Netherlands UAE Cyprus Indonesia Brazil Saudi Arabia Iran Belgium Malaysia India Canada Russia Turkey UK Italy Bermuda Singapore Taiwan Denmark China, Hong Kong SAR Norway US Republic of Korea China excl. Hong Kong Germany Japan Greece

Total DWT merchant fleet as a percentage in world total, 1-1-2011 (%)

(a)

Source: UNCTAD Note: (a) Vessels of 1,000 GT and above operating under national and foreign flag

Turkey relatively large merchant fleet

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Relatively young merchant fleet

www.meys.eu

10 20 30 40 50 60 0 - 9 years 10 - 19 years 20 - 29 years 30+ years

Age merchant fleet Turkey, % in total DWT (December 2011)

Mainly smaller vessels < 10.000 DWT

Source: Turkey Chamber of Shipping

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www.meys.eu

1.000 2.000 3.000 4.000 5.000 6.000 7.000 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Volume container handling Turkish ports (x 1.000 TEU)

Strong increase container handling

Source: UMA, TURKLIM

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www.meys.eu

  • 20.000

40.000 60.000 80.000 100.000 120.000

Turkey Panama France Viet Nam Thailand Australia Egypt Brazil United Kingdom Indonesia India Italy Belgium Netherlands Taiwan Spain Germany UAE Malaysia Korea, Republic of Japan Hong Kong Singapore United States China

Container throughput, 2009 (x 1.000 TEU)

Turkish ports relatively small globally in container handling

Source: UNCTAD

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www.meys.eu

4.2 Trends in Turkish shipbuilding

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www.meys.eu

Concentration of shipyards in Istanbul (Tuzla Bay) and Yalova

(27) (8) Yalova (21) Canakkale (2) Izmit (6) Sakarva (1) (1) (1) (1) (1) (1) Hatay (1)

Source: UMA

71 shipyards as of 1-1-2012

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www.meys.eu

0,07% 0,08% 0,08% 0,09% 0,12% 0,12% 0,15% 0,17% 0,22% 0,33% 0,35% 0,35% 0,44% 0,50% 0,56% 0,60% 1,24% 21,77% 31,34% 41,07%

0% 10% 20% 30% 40% 50%

Bulgaria Poland Italy India Netherlands Indonesia Spain Russia US Turkey Germany Croatia Taiwan Denmark Viet Nam Romania Philippines Japan Republic of Korea China

Top 20 economies for shipbuilding, 2010 deliveries (% in world total DWT)

Turkey among the ‘best of the rest’

Source: UNCTAD

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www.meys.eu

20 40 60 80 100 120 140 160 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Number of ships built at Turkish shipyards

  • 500

1.000 1.500 2.000 2.500 3.000 3.500 4.000 2003 2004 2005 2006 2007 2008 2009 2010 2011

Ship deliveries and max. production capacity (x 1.000 DWT)

Ship deliveries Production capacity

Large overcapacity at Turkish shipyards

Source: Turkey Chamber of Shipping, UMA

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www.meys.eu

  • 500

1.000 1.500 2.000 2.500 3.000 2005 2006 2007 2008 2009 2010 2011

Total order books Turkish shipyards (x 1.000 GT)

9% 17% 1% 2% 71%

Order books by type of ship 2010 (%)

Container General cargo RO-RO Bulk Carrier Tanker

Order books Turkish shipyards are under

  • pressure. Focus primarily on tanker building

Source: Turkey Chamber of Shipping, SAJN

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4.3 Market of tankers and bulk carriers

www.meys.eu

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Tankers and bulk carriers most used vessels in Turkish merchant fleet

www.meys.eu

1.000.000 2.500.000 4.000.000 5.500.000 7.000.000 8.500.000 10.000.000 11.500.000 2008 2009 2010 2011

Merchant fleet Turkey (DWT)*

Tankers Bulk carriers Total

Note: (*) ships over 150 GT Source: UMA

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www.meys.eu

58,6 18,7 16,8 4,6 1,2

Ship deliveries Turkey 2010 (percentage of built tonnage)

Tankers Bulk carriers Other dry cargo/passenger Offshore Others

Tankers and bulk carriers main shipbuilding marketsegments

Source: OECD

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www.meys.eu

10 20 30 40 50 60 70 80 90 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Tanker deliveries Turkish shipyards (number)

Export Domestic

Since 2007 domestic demand for tankers higher than foreign demand

Source: OECD, Turkey Chamber of Shipping

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Decreasing volume order books, particular for tankers

www.meys.eu

57 179 116 90 77 74 8 21 5 3 2 1 21 24 21 22 13 2 23 12 12 10 8

25 50 75 100 125 150 175 200 2008jan 2009feb 2009dec 2010dec 2011mei 2011okt

Order books Turkey (number)

tanker bulk dry cargo container

Source: OECD, Turkey Chamber of Shipping, Clarkson

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4.4 Market of mega yachts

www.meys.eu

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Strong increase international tourism

www.meys.eu

5.000.000 10.000.000 15.000.000 20.000.000 25.000.000 30.000.000 35.000.000 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Foreigners arriving (persons)

Source: Turkstat

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Turkey third largest builder of mega yachts

www.meys.eu

5 10 15 20 25 30 35

Italy Netherlands Turkey Germany US UK New Zealand Taiwan UAE China Others

Mega yachts builders 2010 (% in total boat length)

Source: Camper and Nicholson

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Lower demand mega yachts from Turkish shipyards

www.meys.eu

23 25 29 27 18 6 19 10 18 5 1

5 10 15 20 25 30 2007 2008 2009 2010 2011 2012* Market of mega yachts Turkey (number) Completed New orders

Note: (*) Jan. – April Source: SuperYacht Times, Camper and Nicholson

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Lower prices 2012Q1 after records in 2010 and 2011

www.meys.eu

50.000 100.000 150.000 200.000 250.000 300.000 350.000 400.000 450.000 2007 2008 2009 2010 2011 2012*

Euro

Average asking prices mega yachts Turkey (Loa per metre)

Note: (*) Jan. - April Source: Boat International, Super Yacht Times, The Yacht Market

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Examples of mega yachts built in Turkey

www.meys.eu

Boat: Peri 37M Builder: Peri Yachts Boat length (Loa): 37.75 metres Asking price: 8.000.000 euro Boat: Aegean Yacht Ketch Builder: Aegean Yacht Boat length (Loa): 26.60 metres Asking price: 2.000.000 euro

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4.5 Market of naval ships

www.meys.eu

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Strong increase turnover Turkish defense industry

www.meys.eu

  • 500.000

1.000.000 1.500.000 2.000.000 2.500.000 3.000.000 3.500.000 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Defense industry Turkey (x 1.000 USD) Turnover Exports

Source: SaSad

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Strong increase in expenditures on military equipment

www.meys.eu

200 400 600 800 1.000 1.200 1.400 1.600 1.800 2.000 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Million USD

Development Defense Industry Support Fund Income Expenditures

Source: Undersecretary Defense Industry (SSM)

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Large investment programs Turkish navy

www.meys.eu

MILGEM

  • Investment program of 2 billion dollars over

a period of 15 years

  • Building of twelve (four optional) Patrol and

Anti-Submarine Warfare Ships GENESIS

  • Upgrading weapons

systems on board 8 frigates Submarines

  • Building of 6 submarines
  • Value of the contract 2 billion dollars
  • Cooperation between HDW from Germany and

several Turkish companies, among others Aselan and Havelsan TF-2000

  • Building of 6 anti-air frigates
  • Value of the contract 3 billion

dollars

  • First delivery 2018
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4.6 Market of Offshore Supply Vessels

www.meys.eu

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Turkey small builder in global market of OSVs

www.meys.eu

2 4 6 8 10 12 14 2007okt 2008jan 2008apr 2008jul 2008okt 2009jan 2009mei 2009aug 2009nov 2010feb 2010mei 2010aug 2010nov 2011feb 2011mei 2011aug 2011nov 2012feb

Volume order books OSVs Turkish shipyards (number)

Turkey 1% of global market

Source: Marcon International

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Examples Turkish built OSVs

www.meys.eu

RMK Shipyard

  • Offshore multi-purpose ship
  • 7.800 DWT
  • Delivery 2009
  • North Sea Shipping (Norway)

CEMRE Shipyard

  • Offshore support vessel
  • LOA 86 metres
  • Delivery September 2011
  • Havyard (Norway)
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  • 5. Outlook maritime industry Turkey

2012 - 2014

www.meys.eu

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www.meys.eu

Market segment Outlook 2012 – 2014 Market opportunities Market threats Tankers ++ ✓ Increasing demand oil and gas transport ✓ Strong domestic base ✓ Partly replacement merchant fleet ✓ Regional energy hub ✓ Relatively low labour costs ✓ Falling newbuilding prices

  • > excess capacity

✓ Strong competition Asia ✓ High investments costs Bulk carriers + ✓ Growing economy Turkey ✓ Partly replacement merchant fleet ✓ Relatively low labour costs ✓ Falling newbuilding prices

  • > excess capacity

✓ Strong competition Asia ✓ Lower growth rate global economy Container ships + ✓ Growing economy Turkey ✓ Regional trading hub ✓ Relative low labour costs ✓ Falling newbuilding prices

  • > excess capacity

✓ Strong competition Asia ✓ Lower growth rate global economy Mega yachts ++ ✓ Strong increase international tourism ✓ Higher incomes in Turkey ✓ Strong competition from Europe ✓ Volatile and small global market Naval ships +++ ✓ High government expenditures ✓ Increase foreign demand ✓ Political developments ✓ Difficult market to enter for new foreign companies OSVs ++ ✓ Investments by oil and gas industry ✓ Increasing energy demand Turkey ✓ Strong global competition ✓ High investments in R&D ✓ Strong dependence on foreign imports

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Thank you for your attention!

www.meys.eu

Marco Rensma Mobile: +31(0)612792560 E-mail: mrensma@meys.eu