Seher Kanat Analysis of the Competitiveness of the Turkish … · 51 Wool, fine or coarse animal hair: horsehair yarn and woven fabric 52 Cotton 53 Vegetable textile fibres, paper

GENE

RAL

PROB

LEM

S OF

THE

FIB

RE A

ND T

EXTI

LE IN

DUST

RIES

9Kanat S. Analysis of the Competitiveness of the Turkish Textile and Clothing Sector in the European Union Market.FIBRES & TEXTILES in Eastern Europe 2019; 27, 2(134): 9-18. DOI: 10.5604/01.3001.0012.9981

IntroductionCompetitiveness can be captured and measured by several aspects at micro and macro levels. On the one hand, the World Economic Forum defined national com-petitiveness as ‟the set of institutions, policies and factors that determine the level of productivity of a country”. On the other hand, OECD describes compet-itiveness as ‟the degree to which, under open market conditions, a country can produce goods and services that meet the test of foreign competition while si-multaneously maintaining and expanding domestic real income”. According to the definitions mentioned above, compet-itiveness can be interpreted from trade and policy perspectives. As to the trade perspective, since the seminal work of Balassa in 1965, a vast amount of re-search has analysed comparative advan-tage in international trade at the country level [1]. In other words; the concept of comparative advantage has been widely used in economic literature to assess the specialisation of countries in commod-ities in which they have a competitive edge [2].

In this context, there are many research-es in literature which measure and com-pare comparative advantages, or in other words the competitiveness, of different countries’ and economies’ dissimilar in-dustries. Within these researches, stud-ies [3-5, 22, 25-28, 31], which focus on the textile and clothing sectors that hold a significant place in global trade, are substantially limited. These studies in-

vestigated the international competitive-ness of the Turkish, Romanian, Eastern European, former Soviet Union Nations’, Serbian, Vietnamese, Chinese and Lith-uanian textile and clothing sectors in the period 1990-2014. In order to achieve this, the authors used different techniques such as the Balassa index, Vollrath index, Lafay index, revealed symmetric com-parative advantage index, export-import rate index, Grubel Lloyd’s index, the RUV indicator, the generalised double diamond model, simplified national ex-port profile, Mereuta’s valuation model, the trade competitiveness index, world market share dynamics and other statis-tical indicators. According to the results obtained, some countries possessed com-petitiveness in the textile sector, whereas others owned a comparative advantage in the clothing sector. Besides the, some countries like China and Turkey pos-sessed competitiveness in both sectors.

In addition to these studies, researches [21, 23, 24, 29, 30], which investigate the competitiveness of different coun-tries’ textile and clothing sectors in the European Union (EU) market, are also substantially limited. These studies re-searched the competitiveness of the Cro-tian, Polish and Chinese textile and cloth-ing sectors in the European Union mar-ket. In order to achieve this, the authors used different techniques such as statis-tical analysis and revealed comparative advantage analysis. The results obtained varied according to the country. For Cro-tia, its accession to the European Union had a positive impact on improving the

Analysis of the Competitiveness of the Turkish Textile and Clothing Sector in the European Union MarketDOI: 10.5604/01.3001.0012.9981

AbstractThe Turkish textile and clothing sector maintains its significance and place in the nation-al economy and exports despite the increasing international competition. The European Union-28 (EU-28) countries are some of the most significant markets in which the sector possesses a net foreign trade surplus. In this context, this study aims to analyse the com-petitiveness of the Turkish textile and clothing sector in the EU market. Therefore Turkey’s textile and clothing trade with the EU-28 countries is analysed in detail within the scope of the research. Besides this, the decadal unit export prices of Turkey and its rivals in the EU-28 market are calculated and evaluated. Finally the competitiveness of Turkey and its rivals in the EU market is analysed with Balassa and Vollrath indices. According to the results obtained, the Turkish textile and clothing sector maintains its importance and competitive-ness in the EU market with regard to average unit export prices per kilogram and average Balassa and Vollrath index values.

Key words: competitiveness, European Union market, Turkish textile and clothing sector, unit export price, Balassa index, Vollrath index.

Seher Kanat

Ege University, Department of Textile Engineering

Bornova – Izmir, Turkeye-mail: [email protected]

FIBRES & TEXTILES in Eastern Europe 2019, Vol. 27, 2(134)10

competitiveness of the Croatian textile sector in the EU market. For Poland, its textile and clothing industry had relative-ly high competitive ability in the Euro-pean Union’s internal market. Lastly, for China, its textile and clothing sector had a competitive advantage in the European Union market.

Finally studies [6-11], which investigate the European Union market, which is one of the most important sectorial markets, and the Turkish textile and clothing sec-tor, which is a significant global player of these sectors, jointly are also substantial-ly limited and outdated. Some of these researches investigated the competitive-ness of the Turkish textile and clothing sectors in the European Union market, whereas others analysed the Turkish tex-tile and clothing sectors’ competitiveness together with their European rivals’. In order to achieve this, the authors used different techniques such as analysis of investment, turnover and export figures, analysis of textile and clothing trade be-tween Turkey and the European Union, the revealed comparative advantage, revealed competitiveness and compar-ative export performance indices, and the Grubel-Lloyd index. According to the results obtained, the Turkish textile and clothing sector had a competitive advantage in the EU market. Moreover the Turkish textile and clothing sector also had a competitive advantage over its European rivals in international markets.

At this point, this study will both inform about the important market (European Union market) and reveal the current circumstances of the significant global

player investigated herein (Turkish tex-tile and clothing sector) and its rivals by analysing the competitiveness of the Turkish textile and clothing sector in the EU market. Furthermore this study gath-ers different methods together in order to analyse competitiveness. Therefore it must consider the subject from different views in a broad perspective, as distinct from other researches with these qualifi-cations.

Purpose and the method of the research

This study aims to analyse the competi-tiveness of the Turkish textile and cloth-ing sector in the EU market. In accor-dance with the aim of the research, firstly the major rivals of the Turkish textile and clothing sector in the EU market are de-termined. According to the Euratex 2016 Key Figures report [12], China, Turkey, India, Pakistan and South Korea are the top five textile suppliers of the EU-28 countries, respectively. The top five clothing suppliers consist of China, Ban-gladesh, Turkey, India and Cambodia, re-spectively. In this context; China, India, Pakistan, South Korea, Bangladesh and Cambodia are determined as rival coun-tries. In the second stage, the decadal (2007-2016) textile and clothing trade of Turkey with the EU-28 countries are analysed in detail. During the analysis, decadal foreign trade balances of the sec-tors, annual percentage changes in export and import values, the shares of the tex-tile and clothing sectors within the total export and import values and their shares within the EU-28 market are calculat-ed, shown in graphics and evaluated. In

the third stage, the decadal (2007-2016) unit prices of Turkey and its determined rivals’ export to the EU-28 countries are calculated separately for each textile and clothing product group within the Inter-national Harmonized System Commodi-ty Classification. According to the classi-fication, there are 14 product groups, ex-plained in Table 1. Besides this, decadal unit export prices are also calculated for the textile (whole product groups be-tween 50 and 60) and clothing (whole product groups between 61 and 63) sec-tors. The data obtained are evaluated and interpreted via graphics.

In the fourth stage, the decadal Balassa and Vollrath index values of Turkey and its rivals are calculated for the textile (whole product groups between 50 and 60) and clothing (whole product groups between 61 and 63) sectors. In addition, the decadal Balassa and Vollrath index values of the countries are also calculat-ed separately for each textile and cloth-ing product group. The data obtained are evaluated and interpreted via graph-ics. Finally the competitiveness of the Turkish textile and clothing sector in the EU market is summarised with a table. The export and import values and quanti-ties used in the calculations are acquired from Eurostat [14] and Trademap [15]. The whole export and import values are attained in Euros, whereas all quantities are obtained in kilograms. Besides this, EU-Extra export and import values and quantities (in other words the export of the EU-28 countries outside of the Union and their import from outside) are taken into consideration for accurate evalua-tion. The EU-Intra trade flow is ignored.

The unit export price, which is chosen as one of the research methods, is calculat-ed via dividing a country’s annual export value to the EU-28 countries (Euro) by its annual export quantity to these coun-tries (kg). Another research method is us-ing Balassa and Vollrath indices, which demonstrate the comparative competi-tiveness superiorities of countries in re-lation to their rivals.

The notion of a revealed comparative ad-vantage was first introduced by Liesner in 1958 and operationalised by Balas-sa in 1965. It is widely used to identify a country’s weak and strong export sec-tors [16,17]. The concept of a revealed comparative advantage concerns the relative trade performances of individ-ual countries in particular commodities.

Table 1. Distribution of textile and clothing products according to the International Harmonized System Commodity Classification Codes [13].

HS code Explanation 50 Silk51 Wool, fine or coarse animal hair: horsehair yarn and woven fabric 52 Cotton53 Vegetable textile fibres, paper yarn and woven fabrics of paper yarn54 Man-made filaments, strip and the like of man-made textile materials55 Man-made staple fibres56 Wadding, felt, nonwovens, and special yarns: twine, cordage, ropes, cables, and

articles thereof57 Carpets and other textile floor coverings58 Fabrics, special woven fabrics, tufted textile fabrics, lace, tapestries, trimmings, embroi-

dery59 Textile fabrics - impregnated, coated, covered or laminated, textile articles of a kind

suitable for industrial use60 Fabrics; knitted or crocheted61 Apparel and clothing accessories, knitted or crocheted62 Apparel and clothing accessories, not knitted or crocheted63 Textiles, made up articles. Sets, worn clothing, worn textile articles, rags

11FIBRES & TEXTILES in Eastern Europe 2019, Vol. 27, 2(134)

Figure 1. Turkey’s textile and clothing trade balance with EU-28 countries (Euro).

5

continues to be the second biggest textile supplier of EU-28 countries after China. However, in the clothing sector, Turkey is relegated to third place by losing its position to Bangladesh because Turkey’s decadal clothing export has occurred in the same levels, whereas Bangladesh’s decadal clothing export has approximately increased 3,5 times.

Figure 1. Turkey’s textile and clothing trade balance with EU-28 countries (Euro)

Both decadal textile and clothing export values have usually demonstrated an increment tendency, whereas import values generally have shown a decline tendency (Figure 2). Turkey’s decadal textile export to EU-28 countries has increased 20% at most, whereas it has decreased 15% at the furthest. Besides, Turkey’s clothing export has increased 14% at most, whereas it has decreased 11% at the furthest. In 2016, both textile and clothing export values have increased 2% according to the previous year. If Turkey’s textile and clothing imports from EU-28 countries are analyzed via percentage changes; it can be seen that, decadal textile import has increased 6% at most and has decreased 11% at the furthest. In addition, clothing import has increased 22% at most, whereas it has decreased 5% at the furthest.

Figure 2. Annual percentage changes of Turkey’s textile and clothing trade with EU-28 countries

Turkish textile sector has taken 5,8% share from Turkey’s total export to EU-28 countries in 2007, whereas it has taken 5,5% share in 2016 (Figure 3). The decadal percentage shares have altered between 5,2% and 6,2%. On the other hand, Turkish clothing sector has taken 21,3%

Figure 2. Annual percentage changes in Turkey’s textile and clothing trade with EU-28 countries.

5

continues to be the second biggest textile supplier of EU-28 countries after China. However, in the clothing sector, Turkey is relegated to third place by losing its position to Bangladesh because Turkey’s decadal clothing export has occurred in the same levels, whereas Bangladesh’s decadal clothing export has approximately increased 3,5 times.

Figure 1. Turkey’s textile and clothing trade balance with EU-28 countries (Euro)

Both decadal textile and clothing export values have usually demonstrated an increment tendency, whereas import values generally have shown a decline tendency (Figure 2). Turkey’s decadal textile export to EU-28 countries has increased 20% at most, whereas it has decreased 15% at the furthest. Besides, Turkey’s clothing export has increased 14% at most, whereas it has decreased 11% at the furthest. In 2016, both textile and clothing export values have increased 2% according to the previous year. If Turkey’s textile and clothing imports from EU-28 countries are analyzed via percentage changes; it can be seen that, decadal textile import has increased 6% at most and has decreased 11% at the furthest. In addition, clothing import has increased 22% at most, whereas it has decreased 5% at the furthest.

Figure 2. Annual percentage changes of Turkey’s textile and clothing trade with EU-28 countries

Turkish textile sector has taken 5,8% share from Turkey’s total export to EU-28 countries in 2007, whereas it has taken 5,5% share in 2016 (Figure 3). The decadal percentage shares have altered between 5,2% and 6,2%. On the other hand, Turkish clothing sector has taken 21,3%

10.000.000.000

9.000.000.000

8.000.000.000

7.000.000.000

6.000.000.000

5.000.000.000

4.000.000.000

3.000.000.000

2.000.000.000

1.000.000.000

02007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Textile trade balance Clothing trade balance

The method is commonly used to evalu-ate international competitiveness. Balas-sa’s original index is the ratio of a coun-try’s exports of a product to its total ex-ports relative to the ratio of world exports of the product to the total world exports [18]. The Balassa index is formalised as follows;

4

The notion of a revealed comparative advantage was first introduced by Liesner in 1958 and operationalised by Balassa in 1965. It is widely used to identify a country’s weak and strong export sectors [16,17]. The concept of a revealed comparative advantage concerns the relative trade performances of individual countries in particular commodities. The method is commonly used to evaluate international competitiveness. Balassa’s original index is the ratio of a country’s exports of a product to its total exports relative to the ratio of world exports of the product to the total world exports [18]. The Balassa index is formalised as follows;

𝐵𝐵𝐵𝐵𝐵𝐵𝐵𝐵𝐵𝐵𝐵𝐵𝐵𝐵 𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖 = (𝑋𝑋𝑖𝑖𝑖𝑖 /𝑋𝑋𝑖𝑖𝑖𝑖 )/(𝑋𝑋𝑖𝑖𝑖𝑖 /𝑋𝑋𝑖𝑖𝑖𝑖 ) (1)

where X is exports, i the country, j the commodity/industry, n the world or a set of countries (for example, the European Union), and t is all product groups. As per Balassa, if the index is greater than one, it indicates that the country has a comparative advantage in the commodity/industry, and if the index is smaller than one, it indicates that the country has a comparative disadvantage [3,17,19]. If the Balassa index value is between 0 and 1, it indicates a competitive disadvantage. However, if it possesses a value between 1 and 2, it specifies a weak competitive advantage; whereas values between 2 and 4 indicate an intermediate competitive advantage, and values greater than 4 specify a strong competitive advantage [4]. However, there are some criticisms of this method. It has been criticised for its poor empirical distribution characteristics and for taking only exports into consideration, while ignoring imports. Another objection is the fact that if the country has a comparative disadvantage, the index ranges from zero to one, whereas if it has a comparative advantage the index ranges from one to infinity [3].

Therefore the index was modified by Vollrath in 1991. According to the approach suggested by Vollrath, revealed competitiveness is calculated as the logarithm of the relative export advantage (InRXA) minus the logarithm of the relative import advantage (InRMA), where RXA equals the Balassa index, and RMA is calculated on the basis of Equation (1); but, instead of export flows, imports are considered. It is expressed as follows:

𝑉𝑉𝑉𝑉𝐵𝐵𝐵𝐵𝑉𝑉𝐵𝐵𝑖𝑖𝑉 𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖 = 𝐼𝐼𝑖𝑖 𝑋𝑋𝑖𝑖𝑖𝑖 𝑋𝑋𝑖𝑖𝑖𝑖 𝑋𝑋𝑖𝑖𝑖𝑖 𝑋𝑋𝑖𝑖𝑖𝑖 − 𝐼𝐼𝑖𝑖 𝑀𝑀𝑖𝑖𝑖𝑖 𝑀𝑀𝑖𝑖𝑖𝑖

𝑀𝑀𝑖𝑖𝑖𝑖 𝑀𝑀𝑖𝑖𝑖𝑖 (2)

Where, X is exports, M imports, i the country, j the commodity/industry, n the world or a set of countries. and t is all product groups. Values greater than zero reveal a comparative advantage, whereas negative values reveal a comparative disadvantage [3,19,20].

3. Findings of the Research and their Analysis

3.1 Analysing Turkey’s Textile and Clothing Trade with EU-28 Countries

If Turkey’s textile and clothing trade with the EU-28 countries is analysed, it can be seen that Turkey maintains its importance in the EU market, possessing a net foreign trade surplus in both sectors (Figure 1). The Turkish textile sector possessed a 2 billion Euro foreign trade surplus by 2016, whereas the Turkish clothing sector had a 9.8 billion Euro foreign trade surplus. Turkey’s textile export to the EU-28 countries increased from 2.7 billion Euros in 2007 to 3.7 billion Euros in 2016. On the other hand, clothing export increased decennially from 10.1 billion Euros to 10.7 billion Euros. Turkey’s textile import from the EU-28countries decreased to 1.6 billion Euros in 2016 from 1.7 billion Euros in 2007. However, clothing export increased decennially from 512 million Euros to 938 million Euros. As can

(1)

where X is exports, i – the country, j – the commodity/industry, n – the world or a set of countries (for example, the Euro-pean Union), and t is all product groups. As per Balassa, if the index is greater than one, it indicates that the country has a comparative advantage in the commod-ity/industry, and if the index is smaller than one, it indicates that the country has a comparative disadvantage [3, 17, 19]. If the Balassa index value is between 0 and 1, it indicates a competitive disadvantage. However, if it possesses a value between 1 and 2, it specifies a weak competitive advantage; whereas values between 2 and 4 indicate an intermediate compet-itive advantage, and values greater than 4 specify a strong competitive advantage [4]. However, there are some criticisms of this method. It has been criticised for its poor empirical distribution characteristics and for taking only exports into consid-eration, while ignoring imports. Another objection is the fact that if the country has a comparative disadvantage, the index ranges from zero to one, whereas if it has a comparative advantage the index ranges from one to infinity [3].

Therefore the index was modified by Vol-lrath in 1991. According to the approach suggested by Vollrath, revealed competi-tiveness is calculated as the logarithm of the relative export advantage (InRXA)

minus the logarithm of the relative im-port advantage (InRMA), where RXA equals the Balassa index, and RMA is calculated on the basis of Equation (1); but, instead of export flows, imports are considered. It is expressed as follows:

4











4











(2)

Where, X is exports, M – imports, i – the country, j – the commodity/industry, n – the world or a set of countries. and t is all product groups. Values greater than zero reveal a comparative advantage, whereas negative values reveal a comparative dis-advantage [3, 19, 20].

Findings of the research and their analysis

Analysing Turkey’s textile and clothing trade with EU-28 countriesIf Turkey’s textile and clothing trade with the EU-28 countries is analysed, it can be seen that Turkey maintains its importance in the EU market, possess-ing a net foreign trade surplus in both sectors (Figure 1). The Turkish textile sector possessed a 2 billion Euro foreign trade surplus by 2016, whereas the Turk-ish clothing sector had a 9.8 billion Euro foreign trade surplus. Turkey’s textile export to the EU-28 countries increased from 2.7 billion Euros in 2007 to 3.7 bil-lion Euros in 2016. On the other hand, clothing export increased decennially from 10.1 billion Euros to 10.7 billion Euros. Turkey’s textile import from the EU-28 countries decreased to 1.6 billion Euros in 2016 from 1.7 billion Euros in 2007. However, clothing export in-creased decennially from 512 million Eu-ros to 938 million Euros. As can be seen, Turkey’s textile export to the EU-28

countries increased decennially, where-as its import from the EU-28 countries slightly decreased. On the other hand, Turkey’s decadal clothing export slight-ly decreased, whereas its clothing import increased by approximately 83%. Turkey continued to be the second biggest textile supplier to the EU-28 countries after Chi-na. However, in the clothing sector, Tur-key was relegated to third place, losing its position to Bangladesh because Tur-key’s decadal clothing export remained at the same level, whereas Bangladesh’s decadal clothing export increased ap-proximately 3.5 times.

Both decadal textile and clothing export values usually demonstrated an incre-mental tendency, whereas import values generally showed a declining tendency (Figure 2). Turkey’s decadal textile ex-port to the EU-28 countries increased by 20% at most, whereas it decreased by 15% at the most. Furthermore Tur-key’s clothing export increased by 14% at most, whereas it decreased 11% at the most. In 2016, both textile and clothing export values increased by 2% in relation to the previous year. If Turkey’s textile and clothing imports from the EU-28 countries are analysed via percentage changes. it can be seen that the decad-al textile import increased by 6% and decreased by 11% at most. In addition, clothing import increased by 22% and decreased by 5% at most.

The Turkish textile sector took a 5.8% share in Turkey’s total export to the EU-28 countries in 2007, whereas it had a 5.5% share in 2016 (Figure 3). The decadal percentage shares varied between 5.2% and 6.2%. On the other hand, the Turkish clothing sector took a 21.3% share in Turkey’s total export

25

20

15

10

5

0

-5

-10

-15

-20Textile export % changeTextile import % change

Clothing export % changeClothing import % change


to the EU-28 countries in 2007, whereas it had a 16% share in 2016. The decadal percentage shares ranged between 16% and 22%. Moreover the decadal shares of the Turkish textile sector in Turkey’s total imports from the EU-28 countries varied between 2% and 3%, whereas the decadal shares of the Turkish clothing sector in Turkey’s total imports from the EU-28 countries ranged between 1% and 1.6%.

If the shares of the Turkish textile and clothing sectors in EU-Extra textile and clothing import values ( textile and cloth-ing import values of the EU-28 countries from outside the Union) are analysed, it can be seen that the textile sector’s dec-adal percentage shares ranged between 16% and 20%, whereas the clothing sec-tor’s decadal percentage shares varied between 12% and 16% (Figure 4). In other words, Turkey usually maintained its shares in the EU-28 textile market during the period determined, whereas its shares in the EU-28 clothing market declined generally. As mentioned above, this situation resulted in a decrease from

second to third place in the EU-28 cloth-ing market and an unaltered second place in the EU-28 textile market.

Analysis of the unit textile and clothing export prices of Turkey and its major rivals with respect to EU-28 countries If the unit prices of the Turkish textile and clothing sectors’ export to the EU-28 countries are analysed, it can be seen that the textile sector’s decadal unit export prices varied between 3.51 and 4.46 Eu-ros, whereas the clothing sector’s decadal unit export prices ranged between 14.28 and 17.92 Euros (Figure 5). The decadal average unit price of the Turkish textile sector’s export to EU-28 countries was calculated as 3.89 Euros per kilogram, whereas it was determined as 16.32 Eu-ros per kilogram for the clothing sector.

If the unit export prices of the first five suppliers in the EU-28 textile market are analysed, it can be seen that China possessed the highest decadal average unit export price (Figure 6). The decad-al average unit textile price of China’s,

which is the biggest rival of Turkey, ex-port to EU-28 countries was determined as 4.14 Euros per kilogram. China is followed by Turkey (3.89 EUR), Paki-stan (3.32 EUR), India (2.81 EUR) and South Korea (2.71 EUR), respectively. The ranking of the decadal average unit textile export prices coincides with that of the shares taken from the AB-28 tex-tile market by the same countries.

If the unit export prices of the first five suppliers in the EU-28 clothing market are analysed, it can be seen that Turkey possessed the highest decadal average unit export price (Figure 7). The decadal average unit clothing price of Turkey’s export to the EU-28 countries was calcu-lated as 16.32 Euros per kilogram. Turkey is followed by Cambodia (14.73 EUR), India (11.44 EUR), China (11.35 EUR) and Bangladesh (10.41 EUR), respec-tively. On the other hand, China is the biggest clothing supplier of the AB-28 market and is followed by Bangladesh, Turkey, India and Cambodia, respec-tively. If the decadal average unit export prices are analysed, it can be seen that

Figure 5. Unit prices of Turkish textile and clothing sectors’ export to EU-28 countries (Euro/kg).

7

If the unit prices of the Turkish textile and clothing sectors’ export to the EU-28 countries are analysed, it can be seen that the textile sector’s decadal unit export prices varied between 3,51 and 4,46 Euros, whereas the clothing sector’s decadal unit export prices ranged between 14,28 and 17,92 Euros (Figure 5). The decadal average unit price of the Turkish textile sector’s export to EU-28 countries was calculated as 3,89 Euros per kilogram, whereas it was determined as 16,32 Euros per kilogram for the clothing sector.

Figure 5. Unit prices of Turkish textile and clothing sectors’ export to EU-28 countries (Euro/kg)

If the unit export prices of the first five suppliers in the EU-28 textile market are analysed, it can be seen that China possessed the highest decadal average unit export price (Figure 6). The decadal average unit textile price of China’s, which is the biggest rival of Turkey, export to EU-28 countries was determined as 4,14 Euros per kilogram. China is followed by Turkey (3,89 EUR), Pakistan (3,32 EUR), India (2,81 EUR) and South Korea (2,71 EUR), respectively. The ranking of the decadal average unit textile export prices coincides with that of the shares taken from the AB-28 textile market by the same countries.

Figure 6. Unit textile prices of Turkey and its major rivals’ export to EU-28 countries (Euro/kg)

If the unit export prices of the first five suppliers in the EU-28 clothing market are analysed, it can be seen that Turkey possessed the highest decadal average unit export price (Figure 7). The decadal average unit clothing price of Turkey’s export to the EU-28 countries was calculated as 16.32 Euros per kilogram. Turkey is followed by Cambodia (14,73 EUR), India (11,44 EUR), China (11,35 EUR) and Bangladesh (10,41 EUR), respectively. On the other

7






7






Figure 6. Unit textile prices of Turkey and its major rivals’ export to EU-28 countries (Euro/kg).

7






20.00

18.00

16.00

14.00

12.00

10.00

8.00

6.00

4.00

2.00

0.00

Turkey clothing Turkey textile

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

5.004.504.003.503.002.502.001.501.000.500.00

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Turkey textileChina textile

7






7






India textilePakistan textile

7






7






South Korea textile

7






Figure 3. Annual shares of Turkey’s textile and clothing sectors within the total trade between Turkey and EU-28 countries.

6

share from Turkey’s total export to EU-28 countries in 2007, whereas it has taken 16% share in 2016. The decadal percentage shares have altered between 16% and 22%. Besides, the decadal shares of Turkish textile sector in Turkey’s total imports from EU-28 countries have altered between 2% and 3%; whereas the decadal shares of Turkish clothing sector in Turkey’s total imports from EU-28 countries have changed between 1% and 1,6%.

Figure 3. Annual shares of Turkey’s textile and clothing sectors within the total trade between Turkey and EU-28 countries

If the shares of Turkish textile and clothing sectors in EU-Extra textile and clothing import values (the textile and clothing import values of EU-28 countries from the outside of the union) are analyzed; it can be seen that, textile sector’s decadal percentage shares have altered between 16% and 20%, whereas clothing sector’s decadal percentage shares have altered between 12% and 16% (Figure 4). In other words, Turkey has usually maintained its shares in the EU-28 textile market during the determined period, whereas its shares in the EU-28 clothing market have declined generally. As mentioned above, this situation has resulted in a decrease from second place to third place in the EU-28 clothing market and an unaltered second place in the EU-28 textile market.

Figure 4. Turkey’s shares in the EU-28 textile and clothing market

3.2 Analyzing the Unit Textile and Clothing Export Prices of Turkey and Its Major Rivals to EU-28 Countries

If the unit export prices of Turkish textile and clothing sector to EU-28 countries are analyzed; it can be seen that, textile sector’s decadal unit export prices have altered between

Figure 4. Turkey’s shares in the EU-28 textile and clothing market.

6

share from Turkey’s total export to EU-28 countries in 2007, whereas it has taken 16% share in 2016. The decadal percentage shares have altered between 16% and 22%. Besides, the decadal shares of Turkish textile sector in Turkey’s total imports from EU-28 countries have altered between 2% and 3%; whereas the decadal shares of Turkish clothing sector in Turkey’s total imports from EU-28 countries have changed between 1% and 1,6%.

Figure 3. Annual shares of Turkey’s textile and clothing sectors within the total trade between Turkey and EU-28 countries

If the shares of Turkish textile and clothing sectors in EU-Extra textile and clothing import values (the textile and clothing import values of EU-28 countries from the outside of the union) are analyzed; it can be seen that, textile sector’s decadal percentage shares have altered between 16% and 20%, whereas clothing sector’s decadal percentage shares have altered between 12% and 16% (Figure 4). In other words, Turkey has usually maintained its shares in the EU-28 textile market during the determined period, whereas its shares in the EU-28 clothing market have declined generally. As mentioned above, this situation has resulted in a decrease from second place to third place in the EU-28 clothing market and an unaltered second place in the EU-28 textile market.

Figure 4. Turkey’s shares in the EU-28 textile and clothing market

3.2 Analyzing the Unit Textile and Clothing Export Prices of Turkey and Its Major Rivals to EU-28 Countries

If the unit export prices of Turkish textile and clothing sector to EU-28 countries are analyzed; it can be seen that, textile sector’s decadal unit export prices have altered between

25

20

15

10

5

02007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Textile export % shareClothing export % share

Textile import % shareClothing import % share

20.00

18.00

16.00

14.00

12.00

10.00

8.00

6.00

4.00

2.00

0.002007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Textile % share Clothing % share


Turkey is at the the top, but Cambodia al-most caught Turkey in the last two years. China could only take fourth place. This situation can be explained with the high value-added of Turkey’s product exports to the EU-28 clothing market. Although Turkey lost some of its market share in the latter years, it tried to compensate for this loss by selling high value-added products. On the other hand, Cambodia made a serious spurt and took second place in the average unit export price ranking; however, it took fifth place in the supplier ranking. Even though China is the biggest supplier, it could only take fourth place due to substantial low val-ue-added product procurement.

If the unit export prices of Turkish textile and clothing sectors are analysed on the basis of product groups, it can be seen that the highest unit export prices belong to the silk group (Figure 8). The decad-al average unit export price of the silk group was determined as 34.94 Euros per kilogram. On the other hand, knitted and

woven apparel and clothing accessories are the other product groups which raise the unit export prices. The decadal aver-age unit export price of woven apparel and clothing accessories was calculated as 25.4 Euros per kilogram, whereas it is 19.06 Euros per kilogram for knitted ap-parel and clothing accessories.

If the product groups, which raise the unit export prices per kilogram, are left out, it can be seen that the decadal average unit export prices ranged between 2.69 Euros and 9.34 Euro (Figure 9). Special woven fabrics, tufted textile fabrics, embroider-ies, vegetable textile fibres and the wool group possessed the highest decadal av-erage unit export prices per kilogram. On the other hand; wadding, felt, nonwov-ens, carpet and other textile floor cover-ings, the cotton group and man-made sta-ple fibres had the lowest decadal average unit export prices per kilogram.

If the unit export prices of the first five suppliers in the EU-28 textile market are

analyded on the basis of textile product groups, it can be seen that the highest decadal average unit export price per kilogram belonged to South Korea in terms of the silk category (Figure 10). Besides this, South Korea possessed the highest average unit export prices for wool, vegetable textile fibres, wadding, felt, nonwovens and knitted fabric cate-gories. On the other hand, Pakistan had the highest average unit export prices for carpets and other textile floor cover-ings as well as for impregnated, coated, covered and laminated textile fabrics, whereas India possessed the highest av-erage unit export prices for special wo-ven fabrics and embroideries. In addition to these, China had the highest average unit export prices in the cotton category, whereas Turkey possessed the highest average unit export prices for the man-made filament and staple fibre categories.

If the unit export prices of the first five suppliers in the EU-28 clothing mar-ket are analysed on the basis of cloth-

Figure 7. Unit clothing prices of Turkey and its major rivals’ export to EU-28 countries (Euro/kg).

8

hand, China is the biggest clothing supplier of the AB-28 market and is followed by Bangladesh, Turkey, India and Cambodia, respectively. If the decadal average unit export prices are analysed, it can be seen that Turkey is at the the top, but Cambodia almost caught Turkey in the last two years. China could only take fourth place. This situation can be explained with the high value-added of Turkey’s product exports to the EU-28 clothing market. Although Turkey lost some of its market share in the latter years, it tried to compensate for this loss by selling high value-added products. On the other hand, Cambodia made a serious spurt and took second place in the average unit export price ranking; however, it took fifth place in the supplier ranking. Even though China is the biggest supplier, it could only take fourth place due to substantial low value-added product procurement.

Figure 7. Unit clothing prices of Turkey and its major rivals’ export to EU-28 countries (Euro/kg)

If the unit export prices of Turkish textile and clothing sectors are analysed on the basis of product groups, it can be seen that the highest unit export prices belong to the silk group (Figure 8). The decadal average unit export price of the silk group was determined as 34,94 Euros per kilogram. On the other hand, knitted and woven apparel and clothing accessories are the other product groups which raise the unit export prices. The decadal average unit export price of woven apparel and clothing accessories was calculated as 25.4 Euros per kilogram, whereas it is 19.06 Euros per kilogram for knitted apparel and clothing accessories.

Figure 8. Unit prices of Turkish textile and clothing product groups’ export to EU-28 countries (Euro/kg)

20.00

18.00

16.00

14.00

12.00

10.00

8.00

6.00

4.00

2.00

0.002007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Turkey clothingChina clothing

India clothingBangladesh clothing

Cambodia clothing

8





8





8





8





8





Figure 8. Unit prices of Turkish textile and clothing product groups’ export to EU-28 countries (Euro/kg).

8





70.00

60.00

50.00

40.00

30.00

20.00

10.00

0.002007 2008 2009 2010 2011 2012 2013 2014 2015 2016

5051

8





8





5253

8





8





5455

8





8





5657

8





8





5859

8





8





6061

8





8





6263

8





8





Figure 9. Unit prices of Turkish textile and clothing product groups’ export to EU-28 countries (except 50, 61 and 62 product groups) (Euro/kg).

9

If the product groups, which raise the unit export prices per kilogram, are left out, it can be seen that the decadal average unit export prices ranged between 2,69 Euros and 9,34 Euro (Figure 9). Special woven fabrics, tufted textile fabrics, embroideries, vegetable textile fibres and the wool group possessed the highest decadal average unit export prices per kilogram. On the other hand; wadding, felt, nonwovens, carpet and other textile floor coverings, the cotton group and man-made staple fibres had the lowest decadal average unit export prices per kilogram.

Figure 9. Unit prices of Turkish textile and clothing product groups’ export to EU-28 countries (except 50, 61

and 62 product groups) (Euro/kg) If the unit export prices of the first five suppliers in the EU-28 textile market are analyded on the basis of textile product groups, it can be seen that the highest decadal average unit export price per kilogram belonged to South Korea in terms of the silk category (Figure 10). Besides this, South Korea possessed the highest average unit export prices for wool, vegetable textile fibres, wadding, felt, nonwovens and knitted fabric categories. On the other hand, Pakistan had the highest average unit export prices for carpets and other textile floor coverings as well as for impregnated, coated, covered and laminated textile fabrics, whereas India possessed the highest average unit export prices for special woven fabrics and embroideries. In addition to these, China had the highest average unit export prices in the cotton category, whereas Turkey possessed the highest average unit export prices for the man-made filament and staple fibre categories.

12.00

10.00

8.00

6.00

4.00

2.00

0.002007 2008 2009 2010 2011 2012 2013 2014 2015 2016

5152

5354

5556

5758

5960

63

9




9




9




9




9




9




9




9




9




9




9




Figure 10. Unit prices of Turkey and its major rivals’ export to EU-28 countries on the basis of textile product groups (Euro/kg).

10

Figure 10. Unit export prices of Turkey and its major rivals to EU-28 countries on the basis of textile product groups (Euro/kg)

If the unit export prices of the first five suppliers in EU-28 clothing market are analyzed on the basis of clothing product groups, it can be seen that the highest decadal average unit export price per kilogram has belonged to Turkey in terms of woven and knitted apparel and clothing accessories categories (Figure 11). On the other hand, Cambodia has possessed the highest average unit export price at home textile and used textile products category. In this category, Turkey has taken the second place just after Cambodia.

Figure 11. Unit export prices of Turkey and its major rivals to EU-28 countries on the basis of clothing product groups (Euro/kg)

3.3 Analyzing the Competitiveness of Turkey and Its Major Rivals in EU-28 Market with Balassa and Vollrath Indices

If the decadal Balassa index values, which are calculated for Turkish textile sector, are analyzed; it can be seen that, Turkey has gained strong competitive advantage in the EU-28 market in terms of exports (Decadal Balassa index values have altered between 4,69 and 6,82) (Figure 12). If the major rivals’ situations are analyzed; it can be seen that, Pakistan has

85807570656055504540353025201510

50

50 51 52 53 54 55 56 57 58 59 60

Turkey China India Pakistan South Korea


ing product groups, it can be seen that the highest decadal average unit export price per kilogram belonged to Turkey in terms of the woven and knitted apparel and clothing accessory categories (Fig-ure 11). On the other hand, Cambodia possessed the highest average unit export price for home textile and used textile product category. In this category, Turkey took second place just after Cambodia.

Analysis of the competitiveness of Turkey and its major rivals in the EU-28 market with Balassa and Vollrath indices If the decadal Balassa index values cal-culated for the Turkish textile sector are analyzed; it can be seen that Turkey gained a strong competitive advantage in the EU-28 market in terms of exports (Decadal Balassa index values ranged between 4.69 and 6.82) (Figure 12). If the major rivals’ situations are analyz-ed, it can be seen that Pakistan had the strongest competitive advantage in the EU-28 textile market in terms of exports

(Decadal Balassa index values varied between 16.59 and 23.53). Pakistan pos-sessed very high Balassa index values be-cause its textile exports had big shares in the country’s total exports. On the other hand, India possessed a strong competi-tive advantage in the decade determined, except in 2009. Moreover China and South Korea possessed an intermediate competitive advantage in the EU-28 tex-tile market with regard to exports. China had an intermediate competitive advan-tage, despite being the number one textile supplier to the EU-28 market; because the shares of China’s textile industry in China’s total exports are smaller in com-parison with rivals’ shares.

If the decadal Balassa index values cal-culated for the Turkish clothing sector are analysed, it can be seen that Turkey gained a strong competitive advantage in the EU-28 market in terms of exports (Decadal Balassa index values ranged between 7.89 and 9.76) (Figure 13). If the major rivals’ situations are analysed,

it can be seen that Bangladesh and Cam-bodia had the strongest competitive ad-vantage in the EU-28 clothing market in terms of exports (Decadal Balassa index values of Bangladesh changed be-tween 49.73 and 63.04; whereas those of Cambodia varied between 33.06 and 53.35). Both countries’ clothing exports had big shares in their countries’ total exports: 88% of Bangladesh’s total ex-port and 67% of Cambodia’s total export were attributed to their clothing sectors in 2016. Therefore their export based competitive advantages are very high, and this situation brings risks concomi-tantly. If a crisis or bottleneck occurs in the clothing sector, this can cause serious economic problems in the national econ-omy. On the other hand, China and India had a strong competitive advantage in the EU-28 clothing market with regard to ex-ports. As can be seen, the first five suppli-ers which compete in the EU-28 clothing market possessed a strong competitive advantage in terms of exports. However, if the risky situations of Bangladesh and

Figure 13. Distribution of Turkey and its major rivals according to Balassa index values calculated for the clothing sector.

70.00

60.00

50.00

40.00

30.00

20.00

10.00

0.002007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Turkey clothing

China clothing

India clothing

Bangladesh clothing

Cambodia clothing

12

Figure 13. Distribution of Turkey and its major rivals according to Balassa index values calculated for the

clothing sector If the decadal Vollrath index values calculated for the Turkish textile sector are analysed, it can be seen that Turkey gained a competitive advantage in the EU-28 market (Decadal Vollrath index values ranged between 0.02 and 0.59) (Figure 14). If the major rivals’ situations are analysed, it can be seen that all countries possessed a competitive advantage in the EU-28 textile market. Import as well as export values are taken into consideration during Vollrath index value calculation. Therefore it can be said that Vollrath index values give healthier and more accurate competitiveness results in comparison with Balassa index values.

Figure 14. Distribution of Turkey and its major rivals according to Vollrath index values calculated for the

textile sector If the decadal Vollrath index values calculated for the Turkish clothing sector are analysed, it can be seen that Turkey gained a competitive advantage in the EU-28 market (Decadal Vollrath index values ranged between 3.40 and 3.88) (Figure 15). Similarly all of the major rival countries possessed a competitive advantage in the EU-28 clothing market.

12





12





12





12





12





Figure 14. Distribution of Turkey and its major rivals according to Vollrath index values calculated for the textile sector.

Turkey textile

China textile

India textile

Pakistan textile

South Korea textile

12





12





12





12





12





12





2.00

1.80

1.60

1.40

1.20

1.00

0.80

0.60

0.40

0.20

0.002007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Figure 11. Unit prices of Turkey and its major rivals’ export to EU-28 countries on the basis of clothing product groups (Euro/kg).

10

Figure 10. Unit export prices of Turkey and its major rivals to EU-28 countries on the basis of textile product groups (Euro/kg)

If the unit export prices of the first five suppliers in EU-28 clothing market are analyzed on the basis of clothing product groups, it can be seen that the highest decadal average unit export price per kilogram has belonged to Turkey in terms of woven and knitted apparel and clothing accessories categories (Figure 11). On the other hand, Cambodia has possessed the highest average unit export price at home textile and used textile products category. In this category, Turkey has taken the second place just after Cambodia.

Figure 11. Unit export prices of Turkey and its major rivals to EU-28 countries on the basis of clothing product groups (Euro/kg)

3.3 Analyzing the Competitiveness of Turkey and Its Major Rivals in EU-28 Market with Balassa and Vollrath Indices

If the decadal Balassa index values, which are calculated for Turkish textile sector, are analyzed; it can be seen that, Turkey has gained strong competitive advantage in the EU-28 market in terms of exports (Decadal Balassa index values have altered between 4,69 and 6,82) (Figure 12). If the major rivals’ situations are analyzed; it can be seen that, Pakistan has

30

25

20

15

10

5

061 62 63

Turkey China India Bangladesh Cambodia

Figure 12. Distribution of Turkey and its major rivals according to the Balassa index values calculated for the textile sector

11

its textile exports had big shares in the country’s total exports. On the other hand, India possessed a strong competitive advantage in the decade determined, except in 2009. Moreover China and South Korea possessed an intermediate competitive advantage in the EU-28 textile market with regard to exports. China had an intermediate competitive advantage, despite being the number one textile supplier to the EU-28 market; because the shares of China’s textile industry in China’s total exports are smaller in comparison with rivals’ shares.

Figure 12. Distribution of Turkey and its major rivals according to the Balassa index values calculated for the

textile sector If the decadal Balassa index values calculated for the Turkish clothing sector are analysed, it can be seen that Turkey gained a strong competitive advantage in the EU-28 market in terms of exports (Decadal Balassa index values ranged between 7,89 and 9,76) (Figure 13). If the major rivals’ situations are analysed, it can be seen that Bangladesh and Cambodia had the strongest competitive advantage in the EU-28 clothing market in terms of exports (Decadal Balassa index values of Bangladesh changed between 49,73 and 63,04; whereas those of Cambodia varied between 33,06 and 53,35). Both countries’ clothing exports had big shares in their countries’ total exports: 88% of Bangladesh’s total export and 67% of Cambodia’s total export were attributed to their clothing sectors in 2016. Therefore their export based competitive advantages are very high, and this situation brings risks concomitantly. If a crisis or bottleneck occurs in the clothing sector, this can cause serious economic problems in the national economy. On the other hand, China and India had a strong competitive advantage in the EU-28 clothing market with regard to exports. As can be seen, the first five suppliers which compete in the EU-28 clothing market possessed a strong competitive advantage in terms of exports. However, if the risky situations of Bangladesh and Cambodia are taken into consideration, it can be seen that Turkey possessed the healthiest and strongest competitive advantage.

25.00

20.00

15.00

10.00

5.00

0.002007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Turkey textile

China textile

India textile

Pakistan textile

South Korea textile

11

its textile exports had big shares in the country’s total exports. On the other hand, India possessed a strong competitive advantage in the decade determined, except in 2009. Moreover China and South Korea possessed an intermediate competitive advantage in the EU-28 textile market with regard to exports. China had an intermediate competitive advantage, despite being the number one textile supplier to the EU-28 market; because the shares of China’s textile industry in China’s total exports are smaller in comparison with rivals’ shares.

Figure 12. Distribution of Turkey and its major rivals according to the Balassa index values calculated for the

textile sector If the decadal Balassa index values calculated for the Turkish clothing sector are analysed, it can be seen that Turkey gained a strong competitive advantage in the EU-28 market in terms of exports (Decadal Balassa index values ranged between 7,89 and 9,76) (Figure 13). If the major rivals’ situations are analysed, it can be seen that Bangladesh and Cambodia had the strongest competitive advantage in the EU-28 clothing market in terms of exports (Decadal Balassa index values of Bangladesh changed between 49,73 and 63,04; whereas those of Cambodia varied between 33,06 and 53,35). Both countries’ clothing exports had big shares in their countries’ total exports: 88% of Bangladesh’s total export and 67% of Cambodia’s total export were attributed to their clothing sectors in 2016. Therefore their export based competitive advantages are very high, and this situation brings risks concomitantly. If a crisis or bottleneck occurs in the clothing sector, this can cause serious economic problems in the national economy. On the other hand, China and India had a strong competitive advantage in the EU-28 clothing market with regard to exports. As can be seen, the first five suppliers which compete in the EU-28 clothing market possessed a strong competitive advantage in terms of exports. However, if the risky situations of Bangladesh and Cambodia are taken into consideration, it can be seen that Turkey possessed the healthiest and strongest competitive advantage.


Cambodia are taken into consideration, it can be seen that Turkey possessed the healthiest and strongest competitive ad-vantage.

If the decadal Vollrath index values cal-culated for the Turkish textile sector are analysed, it can be seen that Turkey gained a competitive advantage in the EU-28 market (Decadal Vollrath index values ranged between 0.02 and 0.59) (Figure 14). If the major rivals’ situa-tions are analysed, it can be seen that all countries possessed a competitive advan-tage in the EU-28 textile market. Import as well as export values are taken into consideration during Vollrath index value calculation. Therefore it can be said that Vollrath index values give healthier and more accurate competitiveness results in comparison with Balassa index values.

If the decadal Vollrath index values cal-culated for the Turkish clothing sector are analysed, it can be seen that Turkey

gained a competitive advantage in the EU-28 market (Decadal Vollrath index values ranged between 3.40 and 3.88) (Figure 15). Similarly all of the major rival countries possessed a competitive advantage in the EU-28 clothing market.

If the decadal Balassa index values cal-culated for textile product groups are analysed, it can be seen that India and China possessed a strong competitive advantage in the silk category in the EU-28 market (Figure 16). Turkey and China had a weak competitive advantage in the wool category, whereas the other countries possessed a competitive disad-vantage. On the other hand, India, Paki-stan and Turkey had a strong competitive advantage in the cotton category, where-as Turkey and India possessed a strong competitive advantage for man-made filaments. In addition to these, Turkey, India and Pakistan had a strong compet-itive advantage for man-made staple fi-bres, carpets and other textile floor cover-

ings. Besides this, Turkey and China pos-sessed a strong competitive advantage for special woven fabrics and embroider-ies, and Turkey, South Korea and China had a strong competitive advantage with respect to knitted fabrics. On the other hand, India possessed an intermediate competitive advantage for vegetable textile fibres, whereas Turkey, Pakistan and South Korea had a weak competitive advantage for wadding, felt and nonwo-vens. Finally South Korea possessed an intermediate competitive advantage for impregnated, coated, covered and lami-nated fabrics. None of the countries had a strong competitive advantage in these categories.

If the decadal Balassa index values cal-culated for clothing product groups are analysed; it can be seen that all countries possessed a strong competitive advan-tage in the knitted apparel and clothing accessory category in the EU-28 market (Figure 17). Cambodia and Bangladesh

Figure 15. Distribution of Turkey and its major rivals according to Vollrath index values calculated for the clothing sector.

6.00

5.00

4.00

3.00

2.00

1.00

0.00

Turkey clothing

China clothing

India clothing

Bangladesh clothing

Cambodia clothing

13


clothing sector If the decadal Balassa index values calculated for textile product groups are analysed, it can be seen that India and China possessed a strong competitive advantage in the silk category in the EU-28 market (Figure 16). Turkey and China had a weak competitive advantage in the wool category, whereas the other countries possessed a competitive disadvantage. On the other hand, India, Pakistan and Turkey had a strong competitive advantage in the cotton category, whereas Turkey and India possessed a strong competitive advantage for man-made filaments. In addition to these, Turkey, India and Pakistan had a strong competitive advantage for man-made staple fibres, carpets and other textile floor coverings. Besides this, Turkey and China possessed a strong competitive advantage for special woven fabrics and embroideries, and Turkey, South Korea and China had a strong competitive advantage with respect to knitted fabrics. On the other hand, India possessed an intermediate competitive advantage for vegetable textile fibres, whereas Turkey, Pakistan and South Korea had a weak competitive advantage for wadding, felt and nonwovens. Finally South Korea possessed an intermediate competitive advantage for impregnated, coated, covered and laminated fabrics. None of the countries had a strong competitive advantage in these categories.

Figure 16. Distribution of Turkey and its major rivals according to average Balassa index values calculated on

the basis of textile product groups

12





12





12





12





12





2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Figure 16. Distribution of Turkey and its major rivals according to average Balassa index values calculated on the basis of textile product groups.

13

Figure 15. Distribution of Turkey and its major rivals according to the Vollrath index values which are calculated for clothing sector

If the decadal Balassa index values, which are calculated for textile product groups, are analyzed; it can be seen that, India and China have possessed strong competitive advantage at silk category in EU-28 market (Figure 16). Turkey and China have owned weak competitive advantage at wool category, whereas the other countries have possessed competitive disadvantage. On the other hand, India, Pakistan and Turkey have owned strong competitive advantage at cotton category, whereas Turkey and India have possessed strong competitive advantage at man-made filaments. In addition to these Turkey, India and Pakistan have owned strong competitive advantage at man-made staple fibers and carpets and other textile floor coverings. Besides, Turkey and China have possessed strong competitive advantage at special woven fabrics and embroideries, and Turkey, South Korea and China have owned strong competitive advantage at knitted fabrics. On the other hand, India has possessed intermediate competitive advantage at vegetable textile fibers, whereas Turkey, Pakistan and South Korea have owned weak competitive advantage at wadding, felt and nonwovens. Finally, South Korea has possessed intermediate competitive advantage at impregnated, coated, covered and laminated fabrics. None of the countries have owned strong competitive advantage at these categories.

Figure 16. Distribution of Turkey and its major rivals according to the average Balassa index values which are calculated on the basis of textile product groups

90

80

70

60

50

40

30

20

10

050 51 52 53 54 55 56 57 58 59 60

TurkeyChina

India

Pakistan

South Korea

Figure 17. Distribution of Turkey and its major rivals according to average Balassa index values calculated on the basis of clothing product groups.

14

If the decadal Balassa index values, which are calculated for clothing product groups, are analyzed; it can be seen that, all countries have possessed strong competitive advantage at knitted apparel and clothing accessories category in EU-28 market (Figure 17). Cambodia and Bangladesh have owned the highest Balassa index values, because both countries’ clothing exports have taken big shares from their countries’ total exports. On the other hand, only Turkey, Bangladesh and China have possessed strong competitive advantage at woven apparel and clothing accessories category. India and Cambodia have owned intermediate competitive advantage at this category. Furthermore, all countries except Cambodia have possessed strong competitive advantage at home textile and used textile products category, whereas Cambodia has owned intermediate competitive advantage.

Figure 17. Distribution of Turkey and its major rivals according to the average Balassa index values which are calculated on the basis of clothing product groups

If the decadal Vollrath index values, which are calculated for textile product groups, are analyzed; it can be seen that, only China, India and South Korea have possessed competitive advantage at silk category in EU-28 market (Figure 18). None of the countries have owned competitive advantage at wool category. On the other hand, all countries except South Korea have possessed competitive advantage at cotton category, whereas India has possessed competitive advantage at vegetable textile fibers. Besides, all countries except Pakistan have owned competitive advantage at man-made filaments and all countries except Turkey have possessed competitive advantage at man-made staple fibers. In addition to these, China and India have owned competitive advantage at wadding, felt and nonwovens, whereas all countries except South Korea have possessed competitive advantage at carpets and other textile floor coverings. Furthermore, all countries except Pakistan have owned competitive advantage at special woven fabrics and embroideries, whereas China and South Korea have possessed competitive advantage at impregnated, coated, covered and laminated fabrics. Finally, all countries except India have owned competitive advantage at knitted fabrics.

If the decadal Vollrath index values, which are calculated for clothing product groups, are analyzed; it can be seen that, all countries have possessed competitive advantage at all categories (knitted apparel and clothing accessories, woven apparel and clothing accessories and home textile and used textile products) in the EU-28 market (Figure 19).

160

140

120

100

80

60

40

20

061 62 63

Turkey China IndiaBangladesh Cambodia

Figure 18. Distribution of Turkey and its major rivals according to average Vollrath index values calculated on the basis of textile product groups.

4

3

2

1

0

-1

-2

-3Turkey China India Pakistan South Korea

15

Figure 18. Distribution of Turkey and its major rivals according to the average Vollrath index values which are calculated on the basis of textile product groups

Figure 19. Distribution of Turkey and its major rivals according to the average Vollrath index values which are calculated on the basis of clothing product groups

The competitiveness of Turkish textile and clothing sector in EU-28 market and the situations of its major rivals are summarized in Table 2. According to the obtained results, Turkish textile and clothing sector has possessed competitive advantage in the EU-28 market with regard to decadal average unit export prices. Clothing sector has passed all its rivals with its decadal average unit export price per kilogram, whereas textile sector has only passed by China. Besides, Turkey has possessed the leading position at two product categories both in textile and clothing sectors with regard to the decadal average unit export prices per kilogram. Turkey is the second biggest textile supplier and third biggest clothing supplier of EU-28 market. However, it has passed all its rivals in average unit export prices per kilogram, because it has exported high value-added textile and clothing products.


had the highest Balassa index values be-cause both countries’ clothing exports took big shares in their countries’ total exports. On the other hand, only Turkey, Bangladesh and China possessed a strong competitive advantage in the woven ap-parel and clothing accessory category. India and Cambodia had an intermediate competitive advantage in this category. Furthermore all countries, except Cam-bodia, possessed a strong competitive advantage in the home textile and used textile product category, whereas Cam-bodia had an intermediate competitive advantage.

If the decadal Vollrath index values cal-culated for textile product groups are analysed, it can be seen that only China, India and South Korea possessed a com-petitive advantage in the silk category in the EU-28 market (Figure 18). None of the countries had a competitive advan-tage in the wool category. On the other hand, all countries, except South Korea, possessed a competitive advantage in the cotton category, whereas India possessed a competitive advantage in vegetable tex-tile fibres. Moreover all countries, except Pakistan, had a competitive advantage in man-made filaments, and all countries, except Turkey, possessed a competitive advantage in man-made staple fibres. In addition to these, China and India had a competitive advantage in wadding, felt and nonwovens, whereas all countries, except South Korea, possessed a com-petitive advantage for carpets and other textile floor coverings. Furthermore all countries, except Pakistan, had a compet-itive advantage in special woven fabrics and embroideries, whereas China and South Korea possessed a competitive ad-vantage in impregnated, coated, covered and laminated fabrics. Finally all coun-tries, except India, had a competitive ad-vantage in knitted fabrics.

If the decadal Vollrath index values cal-culated for clothing product groups are analysed, it can be seen that all countries possessed a competitive advantage in all categories (knitted apparel and clothing accessories, woven apparel and clothing accessories, and home textile and used textile products) in the EU-28 market (Figure 19).

The competitiveness of the Turkish tex-tile and clothing sector in the EU-28 mar-ket and the situations of its major rivals are summarised in Table 2. According to the results obtained, the Turkish textile and clothing sector possessed a compet-itive advantage in the EU-28 market with regard to decadal average unit export prices. The clothing sector surpassed all its rivals with its decadal average unit ex-port price per kilogram, whereas the tex-tile sector was only surpassed by China. Besides this, Turkey possessed the lead-ing position in two product categories in both the textile and clothing sectors with regard to the decadal average unit export prices per kilogram. Turkey is the second biggest textile supplier and third biggest clothing supplier to the EU-28 market. However, it surpassed all its rivals in the average unit export prices per kilogram, because it exported high value-added textile and clothing products.

According to other results obtained, the Turkish textile and clothing sector pos-sessed a competitive advantage in the EU-28 market with regard to decadal Balassa and Vollrath index values. As stated by Balassa index values, both the textile and clothing sectors had a strong competitive advantage in the EU-28 mar-ket. Pakistan is the strongest rival of Tur-key in terms of textile exports, whereas Bangladesh and Cambodia are the stron-gest rivals of Turkey with regard to cloth-ing exports. Moreover Turkey possessed

a strong competitive advantage in nine product groups in textile and clothing exports, whereas it had a weak compet-itive advantage in three product groups. Furthermore it possessed a competitive disadvantage in two product groups. Tur-key possessed a strong competitive ad-vantage in approximately 64% of textile and clothing product groups with regard to exports. In this context, it can be said that the sector maintained its significance and place in the EU-28 market, being ex-act evidence.

Import as well as export values were tak-en into consideration during the Vollrath index value calculation, showing that the number of textile and clothing sector ri-vals increased. According to this index, the Turkish textile sector should pay attention to China, India, Pakistan and South Korea, whereas the Turkish cloth-ing sector should focus on China, India, Bangladesh and Cambodia. As stated by Vollrath index values, Turkey possessed a competitive advantage in eight product groups in the textile and clothing sectors, whereas it had a competitive disadvan-tage in six product groups. As can be seen, Turkey possessed a competitive ad-vantage in approximately 57% of the tex-tile and clothing product groups with re-gard to the Vollrath index. In this context, it can be said that Turkey accomplished this situation with high unit export pric-es and created added-value. Therefore Turkey maintains its voice in the EU-28 textile and clothing market and protects its competitive advantage with its expert-ness.

Conclusions and general evaluation

The Turkish textile and clothing sector maintains its significance in the national economy and exports despite increasing international competition. If Turkey’s textile and clothing trade with EU-28 countries is analysed, it can be seen that Turkey maintains its importance in the EU market and both sectors possess a net foreign trade surplus. The Turkish textile sector possessed an approximately 2 bil-lion Euro foreign trade surplus by 2016, while the clothing sector had a 9,8 billion Euro foreign trade surplus.

According to Euratex data [12], the sec-tor was the second biggest textile and third biggest clothing supplier to the EU-28 countries by 2016. Besides this, as stated by this research, the sector pos-

Figure 19. Distribu-tion of Turkey and its major rivals ac-cording to average Vollrath index values calculated on the ba-sis of clothing product groups.

15

Figure 18. Distribution of Turkey and its major rivals according to the average Vollrath index values which are calculated on the basis of textile product groups

Figure 19. Distribution of Turkey and its major rivals according to the average Vollrath index values which are calculated on the basis of clothing product groups

The competitiveness of Turkish textile and clothing sector in EU-28 market and the situations of its major rivals are summarized in Table 2. According to the obtained results, Turkish textile and clothing sector has possessed competitive advantage in the EU-28 market with regard to decadal average unit export prices. Clothing sector has passed all its rivals with its decadal average unit export price per kilogram, whereas textile sector has only passed by China. Besides, Turkey has possessed the leading position at two product categories both in textile and clothing sectors with regard to the decadal average unit export prices per kilogram. Turkey is the second biggest textile supplier and third biggest clothing supplier of EU-28 market. However, it has passed all its rivals in average unit export prices per kilogram, because it has exported high value-added textile and clothing products.

8

7

6

5

4

3

2

1

0

61 62 63

Turkey China IndiaBangladesh Cambodia


sessed a strong competitive advantage in nine out of fourteen product groups in the EU-28 market with regard to exports. In other words, Turkey possessed a strong competitive advantage in approximate-ly 64% of textile and clothing product groups according to Balassa index val-ues. In this context, it can be said that the sector maintains its significance and power in the EU-28 market, being exact evidence.

In addition, if both the export and import values are taken into consideration, it can be seen that the Turkish textile and cloth-ing sector possessed a competitive ad-vantage in eight out of fourteen product groups. In other words, Turkey possessed a competitive advantage in approximate-ly 57% of textile and clothing product groups with regard to Vollrath index values. In this context, it can be said that Turkey maintains its voice in the EU-28 textile and clothing market and protects its competitive advantage with its expert-ness.

Pakistan is the strongest rival of the Turkish textile sector in the EU-28 mar-ket with regard to exports. If both export and import values are taken into consid-eration, the rivals can be determined as China, Pakistan, India and South Ko-rea. On the other hand, Bangladesh and Cambodia are the strongest rivals of the Turkish clothing sector with regard to exports. If the evaluation is based on for-eign trade, China, Bangladesh, India and Cambodia are found as rivals.

According to the results obtained, the Turkish textile and clothing sector should focus on the product groups in which it possesses a weak competitive advantage or disadvantage in order to increase its competitiveness in the EU-28 market. These product groups can be listed as follows: silk, wool, vegetable textile fi-bres, man-made staple fibres, wadding, felt and nonwovens, and impregnated, coated, covered and laminated fabrics. As can be seen, all of them belong to the textile sector. China, India, Pakistan and

South Korea are the rivals in this sector with regard to these categories.

According to another significant result, the Turkish textile and clothing sector possessed a serious competitive advan-tage in the EU-28 market with regard to decadal average unit export prices. The clothing sector surpassed all its ri-vals with its decadal average unit export price per kilogram, whereas the textile sector was only surpassed by China. Be-sides this, Turkey possessed the leading position in two product categories in both the textile and clothing sectors with re-gard to decadal average unit export prices per kilogram. As can be seen, the Turkish textile and clothing sector surpassed all its rivals in accordance with the average unit export prices per kilogram, by ex-porting high value-added products to the EU-28 market.

As can be seen, the Turkish textile and clothing sector competes especially with Far East countries in the EU-28 market.

Table 2. Competitiveness of Turkish textile and clothing sector in EU-28 market.

According to the decadal average unit export prices

According to the decadal average balassa index values

According to the decadal average vollrath index values

Textile 3.89 Euro/kg (China is the strongest rival)

Strong competitive advantage/ Pakistan is the strongest rival.

Competitive advantage/China, India, Pakistan and South Korea are the rivals.

Clothing 16.32 Euro/kg (Cambodia is the closest rival)

Strong competitive advantage/ Bangladesh and Cambodia are strongest rivals.

Competitive advantage/China, India, Bangladesh and Cambodia are the rivals.

Silk 34.94 Euro/kg (South Korea is the strongest rival)

Competitive disadvantage/China and India are the strongest rivals.

Competitive disadvantage/China, India and South Korea are the rivals.

Wool, fine or coarse animal hair, horsehair yarn and woven fabric

7.59 Euro/kg (South Korea is the strongest rival)

Weak competitive advantage/China is the closest rival.

All countries possess competitive disadvantage.

Cotton 3.42 Euro/kg (China is the strongest rival)

Strong competitive advantage/Pakistan and India are the strongest rivals.

Competitive advantage/China, India and Pakistan are the rivals.

Vegetable textile fibres, paper yarn and woven fabrics of paper yarn


Competitive disadvantage/ India is the strongest rival.

Competitive disadvantage/India is the rival.

Man-made filaments, strip and the like of man-made textile materials

4.15 Euro/kg (South Korea is the closest rival)

Strong competitive advantage/ India is the closest rival.

Competitive advantage/China, India and South Korea are the rivals.

Man-made staple fibres 3.69 Euro/kg (China is the closest rival)

Strong competitive advantage/ Pakistan is the strongest rival.

Competitive disadvantage/China, India, Pakistan and South Korea are the rivals.

Wadding, felt, nonwovens, and special yarns: twine, cordage, ropes, cables and articles thereof


Weak competitive advantage/ South Korea is the closest rival.

Competitive disadvantage/China and India are the rivals.

Carpets and other textile floor coverings 2.84 Euro/kg (Pakistan is the strongest rival)

Strong competitive advantage/ Pakistan is the closest rival.

Competitive advantage/China, India and Pakistan are the rivals.

Fabrics, special woven fabrics, tufted textile fabrics, lace, tapestries, trimmings, embroidery

8.48 Euro/kg (India is the strongest rival)

Strong competitive advantage/ China is the closest rival.

Competitive advantage/China, India and South Korea are the rivals.

Textile fabrics:, impregnated, coated, covered or laminated; textile articles of a kind suitable for industrial use

4.13 Euro/kg (Pakistan is the strongest rival)

Weak competitive advantage/ South Korea is the strongest rival.

Competitive disadvantage/China and South Korea are the rivals.

Fabrics knitted or crocheted 5.60 Euro/kg (South Korea is the strongest rival)

Strong competitive advantage/ China is the closest rival.

Competitive advantage/China, Pakistan and South Korea are the rivals.

Apparel and clothing accessories knitted or crocheted

19.06 Euro/kg (India is the closest rival)

Strong competitive advantage/ Bangladesh and Cambodia are the strongest rivals.

Competitive advantage/China, Bangladesh, India and Cambodia are the rivals.

Apparel and clothing accessories not knitted or crocheted

25.41 Euro/kg (India is the closest rival)

Strong competitive advantage/ Bangladesh is the strongest rival.


Textiles – made up articles, sets, worn clothing and textile articles; rags

5.82 Euro/kg (Cambodia is the strongest rival)

Strong competitive advantage/ Bangladesh is the strongest rival.



At this point, Turkey should export high value-added products and increase these products’ export amounts in order to in-crease its market share, by which the sec-tor could be able to compete against these rivals and protect its competitiveness. In this context, it should produce and export high-quality products at appropriate costs by using its knowledge, experience and expertise. Therefore it should give great importance to research and development activities and design through which it should both increase the average unit ex-port prices and the number of textile and clothing product groups in which it pos-sesses a competitive advantage.

To sum up, this study contributes to lit-erature by informing about an important market (European Union market) and re-veals the final situations of a significant global player (Turkish textile and cloth-ing sector) and its rivals. Moreover this study gathers different methods together in order to analyse competitiveness, in which it considers the subject from dif-ferent views in a broad perspective. On the other hand, the research has focused on a determined period (2007-2016) and only six significant rivals (China, India, Pakistan, South Korea, Bangladesh and Cambodia) are included in the research. These are its limitations. For future re-searches, the period investigated and ri-vals included can be broadened. Besides these, other comparative analyses can be carried out for the European Union mar-ket. In addition to these, similar research-es can be carried out in other markets (such as the Middle East, North Africa, Turkic Republics) in which the Turkish textile and clothing sector operates.

References 1. Balogh J M, Jambor A. The global com-

petitiveness of European wine produc-ers. British Food Journal 2017;119, 9: 2076-2088.

2. Hatab A A, Romstad E. Competitiveness analysis of Egyptian cotton exports with special focus on the Chinese market. China Agricultural Economic Review 2014; 6, 2: 248-263.

3. Tripa S, Cuc S, Oana I. Revealed com-parative advantage and competitive-ness in Romanian textile and clothing industry. Industria Textila 2016; 67, 5: 338-344.

4. Erkan B. Determining the internation-al competitiveness of Turkey in textile and clothing export (In Turkish). Anad-olu Üniversitesi Sosyal Bilimler Dergisi 2013; 13, 1: 93-110.

5. Kilduff P, Chi T. Analysis of compara-tive advantage in the textile complex: a study of Eastern European and former Soviet Union nations. Journal of Fashion Marketing and Management 2007; 11,1: 82-105.

6. Atılgan T, Kanat S. The effects of the EU customs union with Turkey on the Turk-ish textile and clothing sector. FIBRES & TEXTILES in Eastern Europe 2006; 14, 4(58): 11-15.

7. Milasius R, Mikucioniene D. Compar-ative analysis of textile and clothing in-dustry in the EU and Turkey. FIBRES & TEXTILES in Eastern Europe 2014; 22, 3(105): 8-16.

8. Gacener Atış A. Comparative competi-tiveness analysis of Turkish textile and clothing sector (In Turkish). Ege Akade-mik Bakış 2014; 14, 2:315-334.

9. Özçalık M, Okur A. Competitiveness of Turkish textile and clothing sectors against EU-15 countries after customs union (In Turkish). Celal Bayar Üniversi-tesi Sosyal Bilimler Dergisi 2013; 11, 1: 205-223ın.

10. Şahin D. Static analysis of Turkish tex-tile and clothing sector’s intra-industry trade: comparison with EU-15 countries (In Turkish). Uşak Üniversitesi Sosyal Bilimler Dergisi 2015; 8, 2: 49-66.

11. Bostan A, Ürüt S, Ateş İ. Competitive-ness of Turkish textile and clothing sector: comparison with European Un-ion countries (In Turkish). Yönetim ve Ekonomi Araştırmaları Dergisi 2010; 8, 13: 43-58.

12. The European Apparel and Textile Con-federation – Euratex, 2016 Key Figures Report, http://euratex.eu/press/key-da-ta/, Date of Access: December 2017.

13. Foreign Trade Online, Harmonized Sys-tem Codes, https://www.foreign-trade.com/reference/hscode.htm?cat=9 , Date of Access: December 2017.

14. Statistical Office of European Union – Eurostat, http://ec.europa.eu/eurostat/data/database Date of Access: Decem-ber 2017.

15. International Trade Center – Trademap, https://www.trademap.org/Index.aspx , Date of Access: December 2017.

16. Brakman S, Marrewijk CV. A closer look at revealed comparative advantage: gross-versus value-added trade flows. Papers in Regional Science 2017; 96, 1: 61-92.

17. Balassa B. Trade liberalization and revealed comparative advantage. The Manchester School of Economic and Social Studies 1965; 33, 2: 99-123.

18. Kuldilok KS, Dawson PJ, Lingard J. The export competitiveness of the tuna industry in Thailand. British Food Jour-nal 2013; 115, 3: 328-341.

19. Maitah M, Kuzmenko E, Smutka L. Real effective exchange rate of rouble and competitiveness of Russian agrar-ian producers. Economies 2016; 4, 12: 1-19.

20. Vollrath TL. A theoretical evaluation of alternative trade revealed comparative advantage measures of intensity. Re-view of World Economics 1991; 127, 2: 265-280.

21. Dziuba R, Jablonska M. Competitive-ness of the textile sector of Croatia in trade with the European Union. FI-BRES & TEXTILES in Eastern Eu-rope 2017; 25, 6 (126): 14-18. DOI: 10.5604/01.3001.0010.5361.

22. Ignjatijevic S, Dordevic D, Ciric M. Ser-bian textile and apparel industry at the international market: comparative ad-vantage analysis. Actual Problems of Economics 2012; 7: 383-393.

23. Wysokinska Z. Competitiveness of the Polish textile and clothing sector within the European integration process and the liberalization procedures of GATT/WTO agreement. FIBRES & TEXTILES in Eastern Europe 2004; 12, 4(48): 8-11.

24. Wysokinska Z. The Polish textile sector and its competitiveness on the single European market with special emphasis on blankets, travelling rugs and towels. FIBRES & TEXTILES in Eastern Europe 2006; 14, 3: 7-11.

25. Vu HT, Pham LC. A dynamic approach to assess international competitiveness of Vietnam’s garment and textile indus-try. Springer Plus 2016; No.5 :203: 1-13.

26. Corovic E, Jovanovic P, Ristic L. Cur-rent trends on the world textile market and the competitiveness of the Serbian textile industry. FIBRES & TEXTILES in Eastern Europe 2013; 21, 5(101): 8-12.

27. Traşca DL, Dudian M. The competi-tivess of the textile industry and textile products in Romania – an analysis ac-cording to Mereuta model. Industria Tex-tila 2011; 62, 5: 254-258.

28. Jucevicius R, Rybakovas E. Competi-tiveness of Lithuanian textile and cloth-ing industry, 6th International Scientific Conference Business and Management 2010; 13-14 May, Lithuania.

29. Chuang L. Research on the internation-al competitiveness of Chinese textile industry in EU market. 4th International Conference on Wireless Communica-tions, Networking and Mobile Comput-ing 2008; 12-17 October, China.

30. Ping WL. Empirical study on the interna-tional competitiveness of Chinese textile industry, 4th International Conference on Wireless Communications, Networking and Mobile Computing 2008; 12-17 Oc-tober, China.

31. Jiang A, Zhang R. An analysis of Shaox-ing textile industry’s international com-petitiveness: the perspective of the export evaluation indexes. Internation-al Conference on Textile Engineering and Materials 2011; 23-25 September, China.

Received 11.04.2018 Reviewed 08.10.2018

Documents

Seher Kanat Analysis of the Competitiveness of the Turkish … · 51 Wool, fine or coarse animal hair: horsehair yarn and woven fabric 52 Cotton 53 Vegetable textile fibres, paper