Italy and Turkey Bolster Economic Ties Amidst Global Trade Shifts

In a strategic move signalling deepening economic ties, Italy hosted a high-level bilateral business meeting with Turkey in Rome on April 29th. The summit, presided over by Italian Prime Minister Giorgia Meloni and Turkish President Recep Tayyip Erdoğan, aimed to significantly enhance commercial relations, bolster the reach of “Made in Italy” excellence, and facilitate the export of Italian products and know-how to the Turkish market. This gathering takes place against the backdrop of evolving global trade dynamics, including the potential impact of protectionist measures such as the spectre of US tariffs, pushing nations to diversify markets and strengthen existing partnerships.

The meeting brought together not only the heads of government but also key ministers and a substantial delegation of business leaders from both countries, representing sectors ranging from infrastructure and energy to fashion, food, and machinery. Discussions focused on identifying barriers to trade and investment, exploring opportunities for joint ventures, and paving the way for smoother access for Italian companies into the dynamic Turkish economy. The shared objective is to create new commercial arteries that can help Italian firms mitigate potential headwinds from other markets and capitalise on Turkey’s strategic geographic position and growing domestic demand.

Catalysts for Commerce: The Indispensable Role of SACE, SIMEST, and ITA

A cornerstone of Italy’s strategy to support its businesses abroad is the integrated action of institutions like SACE, SIMEST, and the Italian Trade Agency (ITA, or ICE Agenzia). Their patronage and active participation were fundamental to the success of the Rome meeting.

SACE, Italy’s export credit agency, plays a vital role by offering insurance and financial solutions to support Italian companies’ expansion in foreign markets. For businesses looking towards Turkey, SACE provides tools that de-risk export transactions and investments, making it safer for companies, particularly SMEs, to venture into or expand their presence in this complex market. This includes credit insurance, investment protection, and guarantees necessary for securing financing.

SIMEST, part of the CDP Group alongside SACE, is the Italian development and investment finance institution that supports Italian companies’ international growth. SIMEST directly acquires minority stakes in Italian companies’ foreign ventures, provides subsidised loans for internationalisation projects (like feasibility studies, market penetration, setting up commercial structures), and supports participation in international tenders. Their presence underscores the commitment to supporting long-term Italian business presence and investment in Turkey.

The Italian Trade Agency (ITA) is the governmental agency that supports the business development of Italian companies abroad and promotes the attraction of foreign investment in Italy.¹ ITA organises trade fairs, business missions, bilateral meetings, and provides crucial market information and networking opportunities. For the Turkey market, ITA’s role is key in connecting Italian exporters with potential Turkish partners, navigating local regulations, and promoting the image and quality of Made in Italy products across various sectors. Together, these three entities form a powerful synergy, offering a comprehensive suite of services essential for Italian companies to successfully enter and thrive in the Turkish market.

The Current Picture: Italy-Turkey Trade in Numbers

Italy and Turkey share a robust and growing trade relationship, making this bilateral meeting particularly timely. Italy is one of Turkey’s most significant trading partners in the European Union, and vice versa.

In recent years, bilateral trade turnover has shown remarkable resilience. Italy’s exports to Turkey are substantial, covering a wide range of high-value goods. Machinery and mechanical appliances consistently rank at the top, reflecting Italy’s strength in capital goods essential for Turkish industrial development. The automotive sector, including components, is another major export category. Furthermore, the renowned excellence of “Made in Italy” is evident in exports of fashion (textiles, apparel, leather goods), furniture and design items, and chemicals. While food exports are present, they represent a smaller share compared to manufactured goods, although there is growing interest in Italian agri-food products among the Turkish middle class.

Conversely, Italy imports significant volumes from Turkey, including textiles and apparel, automotive parts, electrical machinery, and agricultural products. The balance of trade has historically seen fluctuations, but the overall trend is one of strong interdependence. The total value of bilateral trade runs into billions of euros annually, making both countries essential markets for each other’s economies.

Paving the Way for Growth: Prospects for Made in Italy

The strengthening of commercial ties between Italy and Turkey holds significant potential for further growth of Made in Italy. Turkey’s young and dynamic population, coupled with its strategic location bridging Europe and Asia, presents a large and expanding market for Italian consumer goods, from fashion and design to food and luxury items. As the Turkish economy develops, there is increasing demand for high-quality, innovative, and design-led products – hallmarks of Made in Italy.

Moreover, Turkey’s ambitious infrastructure and industrial development plans create substantial opportunities for Italian companies specialised in machinery, engineering, construction technologies, and renewable energy. The bilateral discussions in Rome aimed to unlock these specific opportunities, ensuring Italian firms are well-positioned to participate in Turkish projects. Reducing bureaucratic hurdles and enhancing mutual recognition of standards were key themes, promising smoother access for Italian exporters and investors.

A Glimpse into Shared Connections

While direct anecdotes from yesterday’s meeting may emerge over time, the history between Italy and Turkey is laced with fascinating interconnections beyond economics. Consider, for instance, the historical maritime trade routes across the Mediterranean that linked Italian city-states with the Ottoman Empire for centuries, fostering not just commerce but also cultural exchange in areas like cuisine, art, and language. These deep historical roots provide a fertile ground for contemporary economic partnership, built on a long history of interaction and mutual, albeit sometimes complex, influence.

Navigating Global Currents: The Imperative for Market Diversification

In conclusion, the Italy-Turkey business meeting in Rome underscores a crucial strategic imperative for Italian businesses, particularly for the backbone of our economy: small and medium-sized enterprises. In an increasingly unpredictable global trade environment, where protectionist tendencies and tariff threats loom, relying heavily on a single market, even one as significant as the United States, carries inherent risks.

Opening up to new markets, like the dynamic and strategically important market of Turkey, is not merely an option but a necessity for resilience and growth. Diversification spreads risk and creates alternative revenue streams. The support structures provided by SACE, SIMEST, and ITA are critical enablers in this process, offering the financial tools and market access expertise that SMEs often lack internally. By actively seeking and nurturing relationships with countries like Turkey, Italian enterprises can build a more robust and sustainable future, ensuring that the value and quality of Made in Italy continue to thrive on the global stage, even when faced with challenging international headwinds.

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