Turkish textile industry faces crisis as leading figures warn of production halt – Turkish Minute

Turkey’s leading textile and ready-to-wear executives have warned that the country’s once-thriving industry is on the brink of collapse, saying government policies, high inflation and rising costs have left manufacturers struggling to survive and that production could come to a standstill within six months, the Ekonomim news website reported.

Speaking at a panel discussion this week, titled “30 Years in Retail,” organized by Artaş Holding, one of Turkey’s leading shopping mall developers and operators, industry leaders discussed the future of the textile and retail sectors amid economic turmoil.

They said factories across the country were closing one after another, with production shifting abroad, particularly to Egypt and far eastern countries.

“The government has given up on ready-to-wear and textiles,” Kiğılı Giyim Chairman Abdullah Kiğılı said. “Factories across Anatolia are shutting down, and production is moving to Egypt. Six months from now, we may not have producers left to fill store shelves.”

He warned that Turkey was facing “a major disaster” if no urgent measures were taken to support the sector.

The panel, which also featured leading Turkish ready-to-wear and fashion retail brand LC Waikiki Chairman Vahap Küçük, Artaş Holding Chairman Süleyman Çetinsaya and Alkaş & HAN Spaces President Avi Alkaş, brought together prominent figures in Turkey’s retail industry.

Küçük, whose company employs 55,000 people in 59 countries, said the sector is under serious pressure despite continued growth among top brands.

“We are going through a difficult period,” he said. “We cannot lower inflation or interest rates ourselves, but we must focus on how to better manage our costs.”

Turkey’s annual inflation, which surged to a record level of 85.5 percent in October 2022, stood at 33.29 percent in September, up from 32.95 percent in August, marking the first interruption in the country’s 16-month disinflation trend.

Since May 2024 official data had shown a steady decline in annual inflation, but the September figures suggest that trend has stalled.

The central bank, under its new monetary policy framework, has raised its one-week repo rate several times, most notably to 50 percent in March 2024 to fight inflation and stabilize the lira. However, policy shifts have been uneven, with subsequent holds and rate cuts bringing the benchmark down to 40.5 percent.

Exports decline for a second year

According to the Turkish Exporters Assembly (TİM), Turkey’s textile and raw materials sector exported to 207 countries and free zones in 2024. Textile exports during the year slipped 0.06 percent from the previous year to $9.5 billion. Ready-to-wear exports fell 6.9 percent to $17.9 billion, while leather and leather products dropped 17.9 percent to $1.5 billion.

The largest share of exports went to European countries, with Italy, the United Kingdom and Spain ranking as the top three destinations.

TİM Chairman Mustafa Gültepe said in a statement earlier this year that Turkey’s textile exports peaked at $10.35 billion in 2022 before falling to $9.55 billion in 2023 and $9.49 billion in 2024. He warned that the sector had lost around 250,000 jobs over the past two years. “When you go to Anatolia, there’s no one left to employ; there are no job applications,” he said.

The warnings come amid a broader economic downturn in Turkey, where high inflation, currency depreciation and soaring production costs have pushed many textile companies to relocate operations abroad.

According to recent data, the number of textile factories established by Turkish companies in Egypt has reached 200.

Industry associations have repeatedly cautioned that the once-thriving textile sector, long a cornerstone of Turkish exports, risks mass factory closures if investment and policy support do not resume.

Sector leaders say even profitable companies are worried about long-term sustainability. “We may be earning money today,” Küçük said, “but that doesn’t mean the sector is healthy.”

The ready-to-wear and textile industries together employ more than 1 million people in Turkey and account for a significant share of the country’s export revenue.