Issue: Oct 2012


Aegean free trade zone expanding to meet demand



by Rob White

There are plans to expand Turkey’s Aegean free trade zone. Privately owned and operated by ESBAS, the zone has become the most successful of Turkey’s 19 free zones as measured by trade volume.

ESBAS is the only Turkish Free Zone Development and Operat¬ing Company to be awarded with four quality certificates: ISO 9001/2000 Quality Management, ISO 14001 Environ¬mental Management, OHSAS 18001 Occupational Health and Safety Assessment Series, and ISO 22000/2005 Food Safety Management Sys¬tems. This achievement, says the company, reflects its commitment to maintaining the best work environment possible for its employees, and to providing the highest quality standards for the user companies in the zone.

This success comes in a difficult year, as the founder of the Aegean Free Zone, Kaya Tuncer, passed away on the 7th of January 2012. His wife, Mary Mills Tuncer, who has taken over as chairman from her husband said in a statement: “I have been elected as the Chairman of the Board of Directors by the General Assembly. We are committed to maintain our efforts to increase the contributions of the Aegean Free Zone to the economy of Izmir and Turkey under the policies and principles followed by Kaya Tuncer.

Automotive Industries (AI) asked Tuncer what she saw as the way forward for the Aegean Free Zone.

Tuncer: The zone is a regional development project. Therefore, our priority is to be involved in or support any activity for the economic development of Izmir and the Aegean Region. Today, employment is provided for 20,000 people. We estimate that the trade volume of the zone will exceed US$5.5-bn this year. With respect to land, we have reached close to a 100% occupancy rate. We have an expansion area of 600,000 m2. Upon approval of the Turkish Government, we will include this area in the free zone. With the expansion area, we will be able to provide additional employment for about 7-8,000 people. We are continuing our intensive marketing and promotional activities to achieve this goal.

AI: Tell us a little about the recent growth in business in the zone.
Tuncer: Cummins, one of the leading automotive manufacturers in the world, is about to complete its construction works on a leased area of 100,000 m2. Cummins will manufacture — during its first phase — engine filters for heavy vehicles. The other big investment, CMS Company, has completed construction of facilities on 100,000 m2 of land. The company will manufacture wheel trims and wheel trim caps for the well-known automobile companies of the world. It will become the third biggest wheel trim manufacturer in the world with its new plants in the Aegean Free Zone.

The other new investment is Kale-Pratt & Whitney that will manufacture about 200 parts for the F35 Aircraft. This company will start construction of its factory to be established on an area of 100,000 m2 in August 2012. With the addition of these new companies, employment will total 23,000 in the zone. Compared to the trade volume of the first quarter of 2011, the trade volume for the first quarter of 2012 grew by 8%. In short, the Aegean Free Zone proceeds at full speed and sustains its contributions to the Turkish economy.

AI: What developments are you hoping for to further increase the attractiveness of the zone for potential investors?
Tuncer: My primary aim is to ensure the addition of the expansion area and include it within the borders of the zone. We already have companies interested in setting up factories in the expansion area. Even an expansion area of 600,000 m2 fails to meet demand. What ensures this is the modern infrastructure established by ESBAŞ, as well as the pleasant working environment.

AI: What is most attractive about the Aegean Free Zone for automotive companies?
Tuncer: Izmir and the Aegean Free Zone have an extensive supply chain for the automotive sector. Izmir has an abundant white and blue-collar qualified, bilingual workforce trained to work in the automotive sector. Izmir also has easy access to every part of the world with its nearby seaport, international airport, and close connection to ground transportation.

AI: What does Turkey offer companies investing in the country in areas like the Aegean Free Zone?
Tuncer: Regardless of the type of industry and country of origin, employees of each company engaged in manufacturing in Turkish free zones and exports 85% of its production are exempted from income tax. Also, manufacturing companies are exempt from corporate tax during the validity of its license. These represent significant tax advantages provided to the companies.

AI: What are some of the other projects close to your heart?
Tuncer: My late husband and I developed the Aegean Free Zone together — not just to provide employment — but to create a manufacturing area with the highest standards and a pleasant work environment for those working at the zone. We have had visitors from Europe telling us that our industrial park looks more like a university campus. I have personally taken a great interest in the beautiful landscaping of the zone, in providing the highest level of child care for zone workers, and in ensuring that the zone continues to be an attractive place to work. We felt that we had achieved our goal when the manager of a company in the automotive sector — now operating in the zone — was searching for the best place to build a new factory and reported back to the home office, “You won’t believe this place.” This was after visiting 29 industrial parks in five countries throughout Europe and the Middle East.

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