Turkcell ‘to boost digital exports’ in response to Turkish economic crisis

17 August 2018 | Alan Burkitt-Gray

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Turkcell is planning to boost sales of its portfolio of digital apps and services to operators and digital service providers outside Turkey, according to Kaan Terzioğlu, the company CEO.

Terzioğlu was speaking in a robust media interview as Turkey is faced with a financial and economic crisis thanks in part to US sanctions that have hit the value of the Turkish lira.

“In these difficult times where our economy is being unfairly constrained, we firmly believe that Turkey’s growth will come from the digital economy,” said Terzioğlu.

He said he supported the economic measures taken by Turkey’s president, Recep Tayyip Erdoğan. The government’s “continued support for the development of a healthy and strong technology ecosystem will be crucial as we join forces to create the digital economy”, said Terzioğlu. “Turkcell will continue to invest heavily in Turkey’s local resources and in creating the digital solutions that Turkey needs.”

Terzioğlu said: “Over the course of the past three years, Turkcell has invested in building its own digital apps and services, reaching 110 downloads, three million of which are from outside of Turkey.”

The portfolio includes a communications platform, BiP, a music platform, fizy, a TV platform, a local search engine, a secure login service and a digital payments company Paycell.

“We are investing in Turkey’s data infrastructure with state-of-the-art data centres which host local, regional and global players,” said Terzioğlu. “We contribute to the digital integration of various vertical industries from health to transportation.”

Now, he says, Turkcell is “focusing on taking this model abroad”. He has not named the potential partners, saying only that they are “trustworthy telecom operators and digital players” and that Turkcell will respect “the laws and regulations of those countries”.

Turkey has been hit hard by a halving in the value of the lira. In September last year there were around 3.5 lira to the US dollar. Now the exchange rate is around 6.9 lira to the dollar.

A report by IHS Markit this morning said that the fall will affect Turkey’s ability to import goods. Six Asian countries are among Turkey’s 20 sources of imports, said the market analyst, with China topping the list. Turkcell’s Terzioğlu is due to take part next month in Chinese vendor Huawei’s Operations Transformation Forum in Munich.

“The Turkish economic crisis and slumping lira will impact on bilateral trade, as the cost of imported goods will rise significantly in Turkish lira terms due to the sharp currency depreciation this year,” said IHS Markit Asia Pacific chief economist Rajiv Biswas, quoted this morning by CNBC.