THE KEY TO FINDING DIRECTION IN AN AGE OF UNCERTAINTY: BUSINESS DIPLOMACY

The way to analyze risks in a timely manner, quickly access opportunities, and strategically explore new markets is through strong and proactive diplomatic thinking

The Covid-19 pandemic, which began in 2020, went beyond being merely a health crisis and disrupted global supply chains, causing serious shocks to production and logistics structures. The Russia-Ukraine war, which followed the pandemic, threatened Europe’s energy security, while pressures on agriculture and food products became a factor disrupting global price stability. The conflict in the Israeli-Palestinian region is increasing the risk of lasting instability in the Middle East, while the protectionist policies implemented by the US against China and some other countries are deepening economic polarization.

According to World Trade Organization (WTO) data, global merchandise trade volume grew by only 1.2% in 2023; although this rate is expected to rise to 2.9% in 2024, it remains below historical averages. This picture indicates that global trade is being reshaped and that risks are becoming permanent.

The global economic order is being restructured not only by geopolitical shocks but also by transformations such as the green agreement, digitalization, and artificial intelligence. With the European Union’s “Green Agreement” process, the taxation of products with high carbon footprints at the border has come to the agenda; this situation has created a strategic need for preparation, especially for our export sectors.

According to McKinsey & Co’s 2025 Digital Trade Report, 25% of global trade is expected to take place through digital platforms. In this context, companies that fail to adapt to digitalization will face serious competitive losses.

In such a multi-layered environment of uncertainty, business diplomacy led by the private sector is no longer merely a supporter of foreign trade; it has become a tool for finding direction and a strategic insurance mechanism.

Positioning business diplomacy as a tool for finding direction, DEİK has recently structured its activities, guiding the business world around four main axes:

1. Deepening Existing Markets

European and MENA (Middle East-Gulf-North Africa) countries are Türkiye’s two largest export markets. In 2024, our exports to the European Union reached approximately $103 billion, accounting for more than 40% of our total foreign trade. However, in this period of increasing competition, protecting existing markets is much more strategic than gaining new ones.

2. New Market Openings

The “100 Billion Dollar Trade Volume” vision pursued with the US has reached 40 billion dollars by 2023, thanks to concrete steps. State-based business forums and B2B events focused on technology and defense industries play a critical role in realizing this goal. Additionally, we are prioritizing our relations with rapidly growing regions such as South America, which offer diversified trade potential, as part of our business diplomacy focus.

3. High Technology and Investments

Business diplomacy activities with technology-leading countries such as China, Japan, and South Korea are not limited to import/export relations. Increasing mutual technology investments and encouraging joint R&D projects will make these relations more sustainable.

As of 2024, our foreign trade deficit with China will exceed $40 billion, and efforts are being made to balance this imbalance through investment cooperation.

4. Expansion Focused on Africa, South America, and Central Asia

Africa will reach a population of 2.5 billion by 2050 and will become the continent with the fastest urbanization in the world. Thanks to the 1.3 trillion dollar AfCFTA (African Continental Free Trade Area), Africa has become a single market and offers tremendous opportunities for Turkish businesses.

South America offers potential areas of partnership for Turkish entrepreneurs, particularly in agricultural technologies, infrastructure projects, and the energy sector. As DEİK, we are actively pursuing diplomacy in the region through our business councils.

Central Asia, on the other hand, is increasingly on our agenda due to both our historical ties and the institutional relations that have developed within the framework of the Organization of Turkic States. We continue to support our private sector in regional projects and investment opportunities in the energy, transportation, and construction sectors.

When considering the issue from the perspective of the defense sector, it is important to note that at the NATO Leaders Summit held in The Hague on June 24-25, 2025, member countries agreed to increase their defense expenditures to 5% of GDP within 10 years. Türkiye’s defense industry exports reached $5.5 billion in 2023, with a target of over $15 billion by 2030. This development paves the way for defense cooperation with European countries to come to the fore as an area of both business and strategic diplomacy.

Over the next decade, carbon regulations are expected to become a determining factor in trade policies; regionalization trends (nearshoring, friendshoring) are expected to gain momentum; AI-enabled digital protocols are expected to create new business models; and energy and food security are expected to become key issues in trade cooperation. In this regard, business diplomacy will continue to be a strategic tool not only in inter-state relations but also in the management of inter-company and inter-sectoral relations.

In this new era of intertwined global uncertainties, fragilities, and transformations, business diplomacy is no longer a choice but a necessary tool for the sustainable success of the business world. The path to analyzing risks in a timely manner, quickly accessing opportunities, and strategically exploring new markets lies in a strong and proactive diplomatic mindset.

As DEİK, we are committed to continuing to guide the Turkish business world with our data-driven, visionary, and participatory approach to business diplomacy, and to producing integrated solutions and strategies for global developments.