RIVALRY IN THE EU MARKET: CHINA, INDIA AND TURKEY

The rapid economic growth of China and India is having a major influence on the world economy. Being already the USA’s main economic rival, China is an emerging global power. On the other hand, India get involved in the international trade much more energetically and it is an emerging power on a global scale, too. By using benchmarking method, this paper deals with Turkish export competitiveness besides its export similarities and differences with China and India. The paper uses the revealed comparative advantage framework to analyse the extent of export competition. For empirical analyses we use highly detailed trade data from UN Comtrade at the 4-digit level of ISIC. The dataset contains annual data on manufacturing exports to EU 5 countries between 2000 and 2010 period. The results show that Turkey continues to specialise inherently in low quality products whereas India and China demonstrate their ability to upgrade their performance in particular sectors. The study therefore says that product differentiation, more specifically improvement in product quality, is lacking in the Turkish manufacturing sector. To be globally competitive, Turkish manufacturing industry needs to invest in quality and reputation.