TBY talks to Lütfi Varoğlu, Head of the International Cooperation Department of the Undersecretariat for Defence Industries (SSM) & Board Member of the Defense & Aviation Industry Exporters Association (SSİ), on the key functions of the SSM and SSİ and the relationship between the two organizations.

Lütfi Varoğlu
Prior to his assignment as the Head of International Cooperation at the Undersecretariat for Defense Industries in 1991, Lütfi Varoğlu was responsible for the execution and management of significant defense programs. He also served as the Head of the C4ISR Department. In his current position, he is responsible for enhancing bilateral and multilateral defense cooperation, defense exports, promoting the Turkish defense industry, and establishing support mechanisms to further invigorate relations with its partners.

Which markets are the SSM and SSİ targeting for 2012-2013?

Based on our export strategies and our strong relations, our main focus is on the Gulf region, Southeast Asia, the Caucasus, Africa, and South America. We continue to seek cooperation opportunities and encourage defense industry coordination activities in both Europe and the US, owing to the importance we attach to our strategic relationships. The SSM holds Defense Industry Days in collaboration with other countries. We believe that seeking codevelopment and comarketing opportunities is important. Turkey has adopted concrete strategies to promote Turkey's defense industries in the global marketplace, and now we are harvesting the fruits of our success. We aim to take our companies' efforts to a further level by pushing them to be more export oriented and competitive.

Which Turkish defense products are most attractive for export?

By looking at the exports Turkey has realized over the last few years in the global defense market, we observe that Turkish companies are highly competitive. We excel in the production of armored vehicles, naval shipbuilding, electronic systems such as Combat Management, avionics, software-defined radios, command and control systems, simulators, military clothing, and gear and logistics, owing to the considerable investments made in these areas that support indigenous defense capabilities.

What is the strategy to double Turkey's defense exports by 2016?

Turkey reached its 2011 export target with almost $1 billion worth of defense and aviation exports, and we aim to double this figure. The new strategic plan of the SSM for the years 2012-2016 sets ambitious targets in terms of exports. We aim to export $2 billion worth of defense products by 2016, and our defense export strategy has been shaped around this target. We have started different initiatives, such as the project partnership model, which aims to involve our interested partners in some of our defense procurement programs at different levels. With this method, we believe that we can offer the best-value solutions to our partners, which results in success in global markets and builds relationships based on mutual trust. We promote activities such as industry days with foreign governments (including the UK, Italy, Norway, and Finland), where both government and industry come together to seek opportunities for cooperation. Joint R&D and technology development is also important in terms of gaining a competitive advantage. Furthermore, we encourage our companies to make new investments and establish joint ventures in our priority regions. The SSİ aims to solidify bilateral relations through memorandums of understanding (MoUs) and framework agreements that define the focus areas and avoid duplication.

How does the SSİ contribute to the defense industry?

The SSİ participates in defense industry exhibitions at a national level, promoting our companies through various methods. For example, we are working on establishing a Turkish Foreign Defense Sales system, which is similar to the Foreign Military Sales mechanism in the US, which we believe will help increase exports to certain regions. We have started to work on an export credit mechanism that can offer affordable financial solutions to countries interested in our products and systems. These incentives are also considered beneficial to encourage our defense companies, especially SMEs, to compete in the global marketplace. Furthermore, through our export portal, we share our strategies and capabilities with our partners. This keeps the industry up to date with our plans. Government-to-government dialogue and continued relations based on best value are of importance because they create a basis for solid cooperation. To achieve this, we coordinate and organize mutual high-level visits.

What are the key functions of the SSİ?

The SSİ is aimed at helping our defense companies increase their exports by combining our efforts to compete in the global marketplace. We have created a forum in order to be able to cope with potential challenges and provide vital information. The SSİ's key tasks are to restructure our defense companies in a way that makes them more export oriented, promote their capabilities in global markets, outline feasible methods and strategies, and increase the overall defense export capacity accordingly. It is not wrong to say that the SSM's international cooperation activities and defense export strategies will have a complementary effect on the SSİ's tasks.