THE PAINTS AND DYES INDUSTRY Production Parallel to the developments in the construction, automotive and marine industries

of Turkey, the paints and coatings industry has also developed and has become one of the most dynamic and FDI (foreign direct investment) concentrated sectors of the Turkish industry. Turkey is the 6 th biggest paint producer in Europe. The sector has a production capacity of 800,000 tons per year, and, the capacity utilization rate is 65%. The sector accounts for a yearly market value of 2 billion dollars, holding 2% of the world market. The sector comprises of 20 big firms and about 600 small and medium scaled manufacturers nationwide. About 60% of production capacity of the Turkish paints and dyes industry consists of decorative paints, which creates a strong correlation with building sector. Apart from construction sector, paint industry provides inputs also for automotive, furniture, leather, glass, ceramic, textile and printing sectors, which are all very dynamic sectors of Turkey. Turkish paint sector has reached world quality standards. Most of the firms have ISO 9000 certification. Dyes and paints sector also adapts itself to the ecological and technical standards particularly developed in European Union. Exports Besides meeting the domestic demand, the Turkish paint sector has the capacity to export more. In 2008, the total value of paints and coatings exports reached USD 452 million, whereas it has decreased to USD 428 million in 2009.

Major export products of the Turkish paint and dyes industry have been paints and varnishes (HS 3208, 3209, 3210) with an export value of USD 163 million in 2009. The second major export product were putties, resin cements and other mastics with an export value of USD 86 million. Synthetic tanning substances (USD 55 million), pigments, opacifiers and colors (USD 33 million), synthetic organic coloring matters (USD 33 million) and printing ink (USD 23 million) constitute other important export items. Products coded as 3201, 3202, 3203, 3204 and 3206 in harmonised system are mostly textile paints and pigments. In 2009, total export value of these materials was USD 107 million, 25% of total export of Turkish paint industry.

According to a recent report on the Middle Eastern paint industry published by the UK-based coatings industry market research firm Information Research Limited (IRL), the Turkish paint industry is thriving.

"Turkey, has long been something of a diamond in the global coatings markets," said Terry Knowles of IRL, who authored the new report. "Opportunities still shine out of the Turkish coatings market," he said. With its population of 67 million, Turkey occupies an interesting position in the global paint marketplace. At the crossroads between Europe, Russia, the Middle East and Asia, the country produces 400,000 tons of paint per year from 350 indigenous paint producers. As a result of its geographic location, the nation is, not surprisingly, a busy exporter and importer of paint products and raw materials. While many of the local paint producers are dependent upon raw material imports, 32% of which come from Germany, many resins are available domestically. Dr. Knowles said that many of the local companies, including Boyatas, Aysan Boya and Yasas Yasar Boya, have their own supply on tap. Germany has a huge influence on the Turkish paint sector. Besides supplying raw materials to paint manufacturers, German companies BASF and Caparol have gained a firm foothold on the Turkish coatings scene. Paint maker Caparol, in particular, plays an important role in Turkey. Under license to the Turkish paint maker Betek Boya, it has a place amongst the top five leaders in the Turkish coatings market. Betek Boya is positioned at number three in the market. Turkish company Yasas Yasar Boya is in second place and Akzo Nobel-owned Marshall Boya is at the top, with 22% of the total market. The German influence extends to other areas of the industry. Germany is the source of several licensing agreements, such as those between Ispo and Aysan Boya and Yasas Yasar Boya's partnerships with the German firms BASF, Fia and Wagner. Similarly, German companies such as retailer Praktiker have an interest in DIY. With more than 80% of domestic paint sales being channeled through exclusive or authorized dealerships and DIY or hardware stores, foreign companies have acquired sizeable stakes in the sector. The UK-based Kingfisher home improvement firm, for example, holds 50% of Turkey's largest DIY conglomerate, Koctas.Products coded as 3201, 3202, 3203, 3204 and 3206 in harmonised system are mostly textile paints and pigments. In 2009, total export value of these materials was USD 107 million, 25% of total export of Turkish paint industry. The paints and coatings industry products were exported mainly to the countries which have a dynamic construction sector, such as Iraq, Azerbaijan, Iran, China, Romania, Turkmenistan and Russian Federation.

Products of the industry are exhibited in international and national fairs organized in Turkey.