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Further Reading

Turkey Domestic Arms Industry

Since the mid-1980s, Turkey has been engaged in a wide-ranging program to develop a modern defense industry based on cooperation with firms in other countries. Previously, Turkey's economic and industrial capacity was insufficient to produce weapons as sophisticated as those of Western Europe. In the early years of the republic, the government sponsored a number of arms factories intended primarily to supply basic infantry weapons and ammunition. After World War II, Turkey's efforts to bring its military establishment up to modern standards depended almost totally on military assistance and credits from its NATO partners. After the imposition of the limited embargo by the United States in 1975, Turkey launched a series of projects to reduce its dependence on imports of major military items. Initial results took the form of a broader range of domestically produced light weapons and artillery and the development of an electronics industry oriented toward battlefield communications and the requirements of military aircraft.

In 1985 new legislation centralized efforts to launch an up-to-date arms industry under a new agency -- the Defense Industry Development and Support Administration (later the Ministry of National Defense Undersecretariat for Defense Industries, known as SSM) with its own source of capital, the Defense Industry Support Fund. The fund does not depend on national defense budget appropriations but receives earmarked revenues directly--10 percent of taxes on fuel, 5 percent of individual and corporate income taxes, and taxes on alcohol and tobacco. Most of the major projects encouraged by SSM have been international joint ventures and coproduction enterprises. In most cases, the foreign partner must agree to an offset provision, that is, a commitment to purchase some part of the resulting production, or components or other goods manufactured in Turkey.

By the mid-1990s the Turkish defense industry employed about 50,000 individuals at 110 firms, many of them state owned. About 1,000 additional firms participate in defense business as subcontractors. The largest producer of weaponry in Turkey, with about 12,000 employees, was Makina ve Kimya Endüstrisi Kurumu (MKEK), controlled by the Ministry of Industry and Trade. MKEK meets the requirements of the Turkish armed forces for light arms (including the M-3 and MG-3 rifles and a machine gun of German design), ammunition, and explosives. It also produces antiaircraft and antitank guns.

In 1988 rocket and missile production was shifted from MKEK to a new company, Roket Sanayii (ROKETSAN). ROKETSAN has the largest share in the production of the propulsion system and rocket assembly for the four-country European consortium manufacturing the Stinger SAM. The company also plans to produce multi-launch rocket systems (MLRS) in partnership with a United States firm, the LTV Corporation. A consortium formed by a United States firm, FMC Corporation, and a Turkish firm, Nurol, is projected to produce 1,700 APCs and armored fighting vehicles by 1997.

Communications equipment and electronic warfare systems for the Turkish military are produced by ASELSAN Military Electronics Industries, a state-owned company whose dominant shareholder is OYAK. ASELSAN manufactures under license a United States-designed family of manpack and vehicular battlefield radios and voice scramblers. It supplies the inertial navigation systems and fire control for the TÜSAS F-16 project and produces components for the Stinger missile program.

Peace Onyx is Turkey's first and largest co-production program. Started in 1984 and marked the development of a significant industrial infrastructure. Under the Peace Onyx I program TÜSAS (Türk Uçak Sanayi Sirketi) Aerospace Industries [TAI] co-produced 152 of 160 Lockheed Martin F-16s that were delivered to the air force between 1987 and 1995. Peace Onyx II began in mid-1996 with 80 F-16s ordered already delivered. Production of the 240 F-16s ended in 2002. 80 of the planes were financed by a $2.5 billion fund set up by the U.S., Saudi Arabia, and Kuwait in return for Turkey's cooperation in the Gulf War. Lockheed Martin owns 49% of TAI. On 12 December 2006, the Defence Industry Executive Committee decided on the procurement of 30 F-16 Advanced Block 50 aircraft from the U.S. Government through Foreign Military Sales (FMS) under the Peace Onyx IV (PO-IV) Program.

In addition to its coproduction role in the F-16 project, TÜSAS has contracted with Agusta, the Italian aircraft manufacturer, to produce forty SF-260 trainers at the Mürted plant. A contract with Construcciones Aeronáuticas, S.A. (CASA) of Spain calls for joint production of fifty-two CN-235 light transport aircraft. A US$1.1 billion agreement was concluded in 1992 with Sikorsky covering direct procurement of forty-five Black Hawk helicopters, with an additional fifty helicopters to be coproduced in Turkey by 1999.

Much of Turkey's indigenous naval construction has been carried out with cooperation from German shipbuilders. Turkey embarked on the MEKO 200 Frigate program to improve its anti-submarine, anti-air, and anti-surface ship capabilities. The program calls for eight ships to be built, four in Turkey and four in Germany. Even though the MEKO project was a Turkish-German co-production program, U.S. contractors provided $197 million worth of major combat, propulsion. and weapon systems. Four frigates of the MEKO-200 class were built in the 1990s at the main naval shipyard at Gölcük where three submarines of the 209-class (type-1200) had been built; four type-1400 submarines were commissioned between 1994 and 1998. Dogan-class fast-attack boats armed with Harpoon missiles have been produced in Turkish yards, as well as destroyer escorts, patrol boats, landing craft, and auxiliary craft. In 1993 private shipyards were invited to bid on construction of minesweepers and patrol boats.

The M48A5 Tank Modernization program, conducted in the TLFC Tank Plant in Kayseri, modernized over 2,100 M48 tanks by adding a 105mm gun, diesel engine, and other improvements. In addition, 760 of the tanks were further upgraded by providing add-on stabilization, a thermal site, laser range ?nder, and solid state computer. Of particular note is that 61 percent of the spare parts were supplied by the local market and 24 percent were manufactured on site at the depot. The depot also provided on the job training for apprentices from a local vocational school, adding an additional bene?t to the community.

The Armored Combat Vehicles program was SSM’s ?rst major co-production project. FMC, a U.S. corporation, entered into a joint venture with Nurol of Turkey to co-produce 1,698 Armored Combat Vehicles (ACV) of various con?gurations in Turkey based on an FMC design. Other U.S. companies directly or indirectly supplied parts and equipment in support of the program: Texas Instruments had a contract through ASELAN to produce the optical sights; Alison Transmission and Detroit Diesel are building the power plant; and Cadillac Gage the cupola.

The effort to create a modern defense industry on a narrow technological base was risky for Turkish defense planners. However, it appears to have been successful in enabling Turkey to rely on domestic sources to meet an increasing portion of its advanced equipment needs. The results have included reductions in costs and in the demand for foreign exchange, as well as the opening of foreign markets, mainly through offset provisions. As of the mid-1990s, the anticipated development of a Middle Eastern market for finished products did not appear to have occurred, based on available arms export data. A broader goal was to set new standards for quality and productivity in Turkish industry generally and thus increase the country's competitiveness through the lead established by the defense industry.

The Undersecretariat for Defence Industries has made significant achievements in building the blocks for a modern national defence industry in Turkey, with notable results in certain vital areas. As a result of considerable dedication and efforts, key defence industry institutions have been established to meet the requirements of the Turkish Armed Forces locally, each filling an important void in its field. The local content ratio, the extent to which requirements are met locally, rose to 44.2% in 2008 and Turkish defence industry has reached the phase where the groundwork has been laid for system integration capability and defence products can be developed locally.

In the next phase SSM aims to reduce external dependence in critical subsystems/components/technologies determined in line with the requirements of the Turkish Armed Forces. In order to optimize the resources allocated to improve the technological infrastructure needed for the systems projects that involve procurement by means of indigenous local production, and hence increase local content ratio, worthwhile R&D projects have been determined and prioritized in the Defense R&D Road Map. The Road Map consists of R&D Projects that are compatible with the needs and objectives of main system projects, and that strengthen collaboration among the industry, small and medium enterprises, universities and research organizations.

F. Stephen Larrabee notes that "Turkish defense programs often have an unrealistically ambitious scope. As a result, during competition, the programs are often scaled back, causing delays in the procurement process and frustration to U.S. contractors who have to revise their bids, often several times. In addition, the Turks often make unrealistic demands for technology transfers, causing major delays. U.S. contractors also complain about a lack of coordination between end-users and the procurement office. As a result, Turkey has earned a reputation as a difficult and unpredictable client. U.S. contractors, exhausted after investing large amounts of resources, time, and effort, often find that the initial parameters and rules have been changed in midstream. In May 2004, for instance, Turkey shelved a $4-billion tank coproduction plan and halted $3 billion in attack-helicopter and aerial-vehicle projects. Decisions like this have made U.S. contractors very skittish about bidding on Turkish programs."