President of International Transport and Logistics Service Providers Association Ulusoy states that “Although the global economic situation, wars, and restrictions make it difficult to predict the future, it is not expected for freight prices to increase in the short-medium term.”

Ayşem Ulusoy, the President of the International Transport and Logistics Service Providers Association (UTIKAD), stated that due to the developments in the global economy, major transportation companies around the world experienced significant declines in their values. She also added that “We believe that it would be beneficial for logistics companies in our country to take precautions accordingly, create a serious financial management model, and avoid making unchecked investments.”

Ulusoy made an assessment about the expectations of the international transportation sector for the year 2023 to AA reporter.

Pointing out the change in global trade volume, Ulusoy said that this volume increased by 13% compared to 2019 and 25% compared to 2020, reaching a record level of $7.7 trillion with an increase of $1 trillion in the first quarter of 2022. Emphasizing that the increase in the first quarter of this year was due to the rise in commodity prices, especially energy, rather than trade volume, Ulusoy stated that the World Trade Organization gave a message of slowdown in global trade for the rest of the year and reduced the 2022 growth expectation for global merchandise trade from 4.7% to 3%.

Stating that the logistics sector, like in the world, is among the service sectors that provide significant contribution to the country’s economy in Turkey, Ulusoy said, “Transportation services, which constitute a significant part of service exports, increased by 51.8% in 2021, and the revenue obtained from this reached 24.4 billion dollars. Transportation services had the largest share of 70.2% in service exports.”

Ulusoy stated that according to the data of the Central Bank, service exports worth $42 billion, an increase of about 65% compared to the same period of the previous year, were realized in the January-July period of this year. She also added that a service trade surplus of about $20 billion was achieved during this period and that transportation services increased by 57% compared to the same period of the previous year among service export sectors.

Global developments affect every sector

Ulusoy pointed out that the sector has not been affected much by global developments so far, but the economic crisis in the world is continuing with increasing severity. She said:

“Although the global economic situation, political crises, wars, and restrictions make it difficult to predict the future, it is not expected for freight prices to increase in the short-medium term. Global inflation and interest rate data, political crises, and energy crisis are now indicators that every sector in the world should closely follow. In the current global uncertain environment, it is of great importance to follow the agenda dynamically and correctly, even for a small prediction. The largest markets, North America and Europe, are struggling with historic inflation and economic downturn. Due to interest rate hikes, we can observe a serious decrease in purchasing power in developing countries. Again, the Russia-Ukraine War and the energy crisis are causing concern among especially European people and leading to a decrease in spending. It is predicted that European household spending, and therefore, its exports will decrease significantly due to the energy crisis and insecurity. The world economy, which has been accustomed to growth and increasing economic values for many years, is now encountering concepts such as stagnation and contraction, and those who have not yet met the storm are also feeling it.”

Ulusoy drew attention to the significant declines in the values of major transportation companies worldwide and said, “These companies are realizing their future plans and investments by predicting that there will be a 50% decrease in their profits. We believe that it would be beneficial for logistics companies in our country to take precautions accordingly, create a serious financial management model, and avoid making unchecked investments.”

Ulusoy emphasized that as UTIKAD, they are aware of the difficulties that the sector is struggling with during this period and said:

“While struggling with these difficulties, we are working hard to evaluate the opportunities in front of our sector. We are explaining how our country can be a key point in transit trade on every platform. As a bridge between the private sector and the public, we continue our work with the belief that our sector will overcome these difficulties together, and we continue to put our hands under the stone for a solution.”