BRANCH GENERAL ASSEMBLY

3 MARCH 2021

GEBZE

Honourable District Governor,

Honourable Mayors,

Esteemed Members of our Board of Directors,

Distinguished Presidents and Representatives of the business and political world, of the NGOs and of our chambers, Esteemed President and Members of our MÜSİAD Gebze Branch,

Esteemed Members of the Press,

I welcome you to the General Assembly of our Gebze Branch and respectfully greet you all.

Distinguished Guests,

As you know, 2020 has been left behind as a highly challenging year. Especially from the beginning of 2018 onwards, we persistently emphasized that the global economic system was under severe strain and that we might have to face a serious commodity crisis. Yet the flashpoint of this expected crisis came from a place no one could have predicted: the Global Pandemic. Unlike the others, this crisis did not have an economic basis, but through its effects it made us question an economic system that came to a standstill all over the world.

With the Covid-19 pandemic, the global economy suffered a major shock on both the supply and the demand side; the movement of capital, goods and people came almost to a standstill and survival became impossible in many sectors. From that point on, the global economic system gradually gave way to unitary structures and to the rule of self-sufficiency for countries. While we were expecting sharp paradigm shifts after the pandemic, what we encountered was a statist capitalism, and this model was in fact not at all unfamiliar to us.

Because in a logic built upon national economies, the state was bound to make its regulatory role and its weight over the economy felt ever more strongly, and this is indeed what is happening. At the outset of the pandemic, almost every state announced support and incentive packages so that its own nation would be affected by the outbreak with the least possible damage. As long as the outbreak continues and until it comes to a complete end throughout the world, these measures must gradually maintain their

existence. Perhaps this is also the new economic model within which the business world will operate.

Today, in our country and in many countries of the world, the areas of state intervention are steadily widening because of income injustice, of capital lost in the middle-income trap and of rising prices of goods and services. Despite this, it is also possible to say that global capital is once again flowing from developed countries towards developing countries such as ours. Yet the important point here is not that this capital flow enters and exits with the logic of short-term fund movements; it is that it should provide production, investment and employment in our country through direct investments. And bringing this about is once again in our own hands.

Distinguished guests,

As required by the conjuncture, our state organs have of course had to adopt certain temporary policies and will continue to do so. The important point here is not to refrain from supporting our state during the process we are going through. We are now receiving the first-period results of the steps taken to prevent the excessive depreciation of the Turkish lira and the course of high inflation, for example the adjustment in credit costs. In recent weeks we hosted at our Head Office building a delegation consisting of the Governor of the Central Bank, Mr. Naci Ağbal, and senior bureaucrats. We held consultations on highly critical matters. We even decided that the Central Bank team and our relevant committees would work jointly on certain projects carried out by our committees. Just as we played a very active role as MÜSİAD in the 11th Development Plan of the Presidency of Strategy and Budget (and Mr. Ağbal again voiced this at the meeting), we underlined that we would show the same support this time in the process of meeting the inflation targets.

The determined and resolute stance of the economic administration and of the Central Bank in the fight against inflation, and their preference for cooperating with all economic stakeholders in order to develop policy at this stage, have of course given hope to business people, to end consumers and to foreign capital alike. In other words, up to this point there is certainly a movement in the right direction. However, all these steps are merely footpaths leading towards the main artery road we must reach. They are useful, they buy time, but they do not offer a final solution. They will not last forever. After a while the market will demand from you more permanent and more fundamental moves, that is, an economic plan.

As I have expressed in various statements and indeed at the meeting we held with the Central Bank team, if cyclical adjustments are truly compulsory, we of course respect the decision taken by our state on this matter. Yet we voice our red line on the matter of interest rates in particular at every opportunity. Likewise, for us a permanent and sustainable price level and growth trend can only come through a planned production policy and the synchronization of production, trade and investment.

Esteemed Guests,

The global economy, which before the outbreak had been expected to grow by %3.5 over the course of 2020, is estimated according to current forecasts to have contracted in this period within a band of %4.5 - %5.0.

While the global economy, which contracted sharply in 2020, is projected to recover relatively in 2021, forecast uncertainty remains high depending on the course of the outbreak.

Our country, for its part, ranks among the leading countries that have come through this difficult process with the least and only slight damage.

As is known, the Turkish economy, which grew by %5.9 in the last quarter of 2020, was the country that recorded the highest growth among the G20 countries in that period after China. Over 2020 as a whole, the Turkish economy grew by %1.8 and displayed a performance that surprised all the international institutions which had made contraction forecasts for it at the beginning of the year.

Of course this performance was not surprising for us. For as MÜSİAD we had stated at every opportunity that Türkiye, with its existing manufacturing potential and flexible production capacity, holds a serious advantage compared with other comparable countries. It would not be wrong to say that the renormalization process will increase the revival of both the services and the production sectors, and that this will be reflected positively in our national income in 2021. Yet here again the determining factor is the course of the pandemic and the effectiveness of the vaccination efforts. For, should we face a third wave, in order to compensate for the possible loss of capital we would experience once more, we must continue production without pause in certain regions, exactly as China has done, and move to increase our stocks.

This, of course, comes through the logic of establishing secure production bases in which every stage has been thought through. In this model, the details of which I will touch upon shortly, our basic aim is to develop the strategy China has followed under our own country's conditions with even more advanced standards and with a logic that puts people and nature first.

Whatever anyone may say, in the light of the recently announced growth figures it is clear that we have displayed a serious performance of resilience. However, for this growth performance to acquire a sustainable character, a long and difficult road lies ahead of us.

It would be a correct step to increase the self-sufficiency policies of all our sectors that hold a critical position in domestic and national production, and in particular to determine a new strategy oriented towards foreign trade.

Indeed, despite the leap we have made in recent years particularly in the services sector, manufacturing industry preserves its importance for the Turkish economy. The industrial sector, which expanded by %10.3 in the last quarter of the year, and manufacturing industry, which grew by %10.5, were the driving force of growth in that period. Esteemed guests,

The COVID 19 process is not one that will end from one day to the next. Experts state that even if vaccination efforts are completely finished, social immunity will take time. In other words, we still have as long a road ahead of us. While all this is happening, a new way of life is in fact quietly entering our lives and we are calmly adapting to these new rules.

There is of course a social fatigue, but at the same time we can say that there has been a settling in our reaction mechanisms. In the end, the brain provides adaptation and habituation to every state of mind after a while. Therefore many rules that we found strange last year have been normalized today. A year from now they will have become habits. Eating and drinking habits, shopping habits, new models tested in working systems and the advantages they bring, and so on. It is also certain that we will remain on alert for quite some time. Moreover, even if the COVID process comes to a complete end, two more great problems await us: climate change and biological terror or armament. Therefore, in this process every country is obliged to make its own contingency plans. Measures against a possible repetition will be taken in every field, from production to security. In order to reflect this advantage onto the field with all its parameters, we must prepare manufacturing industry very well for the medium- and long-term transformation process brought about by Covid-19. For there lies before us an area of opportunity in which, by using our R&D and innovation capacity and our labour force competencies in order to develop them, we can make a serious leap in the global economy in the long term.

We believe that we have a serious advantage particularly in terms of geographical position, and that this will create a great area of opportunity for our country in the future projections of the global economy. In a process in which supply chains are being redesigned and logistics lines redrawn, Türkiye, the country where the roads intersect, must take part in the game as a far more active player.

Look, it is not by coincidence: read once more the names of the committees of our Renewal process, which we launched two years ago by analysing these days very well and by drawing up a genuinely strategic road map. You will see how the line drawn in 2018 designed a path leading all the way to 2023-2030. We set out this vision years ago, before anyone else saw it.

We said the Committee for New Routes and Approaches in Logistics. Look, now logistics companies and the new routes they draw are giving direction to world trade. We said the Domestic and National Production

Planning Committee; look, now the fundamental starting point of unitary economic structures has become domestic and national production planning. We said the Energy and Mining Management and Investments Committee; today a completely different area of economic sharing is forming in the name of energy security and new mineral deposits. We said the Industrial Zones and Campuses Committee; look, today establishing production bases has become an indispensable field of investment throughout the world. We said the Smart Cities and Urban Economies Committee; after us it became a policy at Presidency level and was written into the 11th Development Plan. Indeed, the projects launched across the EU for the twinning of cities showed how right and how far-sighted we were on this matter. There are many more examples: Gastro-economy, Rural Development, Mergers and Acquisitions, Export Matching… Look, these strategies, which for a time we had difficulty understanding and for which we even criticized those who conceived and built them, have today become the world's new turning points. So it seems that one must first listen impartially, then respect and try to understand. In the end, the new world order is built upon the young, and we carried out this renewal with a team that is young in terms of age.

Now Türkiye too, with the same logic and as our esteemed President has also expressed, has entered a process of renewal. A new reform movement has begun. God willing, we took its first step yesterday with the Human Rights Action Plan, in which I also took part. Our faith in our country and in our country's potential is complete, dear friends. We accomplished during the pandemic process whatever had been said to be impossible, praise be to God. In 2020, a year that was economically troubled, we held one of Türkiye's most important fairs.

We held MÜSİAD EXPO 2020, the largest fair held after the pandemic, which attracted intense interest from exhibitors and visitors alike, with broad participation and completed it successfully.

Nearly 15 thousand visitors from 102 countries, chiefly from Europe, Asia-Pacific, Eurasia, Africa and the MENA countries, attended the four-day fair. At the fair, which we held under the slogan “Global Trade Is Here”, we hosted 400 purchasing delegations from 50 countries. EXPO 2020, which we held at the İstanbul TÜYAP Fair and Congress Centre and which was attended by business people, politicians and academics from every region of the world, enabled our business people to open up to new collaborations while also allowing foreign investors to examine investment opportunities in our country at first hand.

Distinguished Guests,

Today we are in a region that is extremely important for our industry and that pleases us with its achievements.

This success is being demonstrated together by Kocaeli at the provincial level and by Gebze at the district level.

Gebze, which holds critical importance for Türkiye's automotive industry and for its chemical and metal industries, has on its own carried out more exports than 78 provinces. Accounting for approximately %80 of the USD 12.3 billion of exports Kocaeli made in 2020, Gebze holds a highly important position in terms of transport to all four corners of the world by sea, road, air and rail alike.

With close to 500 domestic and foreign companies and the employment it provides for approximately 40 thousand people, Gebze, which has 3 Organized Industrial Zones, is a critical production base not only for the region it is in but for the whole of Türkiye.

Gebze is at the same time a serious R&D and innovation centre with Informatics Valley, Gebze Technical University (GTÜ), the TUBİTAK Marmara Research Centre (MAM) and the MARTEK Technology Development Zone, the Türkiye Industry Management and Administration Institute (TÜSSİDE) and the TSE Research and Laboratory.

Gebze is also a district of extremely strategic importance for our goal of “a Türkiye that grows by producing”, which we emphasize at every opportunity.

Therefore, together with this goal, we will continue to work and to develop projects in order to carry Gebze's success in industry even higher.

As MÜSİAD, we support our fellow travellers with 89 points in Türkiye and 225 contact points in 95 countries around the world. And now we are launching a brand-new restructuring movement in order to bring them together within a strong trade and investment network. With each one of our members, we have brought to this point this valuable structure, which works harder every day in order to be of benefit to the Turkish economy and to the nation through the employment it provides for 2 million people.

We do this with our corporate culture, our accumulated knowledge and the strength we draw from our organization.

By processing the information we obtain through you from domestic and international regions, we are building an important database. As a result of this, we present to the business world a picture that sets out all the risks, opportunities and current problems.

Distinguished Guests,

As you know, we launched our Renewal process in order to prepare in advance for the new world system. Our motto at the outset was “Together”.

We have fulfilled almost all the initiatives we planned and promised within the framework of our Renewal process. Now we are gathering the fruits of this process with our large-scale projects.

As MÜSİAD, we are developing projects aimed at increasing the contribution made to the national economy and at improving the culture of partnership among our members.

For this purpose, our total of 23 committees under the roof of the MÜSİAD ASSEMBLY, which we established during the Renewal process, have begun to gather the potential investors and industrialists of Anatolia around specific projects with projects suited to their own thematic or sectoral fields.

These projects have begun to encourage the capital power of Anatolia to invest in projects or to become partners in them.

For example, with our Investment and Production Bases Project we have created a model that, by building living and production zones in which all their needs will be met in the same environment for our small-scale companies which struggle to produce in narrow spaces and therefore cannot reach economies of scale, will in time turn them into institutionalized companies ready to move to Organized Industrial Zones. We have completed the first prototype of this model, and we are soon beginning the construction of the second one..

In order to enter the top ten economies in the world, and for the outbreaks and disasters that may recur under any circumstances, we have to establish production bases. By establishing production bases, it becomes possible to protect companies, employees and production in situations of outbreak or severe disaster and to keep them going without a full lockdown.

We have briefly named this model SME INCUBATION CENTRES. This model, in which all the needs of SMEs, from education to accommodation and from social activities to art environments, are met within the same

living space, aims to create a safe production and living space both for our workers and for our producers and their families.

This project of ours has also been one of the works planned from the centre and transferred towards Anatolia. At the same time, this project of ours was registered as a project under state auspices by the Presidency of Strategy and Budget within the scope of the Coordination Council for the Improvement of the Investment Environment.

In the same way, with our Smart Agricultural Cities Project we have launched an initiative in order to encourage rural development and in this way to support reverse migration and to attain a homogeneous population structure.

We presented this to the Ministry of Agriculture and Forestry as a model.

With the Smart Agricultural Cities Model, we have developed an initiative to promote rural life and to support rural development, with opportunities targeting the population crowded into the big cities and especially the enterprises of women and young people.

Today many of our members in Anatolia are carrying out preparatory work in order to implement this initiative in their own regions.

Many more projects like these have been produced by our committees and spread to the grassroots.

Branding cities in the field of gastro-tourism through gastro-economy and Turkish Culinary Arts; establishing structures such as Caravan Tourism and Field Hospitals through multiple partnerships; creating a secure purchasing platform in the second-hand vehicle market; creating a secure real estate buying and selling platform; and, in line with the 2023 targets, growing selected SMEs in 23 locations in 20 places in order to turn them into Turkish and global brands. This and many other projects have become the fruits of MÜSİAD's Renewal adventure.

We have created a MÜSİAD Brand in 6 basic fields in line with Türkiye's 6 basic strategies:

MÜSİAD INNOVA ( MÜSİAD YENİLİK), in the name of innovation management and adaptation to the conditions of digital transformation.

In order to develop the strategic sectors and business models of the future,

MÜSİAD FUTURE (MÜSİAD GELECEK),

MÜSİAD ACADEMY, in order to turn education into a MÜSİAD school and to give it a corporate identity.

2023 YER-EL (20 YER 23 EL), which covers the work directed at our Anatolian companies in order to bring global brands out of Türkiye by increasing branding and the brand values of companies and to turn our SMEs into large-scale corporate brands,

MÜSİAD INVEST (MÜSİAD YATIRIM), in order to turn the credibility advantage of the MÜSİAD Brand, its field, and the savings kept under the mattress into mass investments and partnerships within Türkiye's investment strategies and to establish a systematic structure of investment funds,

MÜSİAD TIA (MÜSİAD TİCARET ve YATIRIM AJANSLARI), which we designed together with the Presidency Investment Office in order to promote Türkiye as an investment and trade market for direct foreign investors and to make MÜSİAD's international field presence work like a trade and investment system.

As many of you have witnessed, we are continuing and will continue our work without interruption. We will go on developing projects and serving our country, our nation and the lands in which we were born.

As MÜSİAD, while upholding the ideals of our founders and these goals of ours, we are on the other hand also continuing the MÜSİAD tradition.

Our Qard al-Hasan Fund, one of the finest applications of this tradition, is a balm for wounds thanks to the goodwill of our members, and it enables us to strengthen the culture of brotherhood and pass it on to new generations.

Our Qard al-Hasan Fund project, which we brought to life out of a desire to continue an ancient tradition, has by transforming the culture of mutual aid and solidarity among our members into a corporate structure, which we created with the thought of making our merchants' trade easier, institutionalized the culture of mutual aid and solidarity.

On the other hand, we are also continuing the practice of the “Zimem Ledger”, another of our ancient traditions, with the support and contributions of all our branch members, chiefly the head office.

Dear Friends,

MÜSİAD is a family, a home, a school. Here we all walk with the pride of being soldiers of the same consciousness and the same cause, and when the time comes we hand the flag over to the brothers and sisters who come after us. This rule is ancient for everyone. This is what makes MÜSİAD unique. For this reason, being present at the General Assembly of our branch makes me exceedingly happy. As I conclude my remarks here, I hope that the MÜSİAD Gebze General Assembly will bring good things and that our branch's contributions to our business world will continue and increase.

I wish success to our branch president Mr. Serkan, to the board of directors, to the MÜSİAD Women's Committee and to our Young MÜSİAD brothers and sisters. I also thank the president of our MÜSİAD Local High Board, Mr. Ahmet, and our local relations committee, and likewise the president of our production and trade high board, Mr. Oktay, for their presentations, as well as our professional staff and everyone who has contributed.

I greet you all with respect and affection.

Abdurrahman Kaan

President of MÜSİAD