Commercial Relations
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  • 1. Turk ish/Portuguese commercial relations
  • 2. Facts About Portugal
    • Location: South-western Europe, Bordering the North Atlantic Ocean, West of Spain
    • Size: 92 500 Km2
    • Total Population: 10 566 212
    • GDP - Real Growth Rate: 1.1%
    • GDP - Per Capita: Purchasing Power Parity - $17,900
    • Inflation Rate (Consumer Prices): 2.1%
    • Labour Force: 5.48 Million
    • Unemployment Rate: 6.5%
  • 3. Economy overview Portugal Has Become a Diversified and Increasingly Service-based Economy Since Joining the European Community in 1986. Over the Past Decade, Successive Governments Have privatised Many State-controlled Firms and Liberalized Key Areas of the Economy, Including the Financial and Telecommunications Sectors. The Country Qualified for the European Monetary Union (EMU) in 1998 and Began Circulating the Euro on 1 January 2002 Along With 11 Other EU Member Economies. Economic Growth Had Been Above the EU Average for Much of the Past Decade, but Fell Back in 2001-04. GDP Per Capita Stands at Two-thirds That of the Big Four EU Economies. A Poor Educational System, in Particular, Has Been an Obstacle to Greater Productivity and Growth. Portugal Has Been Increasingly Overshadowed by Lower-cost Producers in Central Europe and Asia As a Target for Foreign Direct Investment. The Government Faces Tough Choices in Its Attempts to Boost Portugal's Economic Competitiveness While Keeping the Budget Deficit Within the eurozone's 3%-of-GDP Ceiling. Natural Resources: Fish, Forests (Cork), Iron Ore, Copper, Zinc, Tin, Tungsten, Silver, Gold, Uranium, Marble, Clay, Gypsum, Salt, Arable Land, Hydropower
  • 4. Communication infrastructures
    • Railways: Total: 2,850 Km
    • Highways: 17,135 Km
    • Waterways: 210 Km
    • Pipelines: Gas 1,099 Km; Oil 8 Km; Refined Products 174 Km
    • Ports and harbours: Aveiro, Funchal (Madeira Islands), Horta (Azores), Leixoes, Lisbon, Porto, Ponta Delgada (Azores), Praia da Vitoria (Azores), Setubal, Viana Do Castelo
    • Airports - With Paved Runways: 42
  • 5. Increase in economic relation for community members When inside an economic block economic relations are boosted, meaning that companies from within the same commercial zone privilege those markets when selling or buying products. This happens because the costs attached to the community trade (time and money), are normally inferior to those happening outside the free trade zone. Portugal an investment for the future
  • 6. Future evolution To be able to know the future tendencies of any reality is the best way to be prepared to face the challenges that are to unfold. Its the best way to be one step ahead of the present and to be able to make decisions that in a time perspective allow a decision to be made not only on the present reality but also on a fairly predictable future scenario. With this approach we make sure that it is not the idea of present gain that mostly conditions the decision but th at of achieving the biggest profit. Nevertheless those two approaches do n o t have be exclude each other.
  • 7. Buy well sell better Commerce as two distinct directions: buying and selling, and both of them are of the utmost importance. So as to do good business companies must buy good and sell even better. This means buying high quality cheap products and afterwards place those products, preferably in markets where margins are high. Price evolution
  • 8. Competitors In our way to increase selling it is important to know against whom we are competing, who is working in the same market as we are, so as to assess better our comparative advantages, predict future competitive behaviours and to easily differentiate and "work" our differences. Portuguese main suppliers are: Spain 29.3%, Germany 14.4%, France 9.7%, Italy 6.1%, Netherlands 4.6%, UK 4.5% Portuguese main buyers are: Spain 24.8%, France 14%, Germany 13.5%, UK 9.6%, US 6%, Italy 4.3%, Belgium 4.1% Competitive scenario in Portugal
  • 9. Buy well Having good clients is half of the way to a successful strategy. To by well one company must have access to a large number of suppliers so that their dependence from a specific supplier is reduced . This approach also helps increasing negotiation power caused by the increased choice of options . It also pushes delivery times into a reduction. Search for potential suppliers Selling patterns
  • 10. Sell even better There is no use in producing good products if its not possible to sell them. The search for profitable markets is one of the leading vectors in the development of any company. There are two major approaches companies can choose when thinking about placing their products: price leaders(selling at the smallest price), differentiation(bet on quality, design, time, etc .) The best option to choose depends on many factors such as the kind of good, the consumer's behaviour, the competition level, the companies capability, etc. Search for potential costumers Buying patterns
  • 11. Critical success factors A good assessment of the critical success factors allows us to detect patterns of behaviour and "work" them by focusing most of our efforts on these variables, avoiding a undesired dispersion of resources. To identify the critical success factors it is needed to answer the fallowing questions: Why should they choose Turkish products instead of any other s ? Which characteristics do Portuguese costumers value the most, (price, quality)? This is, what are the key factors that make companies choose one instead of other.
  • 12. Critical success factors On the other hand one must know which efforts shall be made to show Turkish companies qualities (to make obvious to Portuguese companies that Turkish products are a good choice). In other words : Which aspects of the Turkish companies should be promoted in Portugal? H ow can we attract clients? What distinguishes the most successful companies trading with Portugal from the others? Which are the relevant competitive factors? A thorough answer to these questions enable us to create a good picture of Portuguese reality.
  • 13. Market analysis The distribution of the Portuguese companies according to its sector of activity is as follows: Companies working on the primary sector: 2.8% Companies working on the secondary sector: 26.6% Companies working on the t reciary sector: 70.6%
  • 14. Turk ish/Portuguese commercial relations Turkey : Exports - commodities: apparel, foodstuffs, textiles, metal manufactures, transport equipment Imports - commodities: machinery, chemicals, semi-finished goods, fuels, transport equipment Portugal : Exports - commodities: clothing and footwear, machinery, chemicals, cork and paper products, hides Imports - commodities: machinery and transport equipment, chemicals, petroleum, textiles, agricultural products
  • 15. SWOT analysis to Portugal
    • Strengths:
    • Euro currency guarantees a minimum risk at the transaction.
    • Good communications, such as roads, ports and airports makes easier for companies to carry their products there.
    • Good purchasing power
    • Weaknesses:
    • Slightly unstable economic environment, with the economic community demanding deficit reduction measures that might increase unemployment and reduce growth in the sort term.
    • No autonomous monetary policy.
    • Opportunities:
    • Government plans to boost public investment
    • Strong pressure to ease the burocracy.
    • Strategical location to access the American continent
    • Threats:
    • High unemployment rate ( 6.5 %) .
  • 16. Portuguese imports