I will explain again the system of Turkey which is in itself a bit unique and efficient.
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In Turkey, the Defense Industry Presidency (Savunma Sanayii Başkanlığı, SSB) plays a unique and central role in the development, procurement and production of armaments and weapons. This role includes both the function as a client and partly as a contractor, which can be explained by the special structures and tasks of the SSB:
1. role as client:
Definition of defense requirements: The SSB is the main institution that defines the requirements of the Turkish Armed Forces (TSK) and other security agencies. It collects lists of requirements based on strategic planning and then initiates tenders.
Project management: The SSB initiates and monitors the development and procurement of defense equipment by the private sector, state-owned companies or international partners.
Coordination: It coordinates between the Turkish Armed Forces, security agencies, companies and research institutions to ensure that projects meet requirements.
2. role as a contractor:
Shareholding in companies: The SSB holds shares in several state and private defense companies. Examples include:
ASELSAN: manufacturer of electronics and weapons systems.
ROKETSAN: Producer of missile and ammunition systems.
TUSAŞ/TAI: Manufacturer of aircraft and drones.
Establishment of own companies: The SSB establishes and sometimes operates its own companies or joint ventures to advance strategic industries.
Technology development: It actively invests in research and development to reduce technological dependencies and promote the export of defense equipment.
3 Why is the SSB both a client and an entrepreneur?
Strategic control: The dual role enables the SSB to better manage Turkey's strategic interests and ensure that sensitive technologies are developed in the country.
Promotion of independence: Through direct participation in companies, the SSB can minimize dependencies on foreign suppliers.
Efficiency: This structure enables a close integration of demand, production and innovation, allowing projects to be implemented more quickly.
Financial independence: The SSB has its own budget, which is fed by income from exports and special funds, allowing it to act independently of the state budget.
4. criticism and challenges:
Conflicts of interest: the dual role could lead to conflicts of interest, as the SSB should control prices and quality as a client on the one hand, and benefit from higher profits as an entrepreneur on the other.
Transparency: There is criticism of the lack of transparency in award and development processes.
Market dominance: State participation could restrict competition in the Turkish defense sector.
Conclusion:
The SSB is both client and contractor in order to safeguard Turkey's strategic and technological interests in the defense sector. It does this by exercising direct control over the entire life cycle of defense projects, from the identification of requirements to production and marketing. This structure is unique and reflects Turkey's efforts to strengthen its defense industry and become less dependent on external suppliers.
The defense industry board (SSB) does indeed benefit indirectly from export revenues, and this is usually through dividends or other financing models. This stems from the SSB's involvement in various state-owned or partially privatized defense companies.
Exports and their proceeds:
The SSB is an active shareholder in leading Turkish defense companies such as ASELSAN, ROKETSAN, TUSAŞ/TAI, HAVELSAN and others. These companies generate revenues, especially from defense exports, and pay dividends to their shareholders, including SSB, as profitably operating companies.
2. how export revenues flow into dividends
1. defense exports as a source of income:
Turkish defense companies export their products such as drones (e.g. Bayraktar TB2), missile systems, ammunition and other technologies to international customers.
These export revenues flow into the companies and contribute to their profits.
2. distribution of dividends:
Companies in which the SSB holds an interest distribute a portion of their profits as dividends.
As a shareholder, the SSB receives these dividends directly, thus benefiting from the export proceeds.
3. reinvestment:
Part of the dividends received can be invested directly in new projects, research and development or other strategic initiatives.
3. other sources of income for the SSB
In addition to dividends from export proceeds, the SSB has other financing mechanisms at its disposal:
Dedicated funds: the SSB manages the Defense Industry Fund, which is fed by export proceeds, taxes on certain goods and services and international defense contracts.
Licenses and patents: The SSB promotes and partially owns intellectual property that also generates revenue through licensing to exports.
4. example of concrete export revenues
Turkey has achieved significant success in arms exports in recent years, particularly with the Bayraktar drones and other high-tech systems. Countries such as Qatar, Azerbaijan, Poland and several African states are customers.
These sales boost the turnover of companies such as Baykar, which are often directly or indirectly supported by the SSB.
The increasing success in the export business boosts the companies' profits and thus also the dividends that the SSB receives.
5. purpose of this income
The income in the form of dividends or other distributions enables the SSB to finance its strategic objectives, e.g:
Promotion of new technologies.
Investing in research and development.
Supporting smaller companies in the defense industry.
Expansion of national defense capabilities.
Conclusion:
The SSB benefits from the export revenues of the companies in which it holds a stake in the form of dividends. These revenues flow directly into the strategic development of the Turkish defense industry and contribute to the independence and strengthening of national security interests.
But Ucan Tost thinks he knows better, In every pore or hole whatever no idea of his body, he sees nepotism, money laundering and private enrichment
in turkish military Industries.
If that were the case, we would probably be fighting with stones and sticks by now and our tanks would be donkeys that we ride on.