AGP Executive Report

Nuclear Power: Türkiye’s Akkuyu NPP hit a major commissioning step by loading 163 mock fuel assemblies into the first reactor unit, a rehearsal for real fuel loading and aimed at first electricity by year-end. Green Finance: Türkiye secured €200m from the European Investment Bank for its green transition, split between sustainable industry support and green export financing via Türk Eximbank. Energy Transition: At COP31 talks in Bonn, Türkiye put electrification front and center, pushing a voluntary goal of electricity reaching 35% of global energy demand by 2035. Rail & Logistics: Türkiye and Saudi Arabia signed landmark transport and railway MoUs, with plans to extend the corridor toward Oman as an overland trade route bypassing the Strait of Hormuz. Regional Trade Routes: Amid Hormuz-linked shipping risks, Malaysia said it is seeking new fuel sources (including Africa and Turkey) but must match refinery processing needs. Industrial Tech: Quality Power signed a term sheet to acquire WSIL, expanding high-voltage insulator manufacturing capacity. Healthcare Oversight: Türkiye rolled out an antibiotic use surveillance system across adult hospital wards to curb antimicrobial resistance. Global Industry Events: UFI’s European Conference drew record attendance in İzmir, reinforcing Türkiye’s MICE clout.

Rail & Logistics Deals: Turkey and Saudi Arabia signed MoUs in Riyadh covering railway cooperation, logistics services, infrastructure, technology transfer and workforce training, with a framework aimed at reviving the historic Hejaz Railway and eventually extending connectivity toward Oman as an alternative Gulf-to-Mediterranean trade route. Energy & Climate Policy: COP31 hosts Turkey and Australia unveiled a “35 by 35” electrification push, aiming to lift electricity’s share of final energy demand to 35% by 2035, using heat pumps and electric vehicles to cut fossil-fuel reliance amid volatile energy markets. Science & Youth Tech: Türkiye’s T3 Foundation won a major European science communication award (ECSITE Bright Spark), highlighting its hands-on model via TEKNOFEST and DENEYAP Makers Labs. Infrastructure & Heritage: Construction on the Silvan Dam in Diyarbakır continues despite expected village submergence and environmental disruption, while restoration of the historic Stone Bridge in Amed is criticized for losing original character. Maritime & Labor: Four Indian sailors stranded for 10 months on an abandoned container ship off Istanbul were finally taken off, underscoring ongoing vessel abandonment risks.

Azerbaijan–Turkey Gas Deal: SOCAR-led Baku Energy Week delivered about $7.5bn in commercial energy agreements, highlighted by a 15-year Absheron Phase 2 gas sales pact: BOTAS to buy 33 bcm, with output expected to triple to at least 4.5 bcm/year as TotalEnergies targets final investment decision this year. Aviation Expansion: Turkish Airlines plans to expand its direct ultra-long-haul network from late 2027, using Airbus A350-1000 configured for up to 17-hour non-stops, including potential Istanbul links to Buenos Aires and Lima, while managing tight 2026 fuel-cost pressures. Defence Tech Link-Up: Bulgaria’s BlackBelt Technologies debuted at IDEES Plovdiv with its Forge-OS autonomy software and opened exploratory technical talks with Turkey’s TEUSAN, signaling more European “sovereign” guidance competition. Pharma Trial Milestone: GEN Pharmaceuticals dosed the first patient in its Phase II proof-of-concept SHEPHERD trial for SUL-238 in early, untreated Parkinson’s, aiming to test mitochondrial dysfunction targeting. Cyber/Trust Automation: NicSRS says its sslTrus brand is gaining traction as certificate lifecycles shorten, expanding into cloud code signing and broader enterprise certificate lifecycle management. Shipping & Logistics: CU Lines launched a Turkish subsidiary, building a Turkey hub to interconnect trunk-and-feeder services across the Eastern Mediterranean, North Africa and the Black Sea, linking routes toward Europe–Asia–Africa trade lanes. Trade Talks: Türkiye and Canada agreed to launch exploratory discussions toward a free trade agreement, with energy flagged as a key cooperation area.

Energy Transition Watch: Ember data shows global gas’s share of electricity slipping for a fifth straight year, with Turkey among the biggest drops, as solar and wind keep gaining—while Middle East supply worries could push the shift faster. Turkey–Venezuela Trade Push: President Erdoğan met Venezuela’s acting President Delcy Rodríguez in Istanbul to expand cooperation in trade, energy and mining, targeting $3bn in bilateral trade. Maritime Policy Delay: Turkey postponed the “Blue Homeland” maritime jurisdiction bill tied to EEZ and shelf claims, likely until after the summer recess, easing tensions ahead of the NATO summit in Ankara. Aviation & Connectivity: Canada and Türkiye launched exploratory talks for a free trade agreement and flagged renewable energy, nuclear cooperation and aerospace/defence industry links. COP31 Energy Stakes: Turkey’s COP31 chair Murat Kurum warned in Bonn that fossil-fuel dependence and unstable energy markets make stronger clean-transition action urgent. Offshore Wind Fleet: Acta Marine delivered the CSOV Acta Gemini from Tersan Shipyard for a long-term charter supporting the Sofia Offshore Wind Farm. Regional Diplomacy: Azerbaijan, Georgia and Türkiye held their 10th trilateral foreign ministers’ meeting in Istanbul, signing a declaration and reaffirming rail and energy connectivity plans.

Defense & Shipbuilding: STM launched RAJA LAUT, the second corvette for Malaysia’s LMS Batch II project, in Istanbul, with the third ship due in August—another sign of Turkey’s naval export push. Aviation & Connectivity: Turkish Airlines plans to add ultra-long-range Airbus A350-1000 aircraft from late 2027, enabling non-stop flights up to 17 hours and expanding reach to Australia and South America. Manufacturing Demand Pulse: Istanbul Chamber of Industry’s export climate index rose to 50.3 in May, showing only marginal improvement, with weakness flagged in parts of Europe but steadier activity in the US and recovery signals in the Middle East. Regional Diplomacy with Industry Links: Venezuela’s interim president Delcy Rodríguez will meet Erdoğan in Istanbul, with past cooperation spanning defense, energy, tourism and agriculture. Trade & Logistics Disruption: Middle East strikes around Iran-Israel tensions are pushing oil up about 5% and raising fresh shipping risk concerns tied to the Strait of Hormuz. Maritime Labor: Four Indian sailors stranded for 10 months on an abandoned ship off Istanbul were evacuated, highlighting ongoing vessel abandonment problems. Textiles/Exports: Sahinler Egypt expanded its ready-made garment capacity, targeting about $55m in exports by 2026.

Defence Industry: UK, Ukraine, France and Germany urged an “immediate and complete ceasefire” after Russia’s Oreshnik missile strikes, while also pushing for faster production of interceptors and deep-strike capabilities ahead of the NATO summit in Ankara. Energy & Shipping: The US Treasury expanded sanctions on Iran-linked LPG carriers, blacklisting six more vessels and targeting traders tied to front companies in UAE free zones. Middle East Energy Corridors: Iraq says it plans to raise oil exports via Syria and Turkey to 650,000 bpd, boosting flows through the Turkish port of Ceyhan and overland routes. Agriculture & Forestry Cooperation: Turkey’s Agriculture minister met his counterpart in Istanbul to discuss forest, rangeland and nature reserve management, plus seed, genetic resources and smart irrigation tech. Local Business & Services: Cafes in Istanbul and Ankara started limiting laptop use and Wi‑Fi, citing higher operating costs and aiming to increase customer turnover. Regional Trade: Azerbaijan used the St. Petersburg forum to push logistics and investment ties, including talks with Turkey on transit and e-commerce.

Central Banking Watch: Türkiye’s Central Bank Monetary Policy Committee meets June 11, with most analysts expecting the one-week repo rate to stay at 37% as inflation edges up to 32.6% in May. Regional Energy & Trade Corridors: Türkiye’s transport minister says the modernised Hejaz Railway could be extended toward Oman to create an alternative route to the Strait of Hormuz, while Ankara also pushes connectivity projects like the Zangezur corridor segment. Defense & Industry Signals: MPs in the UK scrutinise the £6.3bn Ajax armoured vehicle programme over safety and delivery delays, warning it may never be fit for combat—an issue that feeds into broader defence industrial planning. South Caucasus Cooperation: Foreign ministers from Türkiye, Azerbaijan and Georgia meet in Istanbul to review trilateral cooperation, with emphasis on transport links, energy security and commercial ties. Shipping Disruption Risk: The US says it shot down two more Iranian drones near the Strait of Hormuz, underscoring ongoing pressure on maritime traffic and energy logistics.

Energy Diplomacy: Turkish energy firm Karpowership’s power contract talks in Guyana are back in the spotlight after the government finally confirmed negotiations are ongoing, following public pressure and fears over grid stability. Defence & Industry Oversight: UK MPs warned the troubled £6.3bn Ajax armoured vehicle may never be combat-ready, while they also criticised delays to the Defence Investment Plan. Unmanned Strike Tech: Türkiye moved beyond drone bomb-carriage by fielding Roketsan’s İHA-230 supersonic ballistic missile on combat drones, extending stand-off precision strike capability beyond 150 km. Black Sea Shipping Risk: A Turkish-flagged fishing trawler sank after an apparent attack off Crimea, underscoring rising dangers for civilian shipping in the Russia-Ukraine spillover zone. Turkey-Bangladesh Strategic Ties: Ankara and Dhaka agreed to annual foreign-minister consultations and annual 2+2 defence talks, with cooperation also covering Rohingya, trade, investment and joint production. Global Governance Critique: Turkish Parliament Speaker Numan Kurtulmuş said the UN and other institutions are failing to respond effectively to crises. Business & Social Sensitivity: Turkish justice opened a probe into Rahmi Koç after a viral joke referencing a Kurdish woman, despite his apology.

Turkey-EU Fashion & Industry: Turkey is positioning itself to benefit from tighter EU sustainability rules (ESPR, Digital Product Passports, EPR), betting on fast delivery, proximity and more circular production to keep its role as a key apparel supplier. Logistics & Trade: Ozon says it has opened five major logistics centers in Russia since the start of 2026 and plans more by year-end, underscoring continued investment in warehouse capacity and order processing. Energy Security & NATO: Bloomberg reports talks on expanding NATO’s Cold War fuel pipeline network via a new Turkey link connecting Thrace to the Mersin area and Incirlik, with possible approval at the Ankara summit in July. Defense Industry Efficiency: UK defence workers warn of waste and inefficiency, citing repeating jobs, poor planning and too many management layers as a delayed Defence Investment Plan nears. Bilateral Cooperation: Turkey and South Korea agree to expand strategic cooperation across nuclear energy, transport, defence industries and advanced technology. Mining Partnerships: Nigeria and Türkiye move to implement a mining development push, seeking Turkish investment, technology and expertise for critical minerals. Maritime Safety: A Turkish-flagged fishing boat was attacked in the Black Sea near Crimea; one sailor died and four were injured.

Bangladesh–Türkiye Strategic Push: In Dhaka, Foreign Minister Hakan Fidan and Bangladesh FM Khalilur Rahman agreed to deepen ties and target $2bn trade, with priority areas including textiles and apparel, defence manufacturing, shipbuilding, pharma, infrastructure, renewables and ICT, alongside talks on a free trade or preferential trade arrangement and an MoU on cultural heritage protection. Rohingya Return Support: Turkey reiterated support for a safe, voluntary and dignified return of Rohingyas to Myanmar, praising Bangladesh’s hosting role and discussing regional steps for a lasting solution. Black Sea Incident: A Turkish fishing vessel was attacked near occupied Crimea; one fisherman died and four were injured, with investigations ongoing amid rising maritime risks. Turkish Inflation Spotlight: Turkey’s annual inflation was reported at 32.4% in April, far above the OECD average, keeping pressure on household purchasing power. Defence Industry Context: A Turkish intelligence assessment urged boosting air and missile defences and protecting critical infrastructure as regional conflicts reshape threat perceptions. Energy/Power Contract Risk: Turkish powership operator Karpowership warned it may suspend operations in Guyana if commercial terms aren’t finalized, raising grid-stability concerns.

Turkey-US-Iran Diplomacy: Foreign Minister Hakan Fidan welcomed progress in US-Iran peace talks via Pakistan’s mediation, stressing the need for a lasting deal and safe passage through the Strait of Hormuz. Inflation Watch: Turkey’s annual inflation edged up to 32.61% in May, with monthly consumer prices rising 1.71%, as Mideast tensions keep energy-driven pressure on costs. Defence Industry: Türkiye’s defence and aerospace exports hit $992m in May (+33.9% y/y), while Roketsan positioned its Alka laser system as the “Steel Dome” laser layer for drone defense. Regional Trade & Energy: Ankara and Dhaka discussed deeper cooperation including textiles, shipbuilding and defence, while Turkey also pushed alternative routes amid Hormuz risk. Armenia-Russia Pressure: Armenia’s election on June 7 is framed as a test for ties with Türkiye and a shift away from Russia, as Moscow tightens agricultural restrictions. Powership Contract Tensions: New reporting from Guyana mirrors Ghana’s powership controversy, with the government saying it is still negotiating demands after contract renewal disputes. World Cup Build-Up: FIFA named Shakira and Burna Boy for the 2026 opening ceremony, while Turkey’s role as a host base continues to draw attention.

Turkey–South Korea Diplomacy: Turkish FM Hakan Fidan met his South Korean counterpart in Seoul to discuss trade, nuclear energy, defense cooperation, infrastructure and AI, aiming to turn last year’s summit follow-ups into tangible projects. Energy & Industry Cooperation: Türkiye and South Korea also signaled deeper strategic collaboration across key sectors, while DNV validated Carbon Ridge’s centrifugal onboard carbon capture system reaching up to 98% CO2 capture in a pilot on a Turkish-built tanker at Beşiktaş Shipyard. Regional Connectivity & Logistics: Ankara is pushing alternative trade routes amid Gulf tensions, including talks to revive the Hejaz Railway and extend it toward Oman, plus progress on Iraq’s Development Road corridor linking Grand Faw Port to Turkey. Maritime Trade Pressure: A shipbroker report highlights how sanctions and fleet aging are reshaping shipping into a two-tier market, with sanctioned tankers far older than dry bulk units. Trade Signals: Türkiye’s trade deficit narrowed 15.7% in the first five months of 2026, reinforcing a mixed but improving macro picture for exporters and manufacturers. Security & Policy: Türkiye condemned Israel’s approval of 2,162 new West Bank settlement units, warning it undermines the two-state path.

Inflation Outlook: Finance Minister Mehmet Şimşek says Türkiye’s disinflation drive is “firm” and inflation should keep falling, aiming to end the year in the mid-20s despite shocks. Aviation & Tourism: SunExpress is cutting UK summer routes and frequencies, citing higher jet fuel costs tied to the Iran war. Trade & Travel Security: Türkiye’s Trade Ministry is investigating claims that Schengen visa appointment slots were collected by bot software and resold for profit, with seven companies under review. Sustainability Push: Istanbul’s Zero Waste Festival opened June 4, running until June 7, with energy efficiency, recycling and circular economy activities drawing an expected 1 million visitors. Energy Corridors: BP reports higher gas flows on the South Caucasus Pipeline in Q1 2026, while Azerbaijan’s BTC pipeline has shipped nearly 557 million tons of oil since launch. Industrial & Consumer Trends: Türkiye’s fishery production rose 11.1% in 2025, and the country ranks 4th in Europe for bicycle production, though domestic use still lags. Tech & Cyber: Researchers flagged malware campaigns that mimic open-source tools to deliver malicious software via deceptive download flows.

Hejaz Railway Revival: Türkiye plans to modernise the historic Hejaz Railway and extend it toward Oman, aiming to build an alternative trade corridor to the Strait of Hormuz. The first step targets a link from Türkiye to Aleppo via existing Aleppo–Damascus–Jordan routes, with talks underway with Saudi authorities. Energy Security & Logistics: Turkish President Erdoğan warned the Iran–US crisis is raising energy import costs and inflation risks, stressing that Hormuz closure showed supply security is a sovereignty issue. Regional Oil Corridor Push: Iraq approved a plan to more than triple oil exports via the Kurdistan–Turkey pipeline network to 770,000 bpd, routing flows to Ceyhan to offset Hormuz disruptions. Aviation Demand Signal: European airport passenger traffic fell 0.7% in April 2026 year-on-year, the first decline since the post-COVID recovery began, with Middle East exposure hitting Turkey and nearby markets. Industrial Trade Pressure: The EU is building tools beyond product-by-product tariffs to tackle China’s industrial overcapacity, as steel and car exports surge. Local Labor Watch: Turkey was ranked among the world’s 10 worst countries for workers’ rights in the 2026 Global Rights Index, citing union-busting and strike restrictions.

Defense & Tech Diplomacy: FM Hakan Fidan heads to South Korea (June 4) to push defense ties on drones and nuclear/renewables, while also discussing AI, semiconductors and batteries. Trade & Industry: Türkiye targets $30bn trade with France by 2030 after a 71% jump to $24.2bn over five years, with French firms flagging $5bn new investments. Energy & Regional Power: Iraq brings ~1,200MW more power online via Turkish and Kurdistan interconnections to stabilize summer supply. Manufacturing Exports: Turkish tire exports hit a record $1.9bn in 2025, reaching 155 countries; passenger car tires lead. Digital Infrastructure: Damac Digital says its IT capacity landbank reached 6,000MW across 13+ countries, aiming for 2GW operational by Q1 2028. Economy Watch: Türkiye’s Q1 2026 GDP grew 2.5% y/y, led by services and household consumption, while industry contracted 0.8%. Market Pressure: Pistachios face tight, cautious supply as Iran conflict disrupts exports amid demand spikes tied to Dubai chocolate.

Crypto & Payments: Ripple says its USD-backed stablecoin RLUSD is now available to Turkish institutions via new partnerships with BiLira, Bitexen and Bitlo, after reaching $1.7bn market cap since late-2024. Energy Prices: Türkiye cut gasoline and diesel prices after a dip in global oil benchmarks tied to expectations around US-Iran talks. Rail & Logistics: The upgraded Baku-Tbilisi-Kars railway entered full operation, with the Georgian segment modernization lifting annual freight capacity from 1m to 5m tonnes. Defense & Industry: NATO Parliamentary Assembly backed stronger funding and faster delivery of defence capabilities ahead of the Ankara summit, pushing lawmakers to help turn pledges into combat-ready output. Regional Diplomacy: Foreign Minister Hakan Fidan said Trump plans to attend the NATO summit in Ankara, while warning Israeli actions in Lebanon could complicate the US-Iran ceasefire. Aviation/Trade: Malaysia urged Norway to expedite refunds for a canceled missile deal, blaming Oslo’s export-license refusal. Health Tourism: Turkey is drawing more international patients for eyebrow transplants, adding another niche to its medical tourism push.