AGP Executive Report

Black Sea Shipping Under Fire: Türkiye summoned Ukraine’s ambassador after drone attacks hit two Turkish-operated vessels near Tuapse, with a fire on Lider Bordo Mavi and injuries reported, while Lider Kocatepe was also damaged during towing—raising fresh concerns for civilian navigation and the marine environment. Tourism Cost Pressure: Bloomberg reports Turkey’s “value for money” edge is fading as hotel, dining and leisure prices rise alongside the lira’s depreciation policy, pushing some European visitors to look elsewhere. SCO Summit in Bishkek: Leaders of 17 countries plus UN chief António Guterres will attend the SCO summit on Sept. 1, with Türkiye’s Erdoğan among the expected participants. Defense Diplomacy: Turkish FM Hakan Fidan held calls with Qatar and Egypt to coordinate on regional and maritime-security issues. Manufacturing & Industry Finance: Türkiye unveiled a large financing package for manufacturers, while coverage also points to growth in high-tech production. Aviation Demand: Türkiye saw a sharp jump in UAV pilot applications in 2026, with millions of drones registered.

Aegean Tensions: Turkey said Greece’s new Special Spatial Planning Framework for Industry and the Supply Chain covering parts of the Aegean has “no legal consequences” for Ankara, urging Athens to stick to the 2023 Athens Declaration. AI Governance: Türkiye approved a National Artificial Intelligence Board chaired by President Erdoğan to set AI priorities, steer investment and publish annual progress, alongside an ethics board to guide bias, data use and oversight. Energy & Industry Finance: Erdoğan approved a Türkiye–Saudi renewable energy framework for solar plants in Sivas and Karaman (1,000 MW each) with further 3,000 MW in phases. Manufacturing Push: Türkiye unveiled a large financing package aimed at manufacturers, as confidence and high-tech output continue to be highlighted in recent coverage. Maritime Security & Trade Routes: With the Strait of Hormuz reopening discussed via a temporary Iran–Oman corridor, shipping risk remains a live issue for regional logistics and energy flows. Defense Diplomacy: Turkey’s role in the evolving Mecca Joint Defense Agreement and wider regional security architecture continues to draw attention, including India’s stated concerns.

Manufacturing Finance: Türkiye unveiled a 250 billion lira employment-linked financing package for manufacturers, with grace periods up to six months and maturities up to 36 months, and a ministry-backed cost reduction for firms that keep employment levels steady. Energy Push: Domestic and solar power hit record monthly highs in July, with solar reaching 5.37 billion kWh and renewables delivering 58.2% of total generation. Industrial Scale-Up: TurkStat says Türkiye’s high-tech manufacturing production value crossed 1 trillion lira in 2025, with high-tech enterprises rising 40% over five years. Trade & Reconstruction: Turkey’s trade with Syria jumped 42% to $3.75 billion, as Ankara steps up support for Aleppo’s industrial revival. Regional Shipping Risk: Turkish shipowners warn Black Sea attacks could drive operators toward bankruptcy, pushing some vessels into long-term lay-up. AI for Healthcare: Researchers in Turkey propose a privacy-preserving machine-learning framework to build predictive models across institutions without pooling sensitive raw data. Security Pact: Türkiye, Saudi Arabia and Pakistan formalized the Mecca Joint Defence Agreement, with Pakistan calling it a “message of unity and peace.”

EU Carbon Rules for Industry: Hyundai Steel briefed Turkish auto-parts clients in Izmit and Bursa on the EU’s CBAM, including expanding coverage to steel derivatives, auto parts and home appliances, and what firms need to do to stay compliant. Black Sea Security Procurement: Bulgaria approved the purchase of seven mine-hunting ships to expand NATO-aligned mine countermeasures with Romania and Türkiye, aiming to better protect shipping routes. Iran Trade Pressure: Iran’s president urged Muslim states not to let their soil be used for attacks, as the US escalates sanctions threats and Tehran scrambles to sustain trade. Strait of Hormuz Risk for Shipping: Reports of another tanker hit in the Strait of Hormuz underline how quickly maritime disruption is spreading across the region’s energy supply chain. Ukraine Industrial Hit: Russia’s long attack wave targeted ports, grain storage, energy and industry, with multiple missile and drone interceptions reported. Türkiye–Iraq Logistics Push: Türkiye and Iraq are deepening cooperation around Baghdad’s Development Road corridor, seeking an overland route to Europe amid Hormuz disruption. Public Access vs Water Use: A dam-related dispute in Michigan highlights how licensing renewals can reshape access to water resources.

Turkey’s Green Push: Türkiye published the regulation for its Emissions Trading System (TR ETS), aiming to cut greenhouse gases and align monitoring and market rules with the EU ETS. Competition & Pharma: Turkey’s Competition Board opened an investigation into Israeli drugmaker Teva over claims it used patent tactics and misleading steps to block generics. Energy Links: Armenia said it is discussing electricity imports with Azerbaijan, Georgia, Iran and Türkiye, including an EU-funded converter station on the Georgia border. Sunflower Supply: Turkey will cut sunflower seed import tariffs earlier than usual for the 2026/27 season to protect processor input costs and limit refined oil price pressure. Mining & Labor: Turkish courts ordered pretrial detention of two mine union leaders over social media posts, with unions calling it a move to silence protests over unpaid wages. Trade & Industry Snapshot: New data shows services dominate Türkiye’s enterprises and employment, while manufacturing remains concentrated in low-technology activities. Regional Security: Ankara welcomed SDF/YPG dissolution in Syria, reiterating support for a stable, unified Syria.

Sanctions Push: Zelenskyy’s Capitol Hill pitch helped unlock a major Russia sanctions package in the US Senate, with lawmakers framing it as both military support and morale boost—while next steps remain unclear. Defence Industry Partnership: Nigeria reiterated its drive for a self-reliant defence industrial base and renewed focus on technology transfer and local production with Türkiye at the 7th Nigeria–Türkiye defence forum in Abuja. Regional Security Realignment: Commentary and analysis around the Türkiye–Pakistan–Saudi “Mecca pact” points to a potential new Middle East security architecture and knock-on effects for Iran and US influence. Cyber & Tech Security: The US disrupted a Chinese hacking operation targeting sensitive networks tied to the Justice Department, NASA and the Federal Reserve; China denied the claims and accused Washington of smearing. Turkey’s Trade & Logistics: Turkey’s TUSAF chairman urged wheat supply diversification amid Black Sea shipping risks, as millers look to alternative origins to manage war-risk insurance and freight spikes. Energy Routes Watch: Bulgaria’s renegotiation of its BOTAŞ gas deal highlights how Turkey-linked LNG access is reshaping regional energy security after Russia cuts. AI in Defence: NATO’s Indo-Pacific Four partners are urged to learn from NATO’s AI-enabled decision support as they move toward AI integration in military planning.

Turkey-EU Trade: Turkey was the EU’s fifth-largest goods trading partner in Q2 2026, with two-way trade of €52.8bn, though exports and imports both softened year-on-year. Defence Industry Push: Nigeria and Türkiye used the 7th Defence Industry Business Forum in Abuja to stress a shift from buying platforms to joint production, technology transfer, local manufacturing and R&D under Nigeria’s DICON Act. Lobbying Spotlight: Türkiye’s Defense Ministry hired a Trump-linked US lobbying firm (Ballard Partners) on a $2.4m contract, according to US filings. ADEX 2026 Line-up: Lockheed Martin and SIG SAUER will debut at Azerbaijan’s ADEX 2026, with Türkiye’s ROKETSAN as main sponsor and major Turkish defence firms also confirmed. Energy Security Tensions: Iran’s IRGC says the Strait of Hormuz stays closed unless the US accepts Tehran’s conditions, even as Iran and Oman agree on revenue and control terms. Cyber Risk Watch: A report flags a July spike in ransomware victim listings, with industrial firms among the most targeted. E-Export Momentum: Istanbul will host IGEXX 2026 (Sept 3-5) aiming to scale Türkiye’s e-export deals after a 2024 summit topped $1bn in transaction volume. Local Industry in Syria: LC Waikiki quietly started production at a 150-worker plant in northern Syria’s Aleppo, targeting expansion and EU/UAE shipments.

Iran Sanctions Push: The US launched “Operation Economic Outcast,” expanding secondary sanctions to hit Iran-linked trade and sectors including digital assets, technology, gold, aviation and shipping, while warning partners could lose access to the US financial system. China Pushback: Beijing called the move “illegal unilateral sanctions,” vowed to defend its interests, and urged a US-Iran ceasefire. Strait of Hormuz Logistics: Regional talks continue around a possible temporary Hormuz shipping corridor and mine-clearing, while tanker traffic shifts to alternative routes as security risks persist. Türkiye in the Crosshairs: US warnings explicitly name key Iran trading partners that include Turkey, alongside China, UAE, Iraq, India and Pakistan—raising pressure on logistics and finance links. US-Russia Intel Angle: CIA chief John Ratcliffe made a rare, unannounced visit to Moscow, adding another layer to already tense US-Russia relations. Shipping Update: MSC is resuming multiple Red Sea services through the Suez Canal, including a new Asia-to-Mediterranean Tiger loop starting from Turkey’s Mersin. Local Industry/Legal: A Turkish court acquitted defendants in a politically framed “criminal organization” case tied to tender rigging, while sanctions and enforcement remain a live business risk.

Iran Sanctions Push: The US Treasury unveiled “Operation Economic Outcast,” warning banks and businesses that any financial “lifeline” to Iran could mean isolation from the US system, while Iran vows harsh retaliation and targets shipping and cyber. China Pushback: China said the new sanctions are “illegal unilateral” moves and promised “all necessary measures,” as it remains a major buyer of Iranian oil. Turkey-Brazil Defense Ties: Erdoğan and Lula agreed to set up a vice-presidential strategic council to deepen defense investment and partnerships between Turkish and Brazilian firms. Turkey’s Defense Industrial Milestone: Turkish Navy Chief confirmed the first domestic MUGEM aircraft carrier launch for Sept. 27, 2027. Cyber Risk for Industry: A warning highlights growing Iranian cyber threats to critical infrastructure, adding pressure on utilities and industrial operators. Maritime Security: A Royal Navy-led counter-piracy task group handed command to South Korea after years of piracy pressure in the Indian Ocean. AI Infrastructure Deal: Lancium and Nvidia plan gigawatt-scale AI data center deployments using Nvidia’s AI factory platform. Logistics Watch: Georgia’s Poti port reported record container throughput of 404,760 TEU in Jan–Jul 2026, signaling rising Black Sea corridor demand.

Iran Sanctions Shock: The US launched “Operation Economic Outcast,” warning countries and companies that doing business with Iran could trigger secondary sanctions and loss of access to the US dollar system, with new pressure aimed at oil, shipping, finance and other revenue channels. Syria Re-Entry for Investors: Washington removed Syria from its State Sponsor of Terrorism list, a move Damascus says clears a major barrier to investment and rebuilding. Türkiye-Qatar Trade Push: Turkish Trade Minister Ömer Bolat said Türkiye and Qatar are targeting $5B in bilateral trade, citing a surge in contractor activity in Qatar and the need for alternative logistics routes as Hormuz disruptions bite. Agriculture Output Claim: Turkey’s agriculture minister said Türkiye ranked 7th globally and 1st in Europe in agricultural output, pointing to irrigation expansion and large-scale afforestation. Defense Diplomacy: Erdogan discussed defense cooperation with Lithuania, while Lula and Erdogan mapped a roadmap to deepen Türkiye-Brazil ties with a focus on defense industry collaboration. Maritime Demand: Dry bulk carrier demand stayed strong in early 2026, with higher deal activity and improved market fundamentals.

Central Banking: Turkey’s central bank is reviving one-week repo auctions after a suspension, reopening a TRY 1bn auction at the 37% policy rate and signaling tighter funding conditions ahead of the Sept. 10 MPC meeting. Defense & Aerospace: FNSS unveiled the U-MAV unmanned amphibious vehicle at TEKNOFEST Blue Homeland, built to support first-wave landings with modular mission variants. Energy & Infrastructure: Turkey-linked developments include Iraq proposing to raise oil exports via the Turkish port of Ceyhan to 750,000 bpd, using tanker trucks while pipeline flows continue. Cyber & Power Security: Iran-linked hackers were blamed for shutting down a small UK power facility for four days, highlighting risks for energy operators. Regional Industry Diplomacy: Erdoğan held calls with Lithuania and Brazil, stressing defense-industry cooperation and broader trade and investment ties. Agriculture & Water: DSİ data show dam occupancy and precipitation rising sharply versus last year, but experts warn the drought is not necessarily over. Tech for Media Workflows: EditShare will showcase AI-assisted production workflows at IBC 2026 in Amsterdam, aiming to connect storage, discovery and collaboration.

Cyprus Energy Row: Greece says the Great Sea Interconnector is getting fresh momentum as French investor Meridiam takes a majority stake, while Athens rejects Turkey’s “grey zones” claims and insists its Aegean renewables framework follows international law. Gulf Shipping Shock: Iran’s parliament backs a plan to charge fees for authorized Strait of Hormuz transits as the US prepares a new sanctions push, while Tehran warns it could halt Gulf oil exports if pressure escalates. Mecca Pact Watch: Reports say Iran is considering joining the Saudi-Türkiye-Pakistan Mecca Defence Pact, a move that would reshape regional security dynamics even as no official confirmation is yet in place. TRNC vs UN Complaint: Northern Cyprus PM Unal Ustel hits back after Greek Cypriot authorities filed a UN complaint over a TRNC–Türkiye gas pipeline MoU, saying it won’t stop energy cooperation. Turkish Defence Export Momentum: Turkey’s defence industry exports hit $11.2bn (up 40%), with an infrared detector highlighted as a step toward higher-tech, domestically built capabilities.

Defense Industry & Exports: Turkish armored vehicle maker Otokar is pitching its TULPAR tracked IFV and light tank to Brazil under the country’s modernization program, with local-friendly components and potential turret options including a 120mm setup. Maritime Tech Showcase: Teknofest Blue Homeland’s maritime edition wrapped in Kocaeli, spotlighting domestic naval platforms, unmanned systems and air-defense/missile technologies with major crowds. Industrial Safety: An explosion hit the control room of Yeşilyurt iron and steel plant in Samsun, injuring two workers and renewing scrutiny on workplace safety after a prior fatal incident. Energy & Regional Security: Macron and Saudi Crown Prince MBS are set to discuss energy routes that could bypass Hormuz, plus Iran, Gaza and regional developments, with agreements on energy and transport expected. Turkey in Global Deals: A bribery probe in Argentina has put Turkey’s $1.72bn vehicle inspection concession under renewed attention, after an executive tied to a consortium partner was named in the case. Agriculture Policy: New Party leader Özgür Özel pledged debt relief and purchase/price guarantees for tea and hazelnuts, targeting gaps between announced and paid farm prices. Regional Security Architecture: Reports say Iran has been invited to join the Saudi-Türkiye-Pakistan “Mecca” mutual defense pact, while Turkey’s role and coordination mechanisms continue to draw attention. Cyber & Energy Risk: Iran-linked hackers are blamed for shutting a British power plant for four days, with officials stressing no wider system risk. Energy Discovery: Iran announced a major gas find in Fars province, as it faces sanctions pressure and repairs to war-damaged infrastructure.

Maritime Security: A Turkish-operated vessel, Ural (Kalyoncu Denizcilik), was attacked off Russia’s Black Sea port of Novorossiysk; one sailor died and eight were injured, and the ship is expected to reach Samsun after earlier rescue of crew from another Turkish-owned cargo ship. Trade & Logistics: MSC is expanding its Himalaya Express, adding calls at King Abdullah Port, Jeddah and Abu Qir while keeping the longer Cape of Good Hope route to avoid Bab el-Mandeb amid Red Sea security concerns. Energy Routes: Iran has allowed some Iraqi oil tankers to transit the Strait of Hormuz after Baghdad requests, offering limited relief as traffic remains disrupted. Industry & Investment: Moldova’s PM Vasile Tofan met Turkish business groups in Istanbul, highlighting Turkish textile jobs in Moldova and pitching a technology-park model for Stauceni. Regional Defense: India’s FM S. Jaishankar downplayed the Mecca Joint Defence Agreement’s impact, while Bangladesh signals it may consider similar frameworks tied to Saudi-Pakistan-Türkiye ties.

Digital Consumer Crackdown: Turkey’s Trade Ministry fined nine digital subscription firms 171.4 million lira for unfair cancellation and renewal practices, after 3,000+ complaints. Maritime Security: A Turkish-owned commercial vessel was attacked off Russia’s Black Sea port of Novorossiysk; one sailor died and eight were injured, with the ship later expected to reach Samsun. Energy Routes Under Pressure: Iran allowed some Iraqi oil tankers to pass through the Strait of Hormuz “so far,” while Iraq also pushes higher exports via Türkiye’s Ceyhan port. Oil & Infrastructure Focus: Kirkuk targets 1 million bpd crude exports through Türkiye as production expands, with a one-year pipeline deal already moving about 750,000 bpd capacity. Mining Safety: Turkey detained nine people after a coal mine collapse near Ankara killed one worker and injured 12. AI & Economic Security: Türkiye’s Communications Directorate held STRATCOM events in Tokyo on AI risks, digital sovereignty and economic security. Defense Industry Signal: Saab unveiled a stealthy, autonomous combat drone concept (A3-001) aimed at future contested-environment missions.

Defense & Maritime Tech: STM says it has started mass production of its domestically developed Neta autonomous underwater vehicle and is preparing a fast attack craft prototype after TEKNOFEST Blue Homeland, alongside ongoing Istif-class frigate work. Energy & Trade: Iraq and Türkiye agreed to defer a $1.471bn arbitration settlement tied to Iraqi crude exports via Ceyhan, with payment options including offsets through barrels; the Kirkuk-Ceyhan route is operating while capacity expansion is discussed. Shipping Security: Two separate pirate hijackings off Yemen and Somalia involved 22 Indian seafarers, with one vessel reportedly carrying weapons bound for a Turkish training facility in Mogadishu—renewing Horn of Africa maritime risk concerns. Regional Diplomacy: The UAE joined Turkey, Qatar and Saudi Arabia in condemning Israel’s E1 settlement plan and backing a contiguous Palestinian state on 1967 lines. Climate Hosting: China is reportedly considering a bid to host COP33 in 2028, with COP31 scheduled in Turkey this year.