New Incentive Legislation Offers Hope to Our Steel Sector in Terms of Compliance with Green Transformation

The Decision on State Aids in Investments has been published in the Official Gazette dated May 30 and has come into force. The decision, which completely changes the incentive system, determines the procedures and principles regarding the support of investments that will increase production and employment, meet our country's critical needs, ensure supply security, reduce foreign dependency, and encourage high value-added investments that will increase international competitiveness, accelerate the green and digital transformations of enterprises, increase international direct investments, and reduce regional development disparities.

The decision emphasizes that investments compatible with the circular economy approach, protecting natural resources, contributing to climate and sustainability goals, aiming for resource-efficient and low-carbon production will be evaluated within the scope of the Green Transformation Program.

The decision states that investments evaluated within the scope of the Green Transformation Program will benefit from the incentive system under the "Priority Investments Incentive System" and "Strategic Move Program".

The decision also states that no conditions will be required for investments to be supported within the scope of the Green Transformation Program.

All these provisions give the impression that the aids that the European Union has been providing to its own steel producers for years will also be valid for the Turkish steel sector, and this situation will contribute to our steel sector competing more comfortably in international markets within the scope of green transformation.

It is expected that the investment needs included in the "TÜBİTAK Green Growth Technology Roadmap" report, commissioned by the Ministry of Industry and Technology to TÜBİTAK and actively participated by our sector, later announced by our Minister Mr. M. Fatih Kacır, which determines the necessary investments within the scope of green transformation, will benefit from green transformation incentives.

In an environment where the USA, within a short period of two months, increased the tax rate it had determined to protect the steel sector from 25% to 50% by reviewing real conditions; it is not understood why the practices that negatively affect the competitiveness of our sector continue to be maintained for years despite our persistent demands.

In this context, the initiative started by our Government; the elimination of financial burdens caused by practices such as the Environmental Contribution Fee, YEKDEM, GEKAP, IDIS, and VAT Withholding, which pose obstacles to our sector, and supporting it by establishing the Inward Processing Regime on a basis that prioritizes domestic supply, is of great importance in terms of increasing the competitiveness of our sector.