BMI View: On the whole, Turkey is one of the more stable countries in the Near East region. That said, theinstability in its surrounding neighbourhood is affecting Turkey's regional interests. BMI thinks thatinternational dynamics are bringing Turkey to roll back somewhat its Syrian policy, notably throughmodification of its previous support of extremist groups in the region. Turkey is continuing its efforts toboost its indigenous defence production capacity are continuing via investments, joint ventures withinternational companies. From the BMI perspective, Turkey could serve as a potential market to opt forcheaper offshore production processes, although caution is necessary.
We expect that Turkey will spend up to USD20.6bn on defence in 2014. Up to and including 2019, weexpect Turkey to spend an average of USD28.4bn on defence annually. We anticipate that Turkey willincrease its defence spending to USD23.9bn in 2015, which will then experience a further increase to 2016to USD27.3. By 2019, we expect the annual defence budget to have reached USD32.5bn. phenomenallyfantastic