Inward processing regime in turkey,effects: The case of packaging sector

Within the integrated world economy, both developed and developing countries agree to increase exports as the key to increase the welfare of the country and try to use all economic instruments in the most efficient way in order to increase their exports. For this purpose, the foreign trade policies that are put into practice are shaped according to global economic policies. Particularly the efforts of developing countries to export more to increase scarce foreign exchange resources are among the top priorities of economic policies. The most reliable way to obtain foreign currency is exports. Various instruments have been developed to promote foreign trade in general and export in particular. The gradual liberalization of international trade has made it necessary to subject it to a distinctive discipline. This has brought the elements of supporting foreign trade to a point where meticulously studied, especially in countries that have adopted the export oriented industrialization model. On the one hand, in terms of both maintaining world order and keeping the current support, like the other countries the Republic of Turkey also worked on the issue and is working with precision. Adopted liberal economic system has revealed that the necessity of harmonizing Turkey's foreign trade policy with global economic policies. The activation of the export-based industrialization model is directly related to the effective use of foreign trade policies and especially incentive policies to increase exports. The nature of the new incentive policies that have been implemented since 1996 is the promotion of activities and the exporters' position in the world market. Within this context, the inward processing regime is not only the most widely used but also the most important incentive measure that were implemented among others. Inward processing regime is an incentive system that provides tax facilities for imports which will be directed to export. In this study, it has been explained together with the objectives of the Inward Processing Regime, which is being implemented together with some other incentive systems for activities in our country and perhaps the most important one, and whether the results obtained in practice coincide with these aims and suggestions are made for increasing its effectiveness. In this respect, the packaging sector, which has a high dependency on imports in raw material procurement, has been handled and its benefits, difficulties and disadvantages arising from the inward processing regime have been examined. In this context, the static and dynamic effects of the regime were evaluated. Both the general foreign trade data and the foreign trade data of the packaging sector were handled by empirical modeling and the effects of the inward processing regime on export and import both general foreign trade realizations and packaging sector realizations were determined and the effect of the internal processing regime on both general export and packaging sector export was positive and significant. According to these conclusions, outcomes and related issues were identified and proposed solutions were produced and presented.