Türkiye | Defense Industry Potential

Global defense demand is structural, driven by tensions, rising budgets and new warfare. Europe faces gaps in air defense, drones, long-range fires and ammunition, while Türkiye can complement it through co-production and supply-chain partnerships. Future competitiveness will depend on AI, autonomy, cyber and space.

Key points

• Key points:
• Global defense demand is entering a more structural phase. Geopolitical tensions, higher military spending and the changing nature of warfare are pushing governments to rebuild capabilities and invest in new technologies.
• Europe has a substantial defense-industrial base, but important bottlenecks remain in scale, speed and replenishment. The most significant gaps are concentrated in integrated air and missile defense, counter-UAS, drones and loitering munitions, long-range fires and ammunition stockpiles.
• Türkiye can complement Europe selectively. The strongest near-term matches are in UAVs and strike drones, and ammunition and stockpile replenishment, followed by counter-UAS, loitering munitions, selected air-defense layers, ISR/electronic warfare and armored vehicles.
• However, industrial complementarity does not automatically translate into market access. EU procurement rules—particularly SAFE’s local-content and design-authority requirements—mean that deeper Türkiye–Europe cooperation is likely to depend increasingly on co-production, local assembly, joint ventures, supply-chain integration and mutually acceptable technology-sharing arrangements rather than direct exports alone.
• The opportunity extends beyond Europe, but future competitiveness will depend on further technological upgrading. Türkiye is diversifying both its export markets and cooperation models across Africa, Asia and the Gulf, while defense-related activity is becoming increasingly important within high-technology manufacturing at home. Sustaining this momentum will require further progress in AI, autonomous systems, cyber, space and other advanced technologies.

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