Turkey’s recent decision to restrict exports of 54 products to Israel, including construction materials, can significantly impact the Israeli construction industry leading to an increase in property prices.
This move taken in response to escalating tensions between the two countries has already caused disruptions in the supply chain, affecting various sectors.
The list of restricted products includes raw iron bars, aluminium, copper products, concrete, steel, cement, iron-steel, electrical and fibre optic cables, granite, construction materials, and marble. Israel’s Manufacturers’ Association president Ron Tomer stated that about 50 percent of the materials are imported from Turkey.
The shortages could lead to delays in ongoing projects, an increase in construction costs and a bidding war among construction companies
According to the Israeli news outlet Mako, the new restrictions were expected to increase the prices of apartments if they are implemented.
Domestic political concerns
Turkey is Israel’s largest single provider of steel products. The halt could cause problems relating to demand for Turkish rebar, given that Israel is the second-largest buyer of these exports after Yemen.
The export restrictions come amid growing dismay among Turkey’s conservative and Islamist circles over ongoing Turkish-Israeli trade. The decision aims to placate this dismay among the country’s conservatives, as the Turkish government faces domestic criticism over its commercial ties with Israel during the war against Hamas.
The trade curbs could be a strategic move by Turkish President Recep Tayyip Erdogan to appease his domestic audience, given the upcoming elections in the country.
