Turkey’s Textile Powerhouse Faces a Reckoning: Can Bursa Weave a New Future?

Once the beating heart of the Ottoman silk empire, Bursa’s iconic Koza Han was built by Sultan Bayezid II in the 15th century to welcome silk traders from across Asia. It stood as a testament to Turkey’s mastery in textiles, a gateway on the Silk Road where wealth and craftsmanship intertwined.

Today, the same stone arches echo a different story — one of survival. Turkey’s textile industry, once a symbol of national strength, is unraveling under the weight of global competition, high production costs, and an exodus of factories.

A Global Giant Losing Its Thread

For decades, Turkey ranked among the world’s top textile suppliers, exporting garments to every major European market. Yet in 2025, its global market share fell below 3% — the weakest in over thirty years.

Exports have plunged from $22 billion in 2022 to a projected $17 billion this year, a dramatic 23% decline. Over 310,000 workers have lost their jobs. Nearly 6,000 factories have closed, while hundreds more have relocated to Egypt, chasing cheaper labor and looser costs.

In contrast, Bangladesh and Vietnam — two of Turkey’s biggest competitors — recorded double-digit growth in garment exports in early 2025. Turkey, meanwhile, saw its shipments fall by nearly 7%.

High Costs, Low Margins: The Perfect Storm

The collapse is deeply tied to Turkey’s economic crisis. Efforts to curb inflation — which soared near 100% three years ago — left manufacturers caught between sky-high interest rates and an overvalued lira.

Although inflation now hovers around 33%, the pain persists. Labor costs have surged: the minimum wage jumped from $383 to $620 since 2022 — an increase of more than 60% in dollar terms.

“European customers once paid 15–20% more for Turkish quality,” says Mustafa Gültepe, head of the Turkish Exporters Assembly. “But not when the gap reaches 50%.”

That margin gap has pushed European orders toward Asia. China’s exports to the EU rose 20% this year, buoyed by trade diversion following U.S. tariffs. Turkey’s long-held advantage of proximity and speed is no longer enough to offset its costs.

A Labor Force in Flux

The textile workforce that powered Turkey’s boom is also shrinking. For years, migrant and refugee labor, particularly from Syria, filled factory floors. Between 250,000 and 400,000 Syrians were employed in workshops, often for low pay.

But as Syria stabilized and refugees began returning home — roughly 20% have left, according to Muzaffer Cevizli, head of Giyimkent, Istanbul’s textile hub — the labor supply has thinned.

“It’s hard to find workers now, even with competitive wages,” says Cevizli. “Young people prefer desk jobs and digital work to factory life.”

This shortage has made mass production increasingly unsustainable, forcing manufacturers to rethink their business models.

Reinventing Turkish Textiles: From Mass to Class

Experts argue that Turkey’s salvation lies not in competing with Asia’s scale, but in elevating its value proposition — focusing on branding, design, sustainability, and speed.

Some leading firms, including Eroğlu and LC Waikiki, have already shifted parts of production abroad, while investing domestically in automation and specialized design centers.

The new strategy? Become the “Italy of the East”, not the “China of Europe.”
By embracing fashion innovation, eco-friendly fabrics, and digitally integrated supply chains, Turkey could rebuild its textile dominance through creativity rather than volume.

Can Bursa’s Looms Rise Again?

Bursa’s Koza Han still welcomes silk traders, but now its story mirrors the crossroads facing the entire industry. The global landscape has changed — cheap labor no longer guarantees success, and sustainability, technology, and brand identity are the new currencies of trade.

If Turkey can stabilize its economy, attract green investment, and integrate design-led manufacturing, it may yet reclaim its place among textile leaders.

For now, the question looms as large as Bayezid’s ancient arches:
Can Turkey weave resilience from decline — or will the threads of its textile legacy finally fray?