Turkish Stocks Gain on Electoral Results

With great risk comes great reward, and in an internationally diversified portfolio, national news turns quickly into market results. This weekend, while Wall Street slumbered, Turkey reaffirmed its commitment to progress and triggered a stock market cheer.

Will she or won't she? Turkey's pending accession to the European Union has been a topic of fierce debate among existing members of the continental body. Its conflict with Greece over control of the split Mediterranean island of Cyprus is one bone of contention, and then there is the touchy matter of Turkey's regional and religious history. Turkey is a secular Islamic state, generally thought of as part of the Middle East and bearing the Crescent and Star on its red flag.

A land of paradoxes, the separation of church and state is taken by many as an article of faith in the former capital of the Byzantine and Ottoman Empires. But recent political elections have been a jostle between vehemently secularist and moderate religious parties.

Unlike the "Islamist" connotations of parties like the Taliban or Hamas, Turkey's ruling Justice and Development Party has promoted pluralism of traditions, economic growth, and the acceptance of Turkey into the EU.

Based on the Istanbul stock market's reaction to Sunday's re-election of that party (known by its Turkish acronym AKP) and its prime minister, Recep Tayyip Erdogan, the country's economy is expected to benefit from continued moderate rule and parliamentary consensus-building on economic reforms encouraged by the EU.

The Istanbul Stock Exchange benchmark index, the IMKB-100, jumped by nearly 4% on Monday, reaching a record high during the session. Foreign direct investment (FDI) has jumped by leaps and bounds since the AKP came to power in 2002, and public debt plunged.

Our Orbus Investor pure play on Turkey, mobile phone network operator Turkcell, jumped in Istanbul and New York too, where it trades as NYSE:TKC. When the NYSE opened Monday, American Depositary Receipts of Turkcell jumped by over 8%, before Wall Street's overall decline Tuesday. The company's stock is up well over 30% since my recommendation in October of last year, with a significant upswing evident since this spring.

As it continually sets new highs, Turkcell is proving itself to be a perfect example of how to play a country's political progress in the international market.

Regards,

Sam Hopkins

Westcon Group Enters Turkey by Joint Venture with Index Group Subsidiary, Netex

Arrangement Provides Turkish Resellers with Access to World-Class Portfolio and Solutions Programs, Significantly Increasing Vendors’ Reach in Fast-Emerging Market

TARRYTOWN, N.Y.-Westcon Group, Inc., the leading specialty distributor in networking, convergence, security, and mobility, announced that it has entered into a joint venture with Index Group, an Istanbul-based distributor of IT equipment. As a result of the joint venture, Westcon Group, through Netex, becomes the leading networking and security distributor carrying Cisco and Nortel products in that region.

By partnering with an established, locally based distribution operation, Westcon Group is able to apply its solutions-based model while leveraging the local back office and logistics capabilities of Netex. In addition, Netex will be able to leverage the inventory position from Westcon Group’s warehouses in the Middle East and Europe. To further support the local reseller community, the Company will also launch Westcon Group’s targeted solutions programs during the next few months.
With a GDP of $358.5 billion and population of over 71 million, Turkey is an important emerging market where Westcon Group believes networking technology will play an increasingly vital role. Following Westcon’s recent successful entry in the Gulf region, this joint venture further strengthens its presence in emerging markets.

Willem de Haan, vice president, business development of Westcon Group, commented: “By establishing operations in Turkey, we continue to leverage our global relationship with Cisco and Nortel while bringing greater opportunity to resellers in that region. Our One-x and x-Point branded solution programs—which have already demonstrated success across the globe--will deliver the focus and tools to help resellers in Turkey become more successful in selling advanced technology solutions. We look forward to actively engaging an exciting new reseller base.”

Netex is a traditional networking and security distributor whose vendor relationships include Cisco, Nortel, HP, 3Com, Check Point and others. Netex has an advanced logistics capability along with many years of experience moving products in and out of Turkey. These aspects, combined with Comstor’s inventory positions of Cisco and other vendors, will increase Westcon Group’s ability to quickly penetrate the market.

Osvaldo Bianchi, Vice President Channels Emerging Markets of Cisco, commented: "As one of Cisco's Global Broad Based Distribution Partners, Westcon Group is in a position to bring the best practices and efficiency that will help increase Cisco's success in Turkey-especially considering their recent success in the Middle East, where we partnered with them to open distribution operations last year."

About Westcon Group

Westcon Group, Inc. is the leading specialty distributor in networking, security, mobility and convergence for leading technology vendors, including Cisco, Nortel and Avaya, Inc. Through its Westcon, Comstor and Voda One business practices, Westcon Group sells products and services to resellers, systems integrators and service providers. Westcon Group has particular expertise in the convergence of voice, data and video applications and technologies, including voice-over Internet protocol, or VoIP, security for networking and communications systems, remote access, Internet and e-business, virtual private networks, videoconferencing and wireless connectivity. For more information, visit http://www.westcongroup.com/.