Esteemed Business Partners, Colleagues and Shareholders,

The COVID-19 pandemic that marked the year 2020 resulted in significant changes to all aspects of our lives, from ways of doing business to everyday habits. Towards the end of the year, news started to arrive from global powerhouses – the USA, China, Russia and the European Union – on the licensing of COVID-19 vaccines. This development brought a glimmer of hope to help curb the pandemic without having to reach herd immunity. In the meantime, the benefits of digital transformation ensured that life continued for individuals and organizations alike.

Expansionary fiscal policies supported national economies in the face of the pandemic
To address the adverse impacts associated with the pandemic, expansionary monetary policies were introduced to stimulate national economies worldwide. IMF projections estimate that the global economy experienced a dramatic contraction of 3.5% in 2020. The pandemic is also expected to further squeeze the world economy in 2021, despite mass vaccination campaigns in developed countries. Democratic nominee Joe Biden's triumph in the US presidential elections gave rise to expectations that the economic stimulus packages in the US would firmly support growth in the world’s largest economy while also ushering in a new era in global politics. Meanwhile, China took prompt action to keep the pandemic under control and became the fastest expanding economy in the world, posting growth of 2.3% in 2020. This strong performance demonstrated that China remained a key driver of the global economy.

Agile steps to mitigate the impact of the pandemic…
Due to the jarring effects of the COVID-19 pandemic, the Turkish economy shrank by 2.7% in the first half of 2020. However, a recovery took hold in the second half of the year, driven by gradual steps toward normalization and supportive economic policies. Turkey’s government introduced a comprehensive assistance program across a broad range of areas – from loans at affordable interest rates with the support of public banks to short-term payments for employees – to offset the negative impact of the pandemic on the economy. This responsive approach also contributed to Turkey’s economic agility and social stability. As a result of weakening exports, Turkey's economy recorded a current account deficit of USD 36.7 billion during the year. However, the country’s economy posted positive growth of 1.8% for full-year 2020. Seizing the opportunity to position itself as a key hub for the new, post-pandemic global production and logistics map, Turkey is likely to achieve significantly better results in the coming year. In 2020, Borusan Holding delivered a successful performance in line with our goal of protecting our employees, stakeholders and business during these very trying times.

A new era for professional life: Digital Migration
Digital transformation has introduced speed and efficiency into all aspects of life today. In 2020, the pandemic prompted yet another phenomenon: digital migration. This mass migration did not take place only in terms of remote working. Consumers also migrated to digital environments quickly and seamlessly, minimizing risks linked to the pandemic. In addition to fast emerging innovative technologies – such as artificial intelligence (AI), the internet of things (IoT), electronic payment systems, and blockchain – broader access to mobile technologies paved the way for the expansion of the global digital economy and wider adoption of the entrepreneurial ecosystem. Needs that arose under the pandemic conditions underscored the importance of R&D investments for domestic technology in all arenas.

Borusan Holding is well aware of its responsibility as a major industrial conglomerate representing Turkey in global markets. In 2020, Borusan invested in digitalization and reported solid financial and operational results despite the very challenging environment. Distribution, steel, energy and logistics – the focal areas of our digitalization investments – achieved high efficiency in their business processes during the year.

A robust sustainability approach backed by 77 years of experience
At Borusan Holding, we have shaped our sustainability approach in light of 77 years of experience and know-how. Sustainability is positioned at the heart of our business processes. Borusan is a holding company that strides towards long-term goals. We focus on success in financial and operational terms while continuing our social and environmental investments in parallel with the United Nations' 2030 Agenda for Sustainable Development Goals. In fiscal year 2020, we undertook major corporate social responsibility projects and initiatives. I would also like to inform all our stakeholders about this key point: Borusan plays an active role in preserving the natural environment for future generations as part of its ongoing efforts to combat climate change. We remain committed to bolstering our financial and operational achievements with social investments aimed at advancing Turkish society and engaging in exemplary environmental impact assessment work. Borusan generates sustainable value in all aspects of life with operations it views as a continuous value chain.

Borusan plans to be operating 200 years from now
At Borusan Holding, we believe in the bright future ahead for Turkey and make all our investments accordingly. I would like to thank our shareholders, employees and customers for their support in our business activities in 2020 – a year when we took major steps toward our goal of "operating 200 years from now." It is my hope that our ongoing success continues.

Kind regards,

AHMET KOCABIYIK
Chairperson
Borusan Holding