Why Turkey

Turkey is a gateway of energy resources and has strong ties with Caucasia and Central Asia.

Turkey has a huge potential with its human resources, infrastructure, production inputs, geographical position, large domestic market, population, and its power in economic and political fields. Turkey has a unique geographical location with a fast developing economy. A liberal and strong international investment record combined with a large domestic market. There is high-skilled labor creating high quality standards. Turkey is a gateway of energy resources and has strong ties with Caucasia and Central Asia. Due to economic and political stability it is possible to enter into long-term international agreements. There are also some legal regulations concerning Government Subsidies for encouraging foreign investments in Turkey

Facts and Figures

 

Turkish Economy

Recent Economic Performance

Turkey is a member of the OECD, a regional power, a bridge between East and West, and a country which successfully recovered from a deep economic crisis in 2001. It is a dynamic emerging-market economy strategically located between Europe and Asia, bordering the Mediterranean, Aegean, and Black Seas. Over 73 percent of its 69 million people live in urban areas.

Agriculture accounts for some 9 percent of its GDP, industry for 22 percent, and services for 69 percent. Turkey’s economy is among the world’s 20 largest, with a GDP in 2008 of over US$740 billion. GDP per capita (Atlas PPP method) now exceeds US$8,000.

An incredibly close integration with the world economy, proximity to Europe, the external anchor of EU accession, and a lengthening track record of solid economic management and structural reform drive Turkey’s long-run economic prospects. Due to its integration with the world economy, through both trade and financial channels, Turkey was also seriously affected by the global recession since the fourth quarter of 2008.

After the 2001 crisis Turkey entered a period of high growth and structural transformation. Following a rebound in 2002, over the five years 2003-2007 annual growth averaged nearly 7 percent, public debt fell from 74 percent of GDP at end-2002 to 42 percent at end-2007 (with an improvement in composition also reducing market risk). A strong reform program encompassed an exchange-rate float, financial-sector supervision, privatization, revenue administration, investment climate, the energy sector, and social security. At the same time, capital inflows (in an environment of high international liquidity) and reliance on imports of petroleum-related products for Turkey’s energy needs and intermediate inputs for Turkey’s exports drove high current account deficits (which averaged 5.2 percent over 2004-08). These were partly financed by a build-up of external debt, mostly in the private sector, where external debt rose from 16 percent of GDP in 2004 to 25 percent by end-2008. High amortizations of this debt in 2009 and 2010 create additional economic uncertainty, given tight global credit conditions in 2009.

Why invest in turkey

Combining its strategic location with the motivated and qualified workforce makes Turkey a perfect environment to invest.

The following aspects makes Turkey an attractive investment center for global investors.

Source : Investment Support and Promotion Agency of Turkey

Successful Economy

• Booming economy (USD 305 billion to USD 742 billion GDP from 2003 to 2008)
• Sustainable economic growth (7% annual average real GDP increase for the last 6 years)
• 15th largest economy in the world and the 6th largest economy compared to the 27 EU countries in 2007
• Institutionalized economy fueled by USD 18.2 billion of FDI in 2008 and ranked the 15th most attractive FDI destination for 2008-2010 (UNCTAD)
• More than USD 70 billion of FDI inflows in the last 4 years

Population

• A population of 72 million people
• Largest youth population compared with the 27 EU countries
• Median age 28.5
• 61% of the population under the age of 35
• Young, dynamic, well-educated and multi-cultural population

Qualified And Cost-Effective Labor Force

• Over 24.7 million young, well-educated and motivated professionals
• Labor productivity with an annual average growth of 6.1% between 2002 and 2008
• 4th largest labor force compared to the 27 EU countries
• Consumer base and motivated work force
• Approximately 450,000 graduates from 143 universities in 2008
• 730,000 high school graduates in 2008, including one third from vocational, technical and professional high schools

Liberal And Reformist Investment Climate

• A dynamic and mature private sector with USD 132 billion worth of exports and an increase of 179% between 2003 and 2008
• Highly competitive investment conditions
• Strong industrial and service culture
• Equal treatment to all investors
• More than 21,000 companies with international capital
• International arbitration
• Guarantee of transfers

Centrally Located

• A natural bridge between both East-West and North-South axes, hence creating an efficient and cost effective outlet to major markets
• Easy access to 1.5 billion customers in Europe, the Middle East and Asia
• Access to multiple markets worth USD 25 trillion of GDP

Energy Corridor And Terminal Of Europe

• An important energy terminal and corridor in Europe connecting the East and West
• As an energy transit country, Turkey currently has the capacity to transport 121 million tons of oil to the world markets per annum. Once the ongoing projects are completed, the annual transit capacity will increase to 221 million tons of oil and 43 billion m³ of natural gas.

Low Taxes & Incentives

• Corporate Income Tax reduced from 30% to 20%.
• Individual Income Tax varies from 15% to 35%
• Tax benefits and incentives in Technology Development Zones, Industrial Zones and Free Zones. These could include total or partial exemption from Corporate Income Tax, up to 80% grant on employer’s social security share, as well as land allocation.
• New R&D and Innovation Support Law
• Region and sector based incentive system

Customs Union With The Eu Since 1996

• Customs Union with the EU since 1996, and a total of 12 free trade agreements (FTA)
• 11 more FTAs underway
• Accession negotiations with the EU since 2005

Large Domestic Market

• 30 million internet users in 2008, up from 4 million in 2002
• 66 million GSM users in 2008, up from 23 million in 2002
• 44 million credit card users in 2008, up from 16 million in 2002
• 79 million airline passengers in 2008, up from 33 million in 2002
• 26.5 million international tourist arrivals in 2008, up from 13 million in 2002