invest in Turkey?

Wednesday 16 December, 2009

I was invited by the Association for Corporate Growth in Chicago to attend this breakfast briefing Investment Climate of Turkey in the Aftermath of the Global Economic Downturn featuring the President of Turkey’s Investment Support & Promotion Agency, Alpaslan Korkmaz.  He didn’t give a presentation, but here’s what he had to say:

Foreign direct investment has ballooned in Turkey from $1.8B in 2002 to $18B in 2008, & attracted more than India in 2007.  Turkey has the 6th largest economy in Europe & 15th largest in the world.  It has a large population of 72M which is quite young.  The average age is 28 & 50% of the population is 24 years old or younger.  20M are students, so education is Turkey’s top budget item.  The young population is interested in new technologies, so GSM penetration reaches 66M & the internet reaches 30M.  Although Turkey is not part of the BRIC nations, it is part of the N11, or Next 11.  Productivity growth is the highest in Europe @ 7%.  Turkey’s main competition for FDI these days is eastern Europe, but offers other advantages, such as a large market of 72M & per capita incomes of $3-10,000.  They expect growth of 3-4% next year, the highest expectation in Europe.


  • Turkey has a secular government which is distinctly separate from Islam.
  • Turkey is an economic partner with the European Union, but not yet a full member.  This means Turkey’s agricultural products do not work under Europe’s common agricultural policy& Turks require visas to travel in Europe.  Turkey is a logistics hub for the EU & Europe has contributed 70% of FDI in Turkey.
  • A SWOT analysis of 400 Turkish companies led to changes in how to set up businesses in Turkey.  A telephone hotline was created to facilitate permits.  Set-up can happen within 1 week in 270 industrial zones, but it takes longer outside of those zones because of land ownership issues
  • Inflation is now under control in single digits, so Turkish businesses can finally plan 3-5 years & not worry about plans falling through.
  • Private equity/investment bankers are investing in renewable energies (2nd best wind map in Europe) & automotive.  Istanbul airport renovations were 100% privately funded.  Financing is available for middle-market companies.
  • Turkey’s biggest challenges are matching the last 6 years’ growth, resisting bureaucracy, & sustaining education.
  • Labor laws are more liberal than the European Union & eastern Europe.  They work the most hours/week in Europe, 53, with the lowest absenteeism.  There have been 0 automotive strikes in 30 years.

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