Over the last 15 years, Turkey’s attracted US$13 billion in foreign investments every year - adding up to an impressive $200 billion. And that figure is set to grow, according to an investment expert.
Arda Ermut says Turkey’s aim is to attract two percent of the world’s foreign direct investment market. It’s an ambitious target, but the chairman of Turkey’s investment agency ISPAT says is very possible.
Turkey has worked hard to improve its investment climate, cultivating an open market policy, deregulating where possible and introducing a set of incentives to attract investment from all over the world, and to every sector.
Lately, the country has attracted investments from new markets, including those in East Asia and new countries in the Middle East. While every sector attracts investment, European investors favour finance, machinery, science and technology, while Middle East investors target energy and property.
The long-term aim is to diversify Turkey’s investments. It’s a way to ensure regional fluctuations don’t have a knock-on effect on the economy - which is what happened in and after 2008. “When Europe was hit by the 2008 global financial crisis, investments in Turkey also took a serious hit as most of the direct investments are from Europe," Ermut said.
"So, the more we can diversify, the lower will be the impact of any global or regional crisis."
Ermut said ease of access to regional markets, coupled with the large, youth-heavy workforce are also significant investment drivers. He also pointed out that investors haven’t been deterred by political fluctuations in the country, with more than half of the investments Turkey received last year happened after July’s attempted coup. This suggests that investor confidence in Turkey remains strong.
This year’s top investors
In the first half of 2017 the top foreign investments coming into Turkey came from:
- Spain: $4.1 billion
- Netherlands: $821 million
- Qatar: $541 million
- Azerbaijan: $308 million
- Belgium: $213 million
Ermut said Turkey hoped to do better this year. Despite growing interest and strong figures, the expert says the country has potential to grow its investments. "We have never found [the numbers] enough. Therefore, our aim is to attract even more investments, especially high value-added investments."
On average, Turkey has attracted $13 billion each year since 2002. The country is now aiming for a $22 billion target, a figure that would take the country’s global investment share to two percent.
Ermut added that Turkey’s productivity, strategic position and strong economy meant the country is “indispensable” to Europe where investment is concerned.
"Easy access to regional markets, high-quality manpower, senior management quality and young populations are also the reasons bringing more FDI in Turkey. When it all comes together, we have all the main elements ready for investments. Therefore, we can say confidently that Turkey is a country that cannot be ignored by foreign investors," he concluded.
Read more: Why Turkey still matters to Europe.
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