Investment in Turkey has grown by more than 50 percent in the first six months of 2017 - and with the government working to improve investment conditions, this growth is set to continue.
Unaffected by geopolitical tensions, foreign direct investment has reached $4.1 billion this year - a growth of 50 percent over the same period in 2016, when FDI reached $2.7 billion.
Strong ties endure
Turkey’s economic and diplomatic ties with Europe go back almost two centuries to the Ottoman era. Turkey’s strong links to European countries - especially the Netherlands, Germany and the UK - have withstood the buffeting of political events, and that is still true now. In fact, Europe accounts for 68 percent of the total foreign investment in Turkey.
The well-publicised spat with Germany hasn’t dented investor confidence, with $5.3 billion in German investment pouring into the economy since 2010. German investors in Turkey includes Siemens, who’s about to establish a huge wind power plant in the country with two Turkish partners.
Additionally, the diplomatic rift between Turkey and the Netherlands earlier in the year hasn’t affected investment ties between the two countries, with Dutch oil giant Vitol acquiring a large Turkish oil company in March.
The most significant investments during the January to June period came from Spain, the Netherlands, Qatar, Azerbaijan and Belgium.
Investor confidence: trending upwards, says Erdogan
President Recep Tayyip Erdogan has assured investors their faith in Turkey’s investment potential will be rewarded, adding that investors won’t regret their decision.
"Turkey maintains strong neighbour ties with Europe, the Balkans and Russia,” he said, stating that the country’s successful investment environment has been enabled by the advantages of its regional position. He pointed out that these advantages mean that while FDI between 1984 and 2001 amounted to $13.5 billion, that figure grew to $181 billion in the 2002 to 2016 period.
Erdogan said government measures would ensure continued success for foreign investors. These measures include improvements in employment, tax, infrastructure and exports.
Let’s cut red tape - deputy PM
To further boost investment, Turkey’s aiming to cut red tape. Deputy PM Recep Akdag told reporters that a few measures designed to increase investment volume are being rolled out, including contact points to provide information, and a monitoring system to discover how effective the measures are.
"Turkey is a good place to earn money and we are committed to making it better," he said.
Akdag echoed Erdogan in saying that rocky relations and security concerns had not hindered investment. "It does not have any negative impact for investors and should not be considered an obstacle for companies," he said. "Which international investor was damaged by the state of emergency? None. We will continue to show how Turkey is a safe and profitable country for investment."
The economy grew by 5 percent in the first quarter of 2017, compared to the same period last year, according to the Turkish Statistical Institute. The government has targeted 4.4 percent growth by the end of the year.
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