Turkey recently introduced one of the most competitive investment incentive packages in emerging markets in a move to foster economic growth by stimulating industrial production and boosting exports.
Aimed at technology investments in the petrochemicals, energy, metals and mining, healthcare, manufacturing, and agricultural industries, the comprehensive package of incentive certifcates is worth TRY 135 billion and covers 23 projects. 19 companies received project-based certifcates that were granted in person by President Recep Tayyip Erdoğan during a ceremony held in the Presidential Complex in Ankara.
The introduction of these incentives is set to further empower Turkey’s position against emerging markets such as Mexico, India, and Indonesia. The incentive instruments cover a broad range that includes land allocation, various tax refunds/ exemptions/reductions, insurance premium support, and utility support. It is expected that these incentivized projects will help to reduce Turkey's current account defcit by USD 19 billion in 2-3 years, while boosting output in high-tech and mediumhigh tech products that are import dependent, such as electric batteries, drug-eluting stents, energy systems, and hybrid engines.
As per the program, Assan, BMC, CFS, Dow Aksa, SASA, Most Makine, Metcap Energy, Oyak Renault and Vestel will engage in medium-high tech investments, while Alvimedica, Atayurt, Ekore, and TAI will undertake high-tech investments. Vestel will grab the largest incentive worth TRY 28.4 billion for electric vehicle energy storage systems and is expected to contribute the lion’s share to the reduction of the current account defcit to the tune of USD 4.6 billion annually. Oyak Renault's hybrid engine production project is another high-tech investment that will make a substantial annual contribution of USD 2.3 billion to reduction of the current account defcit.
Nearly 34,000 people will be offered direct employment, while indirect employment is expected to hit upwards of 134,000 with the initiative.