As a booming country with a GDP growing at an average annual rate of 5.6 percent over the period of 2003 to 2018, Turkey represents tremendous potential with numerous investment opportunities for international investors. Experts agree that this trend will continue into the future as the country has strong macroeconomic fundamentals and a dynamic population.
Right time, right place!
Turkey is a country that has experienced strong structural changes over the last 16 years. This factor has guided the country into a phase that numerous experts have characterized as a transformation process. And, as with all deep revolutionary reforms, new opportunities arise.
With a strong regional position, Turkey is playing an increasingly important role in its surrounding area and beyond. Turkey is an active member of G-20, and is also a member of the North Atlantic Treaty Organization (NATO), the Council of Europe (COE), and the Organization of Islamic Cooperation (OIC).
Turkey's status also changed once it became an official EU candidate country in October 2005. This has given a new strategic goal to the country, unifying a number of vectors towards a single direction: the Copenhagen political and Maastricht economic criteria. The structural reform process launched in 2003 has generated a new, dynamic and much more internationally-integrated Turkey.
As a booming country with a GDP growing at an average annual rate of 5.6 percent for more than a decade, Turkey is the land of opportunities. Over the past decade, the GDP has more than tripled in current US dollar terms, reaching USD 789 billion in 2018. Such an impressive economic growth made Turkey an industrial powerhouse in its region. Turkey is the 2nd largest commercial vehicle producer in Europe, and the 15th largest automotive manufacturer in the world. Similarly, Turkey is the 2nd largest steel manufacturer as compared with the EU-28 and 8th largest in the world. Today Turkey offers highly lucrative investment opportunities in a variety of sectors, such as automotive, machinery, mining, energy, renewable energy, defense and aerospace, real estate, finance, ICT, agriculture, chemicals, petrochemicals, iron and steel, and so on.
The economic power of Turkey has drastically increased in the past decade. Turkey became the 13th largest economy in the world, and the 7th largest compared to the EU-28 countries in terms of GDP at purchasing power parity in 2018. The country's strong economic performance over the past decade has encouraged investors to make confident projections about the future of the Turkish economy.
Throughout the last decade, Turkey has been implementing an active policy to improve its investment environment. To start with, the FDI frame law, which was passed by the Parliament in 2003, is the first installment of these significant economic reforms to change the investment environment in Turkey and make it attractive to global investors. This law guaranteed equal treatment to all investors without differentiating between local and international investors and enabled all international investors to enter Turkey without a preliminary authorization request, to transfer dividends freely, to access real estate, to be protected against expropriation, and to hire expatriates, etc. Important parameters, such as the acceptance of the international arbitration courts and the ongoing harmonization of laws with EU legislation have made Turkey one of the most liberal countries in the world, both in terms of the legal framework for FDI and the investment environment.
The sum of all the joint efforts has led Turkey to a very impressive economic output. Put differently, in a very short period of time, the FDI received by Turkey has benefited from these deep structural reforms. While Turkey attracted approximately USD 1 billion of FDI per year on average between 1992 and 2002, it has been attracting an average annual FDI of more than USD 13 billion since 2003.
In the light of developments, it is certain that the Turkey of today is very different from the Turkey of 10 years ago. Similarly, the Turkey of 2023, a Turkey celebrating the centennial foundation of the republic, will also be strikingly different from today. With ambitious targets set by the current government, the Turkey of 2023 is expected to be a more prosperous and added-value generating member of the international community with a vital contributing role to global peace and welfare. Active on a global scale, Turkey is also offering investors a platform to benefit from emerging opportunities in other countries, particularly in the surrounding region. Turkey's strategic location allows investors to access a potential market of 1.6 billion people, a combined GDP of USD 25 trillion and foreign trade of USD 8 trillion.
Turkey, with an improved and investor-friendly business environment, achieved considerable success in both domestic and foreign investments over the decade, not only raised the bar a notch, but is now also on track to realize its real and deserved potential; to be home to investments that will contribute to new jobs, new technologies, and new visions.
Certainly, the right place to be at the right time…