Alper: ''Turkey should receive FDI equal to 5 percent of GNP''

Today's Zaman - International Investors Association (YASED) Secretary-General Mustafa Alper has said that Turkey should receive foreign direct investment (FDI) equal to at least 5 percent of gross national product (GNP), adding that the $20 billion of FDI in 2007 will be below this level if Turkey's GNP goes up to $500 billion this year. Alper told the Anatolia news agency that FDI was around $16.1 billion in the first 10 months of 2007 and that nearly $8 billion of this went to the finance sector, especially banking; $3.2 billion was to the manufacturing industry; and around $2.4 billion was to the real estate sector. "FDI may go up to $20 billion. It is totally dependent on the payment schedules of mergers and acquisitions," he explained. HOW TO ATTRACT GREENFIELD INVESTMENTS Alper said throughout the world 75 percent of all FDI in recent years had been made through mergers and acquisitions. "It is the same in Turkey as well. That's why these numbers are very unstable. This may jump at a glance or it may remain low," he said. However, Alper pointed out that the share of Greenfield investments in total FDI was very low. He said their share in the total $16.1 billion in FDI in the first 10 months was less than 10 percent. He also said the share of FDI through privatizations was relatively low. "But the share of privatization may be up in 2008 and the share of mergers and acquisitions may go down thanks to the global liquidity squeeze," Alper said. Alper said reforms should be sustained and that the tax burden on employment should be reduced to attract more Greenfield investments. He also said the new Turkish Commercial Code and new Research & Development Law must be implemented as soon as possible.