REPUBLIC OF TURKEY PRIME MINISTRY€¦ · Turkey is a major economy in the world and an active...

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REPUBLIC OF TURKEY PRIME MINISTRY

Investment Support and Promotion Agency of TurkeyISPAT

“Investment Climate in Turkey”

Dr. Hüseyin ASLANVice President

27 May 2011, Beirut

Beautifullandscape…

Combination ofcontemporary and traditional…

Home of manysuccessfulpeople…

What about theinvestmentopportunities…

AGENDA

• TURKEY WITH SOME KEY FIGURES• FDI IN TURKEY• TOP REASONS TO INVEST IN TURKEY• THE AGENCY

17th largest economy in the world and 7th when compared to the EU Countries (IMF, 2010)

The largest youth population when compared to the EU countries

Presenter

Presentation Notes

Turkey is a major economy in the world and an active member of the G-20, it ranks as the 16th largest economy in the world and 6th largest when compared to the EU countries according to GDP valuation of the countries based on PPP (Purchasing Power Parity). Turkey has also the largest youth population when compared to the EU countries, thus creating a vibrant and growing mareket for investors.

46 million credit cardusers (2010)

62 million GSM users (2010)

35 million internetusers (2010)

Presenter

Presentation Notes

Tthe consumer base in Turkey is getting sophisticated by each passing day, today there are around 35 million internet users in Turkey up from 4 million in 2002, 62 million mobile phone subscribers up from 23 million in 2002, and 46 million credit card users up from 16 million in 2002.

Turkey is the 8th largest steel producer in the world and 2nd compared with the EU countries (worldsteel 2010)

Turkey is the 17th largest automotive producer in the world, the largest Commercial Vehicle producer in Europe (OICA 2009)

-Out of world’s largest 225 construction companies 33 are Turkish (ENR, 2010)

-Turkey is the 5th largest shipbuilder (units) as well as the 4th largest mega yacht producer in the world (2009)

Presenter

Presentation Notes

Out of world’s largest 225 construction companies 33 are Turkish construction companies, today many global construction companies are cooperating with the Turkish construction companies in third countries. Turkey is developing into a manufacturing base for the regions, it is it is the 5th largest shipbuilder (units) as well as the 4th largest mega yacht producer in the world, similarly, it is the 8th largest steel producer in the world and 2nd compared with the EU countries and 17th largest automotive producer in the world as well as the largest Commercial Vehicle producer in Europe.

- Turkish Airlines is one of the fastest growing airlines in Europe

- Fleet Plan for 2009-2023; purchase 105 aircrafts

-The best airline in Southern Europe (Skytrax 2009)

- 103 million air passengers in Turkey, 29 million flew by THY (2010)

- Istanbul Ataturk Airport is the best airport in Southern Europe (Skytrax 2010)

Presenter

Presentation Notes

Economic development and growth in Turkey can observed in many areas, such as air transportation has been booming in recent years, the number of airline passenger tripled in the last 8 years, there were over 100 million airline passengers in Turkey in 2010 up from 33 million in 2002. Growing demand for airline services has made the Turkish Airlines one of the fastest growing airlines in Europe.

Turkey is the 7th most visited holiday destination in the world (2009)

International TouristArrivals

Country 2009(million)

1. France 74.2

2. USA 54.9

3. Spain 52.2

4. China 50.9

5. Italy 43.2

6. UK 28.0

7. Turkey* 27.3

8. Germany 24.2

9. Malaysia 23.6

10. Mexico 21.5Source: UNWTO ;*Ministry of Culture and Tourism

Out of world’s top 100 best hotels 20 are from Turkey (TUI Holly, 2009)

Presenter

Presentation Notes

Turkey is a very attractive tourism destination with its quality of tourism services and hospitality, Turkey attracted more than 27 million tourist in 2009, ranking the 7th most visited destination in the world. Speaking of tourism, hospitality and accomodation are very important, today out of world’s top 100 best hotels 20 are from Turkey..

FDI in Turkey

Source: Central Bank of Republic of Turkey & Treasury

Soaring FDI Inflows

5.6 6.78.8

11.715

18.721

23.725.5

0

5

10

15

20

25

30

20

02

20

03

20

04

20

05

20

06

20

07

20

08

20

09

20

10

‘000 Number of Companies with Foreign Capital

15

94

0

10

20

30

40

50

60

70

80

90

100

1972-2002 (30 years) 2003-2010 (8 years)

FDI Inflows($ billion)

Presenter

Presentation Notes

Turkey attracted $94 billion just in the last 8 years, whereas it attracted only $15 billion in the preceding three decades. Similarly, the number of foreign companies has been soaring in Turkey. These figures clearly indicates Turkey’s attractive investment climate.

Turkey is the 15th most attractive FDI destination for 2008-2010

according to the World Investment Prospects Survey

Presenter

Presentation Notes

Turkey continues to be seen as an attractive FDI destination by global investors, it is the 15th most attractive FDI destination for 2008-2010 according to the World Investment Prospects Survey which was conducted among world’s 226 largest transnational corporations. Once you invest in Turkey, your return on investment will be incomparably profitable, as profitable, as Turkey is a market where foreign direct investment can get “emerging market” returns at a “developed market” risk…

Top reasonsto invest in Turkey


Source: IMF World Economic Outlook,October 2010; *2010 data IMF Staff Estimate

Benchmarking Performance of theTurkish Economy

Presenter

Presentation Notes

There are many reasons to invest in Turkey, one of those reasons is the macroeconomic strengh of the Turkish economy; Turkish economy has been booming in the past 8 years, it has sustained steady and robust economic growth win an average annual growth of 4.3%. GDP reached $730 billions in 2010 up from $231 billion in 2002.

Source: OECD Economic Outlook No.86

Let your business blossom in a thriving economy and promising future


The fastest growing economy among the OECD countries

Presenter

Presentation Notes

I have talked about Turkey’s past and present economic performance, what about future which is very important for any investor’s decision-making. Credible sources, like OECD, projects that Turkey is expected to be the fastest growing economy among the OECD countries during 2011-2017 with an impressive average annual growth rate of 6.7%


Turkey has the 5th most liberal trade policies in the world (World Trade Indicators 2009)

Customs Union with the EU

Free Trade Agreements with 20 countries:

1. Albania 11. Norway

2. Bosnia & Herzegovina 12. Palestine

3. Croatia 13. Switzerland

4. Egypt 14. Syria

5. Georgia 15. Tunisia

6. Iceland 16. Montenegro

7. Israel 17. Serbia

8. Lichtenstein 18. Chile

9. Macedonia 19. Lebonan*

10. Morocco 20. Jordan

Source: Undersecretariat of Foreign Trade, * In ratification process

Presenter

Presentation Notes

Turkey is one of the most libreal countries in the world with regard trade policies, it has the 5th most liberal trade policies in the world, morover it has customs union with the EU and FTAs with 20 countries, thus creating lucrative export opportunities for investors.


Source: for fGDP and population IMF World Economic Outlook April 2010

EUROPE

GDP – $ 18.3 TrillionPopulation – 660 million

RUSSIAN FEDERATION

GDP – $ 1,2 TrillionPopulation - 142 million

MIDDLE EAST AND NORTH AFRICA

GDP – $ 2,4 Trillion Population – 602 million

CENTRAL ASIA & CAUCASUS

GDP – $ 230 billion Population – 80 million

1,5 Billion People

US$ 22 Trillion GDP

at a 3-hour flight

distance

Access to Multiple Markets

Presenter

Presentation Notes

Being strategically located, Turkey offers investors to reach a market of potantial 1,5 billion people and $22 trillion GDP. We all know that US companies already have a strong presence in Europe, but Turkey offers US companies to access markets in the Middle East, North Africa, and Central Asia, especially considering Turkey’s cultural and historical relations with those regions, Turkey is an excellent place to invest.

Turkey As An Energy Corridor And Terminal


Existing Natural Gas Pipelines

Existing Oil Pipelines

Natural Gas Pipelines under Construction

Natural Gas Pipelines Underway

Proposed Natural Gas Pipelines

Oil Pipelines under Construction

Presenter

Presentation Notes

The stragetic location ofTurkey makes it an energy corridor and an energy terminal as well, you will see how important Turkey is for energy security when you conside the fact that70% of the worldwide oil and gas reserves are located at east and south of Turkey, and that, one of the largest consumerof it is Europe, just located at the west side of Turkey.

Structural Reforms

NewFDI Law &Other Legislation

Employmentof Expatriates

InternationalArbitration

Protection Against

Expropriation

CorporateIncome

Tax %20

National Treatment

Freedomto invest

Guarantee of Transfers

Accessto Real Estate

Dynamic, Stable &Attractive Economy

Population

International Hub

Structural Reforms



Source: Respective Companies

Business Capital of Regional HQs ofMultinational Companies (MNCs)

MNCs Number Of Countries ManagedFrom the HQs in Turkey

Coca Cola 94GE Healthcare 80Microsoft 80Intel 67Schneider Electric 27Ericsson 22

DHL 20

Volvo 18BASF 18PepsiCo 14KUEHNE + NAGEL 14Unilever 11P&G 11BSH 11

Presenter

Presentation Notes

Actually some of the American companies together with other global companies are already aware of the Turkey geo-strategic position as well as its strong cultural and historical ties with the surrounding regions, as they are using Turkey as hub for their business operations in Middle East, Africa and Central Asia.. Today Coca Cola manages 94 countries from Turkey, Microsoft 80 countries…etc.


INVESTMENT INCENTIVES IN TURKEY

1. General Incentive System

2. Large Scale Investments

3. Region and Sector-Based Incentive System

4. Employment Scheme

5. Research and Development Supports

6. State Incentives for Export


The Incentives Granted According To The Region, Sector and

The Scale of The Investment:

• Reduced Corporate Tax: between 2-10%

• Social Security Premium Contribution for Employers up to 7 years

• Interest Support

• Land allocation for investments

Zone 1Zone 2Zone 3Zone 4

The Agency

The Agency

Attached to the Prime Ministry and reports directly to the Prime Minister

Private sector approach

Multi-lingual, professional and dedicated project directors

ONE STOP SHOP

2 offices (Ankara – Istanbul)

Result oriented

The EU Negotiation Progress Report shows that the establishment of the Agency is a proof for improvement of the investment climate in Turkey

The Agency

The Agency

International representatives network worldwide and strategic partners in Turkey (Embassies, Consulates, Commercial Attaches, NGO’s etc)

The International Network

15 representatives 21 countries

WORLD BANK’s GLOBAL INVESTMENT PROMOTION BENCHMARKING REPORT2009

Among 181 National Investment Promotion Agencies,

INVESTMENT SUPPORT and PROMOTION AGENCY of TURKEY ranked as;

15th in the World in terms of General Performance Assessment

5th in the World and 2nd in Europe in terms of Inquiry Handling

The Agency

The Agencyfor all potential investors!

nTURKEY

Source: TEDAŞ, OSD, GAP Authority, Ministry of Transportation, BDDK, Interpro Media

The Most Promising Sectors

Automotive ; Target to produce over 2 mio vehicles within 5 years

Energy ; The total amount of investment needed to meet the energy demand in

Turkey until 2023 is $ 130 billion

Real Estate ; Istanbul is the first-ranked development market in 2009 (Emerging

Trends in Real Estate Europe 2009 Report - PWC & ULI)

Agriculture ; Concerning Southeastern Anatolia Project, $ 26.7 billion investment

is required until 2012

Transportation; Highway capacity planned to be trippled up until 2023 with 12

different project

Finance ; In 2009, the net profit of the banking sector has increased by 50%

comparing with 2008. The real growth rate of the financial sector of Turkey was

8.5% in 2009 despite the global financial crisis.

ICT & IT ; IT Market growth rate exceeds 220 % within the last decade and

reaches to $28,1 billion turnover.

Why Turkey?

ON

THANK YOU FOR YOUR ATTENTION

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