Turkey: Developing a new strategy to attract foreign investments
Turkey is developing a new strategy, through which it aims to attract more foreign investments, follow the details through Imtilak Real Estate.
Turkey: Developing a new strategy to attract foreign investments
In order to encourage increased investment in Turkey 2021, the International Direct Investment Strategy for Turkey 2021-2023 has been worked out through the Investment Office of the Presidency of the Republic, which will contribute to attracting a greater number of foreign investments to Turkey.
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Foreign investment in Turkey exceeds $165 billion
During the past twenty years, Turkey was able to achieve great success in attracting foreign direct investments, whose size, according to the Turkish Statistical Institute, exceeded $165 billion, in the period from 2002 to the end of 2020.
In spite of the spread of the Coronavirus during the past year, and the economic repercussions it left on the country, Turkey was able to attract foreign direct investment equivalent to $5 billion.
This figure reflects the great confidence that the Turkish economy enjoys with foreign investors, which has taken possession of more than 1% of the total foreign direct investment in the world, a percentage that is expected to increase dramatically in the coming years.
Sectors of foreign investment in Turkey
Foreign investments in Turkey show a wide variety of types of investments and the sectors in which they are invested. This proves the validity of these words are the figures issued by the statistics, which pertain to foreign investments in different sectors, where there are:
- 4% in the service sector.
- 2% in the manufacturing sector.
- 11% in the energy sector.
- 4 in the agriculture and mining sector.
- 9 in the finance and insurance sector.
- 8% in the telecommunications sector.
- 8% of the retail and wholesale sector.
Sectoral diversity of foreign investments in Turkey was not accompanied by a similar spread in the sources of these investments, at the regional and international levels, during the period from 2002 to 2020.
Accordingly, the European Union accounted for 67% of the overall rate of foreign investment sources, and the value paid to it amounted to 110.4 billion dollars, while the countries of Asia ranked second with 18%, with a value of 29.1 billion dollars, and the countries of the American continent came in third place among the sources Foreign investments, by 9%, at a value of 14.3 billion dollars.
A new Turkish strategy to attract foreign investment
In view of the Turkish State's desire to increase foreign flows and its desire to work towards diversification and proliferation of sources of investment, Turkey recently launched the so-called "International Direct Investment Strategy for Turkey 2021-2023" through the Investment Bureau of the Presidency of the Republic.
Through this strategy, the Investment Bureau provides investors with a road map for the country in the area of international investment, which aims to increase Turkey's FDI in terms of quantity (share of the global FDI market) and quality (value-added of investment).
The objective of the international investment strategy
Based on Turkey's international direct investment strategy document, and based on the information published in this document, foreign investors will be able to benefit from many advantages, which will increase the volume of foreign flows in the country, the most important of which are the following:
- Ways for investors to access the offers on the industrial land they need will be developed.
- The requirements for potential industrial lands will be analyzed, in line with the specific objectives of the FDI files.
- Eligible industrial zones will be developed in the light of these analyses.
- A digital database of industrial lands will be created, through which it is possible to track the assets and documents of lands suitable for investment, through geographic information systems.
- The digital database of industrial lands will include the latest information regarding the lands located in the investment areas, such as industrial zones, free zones, and technological development areas, and share it with investors in a modern digital way.
- Transportation, logistics, and digital infrastructure, and information and communication technology will be developed.
- The establishment of logistics lines and centers will be completed, to serve the important shipping centers.
- The share of railways in freight transport will be raised, ensuring greater penetration of multimodal transport and competitiveness in the industrial sector.
- Specific incentive mechanisms for supply infrastructure and training support mechanisms for supply companies will be established.
- Develop a platform for suppliers in Turkey, that can act as a link between them and international investors, through which they can evaluate supplier companies, given several criteria, such as these companies' products and production standards, number of employees, and location.
- Work on organizing supplier events to bring together international investors in Turkey, and suppliers based on sectors and technology products.
- Training activities will be supported in the transfer of expertise and technology, which will be implemented by international investors to local companies, and personnel recruitment activities to work with international investors will be supported.
Reasons for working on an international investment strategy
There’s no doubt that the development of such a strategy indicates the significant role played by foreign investments in supporting the national economy. Therefore, the establishment of this strategy will contribute to the sustainable development and modernization of existing mechanisms, in line with the latest global systems.
The intensification of international competition for foreign investments, and the entry of new countries with capabilities and logistics, laws and mechanisms with high flexibility and competitiveness, such as China, Germany, and England into the competition arena, was one of the reasons for developing this strategy.
It is worth noting that the Turkish government needs to selectively stimulate foreign investments in certain sectors, such as technology companies, artificial intelligence and data analysis, and other modern fields that it is important to work on localizing in the Turkish business community and transfer its expertise to its affiliates, which are areas that will represent a logistical structure essential for foreign investment in the near future.
Edited by Imtilak Real Estate©
Reference: TRT Arabi
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