Turkey Economy: Everything You Need to Know
The economy of Turkey is characterized by embracing general competitive rules, with the private sector assuming a leadership position. Read more in this article.
Introduction: The Turkish economy is characterized by embracing general competitive rules, with the private sector assuming a leadership position. The role of the public sector is limited to regulatory actions, the application of free liberal foreign trade policy, free circulation of funds and services between individuals and institutions without any obstacles.
Table of Content
- The Recent Economic Improvements in Turkey
- International Ranking of Turkey Economy
- The Impact of the Global Economic Crisis of Turkey Economy 2008
- A Glance at the Most Active Factors for the Economy in Turkey
The Recent Economic Improvements in Turkey
- Important reformations in many important sectors, such as the financial markets sector, the agricultural sector, the social protection sector, and the energy and transport sectors. Thanks to these reforms, the infrastructure of economic institutions have been strengthened.
- Taking actions to strengthen Turkey's economy and enable it to withstand the economic downturns in the world markets by establishing semi-autonomous institutions in the sector.
- Many bureaucratic obstacles have been removed and some have been reduced to a minimum.
- Regulating financial markets in line with the concept of the new era.
- Accelerating privatization processes, as the public finances were regulated.
International Ranking of Turkey Economy
- Turkey is an active member of the G20, which represent the world's most powerful economies.
- The Turkish economy is the 18th largest economy in the world.
- The Turkish economy ranks seventh among the largest economies in Europe
The Impact of the Global Economic Crisis of Turkey Economy 2008
During the period in which many economies of the world had witnessed a stagnation, due to the global economic crisis in 2008, the Turkish economy had also experienced stagnation and decline in 2009. However, it returned to growth of 9.2% in 2010 and 8.5% in 2011, Average GDP growth between the years 2002-2014 was 4.9%, while the average GDP growth between 2010-2014 was 5.4%, and in this range GDP per capita in 2014 had increased to 10% Thousand and $ 404, after it did not exceed 3 thousand and 492 dollars in 2002.
A Glance at the Most Active Factors for the Economy in Turkey
1. Foreign Trade in Turkey
Turkey has pursued an economic policy focusing on the development of foreign trade since the beginning of the eighties of the last century, and through the economic reforms carried out:
- Removing import’s restrictions
- Reducing the protection policy
- Giving freedom to circulate transactions in hard currency.
- The volume of trade and its external structure has also undergone a major transformation in the recent period, as a result of the economic reforms implemented.
Turkey's foreign trade volume reached 351 billion dollars in 2015, exports amounted to 144 billion dollars and the volume of imports reached 207 billion dollars. Turkey aims to raise the volume of exports in 2023, which coincides with the 100th anniversary of the establishment of the Turkish republic to 500 billion dollars.
2. Foreign investments in Turkey
Turkey's successful economic performance and its young people, the provision of skilled labor and the free economic environment, its advanced infrastructure, its strategic geographical position, low taxes and incentive policies, its extensive internal markets and the customs union with the EU provide foreign investors with unparalleled investment opportunities.
The Best Investment Opporutnities in Turkey
- Arranging and amending laws that grant foreign investors the same rights and duties granted to Turkish investors.
- Taking action to improve the tax system, adopt successful privatization policies and programs.
- The safe environment for foreign investors is available, such as that available to Turkish investors.
- Establishing an appropriate legal infrastructure for foreign investments in the country.
- Removing the bureaucratic restrictions and obstacles that slow the investment process.
All of this has made Turkey one of the most important and attractive investment centers in the world. Since the end of 2015, more than 46,000 foreign capital companies have been operating in Turkey, 916 foreign companies have representative offices in Turkey as the total Direct foreign investments in Turkey during the first ten months of 2015 has reached more than $ 165 billion.
The unique and unrivalled feature of Turkey's trade and direct foreign investment is its position as an open gateway to Europe, the Middle East, North Africa and Central Asia, where Istanbul can be reached from more than 50 countries within four hours by air, about a quarter of the world's markets can be contacted in the same period.
3. Privatization Plans in Turkey
The main objective of the privatization process is to limit the role of the state in the health sector, basic education, social protection, national defense and large infrastructure investments. These objectives are in line with Turkey's goal of establishing a free market economy that depends mainly on the private sector.
Turkey is one of the first countries among the EEC countries to complete the policy of privatization and obtaining high revenues. The total of the revenues of privatization between 1986 and 2003 was about $ 8 billion, this amount between 2004 - 2015 to $ 58 billion, bringing the total of the proceeds of privatization $ 66 billion.
4. The Role of Construction Sector in Turkey
Between 1972 and 2015, the construction sector in Turkey was able to complete 8693 constructive projects in 107 countries with a total value of $ 322.6 billion. Construction revenues in 2015 were about $ 19.6 billion. One of the most important indicators showing the success of the Turkish construction sector at the global level is the entry of 42 Turkish construction companies on the list of the top 250 construction companies in the world in 2015, and the number of Turkish companies in the same list for 2004 does not exceed 11 companies.
5. Tourism Sector in Turkey
Turkey is rich in historical and geographical wealth, not only a center for coastal tourism but also an important center for health, cultural, religious, sports and conference tourism. It has a strong infrastructure for these types of tourism, furthermore, it is among the top 10 tourist countries in the world. Foreigners who visited Turkey in 2015 more were than 36 million tourists, and tourism imports amounted to about 31 billion dollars in the same year.
6. Fiscal and Monetary Policy in Turkey
Turkey's fiscal policy plays an important role in achieving macroeconomic balance and controlling inflation over the last 10 years. The inflation that has engulfed Turkish governments during the last three decades of the last century has been reduced to a one-digit number at the beginning of the year 2000, the CPI was also achieved by 8.17% in 2014 and 8.81% in 2015.
Turkey's international reserves in cash continue to increase over the past 10 years. Turkey's central bank reserves in January 2016 amounted to about $ 111 billion.
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