Turkey

Investing

FDI in figures

Following the economic and political crisis in 2001, Turkey concluded, in 2002, a large program of macroeconomic stabilization with the IMF which enabled FDI to experience a real boom since 2002 going from 622 M USD to 19.2 billion USD in 2007.

Foreign Direct Investment	2004	2005	2006
FDI of inward flow (millions USD)	2,883	9,803	20,120
FDI inward stock (millions USD)	n.c.	n.c.	79,075.0
Performance Index*, world ranking	119	99	73
Potential Index**, world ranking	69	69	n.c.
Number of Greenfield investments	66	67	84
FDI inwards (in % of GFCF)	5.4	13.8	23.7
FDI stock (in % of GDP)	n.c.	n.c.	19.6

Source: UNCTAD, World Investment Report

Note: * The UNCTAD Inward FDI Performance index is based on a ratio of the country's share in global FDI inflows and its share in global GDP. ** The UNCTAD Inward FDI Potential index is based on 12 economic and structural variables such as GDP, foreign trade, FDI, infrastructures, energy use, R&D, education, country risk.

Why you should choose Turkey

Strong points: - 17th world economic power
- Turkey's geostrategic position
- Well developed industrial basin
- A country whose calling is to join the EU club by 2015-2020
- A rapidly developing consumer middle class
- Cost of labor and flexibility of labor law favors investment
- Sustained growth under the effect of a modern, dynamic private sector
- Strong increase in productivity
- Legal framework close to European standards and favorable to investment
Weak points: - Slowing down of economic and political reforms observed since the end of 2005
- Strongly dependent on imports of hydrocarbons
- Uncertainty about the exchange rate
- Disturbing deficit of the balance of current payments
- Infrastructures victims of numerous bottlenecks
- An informal sector difficult to reduce
Government measures to motivate or restrict FDI: Since 2003, investors have no longer been subject to an obligation to acquire a minimum interest.
The government encourages investments in the form of Build Operate Transfer (BOT) (law n° 4283 of 16 July 1997). It favors investment in the sectors of High Tech, textiles, services (health, education, transport), telecommunications, shipbuilding, electronics and biotechnologies. Projects oriented towards export are also favored.
Decree n° 24 810 of 9 July 2002 defines public aid for investment.
Bilateral investment conventions signed by Turkey: Turkey has signed bilateral conventions with nearly 80 countries. In the Mediterranean basin, Turkey has signed bilateral conventions with Algeria, Egypt, Israel, Spain, Greece, Lebanon, Morocco, Portugal and Tunisia. 44 conventions can be downloaded on the UNCTAD website: click here to download these conventions. They define the framework of protection for foreign investment in Turkey for each of the signatory countries.

Administrative procedures relative to foreign investment

Freedom of establishment: Guaranteed
Acquisition of holdings: Possible
Obligation to declare: Foreign investors only have to inform the General Directorate of Foreign Investment (GDFI) through the under-secretariat of State to the Treasury.
Competent organization for the declaration: Turkish Treasury
Requests for specific authorizations: In some sectors considered to be strategic such as petroleum, the media (radio and TV) and tourism, acquisitions are limited to a certain amount (law n° 6326 of 1954).