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Turkey : in brief
Strategic Location
At a Crossroads
Area : 780.580 km2
Population: 76.805.524 (CIA, July 2009)
In the Past
Tomorrow
In the Future
An Energy Gateway
…70% of the world’s total
energy consumption
…70% of the world’s total
energy consumption
…An Energy Gateway
…50% of the world’s total energy production
…50% of the world’s total energy production
…An Energy Gateway
• Proximity to 72% of the world’s proven gas & oil reserves.
• 7% of global oil supply transits through Turkey
• Ceyhan: one of the world’s most important energy market & terminal centers
• Turkey is expected to become Europe’s 4th main energy artery.
Turkey harbours a 120 bn. USD potential market for energy-related investments until 2020.
Young, Dynamic, Global
Demographics
Turkey has a population of over 70 million with an average age of 28,5.
65% of inhabitants are below 34 years old.
Turkey has a population of over 70 million with an average age of 28,5.
65% of inhabitants are below 34 years old.
Source : TUIK
6,20 6,08
6,60 6,32 6,22 6,31 6,50
5,63
4,77 4,79
3,79 3,45
2,57
1,87 1,45
1,12 0,69
0,28 0,08
Distribution of Population by Age Group (2011)(million people)
Skilled Labor Force
Turkey’s total workforce : 24,110,000 Total employed in manufacturing: 2,600,000 people
0 1 2 3 4 5 6 7 8 9 10
Availability of Skilled Labor
Force; 6.3
Availability of Qualified En-gineers; 7.6
Availability of Competent Senior Man-agers; 6.8
Source: Investment Support and Promotion Agency, 2012
A Global PlayerCustoms Union
with the European Union
Founding Member of the Economic Cooperation Organization
Member of the Organization of
Islamic Conference
Member of the
WTO
Free Trade Agreements
Founding Member of the Black Sea
Economic Cooperation Org.
Founding Member of the
UN Memberof
NATO
Founding Member of the European Council
Founding Member of
the Alliance of
Civilizations
An Official Candidatefor
EU Membership Founding
Member of the OECD
A Booming Economy
A Booming Economy
Turkey is the 18th largest economy in the world*Turkey is the 18th largest economy in the world*
grey indicates estimates
Source: TUIK; International Monetary Fund, World Economic Outlook Database, April 2012 – *(GDP @current prices)
197 230305
390481
526
649742
617
732 772817
878953
1.0441.148GDP (USD bn.)
Rising Income
Source: Ministry of Economy
20022003
20042005
20062007
20082009
20102011
3,4924,559
5,7647,022
7,586
9,24010,438
8,559
10,022 10,444
8,741 8,861
10,24111,465
12,95313,950
14,99514,228
15,34015,914
GDP per Capita (USD)
Per capita GDP (current prices)
Per capita GDP (PPP)
Sustained Growth
Source: TUIK, International Monetary Fund, World Economic Outlook Database, April 2012
grey indicates estimates
-5,7
6,25,3
9,48,4
6,9
4,7
0,7
-4,8
9,28,5
2,33,2
4,0 4,3 4,5
GDP Growth (%)
-4,7
-3,3
-1,9 -1,8
-1,2-1,0
-0,5-0,2
0,0 0,0 0,10,5 0,5 0,5 0,6 0,6
0,8 0,8 0,9 0,91,2
1,5
2,0 2,0 2,02,4
2,62,3
% GDP Growth in Europe, 2012 Estimates
Source: International Monetary Fund, World Economic Outlook Database, April 2012
High Growth
Turkey’s economic growth rate is typically above the EU average and one of the highest in Europe.
Turkey’s economic growth rate is typically above the EU average and one of the highest in Europe.
Economic Freedom Index 2012
A Free Economy
0 10 20 30 40 50 60 70 80 90
Business Freedom
Trade Freedom
Fiscal Freedom
Gov't Spending
Monetary Freedom
Investment Freedom
Financial Freedom
Property Rights
Freedom from Corruption
Labor Freedom
62.5 % Free
73rd freest economy in the
worldout of 184.
62.5 % Free
73rd freest economy in the
worldout of 184.
Source: The Heritage Foundation, 2012 - www.heritage.org
A Global CompetitorSource: World Economic Forum Global Competitiveness Report 2010-2011
(rank out of 133 countries)
Market size
Domestic Market Size 16th
Foreign Market Size 26th
Goods market efficiency
Time required to start a business 13th
Intensity of local competition15th
Effectiveness of anti-monopoly policy34th
Business sophistication
Local supplier quantity27th
Value chain breadth 43th
Production process sophistication38th
Financial market sophistication
Strength of investor protection 45th
Restriction on capital flows 41st
Affordability of financial services 40th
68,5
29,7
18,4
9,4 7,79,7 8,4 10,1
6,5 6,410,5 10,6
7,1 5,7 5,5
Inflation (%)
Inflation (%)
Source: International Monetary Fund, World Economic Outlook Database, April 2012
*grey indicates estimates
Tight budgetary policies have enabled Turkey to lower its inflation rate to single digit rates.
In 2010 inflation was at its lowest in 41 years.
Tight budgetary policies have enabled Turkey to lower its inflation rate to single digit rates.
In 2010 inflation was at its lowest in 41 years.
Unemployment
Source: International Monetary Fund, World Economic Outlook Database, April 2012
10,5 10,8 10,6 10,2 10,311,0
14,0
11,9
9,89,1 9,2 9,0
8,3
7,2 7,1
9,09,7 9,7
Unemployment (%) Turkey EU27
Distribution of GDP by Sector
Source:TUIK
Manufacturing16%
Transport, storage and communication
13%
Wholesale and retail trade12%
Ownership and dwelling10%
Hunting and forestry8%
Real estate, renting and business activities
5%
Construction5%
Public administration and defence; compulsory social
security4%
Education3%
Financial intermediation3%
Hotels and Restaurants2%
Electricity, gas and water supply
2%
Other community, social and personel service
activities2%
Health and social work2%
Mining and quarrying2%
Other11%
Distribution of GDP by Sector (2011)
Trade
Free-Trade Agreements 19 Free Trade Agreements: EFTA member countries (Iceland, Norway, Switzerland,
Lichtenstein), Israel, Macedonia, Croatia, Bosnia and Herzegovina, Palestine, Tunisia, Morocco, Syria, Egypt, Albania, Georgia, South Korea, Montenegro, Jordan and Chile.
Free Trade Agreements under negotiation: Lebanon, South Africa, Mexico,
and the Cooperation Council for Arab States.
Free Trade Agreements for which talks have been initiated:
Algeria, Ukraine, Mercosur (Brazil, Argentina, Uruguay, Paraguay, Venezuela), ACP countries (Ethiopia, Congo, Djibouti, Cameroon, Kenya, Gabon).
19 Free Trade Agreements: EFTA member countries (Iceland, Norway, Switzerland,
Lichtenstein), Israel, Macedonia, Croatia, Bosnia and Herzegovina, Palestine, Tunisia, Morocco, Syria, Egypt, Albania, Georgia, South Korea, Montenegro, Jordan and Chile.
Free Trade Agreements under negotiation: Lebanon, South Africa, Mexico,
and the Cooperation Council for Arab States.
Free Trade Agreements for which talks have been initiated:
Algeria, Ukraine, Mercosur (Brazil, Argentina, Uruguay, Paraguay, Venezuela), ACP countries (Ethiopia, Congo, Djibouti, Cameroon, Kenya, Gabon).
Prevention of Double Taxation Albania Estonia Khazakstan Oman Sweden
Algeria Ethiopia Kuwait Pakistan Syria
Austria Finland Kyrgyzystan Poland Tadjikistan
Azerbaijan France Latvia Portugal Thailand
Bahrain Georgia Lebanon Qatar Tunisia
Bangladesh Germany Lithuania Romania Turkmenistan
Belarus Greece Luxembourg Russian Federation Ukraine
Belgium Hungary Macedonia Saudi Arabia United Arab Emirates
Bosnia Herzegovina India Malaysia Serbia-Montenegro United Kingdom
Bulgaria Indonesia Moldova Singapore USA
Canada Iran Mongolia Slovakia Uzbekistan
China Ireland Morocoo Slovenia Yemen
Croatia Israel Netherlands Soudan
Czech Republic Italy New Zealand South Africa
Denmark Japan Northern Cyprus South Korea
Egypt Jordan Norway Spain
Foreign Trade
Source : Ministry of Economy
49 46 4155
4152
69
98117
140
170
202
141
186
241
26 27 27 28 31 3647
6373
86
107
132
102114
135
Foreign Trade (2011, USD bn.)
Imports Exports
Exports
Exports
Exports in 2011 : 135 billion USD
Share of Industry: 126 billion USD
• Transport vehicles: 15.8 billion USD
• Apparel & Clothing: 13,5 billion USD
• Machinery: 11.6 billion USD
• Iron & steel: 11,2 billion USD
SMEs account for ~60% of exports
Exports by Region
Source : TUİK
EU 2746,2%
Near & Middle East
20,7%
North America4,1%
North Africa5,0%
Other14,4%
Rest of Europe9,6%
Exports by Region (2011)
Top Export Partners
Source : TUİK
14,0
8,3
8,2
7,9
6,8
6,0
4,6
3,9
3,7
3,6
Germany
Iraq
UK
Italy
France
Russian Fed.
USA
Spain
U.A.E
Iran
Top Export Partners (2011, USD bn.)
Top 10 Export Categories
2011–USD millions
Vehicles other than Railway 15,805
Machineries, Mechanical Appliances 11,563
Iron & Steel 11,226
Electrical Machinery & Equipment 8,882
Articles of Apparel and Clothing Accessories Knitted 8,396
Mineral fuels, oils, distillation products, etc. 6,539
Articles of Iron & Steel 5,759
Articles of Apparel and Clothing Accessories Not Knitted 5,129
Plastics and Articles Thereof 4,581
Edible Fruits, nuts, etc. 3.910
Source : Ministry of Economy
Turkey is theworld leader in the production and export of:
Hazelnuts
Figs
Raisins
Various dried fruits
Facts
World’s
largest exporter of
Unmanufactured tobacco
Poppy seeds
Wheat of meslin flour
Facts
worldwide exporter of
Lemons (2nd)
Fresh cherries (3rd)
Fresh apricots (4th)
Fresh mandarins (4th)
Fresh grapefruits (4th)
Facts
World exporter of
Refined olive oil (6th) Tomatoes (5th)
Facts
Facts
World’s largest exporter of
Marble Travertine Ecaussine Quartz
2nd exporter of
woven cotton fabrics
in the World
World’s largest exporter
of cotton yarn
Facts
World’s 3rd largest Europe’s 2nd biggest exporter of
carpets & other textile floor coverings
Facts
World’s 5th & Europe’s largest exporter of
knit or crocheted
fabrics
World’s 4th
& Europe’s largest exporter of
cotton denim
fabrics
Facts
World’s 3rd largest
Europe’s #1
exporter of cotton T-shirts
Among the World’s largest Europe’s #1exporter of various kinds ofsinglets, panties, briefs, pyjamas and bathrobes
Facts
5th largest exporter of
fur apparel in the world,
3rd in Europe
Facts
3rd exporter of Panty hose, socks, tights,
stockings & other hosiery in the world,
2nd in Europe
Europe’s 3rd largest, World’s 6th biggest exporter of special woven or tufted fabric, lace and tapestry
Facts
4th largest exporter of household glassware in the world – #3 in Europe
Facts
3rd largest exporter of drinking glasses in the world – #2 in Europe
World’s 4th,
Europe’s 2nd largest
exporter of
shaped soap
2nd largest exporter of
polishes and creams
for footwear or leather in the world
Facts
World’s largest exporter of Cements
Europe’s #1 exporter of Cement Clinkers
Facts
5th largest exporter of
ceramic bathroom and sanitary
fixtures
in the world and
3rd in Europe
Facts
World’s largest exporter of non aluminous, hot-extruded iron bars and rods
Facts
World’s largest exporter of
radiators (iron or steel)
Facts
5th largest exporter of
household washing machines
in the world and 4th in Europe
Facts
World’s 4th largest exporter of
household type refrigerators
in the world, 1st in Europe
World’s largest Exporter of
centrifugal
clothes-driers
Facts
World’s 11th largest exporter of
Gold jewellery in the world,
2nd in Europe
World’s and Europe’s
5th largest exporter of
automobileswith diesel engine
Facts
6th largest exporter of public transport type passenger
motor vehicles in the world, 3rd in Europe
World’s
9th largest exporter of
trucks 5th in Europe
Facts
Imports
Imports by Region
Source: TUİK
EU 2737,8%
Other Asia22,1%
Rest of Europe14,9%
Near & Middle East8,5%
North America7,2%
Other8,1%
North Africa1,4%
Imports by Region (2011)
Top Import Partners
Source: TUİK
24,0
23,0
21,7
16,0
13,5
12,5
9,2
6,5
6,3
6,2
Russian Fed.
Germany
China
USA
Italy
Iran
France
India
South Korea
Spain
Top Import Partners (2011, USD bn.)
Top 10 Import Categories2011–USD millions
Mineral Fuels, Mineral Oils and Derivatives 54,115
Nuclear reactors, boilers, machinery, etc 27,107
Iron & Steel 20,424
Vehicles other than Railway 17,184
Electrical Machinery & Spare parts 16,836
Plastics and Articles Thereof 12,578
Pearls, Art. of Precious Stone & Metals, Metal Coins 7,022
Organic Chemicals 5,504
Pharmaceuticals 4,697
Copper and Articles Thereof 4,119
Source: Ministry of Economy
Investment
Turkey was ranked the 15th most attractive country in the world in terms of FDIfor 2008-2010.
(UNCTAD)
FDI inflows to Turkey have increased by over 1000% since 2004.
New Investment Incentives System
Support Instruments
General Investment Incentives Scheme
Regional Investment Incentives Scheme
Large-Scale Investment Incentives Scheme
Strategic Investment Incentives Scheme
VAT Exemption + + + +
Customs Duty Exemption + + + +
Tax Reduction + + +
Social Security Premium Support
(Employer’s Share) + + +
Income Tax Withholding Allowance *
+ + +
Social Security Premium Support
(Employee’s Share) * + + +
Interest Payment Support **
+ +
Land Allocation + + +
VAT Refund*** +
* Provided that the investment is made in Region 6** Provided that the investment is made in Region 3, 4, 5 or 6 within the framework of the Regional Investment
Incentives Scheme.***Provided that the investment is made within the framework of the Strategic Investment Incentives Scheme with a
minimum fixed investment amount over TRY 500 million.
New Investment Incentives System
FDI Legislation
Main Principles:
Equal treatment for domestic and foreign capital companies
– all companies are entitled to the same rights as domestic companies
No pre-entry /pre-establishment screening requirements
– such as permits or approvals
Unrestricted foreign ownership
– Right to acquire real estate
– Freedom to seek alternative dispute arbitration besides state jurisdiction
No obligation to set up a specific company type
Notification: Foreign capital companies are only required to notify the Undersecreteriat of Treasury for statistical purposes.
Rights of Foreign Investors Free transfer of funds
– Net profits, dividends, proceeds from sales or liquidations of any part of an investment, compensation payments, funds arising from license, management or similar agreements, and reimbursements and interest payments originating from foreign loans through banks or special financial institutions can be freely transferred abroad.
Acquisition of real estate – Companies may freely acquire real estate through a legal entity established by or withthe
participation of foreign investors in Turkey, provided that such acquisitions are permitted to Turkish citizens.
Dispute settlement– Through either authorized local courts or national and international arbitration bodies.
Valuation of non-cash capital– Non-cash capital is valued under the regulatios of Turkish Commercial Law. In the case
stocks and bonds of companies abroad are used as the foreign capital share of foreign investors, the values assessed by the equivalent authorities in the home country or any other international institutions performing valuations will be accepted.
Work permits for expatriates
Setting up a liaison office– Liaison offices can be opened provided that they do not engage in commercial activities
Foreign Direct Investment
Source: Ministry of Finance
810 844 636 608 885 722 805 940 783 982
3.352
1.1331.7522.785
10.031
20.185
22.047
19.504
8.4119.038
15.732
Foreign Direct Investment (mn. USD)
Foreign Capital Companies
Total number of foreign companies in Turkey : 29,283 Number of EU27 companies established in Turkey > 13,550 Countries with significant investments:
Germany (4,779) the UK (2,334) the Iran (2,140)
Source: Ministry of Finance
10.130
2.855 3.235 3.070 2.850 3.309 3.834
29.283
Number of Foreign Companies
Agriculture, Fishing, Forestry
2%Mining
2%Manufacturing
16%
Electricity, water, gas2%
Construction10%
Trade31%
Hotels & Restaurants6%
Communications & Logistics
9%
Financial Intermediation
1%
Real Estate16%
Other Services5%
FDI Companies by Activity (1954 - 2011)
FDI Companies by Activity
Source: Ministry of Economy
FDI Companies by Investing Region
EU Countries52%
Other European Countries
11%
African Countries2%
North American Countries
5%
South and Central American Countries
1%
Near and Middle Eastern Countries
21%
Other Asian Countries
7%
Other Countries1%
FDI Companies by Investing Region, (1954 - 2011)
Source: Ministry of Economy
Top 5 Investors in Turkey (2011)
Austria 17.3%
Spain 17.3%
Netherlands 12.3%
USA 10.9%
Source: Ministry of Economy
Multinationals in Turkey
3M CHEVRON GENERAL MOTORS MCKINSEY RENAULT
ABB HOLDING CITIBANK GILETTE MERCEDES- BENZ REUTERS
ABN AMRO CNN GLAXOSMITHKLINE MERCK SHARP DOHME ROCHE
AC NIELSEN ZET COCA COLA GOODYEAR MERLONI SERVIER
ACCENTURE COLGATE PALMOLIVE HENKEL METRO AG SHV GAS
AEG CREDIT LYONNAIS HEWLETT PACKARD MICROSOFT SIEMENS
ALCATEL- CREDIT AGRICOLE HSBC MOBIL OIL SOCIETE GENERALE
ALLIANZ CROWN CORK HYUNDAI CORPORATION NESTLE SODEXHO
AMERICAN EXPRESS DANONE IBM NIKE SONY EURASIA
AUTOLIV CANKOR DEUTSCHE BANK INTERGEN NISSHO IWAI TESCO KIPA
AVENTIS PHARMA DHL ITOCHU CORP NORTEL NETWORKS TETRA PAK
AXA DUPONT JOHNSON & JOHNSON NOVARTIS THAMES WATER
BANCA DI ROMA ERICSSON JP MORGAN CHASE ORACLEBANK OF TOKYO-MITSUBISHI
BARCLAYS BANK FIAT JTI PARS MCCANN THE SHELL COMPANY
BASF FMC LAFARGE PEPSI COLA TNT
BAT FORD LEVIS PERFETTI TOTAL
BAYER FORTIS LILLY PFIZER TOYOTA
BOSCH FOSTER WHEELER LOCKHEED-MARTIN PHILIP MORRIS UNILEVER
BP FOUR SEASONS MAN PHILIPS VOLKSWAGEN
BRIDGESTONE FRITO LAY MARSA KRAFT JAKOPS PIRELLI XEROX
BRISTOL MYERS SQUIBB GENERAL ELECTRIC MCDONALDS PROCTER & GAMBLE YAZAKI
1. Petrol Ofisi 6. BSH Home Appliances
41% (overall ranking: 2) 99,28%
(overall ranking: 17)
2. Ford 7. Vestel
41,04% (overall ranking: 4) 74,69% (overall ranking: 16)
3. Tofas-Fiat 8. Unilever
37,86% (overall ranking:5) 99,98%
(overall ranking: 18)
4. OYAK-Renault 9. Toyota
51% (overall ranking: 7) 100% (overall ranking: 21)
5. Mercedes-Benz 10. Hyundai Assan
85% (overall ranking: 11) 85%
(overall ranking: 27)
Top 10 Foreign Capital Companiesin terms of Net Sales (2011)
Banking Some foreign banks in Turkey:
Arap Türk Bank A.Ş.
Citibank A.Ş.
Denizbank A.Ş.
Deutsche Bank A.Ş.
Eurobank Tekfen A.Ş.
Finans Bank A.Ş.
Fortis Bank A.Ş.
HSBC Bank A.Ş.
ING Bank A.Ş.
Millennium Bank A.Ş.
Bank Mellat
Habib Bank Limited
JPMorgan Chase Bank N.A.
Société Générale (SA)
The Royal Bank of Scotland N.V.
WestLB AG
Expected Privatizations
TEDAŞ (Gas and electricity distribution)
Türkiye Şeker Fabrikaları A.Ş.(Sugar Manufacturing)
Highways and ports
T. Halkbank A.Ş.
Milli Piyango İdaresi (National Lottery)
THY (Turkish Airlines) A.Ş.
Turkey Maritime Organization Inc.
Sümer Holding A.Ş.
Major Cross-Border Acquisitions
Oyak Bank (ING Group (NL) - 2,7 bn. USD) UN Ro-Ro (KKR & Co. (USA) - 910 mn. Euro) Demirdöküm (Vaillant (DE) - 211 mn. Euro) AFM Movie Theaters (Alfa Group (RU) – 52 mn. Euro) Eczacıbaşı Pharma (%75 / Zentiva – 460 mn. Euro) Ray Sigorta (%58 / TBIH Group - 82 mn. USD ) Intergum (Cadbury Schweppes (UK) 450 mn. USD) Acıbadem Health (%22 / Abraaj Capital) T. Genel Sigorta AŞ (%80 / Mapfre SA – 285 mn. Euro) Garanti Sigorta (%80 / Eureko (NL) 365mn. Euro) Garanti Emeklilik (%15 / Eureko (NL) 100mn. Euro) Dentistanbul (Global Environment Fund (USA)) ZapMedya (%70 / Int. Marketing & Sales Group - 13 mn. USD)
Other examples:Başak Sigorta, Adabank, AVEA (gsm network), Dışbank, TEB, TGRT (Fox TV)
More Facts of Interest
Ratio of R&D Expenditures to GDP (%)
(%)
Year
Target for 2023 : %3
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 -
0.10
0.20
0.30
0.40
0.50
0.60
0.70
0.80
0.90
0.48
0.54 0.53
0.48 0.52
0.59
0.60
0.72
0.73
0.85
0.84
Data Source: TURKSTAT
Share of Technology Intensive Products in Exports
2002 2006 20100%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
LowMid-LowMid-HighHigh
Data Source: TURKSTAT, OECD STAN Database
Some widely recognized brands are owned by Turkish companies.
Godiva (Ülker)
Grundig (Beko)
Arctic (Arçelik)
Blomberg (Arçelik)
Turkish-Owned Brands
Transportation THY is known as the best airline in
Southern Europe
Road Transportation (2010)
– 45% of Turkish exports– 2,153 km of motorways– A total of 64,746 km of roads– 10,500 private passenger cars
Air transportation (2010)
– 46 airports– 50,516,000 domestic passengers – 52,189,000 international passengers– Cargo (tonne) 1.500.000
Sea transportation (2008)
– Goods loaded: 75,623,167 tons
Did you know that…
Istanbul is the only city in the region with 3 Exchange Markets :
– The Istanbul Stock Exchange Market
– The Istanbul Gold Exchange
– The Istanbul Commodity Exchange
There are 5 technoparks in Istanbul (18 in Turkey)
Did you know that…
In 2010, the total number of international projects undertaken by Turkish contractors was 517 in 48 countries, for a total value of 20,3 bn. USD
With 31 companies among the top 225 contracting companies, Turkey ranks 2nd in the world after China.
Between 1972 and 2010, about 700 Turkish contractors have completed over 6,000 projects in 89 countries.
With a market size of 20 billion USD, the Turkish communications sector is one of the largest in the Europe.
• 65 million GSM operator users– 92% of households own a cell phone
• 50 million Internet users– 43% of households have internet access
The total ICT market is valued at 27,3 billion USD, with a yearly growth rate of 4,2%.
Did you know that…
51 million credit card users.
More than 31,4 million people visited Turkey in 2011 (7th most visited country in the world in 2010).
20 of the Top 100 hotels in the world are Turkish.
Regional headquarters of many multinationals are located in Turkey.
Did you know that…
Points to Remember
A strategic location
– a gateway for trade, energy, and communications.
An active global player
A successful economy– A young, well-qualified population
– An competitive industrial exporter
– Well-developed infrastructure
– A large, expanding domestic market
A beneficial investment climate
Thank you!
EU & Foreign Economic Relations Dept.
[email protected] , [email protected] +90 212 252 29 00 ext. 170-177 +90 212 293 55 65 www.iso.org.tr
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