There will always be a business case for investing in Turkey
Many factors make Turkey an attractive location for economic co-operation – especially for SMEs.
• Favourable geographical position
Set between Europe and Asia, Turkey is the East’s gate to the European economy. The country is rapidly developing into a worldwide logistics hub.
• Large domestic market
A considerable incentive for international companies to engage with Turkey is the relatively low costs of wages and production, and the huge end-consumer market with almost 79m inhabitants and an average age of 31 years. In addition, with 57m credit-card holders Turkey has a high number of potential customers.
• Strong economic growth
According to the World Bank, Turkey is among the top 20 economies worldwide and is one of the “emerging markets”, alongside economies such as China, Brazil, Russia, India, South Africa, Mexico, Indonesia and South Africa (BRICS or MIST states).
• Growing purchasing power
With GDP growth from USD 231m (2002) to USD 800 (2014), the sales market for investors has grown considerably. In 2015, the Turkish population’s consumption propensity was indeed the main driver of economic growth of 4%, outperforming all predictions. In total, private consumption has contributed 75% to economic growth. In the first half of 2016, the Turkish economy grew by 4% in real terms, with private consumption seeing an increase of 6.1%.
• Customs Union with the EU
In 1996, the Customs Union between Turkey and the EU came into force.
• Qualified workforce
With over 29.2m well educated and motivated experts below 30 years of age, productivity has increased considerably.
• Legally guaranteed equality for foreign investors
Complications surrounding international expansions often arise from state-imposed limitations and laws that disadvantage international competitors. In Turkey, foreign companies are legally guaranteed equal treatment to local market participants.
• Low taxes and investment incentives
To make Turkey an attractive environment for foreign market entrants, it offers many investment incentives. These include a full or partial exemption from corporation tax, taking on payment of employer social security contributions, and, where required, allocation of land for investors. Various statutory support initiatives for large and small investments are in place. The support initiatives are adapted to suit the type and scale of the region where the investment takes place.
• Intensified support for SMEs
Small and medium-sized enterprises (SMEs) form the backbone of the Turkish economy. Their contribution to the revenue of the Turkish economy as a whole is just over 63%. Almost 94% of all SMEs are micro-enterprises with fewer than ten employees. To promote the competitiveness of the Turkish economy in a targeted manner, a strategy document with an action plan for the years 2015-2018 recently came into force. German SMEs that invest in Turkey and have founded a company according to Turkish law can benefit from state support in the same manner as Turkish firms.
We are happy to advise you on your individual requirements for entry into the Turkish market. Get in touch with us.