The Turkish economy is a dynamic economy that has earned the trust of international economic actors and investors. Furthermore, the private sector plays an important role in the economic sphere. Additionally, the public economic sector is concerned with work organization, the implementation of a free foreign trade policy, as well as the freedom to exchange money.
Turkey’s GDP of roughly 736,716 billion dollars has made it the world’s seventh-largest economy. By 2023, Turkey hopes to be the world’s tenth-largest economy. Its financial policies have aided the Turkish economy this year, causing it to grow faster than Moody’s International predicted in its report on global economic and credit estimates for 2020-2022.
1. Construction and Real State
The Turkish real estate market is viewed as a safe investment by many. The world’s attention is now on Turkey, whose housing market is still developing. The market is concentrated on domestic Turkish property transactions but heavily weighted towards overseas real estate holdings. As a result, many overseas home buyers are drawn to Turkey.
Turkey is a vast country with many property investors. Foreign investors continue to profit from investments in Turkey. Investors like Bursa, Ankara, Mersin, and Antalya. Read this post to learn how to evaluate your capital in real estate investing. The Turkish real estate market is booming.
Despite the pandemic, the industry has thrived, attracting local and international investment. Istanbul is a popular city in Turkey and a favorite of foreign investors. As a result, Istanbul is the most talked-about city. Expats flock to Istanbul in search of a home. The cost of living in Istanbul varies by region. You should do your homework to find the best property for your budget and lifestyle according to Property Prices in Istanbul, which is also a part of your income. Obtain assistance from reputable real estate companies in Turkey.
Turkey’s strategic location attracts international attention regularly. Due to its expanding real estate industry and strategic location, it is one of the world’s most valued countries. In Turkish real estate, large-scale structures are common. Turkish businesses use technology to keep track of changing real estate trends. Keep an eye on the Turkish market if you wish to thrive in real estate investing.
Turkey’s property market is one of Europe’s brightest. The 83 million Turkish people living at the crossroads of Europe, the Middle East, and Central Asia is huge for developers and investors.
2. Automotive
The automotive industry in Turkey began in the early 1960s. During a period of tremendous industrialization and innovation, these alliances grew into a full-fledged industry with design skills and a huge manufacturing capacity. OEMs have invested around USD 15 billion in Turkey since 2000. These investments increased their production capacity, putting Turkey at the center of global value chains for foreign OEMs. Today’s Turkish auto sector is efficient and competitive thanks to value-added manufacturing. It meets and surpasses international quality standards.
Turkey is the world’s ninth-largest automobile manufacturing and engineering base, based on average exports. Turkey is a global manufacturing, export, and engineering hub. Turkish car production is located in Izmit, Bursa, Ankara, Izmir, and Aksaray. Taking advantage of Turkey’s strategic location and easy access to transportation, major automakers invest heavily to expand their operations. This sector has moved Turkey to 5th in Europe and 9th globally in terms of vehicle production. (2020) In the first half of last year, the auto sector shipped $11.7 billion to Turkey; in the same period this year, it exported $14.4 billion, up 22.4%. To beat the previous record of $24.7 billion established in 2008, Turkey’s auto exports are predicted to cross $27 billion in 2017.
3. Information Technology
Turkey’s information and communication technologies (ICT) sector has developed into a critical component of the economy, with exports to the EU, MENA, Asia, and North America exceeding USD 1 billion. The EU receives almost 80% of Turkey’s IT and communications technology experts in software, hardware, equipment, and services.
Since the early 2000s, international investment has boosted employment in the sector to 143,000. Today, about 20% of ICT employees work in R&D, and nearly 70% are under the age of 35. A surge in university graduates in engineering and IT has boosted Turkey’s skill pool. In 2019, the relevant fields graduated over 59,000 for the first time. Turkey’s regional competitiveness is maintained through a skilled workforce and low labor costs.
The Turkish government has made various efforts to stimulate investment in the ICT sector. The R&D Law, passed in 2008 and revised in 2016, outlines the government’s support for R&D and contains an incentive package. These include corporate tax benefits, VAT exemptions, and help with Social Security contributions.
According to the research, domestic products have a stronger weight in the information technology service and software categories. Domestic products make up 76% of the overall output in the information technology services industry. Domestic information technology-software items account for 71% of overall output.
The Turkish government prioritizes this sector to attract telecom investment. Last year, the government budgeted $ 5 billion for this purpose. Turkey plans to deploy 5G mobile internet by 2020. 5G will target the automotive, media, entertainment, energy, health, and agriculture industries. 5G will target the automotive, media, entertainment, energy, health, and agriculture industries. Fiber optic solutions are gaining market share as Turk Telekom, TTNet, and other ISPs invest in infrastructure.
The cybersecurity industry is also expected to grow, as corporations and governments continue to invest more in ICT security. Information that belongs to persons and is confined to the Turkish government is protected by this system. This system protects identity, certificates, mobile security, system security, data security, and application security.
Turkish government spending on cyber security hardware and software has also surged. To accomplish these steps, the Turkish National Police and the Turkish Army will continue to strengthen their cyber security technology. The Ministry of Transport, Maritime Affairs, and Communications have put in place several measures to defend government institutions and businesses from cyber-attacks (cyber incident response teams). BTK, TUBITAK, and the Ministry of Communications and Transportation are in charge of the government’s cyber security initiatives.
4. Textile
Turkey’s textile industry stretches back to the Ottoman Empire, and it continues to play a significant part in the worldwide textile and garment industries. In 2020, textile exports stood fourth in the world, accounting for around 3.3 percent of total exports. Textile and garment exports have more than doubled since 2000. The majority of Turkish textile and garment exports travel to Europe, with the top five destinations being Germany, the United Kingdom, and Spain. These three countries imported over $9 billion worth of goods in 2019.
Textiles are a major part of Turkey’s economy. Manufacturing, employment, investment, and macroeconomic indexes all rank this roughly 10% of GDP industry highly. To profit from the increasing textile business, start a company that creates a variety of fabrics. Exporting textiles to similar cultures is simple if the Turkish market is saturated.
Low economic growth puts strain on businesses, compromising capacity development plans and profit margins. Between 2000 and 2013, the Turkish economy grew significantly, but it now appears to be stagnant. Inflation and currency restrictions might make resuming double-digit growth more difficult. Vietnam and Bangladesh are examples of countries that have achieved economic stability. Economic shocks can damage any community, but especially one in decline, as the pandemic has demonstrated. If Turkey is to play a significant role in global supply chains, economic growth and price stability are required.
The labor costs in Turkey are significantly greater than those of its competitors. Turkey’s average monthly wage in 2020 was 298.7 dollars, compared to 159.3 dollars in Vietnam, 94.2 dollars in Bangladesh, 221.9 dollars in China, and 126.7 dollars in Egypt. Turkey, on the other hand, can compete in global value chains by lowering logistics and transportation costs. Despite equal dollar prices, Turkey outperforms Vietnam, Bangladesh, and Egypt in terms of border compliance lead time and hours. Turkey only benefits from lower border compliance costs.
While Turkey has profited from its proximity to Europe and the United States, other textile centers in the region, such as Egypt, are swiftly catching up. Growing commercial linkages between Europe and the United States, as well as between Vietnam and Bangladesh, suggest that proximity is only one facet of the trade. Large-scale Chinese textile investments, for example, would help Egypt and Ethiopia, further harming Turkey’s location dynamics. Expanding network economies and using its vertically integrated supply chain will only help the textile industry and its worldwide competitiveness. It will also be critical to attracting considerable quantities of foreign investment.
Turkey is one of the largest producers of organic cotton in the world. Turkey and Kyrgyzstan will tie for third place in 2020, at 10% each. As garment chains replace Xinjiang cotton, demand for organic cotton from India, Kyrgyzstan, and Turkey is expected to surge. Turkey is also one of the few countries that prohibit the use of genetically modified organisms (GMOs) in agriculture, significantly improving cotton quality while retaining one of the greatest farm productivity rates in the world. Turkish cotton is known for its high quality, which draws customers from all over the world (Source: Textile Exchange Organic Cotton Market Report, 2020). Turkey will gain an advantage in the future by focusing on the sustainability of materials and supply networks.
5. Tourism
Turkey is today one of the most popular tourist destinations in the world, thanks to its historical artifacts and treasures that recount the tale of humanity’s most important events. As a result, they have always been and will continue to be symbols of beauty and enchantment. In 2022, tourism in a variety of businesses set new highs, as tourists flocked to Turkey for a variety of reasons: some came to learn about the country, while others were emotionally attached and sought refuge there.
On the other hand, Turkey is working to improve tourism, particularly maritime tourism, by addressing port shortages, particularly in Istanbul. Marine tourism returned to Istanbul last year after a four-year absence, with over 80 ships slated to arrive in 2022. A new cruise port in Yenikapi, Istanbul, is being built alongside the Galata port project, which is expected to open in March 2022 and accommodate 500 cruise ships. With an average of 4,000 passengers, this number may surpass two million. Including employees and crew, the total is expected to be higher. It would reintroduce marine tourism to Istanbul and Turkey. Antalya ranked second in terms of tourists last year, with a 17.14 percent increase in international visitors compared to 2018.
6. Hazelnut Farming
Turkey grows and processes the majority of the world’s hazelnuts, resulting in a significant hazelnut output. According to some estimates, it accounts for 70-80% of global hazelnut production. Hazelnuts are grown in the east and west of Turkey, where the soil is unsuitable for most other crops and the terrain is hilly (steep higher than 20 percent).
Hazelnuts also help to prevent soil erosion in high-rainfall locations. Hazelnut growing offers income to 2.3 million farmers (5 percent of the country’s population) in the region’s social and economic framework. Over 80% of the world’s hazelnuts are produced and exported by Turkey. Hazelnuts are a nut that many people are unfamiliar with. They’re a sweet-tasting Turkish nut that’s easy to grow. Filberts is another name for this nut. One of the best ways to invest in Turkish agriculture is to grow and sell hazelnuts. This nut only needs to locate potential clients and begin discussing export requirements.
Turkey hazelnut’s price has fluctuated over time. Hazelnuts cost $6.68 in 2017 and $5.77 in 2018 per kg before 2019. The export price increased by 11.673 percent in 2019 to $6.44 per kilo. Turkey hazelnut exports to Mexico, Serbia, Poland, Ecuador, and New Zealand had high return markets in 2019.
7. Mining
With the tenth-best mineral resources in the world, Turkey is a component of the Tethyan-Eurasian Metallogenic Belt. The administration is determined to expand mining operations to new heights. Instead of exporting ore, the government recently announced that it will focus on mine processing.
By 2023, the mineral sector expects to contribute US$15 billion to Turkey’s exports, which will total US$500 billion. Natural stones dominate Turkey’s mining exports. In 2018, mining exports accounted for 71% of total stone and metal ore exports (such as chrome, zinc, and copper). Manufacturing minerals (such as boron and feldspar) made for 21% of overall mining exports.
Zinc, copper, marble, and chromium are among Turkey’s mineral riches. The government’s extensive incentive package demonstrates its preference for overseas investment, particularly in mining. Turkey is restarting lignite and coal-fired power reactors to reduce its reliance on imported oil. As a result, plans to expand lignite/coal-fired power facilities as well as plans to renovate outdated state-owned power plants sold to private investors were planned. Several small to medium-sized mining and exploration companies are attempting to collect precious metals for the Turkish government and people from the ground.
8. Car Rental Service
A growing economy, greater convention tourism, and improvements in civil aviation, according to Ali Ekici, Avis’ deputy general manager in Turkey. He expects premium car rental to develop rapidly. Increasing capital, employment, and technological improvements are expected to more than triple the Turkish automotive rental industry’s volume in the next five years. Even yet, its scale is dwarfed by that of Europe’s car rental business. Dan Ekici, deputy general manager of the local Avis branch, estimates 145,000 daily individual and business rentals. According to Ekici, the value of rental cars used this year was $3 billion. He claimed that legal regulation was required to keep up with the last decade’s growth. According to Ekici, Turkey has 2 rental cars per 10,000 people. In certain EU countries, it reaches 50.
A car in Turkey costs 1.3 euros per person. Ekici said the figure was unacceptable compared to other EU countries, with Hungary having a 3.5-fold higher figure. According to him, the domestic rental industry lags well behind its European competitors. Turkey has around 130,000 long-term rental cars. 2007 commercial vehicle rental laws reduced domestic parking lot capacity by 20–25%. One company in Europe owns as many rental cars as Turkey “he said. According to the economist, as the country’s economy grows, so does business travel and conference tourism. Increasing the number of airlines operating in the country also encourages company growth. Domestic travel climbed by 53% in the last three years, while international travel increased by 33%. Long-distance business travel is preferred by flying, then renting a car. Airport car rental is also growing in number.
9. Good Service Delivery
With home delivery, Turkey is catching up to the rest of the world. More things should be delivered to people’s homes. The majority of small businesses in the area do not provide delivery. While Turkey has a few small local delivery companies, most specialize in food. Local deliveries, package deliveries, and grocery store deliveries are all profitable business ventures. You’ll need a website and a mobile app to establish an internet business in Turkey. You must work with local businesses, wholesalers, and grocers in addition to meeting legal criteria. If your product and business are registered in Turkey, your mobile app development and maintenance team does not need to be headquartered there.
10. Cleaning Services
The need for cleaning services is enormous in Turkey. From house cleaning services to office cleaning services, the market is huge and constantly growing.
How is the Economy of Turkey?
Turkey’s economy is classified as an emerging market economy by the International Monetary Fund. Economists and political scientists call Turkey a newly industrialized country. Turkey, with an anticipated 83.4 million people in 2022[37], has the world’s 20th nominal and 11th PPP GDP. In addition to agriculture and textiles, the country produces cars and heavy equipment.
Turkey’s economy has changed dramatically in the last two decades. Employment and income have risen since 2000. Recent changes in external and internal variables have slowed Turkey’s economic growth. The country is also dealing with an increase in Syrian refugees and a slowdown in economic reforms.
What is the Currency of Turkey?
The Turkish Lira, TL, sign code TRY, is the country’s officially declared currency. It is used in Turkey and the Turkish Republic of Northern Cyprus. The sign was created by Tulay Lale and is a combination and manipulation of the letter ‘L’s in the shape of a half anchor and the embedded double-striped letter ‘T’ tilted at a 20-degree angle. The emblem was chosen following a countrywide competition that concluded with seven nominees in front of the Central Bank and was to be revealed as the official symbol of the Turkish Lira in March 2012.
The new Turkish Lira depicts the Turkish Republic’s founder, Mustafa Kemal Atatürk. Converting your home currency to Turkish liras To book a trip, simply visit any of the country’s ATMs or local Turkish banks. Credit and debit cards, Visa, MasterCard, American Express, and other payment methods are quickly withdrawn. The value of the Turkish lira has fluctuated for years. In 2021, 1 TRY Equaled 8.82 USD and 10.32 EUR.
Why Investment in Turkey is a Good Idea?
Turkey’s hospitality and geographic location have made it an essential hub for attracting local and foreign investors in a range of fields, particularly the tourism industry and the real estate market, sparking investor interest in the region. Aside from the country’s natural riches, investors were lured to Turkey by the country’s ideas, which define Turkey and have made it a hospitable place for foreign investment and capital in general.
There are solid reasons for local and international investors to consider investing in Turkey which are summarized below.
The country’s GDP increased from 231 billion to 820 billion over this time. The country’s GDP climbed by 5.1 percent per year between 2002 and 2015. According to IMF projections, Turkey’s economy will grow at one of the fastest rates between 2012 and 2017. (OECD). Turkey’s economy grew to become Europe’s sixth largest and the world’s 16th largest in 2013, attracting over $ 135 billion in foreign investment. During this time, exports climbed by around 245 percent.
Many governments struggle to track foreign investments, but Turkey, an OECD member, began doing so in 1997. Every six days, a Turkish company is founded, and the government treats all investors equally, promoting competition. According to the Turkish Ministry of Economy, there are around 37.000 foreign-funded businesses in Turkey. Foreign investors might also examine international courts and tribunals in Turkey. It also boosted Turkey’s international attractiveness.
One of the most compelling arguments for foreign investors to invest somewhere is that it provides the necessary infrastructure and reduces transportation costs. Turkey has seen an increase in fundamental infrastructures, such as transportation, communications, power, and technical infrastructure, making it a global investment magnet. Three seafarers were briefed in Turkey, which offered them low-cost maritime passage as well as a railway network connecting them to Central and Eastern Europe.
Turkey has long been a natural bridge between Asia and Europe because of its location. Turkey has embraced many East-West trade lines due to its geographical location. Turkey is becoming the most reliable economic transit point for more than 1.5 billion people across Asia, Europe, and Africa.
To encourage international investors to invest in Turkey, the institutional profit tax has been decreased from 33% to 20%. In rare circumstances, foreigners are free from this tax entirely or partially. Investors are also encouraged in some sectors allotted by the state, such as land allotment and other incentive measures.
The Benefits of Turkish Investments include the following.
- Turkey is the commercial hub for the world’s top twenty largest economies.
- A vital link between Europe and Asia
- A driving force that connects Asia and Europe via new highways
- Tourism throughout the year
- The Crossroads of History and Cultures
- Civilization’s cradle
- The embodiment of a young population, expanding employment, and a burgeoning economy
- A modern nation that has entered the defense manufacturing industry and is making significant strides in space and aviation development
- The country that assists the world the most, regardless of race, religion, or status. A Companionable Turkey.
What is the Best Sector to Invest in Turkey?
Turkey is an ideal country to invest in, thanks to its population of 85 million and its qualified and young workforce. Moreover, the incentives provided to foreign investors, tax reductions, and free land allocations make it attractive to invest in Turkey.
Now let’s take a look at the most profitable and good investment areas to invest in Turkey.
- Informatics and Technology
Turkey has started to attach great importance to technology-based research and development in recent years. Today, many universities in Turkey have technology centers and great facilities are provided for investors to invest in technology in these areas. Turkey is a very attractive country, especially for those who want to invest in areas such as software development, biotechnology, nanotechnology, and electronics. Although there are many domestic and foreign companies operating in this field, we should state that there are still great deficits and great opportunities in this field.
- Construction and Real Estate
The construction and real estate sectors are among the most important sectors that keep the Turkish economy alive. The real estate and construction sectors in Turkey are very lively, especially due to the increasing population and urban transformation projects throughout the country. For this reason, we can say that the construction and real estate sectors will be attractive options for investors for a long time. As of September 2017, 6% of the house sales in Turkey were made to foreign investors. This number is expected to increase. In addition, there is no residence permit requirement for foreign investors to purchase real estate in Turkey. Investors who purchase real estate for at least 500 thousand dollars are also entitled to Turkish citizenship.
- Textile and Clothing
Turkey has many advantages such as the quality it offers in the textile and ready-made clothing sector, richness in terms of raw material resources, ability to respond to special demands, flexibility, and geographical proximity to regions with high demand such as the European Union and the Middle East. For this reason, we can say that it would be a good move to invest in textile and ready-made clothing in Turkey. In addition to the existing incentives, some new incentives were offered to those who will invest in the textile field with the new incentive program. Accordingly, many additional incentives will be given to the investments to be made in the field of textiles, especially in the Eastern provinces of the country.
- Energy and Natural Resources
The energy sector is very important in terms of the smooth running of almost all economic activities. In this respect, Turkey is expected to invest 130 billion dollars to close its energy gap. The fact that Turkey attaches great importance to this sector can be understood from the extensive incentives it offers to those who will invest in the field of energy and natural resources.
- Tourism
The government provides incentives for all capital owners, domestic or foreign, who want to invest in Turkey, and tourism is one of the most ideal sectors. It is of great importance due to its location between Asian, European, African, and Middle Eastern countries. At the same time, it is known as a popular civilization with its natural and cultural beauties as well as the breadth of resources arising from its geopolitical position. We examined the data announced by the Turkish Statistical Institute on behalf of the tourism sector, which stands out among the most ideal sectors to invest in in Turkey, together with the incentives provided by the government. According to the latest data, it has been determined that tourism income has increased by 17% compared to the previous year. According to the research conducted over the same quarter of the previous year, it is certain that the number of visitors has increased, as well as the expenditures per person or on tour.
- E-Commerce
E-Commerce investments, which come to the fore among the sectors of the future in the world, have also shown a great impact today. In this context, selling the right product or service electronically will quickly open the doors to success. At this point, sufficient attention should be paid to important focal points such as the target audience, data analysis, and product preference.
- Advertising and Marketing
The advertising and marketing sector has the feature of being the most invested sector in Turkey. At the same time, this sector, which is a pioneer in the world, allows a significant income, especially in the digital environment. Recently, the importance of digital marketing has increased significantly compared to other sectors, and it is possible to say that it is increasing day by day.
- Agriculture
Agriculture, which is among the investment areas of the future, draws attention as a sector that will never end. In this context, if investors invest in agriculture, they will enter an unlimited sector. I want to invest, which sector should I enter? If you are asking yourself the question, one of the easiest jobs is to invest in agriculture or enter the agricultural sector.
- Cosmetics
Especially the developments in the field of science have directly affected the cosmetics industry. In today’s world, where personal cosmetics brands are in great demand and there is a young population, investing in this field can provide successful results.
Is Investment in Turkey Easy as a Foreigner?
Yes, it’s easy depending on the budget.
Turkey has recently emerged as a viable investment option due to its geographic, economic, and demographic characteristics. Foreign investment promotion and support are at the center of modern economic initiatives. This is a blunder. As a result, many modifications to foreign investment legislation have been enacted, making it more appealing to invest in Turkey and making the investor’s job easier. As a result of recent economic and legal reforms, foreign investors can now conduct practically all of their business remotely by appointing a proxy in Turkey rather than traveling to Turkey directly. A couple of the processing procedures can be completed online. To start a business in Turkey fast and cheaply, they don’t have to travel as much or deal with bureaucratic formalities.
Foreign investors in Turkey have a wide range of possibilities when it comes to making investments. According to the investor’s method of arrival in Turkey, several investment opportunities are advised to him or her. If the investor is a real person, he or she will have the ability to be a real-life partner in an established Turkish business, can take up the shares of a Turkish company to become a partner, able buy a house, and possesses the ability to make long-term investments and to purchase securities.
A legal person who invests as a legal person can start a new business, open a new brand, and possesses the capability of opening a liaison office and of joining forces with a Turkish firm via an overseas entity.
The best form of investment to make depends on the investor’s goals and expectations, to get the highest return at the lowest expense.
In the Joint Liability company, the liability of any shareholder is limited to the capital subscribed to and paid by shareholders to conduct business under a specified trade name. There’s no necessity for a certain amount of money upfront. Real persons must be all contributors. The Statutes determine the equity and liabilities of shareholders. There must be at least one actual person or a legal entity and up to fifty shareholders for this type of company to be formed, and the responsibility of shareholders is limited to the capital that the shareholders have subscribed for and paid in full. The minimum capital required for the establishment of a company per person is US$720 and the minimum capital required for a two-person firm is US$900.
The Limited Liability Company is an individual or legal body that must form the company, and the liability of shareholders is limited to the amount of capital they have subscribed to and paid. These companies must have at least US$720 in capital to start and US$900 if there are two founders.
To manage a firm under a certain brand name, Limited Partnership corporations are formed. Unless a shareholder’s duty is restricted to the capital they contributed and paid, all shareholders are liable for all debts and obligations. Financing is available only to legally formed organizations. There’s no necessity for a certain amount of money upfront. The Statutes determine the equity and liabilities of shareholders.
What is the Best Way to Get Citizenship in Turkey?
Turkey acts as a role model for stability and prosperity as a country with a rich history and cultural tradition. It has welcomed people from all over the world and offers a variety of services to those who wish to reside in Turkey and benefit from Turkish citizenship.
As a result of the country’s growth on all levels, people seeking stability, notably from the Arab world and the Middle East, have been lured to Turkey, and Turkish officials have been enthusiastic about offering Turkish citizenship to those who qualify. There are restrictions on how to obtain Turkish citizenship that apply to all foreigners in specific ways that we’ll explain, and benefits linked to economic investment, particularly in real estate, have lately been added. When dealing with foreigners, the government respects these laws.
The authorities have established several distinct paths to becoming a citizen, each with its own set of criteria that must be met. Obtaining a work permit and residing in Turkey for five continuous years is one of them. Turkish citizenship is conferred in exceptional situations, usually by holders of university degrees. Buying a property (real estate) at least for US$400,000.
After three years of marriage to a Turkish national, you can apply for Turkish citizenship if you meet the following requirements:
- Proof that the motive is pure, that the marriage is built on solid principles, and that the goal is to start a family, not just for the sake of starting a family.
- There is nothing to suggest otherwise.
- The foreign spouse is not a danger to the security of Turkey or the public.