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FDI in TURKEY

FDI in TURKEY. Undersecretariat of Treasury. Özge DUMLUPINAR Treasury Expert. October 19, 2009 İSTANBUL. FDI in TURKEY. Outline Global Trends in FDI Inflows Basic FDI Statistics of Turkey FDI Policy of Turkey. FDI in TURKEY. I. Global Trends in FDI Inflows.

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FDI in TURKEY

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  1. FDI inTURKEY Undersecretariat of Treasury Özge DUMLUPINAR Treasury Expert October 19, 2009 İSTANBUL YOIKK Secretariat, 2008

  2. FDI in TURKEY • Outline • Global Trends in FDI Inflows • Basic FDI Statistics of Turkey • FDI Policy of Turkey YOIKK Secretariat 2008 2

  3. FDI in TURKEY I. Global Trends in FDI Inflows YOIKK Secretariat 2008 3

  4. Global Trends in FDI Inflows • FDI inflows: severelyaffected worldwide by the economic and financial crisis in 2008. • Fall from a historic high of $1,979 billion in 2007 to $1,697 billion in 2008 (a decline of %14) • Slide continuation into 2009 : Fall in inflows by %44 compared with their level in the same period in 2008. • Expectation to fall from $1.7 trillion to below $1.2 trillion in 2009. • Slow recovery in 2010 (to a level up to $1.4 trillion) and 2011 (approaching $1.8 trillion) YOIKK Secretariat 2008 4

  5. Global Trends in FDI Inflows • Change in the investment landscape: • Decline in the numbers and values of cross border M&As in 2008, also decline in greenfield investments in the last quarter. • Intentions of the majority (%58) of large TNCs to reduce their FDI expenditures in 2009 from their 2008 levels. • Decline in FDI inflows of developed countries by %29 • Surge to %43 in global FDI inflows in the share of developing and transition economes in 2008. YOIKK Secretariat 2008 5

  6. Global Trends in FDI Inflows • Despite concerns about a possible rise in investment protectionism, greater openness in FDI policies worldwide: • Trend of scrutinizing foreign investments for national security reasons. • Expansion in the network of IIAs: signature of 59 new bilateral investment treaties and increase in the number of DTT and international agreements with investment provisons. • During 2008, 110 new FDI –related measures were introduced, of which 85 were more favourable to FDI. • Compared to 2007, the percentage of less favourable measures for FDI remained unchanged. YOIKK Secretariat 2008 6

  7. FDI in TURKEY II. Basic FDI Statistics of Turkey YOIKK Secretariat 2008 7

  8. Basic FDI Statistics of Turkey Source: CBRT YOIKK Secretariat 2008 8

  9. Basic FDI Statistics of Turkey FDI Inflows and Their Distribution by Components Between 1995-2008 (USD million) Source: CBRT YOIKK Secretariat 2008 9

  10. Basic FDI Statistics of Turkey Top 5 Inflows in 2008 Source: Undersecretariat of Treasury, CBRT YOIKK Secretariat 2008 10

  11. Basic FDI Statistics of Turkey FDI Inflows by Sector, 2008 (USD Million) Source: CBRT YOIKK Secretariat 2008 11

  12. Basic FDI Statistics of Turkey FDI Inflows by Home Country 2007-2008 (USD million) Source: CBRT YOIKK Secretariat 2008 12

  13. Basic FDI Statistics of Turkey Breakdown of Companies with International Capital According to their Country of Origin Source:Undersecretariat of Turkey, Porvisional Data YOIKK Secretariat 2008 13

  14. Basic FDI Statistics of Turkey FDI Inflows by economy (USD million) YOIKK Secretariat 2008 14

  15. Basic FDI Statistics of Turkey FDI Inflows by West Asia region (USD million) YOIKK Secretariat 2008 15

  16. Basic FDI Statistics of Turkey FDI Stock by economy (USD million) YOIKK Secretariat 2008 16

  17. Basic FDI Statistics of Turkey FDI Stock by West Asia region (USD million) YOIKK Secretariat 2008 17

  18. FDI in TURKEY III. FDI Policy of Turkey YOIKK Secretariat 2008 18

  19. FDI Policy of Turkey • Three basic components: • Increasing predictability in the economy • Economic stability • Political stability • Maintaining a functioning free market economy • Creating an investor friendly environment YOIKK Secretariat 2008 19

  20. FDI Policy of Turkey • Creating an Investor Friendly Environment: Investment Environment Reform Programme Diagnosis on Problem Areas of Investment Environment in Turkey Determination of Priorities with All Relevant Parties Design of an Appropriate Structure Involving the Stakeholders YOIKK Secretariat 2008 20

  21. FDI Policy of Turkey • Creating an Investor Friendly Environment: Two basic platforms based on public-private sector dialogue and cooperation • Coordination Council for the Improvement of Investment Environment (YOİKK) • Investment Advisory Council (IAC) YOIKK Secretariat 2008 21

  22. FDI Policy of Turkey Investment Advisory Council YOIKK STRUCTURE Coordination Council for the Improvement of Investment Environment (YOIKK) Steering Committee Location of Investment Foreign Trade & Customs Licensing Taxes and Incentives Company Establishment Employment Intellectual Property Rights Foreign Direct Investment Legislation Research & Development Corporate Governance Investment Promotion SMEs YOIKK Secretariat 2008 22

  23. FDI Policy of Turkey YOIKK WORKING PRINCIPLES AGENDA SETTING WORKING OUTCOMES • Recommendations of public institutions • Recommendations of private sector • Assessments in international indices and publications • IAC recommendations • Technical Committee Action Plans • Basic policy guides • Twinning Project • Draft regulations • Institutional capacity building • Recommendations related to enforcement YOIKK STEERING COMMITTEE TECHNICAL COMMITTEES Council of Ministers is regularly informed about YOIKK studies. YOIKK Secretariat 2008 23

  24. FDI Policy of Turkey • Executives of leading multinational firms, • Heads of international institutions (IMF, World Bank, European Investment Bank), • TOBB, TUSİAD, YASED, TİM IAC STRUCTURE Investment Advisory Council of Turkey had 5 meetings so far. YOIKK Secretariat 2008 24

  25. FDI Policy of Turkey • The main achievements in the investment environment of Turkey:  FDI law  Simplification of Business Start-Up  Investment Support and Promotion Agency of Turkey  Trade Registry Automation Project • Employment Package • Social Security Reform  Regulations on mining and fuel sectors  Minimum living allowance system • Communique on Principles to be Followed by Joint Stock Corporations Subject To Capital Market Law • Increased flexibility in the labor market • Improved infrastructure in strategic sectors • Improved protection for intellectual property rights • New investment incentive system YOIKK Secretariat 2008 25

  26. FDI Policy of Turkey The performance of Turkey in the international investment indices YOIKK Secretariat 2008 26

  27. FDI Policy of Turkey • Useful Links • www.hazine.gov.tr • www.yoikk.gov.tr YOIKK Secretariat 2008 27

  28. FDI inTURKEY Undersecretariat of Treasury Özge DUMLUPINAR Treasury Expert October 19, 2009 İSTANBUL YOIKK Secretariat, 2008

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