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BUSINESS > Turkey still safe haven for investments, minister says

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Foreigners invested mainly in Turkey’s manufacturing sector, says Economy Minister Zafer Çağlayan (3rd L), adding that Europeans are the largest investors.

Foreigners invested mainly in Turkey’s manufacturing sector, says Economy Minister Zafer Çağlayan (3rd L), adding that Europeans are the largest investors.

Turkey continues to be a safe haven for foreign investors and an important investment hub as the European Union and other countries grappling with an economic crisis, Economy Minister Zafer Çağlayan said yesterday. 

In May foreign direct investment (FDI) hit $1.4 billion and registered $6.5 billion in the first five months of the year, according to Çağlayan, a figure which is 11 percent more than the $5.8 billion achieved in the first five months of 2011. 

The minister said 78.6 percent of FDI in the January-May period was from the EU. In particular $1.9 billion came from Austria and $1.2 billion was from the Netherlands. 

Foreigners invested mainly in Turkey’s manufacturing sector, especially food and beverages, at $2 billion of FDI. Çağlayan said this figure indicated that Turkey has become a critical manufacturing center. He added that the new incentive scheme would further encourage FDI flow into the country as the country was Europe’s closest supplier. 

In terms of the services sector, Turkey’s banking and finance sector takes the lead in FDI at a time when European banks are struggling and their credit ratings are being slashed, Çağlayan said. Turkey’s banking and finance sector was able to bring in $678 million in the January-May period. 

Much of the recent FDI is coming from the Middle East, according to Çağlayan. He said the number of companies setting up office in Turkey with capital from the Middle East had exceeded that of Europe for the first time. Only 36 percent, or 212, of the new companies in Turkey had European capital. 

Some 57 percent of new companies with foreign capital are based in Istanbul. Antalya comes in at second place at 12 percent, followed by Ankara in third place with 7 percent. Other important centers of foreign capital are İzmir, Muğla, Bursa and Mersin.

Turkey’s new sweeping investment incentive has started to arouse interest from foreign investors after coming into force, the science, industry and technology minister has said. 

One of the latest examples in this regard is an American firm that is considering investments in solar panel systems and solar energy technology in the southern province of Kilis, Nihat Ergün said.
Several firms from Europe, the United States, South Korea and Japan are studying Turkey to make investments, he said, adding that the chairman of Caterpillar came to Turkey last week to look for Turkish partners for its investments.

The minister spoke at a meeting yesterday regarding the country’s presidency of EUREKA, an intergovernmental research and development body.

July/14/2012

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