Investment Guide

Entrance to Turkey

a-) Work Permit
First Application
Application for a work permit in Turkey can be made from Turkey or abroad.

Extension Application
The request for extension of the work permit shall be made by the foreign or employer directly to the Ministry of Labor and Social Security by adding the original work permit to the documents specified in the application form and application regulation.

b-) Residence Permit
Foreigners who are going to stay in Turkey more than ninety days or the period that Turkey's visa or visa exemption has, should have residence permit.

Short Term Residence Permit for Foreigners
To get a short-term residence permits of foreigners who has immovable property in Turkey and commercial connections or business exchange, following an application made by e-residency system are required to submit the following documents to the relevant Provincial Directorate of Migration Management.

Long Term Residence Permit for Foreigners
For permission to have long-term residence, foreigners who have stayed at least eight years with a continuous residence permit in Turkey are required to submit the relevant documents to the Provincial Directorate of Migration Management.

c-) Exceptional Citizenship Acquisition
(B) with the clause added the first paragraph of Article 12 of the Law No. 5901 on 28 July 2016;
Those who receive a residence permit in accordance with clause (j) of the first paragraph of Article 31 of the Law no.6458
Foreigners who has Turquoise Card Holder
Can acquire Turkish Citizenship with the decision T. R. The President

Establishing a Business in Turkey

Turkey's Foreign Direct Investment (FDI) Law is based on the principle of equal treatment, makes it possible to have the same rights and obligations as local investors and international investors.

Asset Transfer

Asset transfer is defined as the transfer of ownership of a good / group of goods or business from one natural or legal person to another natural or legal person. Although the issue of transfer of assets is not specifically regulated in the Turkish Legal System, there are provisions directly or indirectly related to this issue in various laws. The articles 202 and 203 of the Turkish Code of Obligations No 6098 on assets and business transfers and Articles 134-158 of the Turkish Commercial Code No. 6102 on company mergers are the leading provisions regarding this issue.

According to the Code of Obligations 202 substances, '' a property or business assets and transferee with liabilities, it reported to the creditors or the Trade Registry Gazette for businesses, in Turkey for others starting from the date announced by to be published in one newspaper which is distributed them be responsible for debts in counter assets or business. However, the previous borrower remains liable with the transferee as joint debtor for two years. This period, for outstanding debts, from the date of notification or announcement; For debts that will become due later, it starts to process from the due date. The consequences of undertaking debts in this way are identical to those resulting from the external assumption contract. Unless the obligation to declare or announce is fulfilled by the transferee, the two-year period stipulated in the second paragraph shall not start to run. "  Again, according to the article 203 of the same law, "If a business is combined with another business by mutual acquisition of assets and liabilities or by the participation of one to another, the creditors of both businesses have the rights arising from the acquisition of an asset and can receive all their receivables from the new business." 'In the 11th article of the Turkish Commercial Code, the operating transfer is specifically rearranged and in case of the transfer of business, the scope and form of this transfer is stipulated, and in the articles 134-158, the mergers of the companies are specially regulated.

In order to obtain the desired results from merger and acquisition activities, first of all, the provisions of the Commercial Code, the Code of Obligations and in particular the legislation that determine the legal basis for the merger companies must be examined.

According to the articles mentioned above, when a legal entity takes over a business (company) with its assets and debts, it also becomes responsible for the debts and receivables of this company. As can be understood from Articles 202 and 203 of the Turkish Code of Obligations, the transferor and the transferee are jointly responsible for the payment of the debts for two years after their notification or announcement to the creditors.

The relationship between the transferor and the transferee depends on the contract for the transfer of the assets and liabilities of an enterprise. However, pursuant to Article 7 of the Law on the Protection of Competition numbered 4054, mergers and acquisitions that will create a dominant position in a certain market or strengthen an existing dominant position are prohibited, and transfers that may be within this scope above a certain value are also subject to the permission of the Competition Board. The legal approval of the transfer must be announced through the communication tools stipulated in the legislation.

Since the transfer of assets can be considered as the income of the selling company, it can be taxed and therefore corporate tax liability occurs. Asset transfer is generally subject to VAT on the sales value of the assets. Although the VAT rate varies according to different assets (1%, 8% and 18%), the general VAT rate is 18%. VAT liability can be reduced by various methods such as investment incentive certificates.

Important articles regarding the transfer of assets:

  • Turkish Code of Obligations: Articles 202 and 203
  • Turkish Commercial Code: Articles 134-158
  • Enforcement and Bankruptcy Law: Article 280
  • Law on the Procedure for Collection of Public Receivables: Article 30
  • Competition Law: Article 7

 

Access to Financing

The banking sector in Turkey with the 2nd largest banking system after Russia in emerging European Region is able to provide high flexibility and ease capital financing to investors in countries with highly liquid structure. Turkish credit market as well as banks, provide project financing with leasing and factoring projects of investors. 

There are three types of banks in Turkey: commercial / investment banking and development activities have been accepted worldwide on the basis of the principles of Islamic finance consistent with the principles of participating banking. Banks can grant cash loans, non-cash loans or interest-free (participation) loans to legal and natural persons, both in local and foreign currencies, however, banks cannot grant loans in currencies to natural persons for non-commercial purposes. In addition, getting a loan from abroad while residing in Turkey it is compulsory using a bank as an intermediary institution. 

Leasing and factoring are other financing methods. Leasing; It can be in the form of domestic lease, overseas lease, sale and lease back, or sales assistant lease. Real estate, automobiles, computers, office equipment, medical devices, construction machinery, manufacturing machinery and other fixed assets can be acquired through leasing. Factoring companies, on the other hand, pay for receivables documented by invoices arising from goods and services sold and undertake the payment risk.

In addition to the built-in financial institutions in Turkey, the various international development banks such as European Bank for Reconstruction and Development (EBRD), European Investment Bank (EIB) and the International Finance Corporation (IFC),  providing financing to many investment projects in Turkey.

 

Banking Regulation and Supervision Agency: www.bddk.org.tr

Banks Association of Turkey: www.tbb.org.tr 

European Investment Bank: www.eib.org  

International Finance Corporation: www.ifc.org 

European Bank for Reconstruction and Development:  www.ebrd.com 

Investment Incentives

Investment Incentives
The new investment incentive system has been specifically designed to encourage investments with the potential to reduce import dependency on intermediate goods that are important to the strategic sectors of the country.

The new investment incentive system valid as of 1 January 2012 consists of four different regimes. Local and foreign investors can benefit equally from the following incentives:
1- General Investment Incentive Practices
2- Regional Investment Incentive Practices
3- Large Scale Investment Incentive Practices
4- Strategic Investment Incentive Practices

Employees and Social Security

a-) Employment Conditions
Working conditions in Turkey is mainly governed by the Labor Code and Trade Union Law.

b-) Termination of employment contract
Pursuant to the relevant provisions of the Labor Law No. 4857, employers and employees who terminate their employment contracts need to report a period before the termination procedure, as shown in the table below.

c-) Social Security System
The social security system in Turkey went through a major transformation process in 2007, and at the end of this process, collected at a single institution within the different social security funds, which are based inspection in a centralized way, has become a system that operates more efficiently and faster.

Investment Zones

There are three types of investments in Turkey:

1.  Technology Development Zones - Techno parks

Technological Development Zones (TGB) are areas designed to support R&D studies and attract investment in high technology. There are currently 84 TDZs, of which 63 are active; The remaining 21 regions have been approved and construction is continuing.
Advantages of TGB

  • Income from software development, R&D and design activities is exempt from income tax and corporation tax until December 31, 2023.
  • Sales of application software produced in TDZ are exempt from VAT until December 31, 2023. These include software used in systems management, data management, business applications, various business sectors. activity, Internet, mobile phones and military command control systems.
  • Salaries of R&D, design and support staff working in the area for these rights are exempt from all tax until December 31, 2023. The number of support staff under the exemption cannot exceed 10% the number of R&D personnel.
  • The investment necessary for the production of the technological product obtained as a result of the R&D projects initiated and finalized in the region can be made in the region provided that the operator approves it and that the Ministry of Industry and Technology gives its consent.
  • Until December 31, 2023, 50% of the employer's share of the SSI premium will be paid by the State.
  • Products to be imported within the framework of R&D, design and software development projects are exempt from customs duties and documents to be issued are exempt from stamp duty.

2. Organized Industrial Zones

  • Organized Industrial Zones (OIZ *) are designed to enable companies to operate using ready-made infrastructure and social facilities. The infrastructure provided in these regions includes roads, water, natural gas, electricity, communications, waste treatment and other services.
  • In 80 provinces, there are currently 331 OIZ, of which 234 are active; It continues in the 97 other OSB productions in various regions of Turkey.

 

Benefits of OIZ
Investors operating in OIZs, in addition to the application of existing investment incentive in Turkey, (general investment incentives, regional investment incentives, large-scale investment incentives, strategic incentives investment, employment incentives, support for R&D, etc.) benefit from the following advantages:

  • VAT exemption on land purchases.
  • Exemption from property tax for five years, starting from the completion of the construction of the facility.
  • Low costs of water, natural gas and communication.
  • Tax exemption in division / merger of plots.
  • Local government tax exemption in the construction and operation of facilities.
  • Exemption from the solid waste tax if the OIZ does not benefit from municipal services.


3. Free Zones

  • Free zones are special zones located outside the scope of customs zones, although they are located within the political borders of the country. These regions are designed to increase the number of export oriented investments. The legal and administrative regulations applied in the commercial, financial and economic zones of the customs zones are not applied or partially implemented in the free zones.

  • In Turkey, the EU and Middle East market is located in the Free Trade Zone close to a total of 19 cases of which 18 are active, while one is under construction. Free Zones; It is located at the points where access to international trade routes with ports in the Mediterranean, Aegean and Black Sea is easily provided.

Advantages of Free Zones

  • 100% exemption from customs duties and other similar taxes
  • 100% exemption from corporation tax for manufacturing companies.
  • 100% exemption from VAT and special consumption tax.
  • 100% exemption from stamp duty applied to documents to be issued.
  • 100% exemption from property tax.
  • 100% exemption from income and corporate tax for certain logistics services to be provided from free zones, provided they are all abroad
  • 100% exemption from income tax on employee salary (for companies exporting at least 85% of the FOB value of products produced in free zones).
  • Goods can be kept in free zones without any time limitation.
  • Corporations, the profits derived from free trade zones abroad as well as to Turkey without restrictions can be transferred freely.
  • Exemption from title deed fees when buying and selling properties
  • VAT exemption in construction, project, settlement, permit and approval processes.
  • Ready-made infrastructure free from VAT and other taxes.
  • Allowing second hand / used machinery to be brought in.

Demography

Turkey situated in GMT + 3-time zone, has the ability to communicate within the same business day with both eastern and western countries.

a-) Population
Turkey which has an extremely positive effect on the economy of the country in terms of population demographics offers many opportunities for investors. Investors are faced with major challenges such as aging and declining population in Europe, consider Turkey's young and educated population as a significant advantage. Turkey, which forms the foundation of a strong labor market and young vibrant domestic market, offers unique opportunities with a dynamic and growing population.

b-) Work Force
Turkey constitutes Europe's third-largest labor pool with the 31.6 million-strong workforce.
The young population of Turkey as the most important factor in the growth of the labor force has contributed to getting top position compared to competitors. Turkey has also realized the highest growth in labor force compared to EU countries growth.

c-) Urbanization
In Turkey, there are 22 cities with population of more than 1 million and are in a situation as locomotive of economic growth and social development with its goods and services produced. Istanbul is the most populous city in Europe.

Regulatory and Supervisory Agencies

Regulatory and supervisory agencies have been created for the regulation and monitoring of different markets, compliance with the market activities, or any problems that may occur. Some of the important entities in Turkey are; the Competition Authority, the Energy Market Regulation Authority, the Banking Regulation and Supervisory Agency, Capital Markets Board, Information and Communication Technologies Authority, Tobacco, Tobacco Products and Alcoholic Beverages Market Regulatory Authority, the Privatization Administration, Public Procurement Authority, Sugar Authority, Radio and Television Supreme Council, Public Oversight Accounting and Auditing Standards Authority

Macroeconomic Indicators

According to Data GDP-PPP * Country Rankings - 2003 and 2017 Turkey's economy was the world's 18th largest economy in 2003 and it rose to 13th in 2017 as well.

Foreign Direct Investment in Turkey

Thanks to the implementation of the liberalization process since the 1980s, the Turkish economy has achieved its high growth rates. Turkey's accession to the World Trade Organization (WTO) in 1995 is one of the most important steps in this process. Following this development of Turkey, by finalizing negotiations with the EU, it joined the Customs Union on January 1, 1996. As a result of all these stages, foreign trade increased rapidly both in terms of exports and imports. Significant changes were observed in the structure of export products, which were the main reasons for the replacement of agricultural products by industrial products.


a) Export
In accordance with the observed and export-oriented development model applied as part of the policy since 1980, the importance of exporting has increased enormously in quality and quantity.


b) Import
Turkey's import regime in full compliance with the Customs Union established with the EU, EFTA (European Free Trade Association) with the continuation of existing relations and the experienced World Trade Organization (WTO) in terms of meeting the obligations imposed by membership in nature emphasizes liberalization.

Foreign Trade

Turkey's economy, thanks to the implementation of the liberalization process since the 1980s reached their high growth rates. One of the most important milestones of this process, Turkey's 1995 World Trade Organization (WTO) is a member. Following this development of Turkey, it finalized negotiations with the EU on 1 January 1996 to join the Customs Union. As a result of all these steps, foreign trade has increased rapidly in terms of both exports and imports. Considerable changes have been observed in the structure of export goods, which have contributed to the replacement of agricultural products by industrial products.
The new investment incentive system, effective as of January 1, 2012, consists of four different regimes. Local and foreign investors can benefit equally from the following incentives:

  1. General Investment Incentives Practices
  2. Regional Investment Incentives Practices
  3. Large-Scale Investment Incentives Practices
  4. Strategic Investment Incentives Practices

Investment Legislation

Turkey's investment legislation, it offers equal treatment for all investors and simplicity of conformity to international standards. The basis of investment legislation; Incentives for Investments and Employment Law No. 5084, Foreign Direct Investments Law No. 4875, Foreign Direct Investments Law Implementation Regulation set up various laws and related sub-regulations regulating the incentives for investments on a sectoral basis with multilateral and bilateral agreements.

Entrance to Turkey

a-) Work Permit
First Application
Application for a work permit in Turkey can be made from Turkey or abroad.

Extension Application
The request for extension of the work permit shall be made by the foreign or employer directly to the Ministry of Labor and Social Security by adding the original work permit to the documents specified in the application form and application regulation.

b-) Residence Permit
Foreigners who are going to stay in Turkey more than ninety days or the period that Turkey's visa or visa exemption has, should have residence permit.

Short Term Residence Permit for Foreigners
To get a short-term residence permits of foreigners who has immovable property in Turkey and commercial connections or business exchange, following an application made by e-residency system are required to submit the following documents to the relevant Provincial Directorate of Migration Management.

Long Term Residence Permit for Foreigners
For permission to have long-term residence, foreigners who have stayed at least eight years with a continuous residence permit in Turkey are required to submit the relevant documents to the Provincial Directorate of Migration Management.

c-) Exceptional Citizenship Acquisition
(B) with the clause added the first paragraph of Article 12 of the Law No. 5901 on 28 July 2016;
Those who receive a residence permit in accordance with clause (j) of the first paragraph of Article 31 of the Law no.6458
Foreigners who has Turquoise Card Holder
Can acquire Turkish Citizenship with the decision T. R. The President

Establishing a Business in Turkey

Turkey's Foreign Direct Investment (FDI) Law is based on the principle of equal treatment, makes it possible to have the same rights and obligations as local investors and international investors.

Asset Transfer

Asset transfer is defined as the transfer of ownership of a good / group of goods or business from one natural or legal person to another natural or legal person. Although the issue of transfer of assets is not specifically regulated in the Turkish Legal System, there are provisions directly or indirectly related to this issue in various laws. The articles 202 and 203 of the Turkish Code of Obligations No 6098 on assets and business transfers and Articles 134-158 of the Turkish Commercial Code No. 6102 on company mergers are the leading provisions regarding this issue.

According to the Code of Obligations 202 substances, '' a property or business assets and transferee with liabilities, it reported to the creditors or the Trade Registry Gazette for businesses, in Turkey for others starting from the date announced by to be published in one newspaper which is distributed them be responsible for debts in counter assets or business. However, the previous borrower remains liable with the transferee as joint debtor for two years. This period, for outstanding debts, from the date of notification or announcement; For debts that will become due later, it starts to process from the due date. The consequences of undertaking debts in this way are identical to those resulting from the external assumption contract. Unless the obligation to declare or announce is fulfilled by the transferee, the two-year period stipulated in the second paragraph shall not start to run. "  Again, according to the article 203 of the same law, "If a business is combined with another business by mutual acquisition of assets and liabilities or by the participation of one to another, the creditors of both businesses have the rights arising from the acquisition of an asset and can receive all their receivables from the new business." 'In the 11th article of the Turkish Commercial Code, the operating transfer is specifically rearranged and in case of the transfer of business, the scope and form of this transfer is stipulated, and in the articles 134-158, the mergers of the companies are specially regulated.

In order to obtain the desired results from merger and acquisition activities, first of all, the provisions of the Commercial Code, the Code of Obligations and in particular the legislation that determine the legal basis for the merger companies must be examined.

According to the articles mentioned above, when a legal entity takes over a business (company) with its assets and debts, it also becomes responsible for the debts and receivables of this company. As can be understood from Articles 202 and 203 of the Turkish Code of Obligations, the transferor and the transferee are jointly responsible for the payment of the debts for two years after their notification or announcement to the creditors.

The relationship between the transferor and the transferee depends on the contract for the transfer of the assets and liabilities of an enterprise. However, pursuant to Article 7 of the Law on the Protection of Competition numbered 4054, mergers and acquisitions that will create a dominant position in a certain market or strengthen an existing dominant position are prohibited, and transfers that may be within this scope above a certain value are also subject to the permission of the Competition Board. The legal approval of the transfer must be announced through the communication tools stipulated in the legislation.

Since the transfer of assets can be considered as the income of the selling company, it can be taxed and therefore corporate tax liability occurs. Asset transfer is generally subject to VAT on the sales value of the assets. Although the VAT rate varies according to different assets (1%, 8% and 18%), the general VAT rate is 18%. VAT liability can be reduced by various methods such as investment incentive certificates.

Important articles regarding the transfer of assets:

  • Turkish Code of Obligations: Articles 202 and 203
  • Turkish Commercial Code: Articles 134-158
  • Enforcement and Bankruptcy Law: Article 280
  • Law on the Procedure for Collection of Public Receivables: Article 30
  • Competition Law: Article 7

 

Access to Financing

The banking sector in Turkey with the 2nd largest banking system after Russia in emerging European Region is able to provide high flexibility and ease capital financing to investors in countries with highly liquid structure. Turkish credit market as well as banks, provide project financing with leasing and factoring projects of investors. 

There are three types of banks in Turkey: commercial / investment banking and development activities have been accepted worldwide on the basis of the principles of Islamic finance consistent with the principles of participating banking. Banks can grant cash loans, non-cash loans or interest-free (participation) loans to legal and natural persons, both in local and foreign currencies, however, banks cannot grant loans in currencies to natural persons for non-commercial purposes. In addition, getting a loan from abroad while residing in Turkey it is compulsory using a bank as an intermediary institution. 

Leasing and factoring are other financing methods. Leasing; It can be in the form of domestic lease, overseas lease, sale and lease back, or sales assistant lease. Real estate, automobiles, computers, office equipment, medical devices, construction machinery, manufacturing machinery and other fixed assets can be acquired through leasing. Factoring companies, on the other hand, pay for receivables documented by invoices arising from goods and services sold and undertake the payment risk.

In addition to the built-in financial institutions in Turkey, the various international development banks such as European Bank for Reconstruction and Development (EBRD), European Investment Bank (EIB) and the International Finance Corporation (IFC),  providing financing to many investment projects in Turkey.

 

Banking Regulation and Supervision Agency: www.bddk.org.tr

Banks Association of Turkey: www.tbb.org.tr 

European Investment Bank: www.eib.org  

International Finance Corporation: www.ifc.org 

European Bank for Reconstruction and Development:  www.ebrd.com 

Investment Incentives

Investment Incentives
The new investment incentive system has been specifically designed to encourage investments with the potential to reduce import dependency on intermediate goods that are important to the strategic sectors of the country.

The new investment incentive system valid as of 1 January 2012 consists of four different regimes. Local and foreign investors can benefit equally from the following incentives:
1- General Investment Incentive Practices
2- Regional Investment Incentive Practices
3- Large Scale Investment Incentive Practices
4- Strategic Investment Incentive Practices

Employees and Social Security

a-) Employment Conditions
Working conditions in Turkey is mainly governed by the Labor Code and Trade Union Law.

b-) Termination of employment contract
Pursuant to the relevant provisions of the Labor Law No. 4857, employers and employees who terminate their employment contracts need to report a period before the termination procedure, as shown in the table below.

c-) Social Security System
The social security system in Turkey went through a major transformation process in 2007, and at the end of this process, collected at a single institution within the different social security funds, which are based inspection in a centralized way, has become a system that operates more efficiently and faster.

Investment Zones

There are three types of investments in Turkey:

1.  Technology Development Zones - Techno parks

Technological Development Zones (TGB) are areas designed to support R&D studies and attract investment in high technology. There are currently 84 TDZs, of which 63 are active; The remaining 21 regions have been approved and construction is continuing.
Advantages of TGB

  • Income from software development, R&D and design activities is exempt from income tax and corporation tax until December 31, 2023.
  • Sales of application software produced in TDZ are exempt from VAT until December 31, 2023. These include software used in systems management, data management, business applications, various business sectors. activity, Internet, mobile phones and military command control systems.
  • Salaries of R&D, design and support staff working in the area for these rights are exempt from all tax until December 31, 2023. The number of support staff under the exemption cannot exceed 10% the number of R&D personnel.
  • The investment necessary for the production of the technological product obtained as a result of the R&D projects initiated and finalized in the region can be made in the region provided that the operator approves it and that the Ministry of Industry and Technology gives its consent.
  • Until December 31, 2023, 50% of the employer's share of the SSI premium will be paid by the State.
  • Products to be imported within the framework of R&D, design and software development projects are exempt from customs duties and documents to be issued are exempt from stamp duty.

2. Organized Industrial Zones

  • Organized Industrial Zones (OIZ *) are designed to enable companies to operate using ready-made infrastructure and social facilities. The infrastructure provided in these regions includes roads, water, natural gas, electricity, communications, waste treatment and other services.
  • In 80 provinces, there are currently 331 OIZ, of which 234 are active; It continues in the 97 other OSB productions in various regions of Turkey.

 

Benefits of OIZ
Investors operating in OIZs, in addition to the application of existing investment incentive in Turkey, (general investment incentives, regional investment incentives, large-scale investment incentives, strategic incentives investment, employment incentives, support for R&D, etc.) benefit from the following advantages:

  • VAT exemption on land purchases.
  • Exemption from property tax for five years, starting from the completion of the construction of the facility.
  • Low costs of water, natural gas and communication.
  • Tax exemption in division / merger of plots.
  • Local government tax exemption in the construction and operation of facilities.
  • Exemption from the solid waste tax if the OIZ does not benefit from municipal services.


3. Free Zones

  • Free zones are special zones located outside the scope of customs zones, although they are located within the political borders of the country. These regions are designed to increase the number of export oriented investments. The legal and administrative regulations applied in the commercial, financial and economic zones of the customs zones are not applied or partially implemented in the free zones.

  • In Turkey, the EU and Middle East market is located in the Free Trade Zone close to a total of 19 cases of which 18 are active, while one is under construction. Free Zones; It is located at the points where access to international trade routes with ports in the Mediterranean, Aegean and Black Sea is easily provided.

Advantages of Free Zones

  • 100% exemption from customs duties and other similar taxes
  • 100% exemption from corporation tax for manufacturing companies.
  • 100% exemption from VAT and special consumption tax.
  • 100% exemption from stamp duty applied to documents to be issued.
  • 100% exemption from property tax.
  • 100% exemption from income and corporate tax for certain logistics services to be provided from free zones, provided they are all abroad
  • 100% exemption from income tax on employee salary (for companies exporting at least 85% of the FOB value of products produced in free zones).
  • Goods can be kept in free zones without any time limitation.
  • Corporations, the profits derived from free trade zones abroad as well as to Turkey without restrictions can be transferred freely.
  • Exemption from title deed fees when buying and selling properties
  • VAT exemption in construction, project, settlement, permit and approval processes.
  • Ready-made infrastructure free from VAT and other taxes.
  • Allowing second hand / used machinery to be brought in.

Demography

Turkey situated in GMT + 3-time zone, has the ability to communicate within the same business day with both eastern and western countries.

a-) Population
Turkey which has an extremely positive effect on the economy of the country in terms of population demographics offers many opportunities for investors. Investors are faced with major challenges such as aging and declining population in Europe, consider Turkey's young and educated population as a significant advantage. Turkey, which forms the foundation of a strong labor market and young vibrant domestic market, offers unique opportunities with a dynamic and growing population.

b-) Work Force
Turkey constitutes Europe's third-largest labor pool with the 31.6 million-strong workforce.
The young population of Turkey as the most important factor in the growth of the labor force has contributed to getting top position compared to competitors. Turkey has also realized the highest growth in labor force compared to EU countries growth.

c-) Urbanization
In Turkey, there are 22 cities with population of more than 1 million and are in a situation as locomotive of economic growth and social development with its goods and services produced. Istanbul is the most populous city in Europe.

Regulatory and Supervisory Agencies

Regulatory and supervisory agencies have been created for the regulation and monitoring of different markets, compliance with the market activities, or any problems that may occur. Some of the important entities in Turkey are; the Competition Authority, the Energy Market Regulation Authority, the Banking Regulation and Supervisory Agency, Capital Markets Board, Information and Communication Technologies Authority, Tobacco, Tobacco Products and Alcoholic Beverages Market Regulatory Authority, the Privatization Administration, Public Procurement Authority, Sugar Authority, Radio and Television Supreme Council, Public Oversight Accounting and Auditing Standards Authority

Macroeconomic Indicators

According to Data GDP-PPP * Country Rankings - 2003 and 2017 Turkey's economy was the world's 18th largest economy in 2003 and it rose to 13th in 2017 as well.

Foreign Direct Investment in Turkey

Thanks to the implementation of the liberalization process since the 1980s, the Turkish economy has achieved its high growth rates. Turkey's accession to the World Trade Organization (WTO) in 1995 is one of the most important steps in this process. Following this development of Turkey, by finalizing negotiations with the EU, it joined the Customs Union on January 1, 1996. As a result of all these stages, foreign trade increased rapidly both in terms of exports and imports. Significant changes were observed in the structure of export products, which were the main reasons for the replacement of agricultural products by industrial products.


a) Export
In accordance with the observed and export-oriented development model applied as part of the policy since 1980, the importance of exporting has increased enormously in quality and quantity.


b) Import
Turkey's import regime in full compliance with the Customs Union established with the EU, EFTA (European Free Trade Association) with the continuation of existing relations and the experienced World Trade Organization (WTO) in terms of meeting the obligations imposed by membership in nature emphasizes liberalization.

Foreign Trade

Turkey's economy, thanks to the implementation of the liberalization process since the 1980s reached their high growth rates. One of the most important milestones of this process, Turkey's 1995 World Trade Organization (WTO) is a member. Following this development of Turkey, it finalized negotiations with the EU on 1 January 1996 to join the Customs Union. As a result of all these steps, foreign trade has increased rapidly in terms of both exports and imports. Considerable changes have been observed in the structure of export goods, which have contributed to the replacement of agricultural products by industrial products.
The new investment incentive system, effective as of January 1, 2012, consists of four different regimes. Local and foreign investors can benefit equally from the following incentives:

  1. General Investment Incentives Practices
  2. Regional Investment Incentives Practices
  3. Large-Scale Investment Incentives Practices
  4. Strategic Investment Incentives Practices

Investment Legislation

Turkey's investment legislation, it offers equal treatment for all investors and simplicity of conformity to international standards. The basis of investment legislation; Incentives for Investments and Employment Law No. 5084, Foreign Direct Investments Law No. 4875, Foreign Direct Investments Law Implementation Regulation set up various laws and related sub-regulations regulating the incentives for investments on a sectoral basis with multilateral and bilateral agreements.