TURKEY BRIEF TURKISH – CANADIAN RELATIONS May 2009 TABLE OF CONTENTS CHAIRMAN’S MESSAGE……………………………………………………1 1 COUNTRY PROFILE: 1.1 INTRODUCING TURKEY………………………...……………………...3 1.2 FUTURE PROSPECTS…………………………………………………… 6 2 TURKISH-CANADIAN ECONOMIC RELATIONS. .....................................7 2.1 LEGAL FRAMEWORK .............................................................................. 7 2.2 TURKISH-CANADIAN BUSINESS COUNCIL ........................................8 2.3 HIGHLIGHTS IN 2006 AND 2007 ............................................................10 2.4 BILATERAL TRADE .................................................................................13 2.5 CANADIAN INVESTMENTS IN TURKEY .............................................15 2.6 EDC IN TURKEY.......................................................................................16 3 BUSINESS OPPORTUNITIES ..........................................................................17 CONSTRUCTION AND REAL ESTATE DEVLOPMENT ......................20 DEFENSE ....................................................................................................30 ENERGY ......................................................................................................36 ENTERTAINMENT AND MEDIA ............................................................62 FINANCIAL SERVICES .............................................................................64 FOOD AND AGRICULTURE ....................................................................80 EDUCATION ...............................................................................................85 HEALTHCARE ...........................................................................................89 INFORMATION AND COMMUNICATION TECHNOLOGIES (ICT) ...95 MINING .....................................................................................................103 TRANSPORTATION ................................................................................107 TOURISM ..................................................................................................116 AUTOMOTIVE ......................................................................................... 128 IV HIGHLIGHTS OF TURKEY ........................................................................... 139 4.1 BEYOND THE GLOBAL ECONOMIC CRISIS .....................................139 4.2 CHALLENGES IN 2009............................................................................144 4.3 FUTURE PROSPECTS ...............................................................................144 4.4 PRIVATIZATION AND FOREIGN INVESTMENT ...............................148 4.5 THE EU ACCESSION PROCESS ............................................................150 CHAIRMAN’S MESSAGE Dear Readers, DEİK/Turkish-Canadian Business Council’s mission is to enhance the economic bilateral relations between Turkey and Canada by promoting trade and investment between the two countries. The relations between Turkey and Canada are based on common values and ideals with regard to democracy, freedom, human rights and a free market economy. We should take two important global developments into consideration as we consider the future of the relations between the two countries. First of them is the increase in the mutual dependence of nations. The destruction of rain forrests in Brazil has effects on the global climate. The SARS disease that originated in China could threaten both Canada and Turkey shortly after its first appearance. The increase in AIDS patients in Africa could become among the biggest problems of the world. The huge increase in the demand of Asian countries could make other nations endure higher energy and logistical costs. A terrorist group in a distant place in the world could commit attacks on the most powerful country of the world. It is for this reason that the countries sharing the same ideals and values should expand their existing cooperation. The other important development is that relations between countries are becoming multidimensional. Civil society is taking an ever increasing role. The ties between nations are no more solely determined by their governments; the roles of the business community, the world of academics and arts, and non-governmental organizations (NGOs) in these relations are growing. Success in public policy making would be increasingly difficult, if one misses the meaning of this transformation. This is so because the NGOs are instrumental in shaping the global standards, in the gathering and dessemination of the information that feeds decision-making and problem-solving. For example, the sensitivity towards environmental problems has been developed by non-governmental organizations. Important developments such as the ratification of the “Universal declaration of human rights” and prohibition of land mines are all results of civilian initiatives. Most importantly, NGOs bring participatory democracy to life. Therefore, as the Turkish-Canadian Business Council and our Canadian counterparts, we have much to contribute to the development of Turkish- Canadian relations. Turkey is a prominent actor in international trade as well as an attractive destination for foreign direct investment and this brief report on Turkish- Canadian relations aims to be instrumental in raising interest and awareness among readers and have a moving effect on Turkish-Canadian bilateral relations. The primary objective of this report is to present the opportunities for further developing the partnership of Turkey and Canada in areas such as telecommunications, agribusiness, mining, automotive, energy and education. Although Turkey is Canada’s biggest trading partner in Eastern Europe, and this position is strengthening every day, the current trade and investment figures still fall short of reflecting the true potential. As the DEİK/Turkish- Canadian Business Council, we are hopeful that the positive trend will continue in the future and we stand ready to take the necessary steps to strengthen further Turkey’s relations with Canada. DEİK/Turkish-Canadian Business Council is a source of information and networking on bilateral business issues for both Turkish and Candian companies and acts to assist Canadian firms to view Turkey as a key partner and destination for direct investments in the region. The Business Council organizes annual conferences and visits to Canada and hosts ministers and top level delegations from Canada and is the sole institution with a manade to promote bilateral economic relationships. We believe that the report entitled “Turkey Brief: Turkish-Canadian Relations” will serve as a guide to those who would like to have a better understanding of the current state of affairs between Turkey and Canada. Dr. Yılmaz ARGÜDEN Chairman DEİK/ Turkish- Canadian Business Council I. COUNTRY PROFILE: INTRODUCING TURKEY 1.1 History, geography, population and economic developments Turkey is a country on the go – a dynamic, fast industrializing country with a young population and a robust economy, often described as the “China of Europe.” It is a nation with a long history and a cultural life steeped in rich traditions. It is a realm of sprawling cities and enormous rural areas; of coastal towns and tiny fishing communities. It is a mountainous nation with mist-hidden plateau villages, combined with vast steppes and fertile, meandering river valleys. Sixty percent of the country is located at altitudes of 3,300 feet above sea level or higher. Located in eastern Turkey, Ağrı Dağı (Mount Ararat) at 16,976 feet is the nation’s highest peak and the biblical resting grounds of Noah’s Ark. More than 99% of Turkey’s population is Muslim, but the nation is a secular state with a definite western perspective. Christian and Jewish communities also exist in Istanbul, Izmir and Adana, the country’s big cities. Conservative Sunni Muslims make up the large majority of the country’s Muslim population. But about a sixth of Turkey’s population is Alevi, an Anatolian offshoot of the Shiite branch of Islam. Two continents Located on two continents -- Europe and Asia -- Turkey has always served as a bridge between the Occident and Orient. The Silk Road, the traditional trade passage connecting Europe to China, began in the ancient cities of what is now western Turkey. Eight countries border Turkey: Bulgaria in the northwest, Greece in the west, Georgia in the northeast, Armenia, Azerbaijan and Iran in the east, Iraq and Syria in the southeast. Turkey is the third biggest nation in Europe and Eurasia in terms of territory after Russia and Kazakhstan -- nearly twice the size of the state of California. Three percent of Turkey lies in Europe. Known as Thrace, European Turkey forms the southeastern tip of the Balkans. Ninety-seven percent of Turkey is located in Asia and this landmass is known as Anatolia. A bulging peninsula resembling a mare’s head, Anatolia is surrounded by the Black Sea, the Bosphorus, the Sea of Marmara, the Dardanelles, the Aegean and the Mediterranean and has been home to many civilizations, including the Hittite, and the Carian, Lydian and Phrygian empires. Anatolia served as the granary of the Roman and Byzantine Empires. Its loss to the Turks in the 11 th century deprived the Byzantine Empire of its agricultural wealth and led to its eventual collapse. Turkey is a key member of NATO and has the second biggest standing army in Europe after Russia with more than one million men under arms. It is a member of the United Nations (UN), the Organization