ISSUE 51 MAY'18 ISPAT NEWSLETTER
TURKEY UNVEILS SUPER INCENTIVES FOR HIGH-IMPACT INVESTMENTS Turkey recently introduced one of current account deficit by USD 19 the most competitive investment billion in 2-3 years, while boosting incentive packages in emerging output in high-tech and medium- markets in a move to foster economic high tech products that are import growth by stimulating industrial dependent, such as electric batteries, production and boosting exports. drug-eluting stents, energy systems, Aimed at technology investments and hybrid engines. in the petrochemicals, energy, As per the program, Assan, BMC, metals and mining, healthcare, CFS, Dow Aksa, SASA, Most Makine, manufacturing, and agricultural Metcap Energy, Oyak Renault and Turkey continued building on its industries, the comprehensive Vestel will engage in medium-high decade-long track record of strong growth as its economy expanded by 7.4 package of incentive certificates is tech investments, while Alvimedica, percent in 2017, beating expectations worth TRY 135 billion and covers Atayurt, Ekore, and TAI will undertake and becoming the fastest growing economy in G20. Turkey’s economic 23 projects. 19 companies received high-tech investments. Vestel will development has been supported by project-based certificates that were grab the largest incentive worth TRY continuous reforms that have made Turkey one of the most attractive granted in person by President Recep 28.4 billion for electric vehicle energy destinations for FDI. Turkey introduced Tayyip Erdoğan during a ceremony storage systems and is expected one of the most competitive held in the Presidential Complex in to contribute the lion’s share to the investment incentive packages in emerging markets in April, aiming to Ankara. reduction of the current account attract high-tech and medium-high The introduction of these deficit to the tune of USD 4.6 billion tech investments in strategic sectors. In April, the groundbreaking incentives is set to further empower annually. Oyak Renault's hybrid ceremony for Akkuyu, the first in a Turkey’s position against emerging engine production project is another series of nuclear power plants in markets such as Mexico, India, and high-tech investment that will make Turkey, was made at the Presidential Complex in Ankara, with President Indonesia. The incentive instruments a substantial annual contribution Recep Tayyip Erdoğan hosting Russian cover a broad range that includes of USD 2.3 billion to reduction of the President Vladimir Putin. Other notable highlights in April included the land allocation, various tax refunds/ current account deficit. inauguration of the Cisco Innovation exemptions/reductions, insurance Nearly 34,000 people will be offered Center Istanbul and the hosting in premium support, and utility support. direct employment, while indirect Istanbul and Bursa of a delegation of Swiss journalists as part of the fourth It is expected that these incentivized employment is expected to hit round of our media-specific initiative. projects will help to reduce Turkey's upwards of 134,000 with the initiative. TURKEY FASTEST GROWING G20 COUNTRY IN 2017
Beating expectations, the Turkish growth in the third quarter of 2017 and 2.2pp to the 7.4 percent growth economy grew by 7.4 percent in was revised to 11.3 percent. rate in 2017. Investments in the 2017 according to data released by Fiscal measures taken by the machinery sector also continued to the Turkish Statistical Institute government, such as the Credit show signs of optimism. (TurkStat). The high growth rate saw Guarantee Fund, have spurred a Recently announced super Turkey become the fastest growing strong increase in economic activity incentives for a number of G20 economy in 2017, surpassing in Turkey and have had a favorable investment projects are also expected China and India, which recorded impact on the robust growth to accelerate growth in 2018. The 6.9 percent and 6.4 percent growth achieved in 2017. The growth was growth figure of Turkey in 2017 is respectively. Turkey's GDP growth mainly fueled by strong household likely to cause an upward revision to rate for the last quarter of 2017 was consumption and rising investments, international organizations’ growth 7.3 percent, and the sharp 11.1 percent which respectively contributed 3.7pp forecasts for this year.
S. Korea
3.1% Canada Indonesia 3% Argentina 5.1% 2.8% EU (28) 2.4% India 6.4% Australia 2.4%
USA 2.3% China G20 Germany 6.9% 2.2%
GDP GROWTH Mexico 2%
France 2017 2% Turkey (%) 7.4% UK 1.8%
Japan S. Arabia 1.7% -0.7% Russia Brazil Italy 1.5% 1% S. Africa 1.3% 1.5% CISCO COMMISSIONS INNOVATION CENTER ISTANBUL AT ITU ARI TEKNOKENT
US tech giant Cisco has inaugurated research communities, and industry environment for start-ups and Innovation Center Istanbul – the collaborators. businesses.” company’s 10th innovation hub globally Speaking at the inauguration During his keynote speech at the – in İTÜ Arı Teknokent, a technology ceremony, Cisco Turkey General ceremony, ISPAT President Arda Ermut park affiliated with Istanbul Technical Manager Cenk Kıvılcım said, added, “R&D is a long-term process and University, one of the world’s oldest “We believe in Turkey’s young might be one of the first areas to be technical universities. population, creative brain power, abandoned during tough times. Yet, for Located on a 4,500-square-foot and entrepreneurial potential. Our every Lira invested in Turkey’s R&D, one area, the center will serve as part of a center will bring innovative and can expect twice the amount returned network of Cisco Innovation Centers enterprising minds together to create in terms of incentives. The companies worldwide. Innovation Center Istanbul ground-breaking solutions for the are incentivized by the government in is set to tackle the most pressing future. We aim to support Turkey's numerous ways, including support for challenges with innovative and PPP and logistics, transportation, and the wages of R&D staff. This is an area high-tech solutions, while taking into manufacturing investments, while that the Turkish government places account Turkey's priorities. The center also looking to co-develop applications utmost importance on. R&D spending will act as a platform of collaboration, such as paperless warehousing, in Turkey has more than doubled bringing government organizations, hyper-location, and virtual wearables. over the past decade, yet we still see customers, and partners together with This facility will enrich our ecosystem, ample room for further innovative start-ups, accelerators, universities, making it an even more attractive investments.”
Localization in the sector is expected part of the energy industry as part of to exceed 60 percent in the next 5 to 10 its commitment to boosting energy years. security. “Turkey will have sound and Apart from the aforementioned sustainable energy in the future thanks domestic sources of energy, another of to the efforts in nuclear energy today. the efforts to increase national energy Turkey’s energy sources, which are still resources is the utilization of nuclear mainly based on oil, natural gas and TURKEY-RUSSIA power plants. The groundbreaking coal, will become healthier with the ceremony for Akkuyu, the first of a commissioning of the nuclear power BOOST series of nuclear power plants, was plants in Turkey,” Erdoğan said. COLLABORATION made in April at the Presidential Congratulating Turkey for its efforts Complex in Ankara, with Turkish in nuclear energy, Russian President IN ENERGY President Recep Tayyip Erdoğan hosting Putin emphasized the contribution Russian President Vladimir Putin. Being of nuclear power plants to Turkey’s Turkey ranks 2nd in the world, after built in close cooperation with Russia, economy and said that Akkuyu will China, in terms of growth in electricity the Akkuyu plant in Mersin province also provide for technology transfer demand. The external dependence ratio represents a USD 20 billion investment. opportunities to the country. in energy sources in Turkey was more The second nuclear power plant will be The first reactor of the Akkuyu than 70 percent over the last decade; built in the Sinop province of Turkey, Nuclear Power Plant will be however, that ratio has been declining with a third being planned for the future. commissioned in 2023, and when totally recently due to the uptake in utilizing Speaking at the ceremony, finished, it will provide for 10 percent of domestic sources of energy such as President Erdoğan said that Turkey Turkey’s total electricity need. wind, geothermal, solar, and hydro. is continuously investing in every 9-10 İSTANBUL & BURSA APRIL
SWISS JOURNALISTS GET FIRST-HAND INSIGHT INTO TURKEY’S INVESTMENT CLIMATE
As part of its global efforts to Dorman at their first stop in Istanbul, delegation headed to Bursa – one of showcase Turkey’s business climate and then met with İTÜ Arı Teknokent the most industrialized metropolitan and to reinforce global investor CEO Kenan Çolpan at their second centers in Turkey – to visit Swiss perceptions, ISPAT continued stop. As they were briefed by Çolpan, technical component manufacturer its country-specific initiative by the delegation was impressed by Angst+Pfister’s facilities based in recently hosting a delegation of the huge demand international Hasanağa. Swiss journalists from Neue Zürcher companies show in Turkey, as well as During dialogues with the Zeitung, Luzerner Zeitung, 20 the numerous examples of university- delegation, Angst+Pfister CEO Minuten, and Schweizer Radio und entrepreneurship cooperation cases Eray Ulugül took the opportunity Fernsehen (SRF) in Turkey. ISPAT in both the incubation and growth to present the company’s projects wanted the delegation to see first- phases of companies operating in İTÜ both completed and in the pipeline hand the dynamism of the Turkish Arı Teknokent. that have been facilitated by the economy in different parts of the The first day ended with ISPAT investment incentives extended by country, particularly in Turkey’s Coordinator Necmettin Kaymaz’s Tubitak and the Turkish Ministry of Istanbul and Bursa provinces. comprehensive presentation on Economy. Ulugül made a point to The first day of the program Turkey’s investment climate based draw attention to the significance began with a focus on start-ups and on the country’s macroeconomic the Turkish government attaches to entrepreneurship in Turkey. The indicators and inborn advantages. R&D operations. While addressing the Swiss delegation came together A Q&A session followed shortly questions from the delegation at the with StartersHub Chairwoman Ebru thereafter. on-site facility tour, Ulugül stressed On the second day Angst+Pfister’s full confidence in of the program, the Turkey. delegation had the The dinner with Bursa Governor chance to exchange İzzettin Küçük marked the last stop views with Swiss of the Bursa program. The governor Consul General to talked about some of the goals for Istanbul Nathalie Marti value-added production in Bursa’s at a working breakfast soon-to-be established technology that was also attended development zone Teknosab. by officials from Swiss The final stage of the program Business Hub Turkey ended with a meeting with EBRD and the Swiss Chamber Turkey Deputy Heads Hande Islak of Commerce in Turkey. and Oksana Pak. After the breakfast the
ISPAT, the official investment advisory body of Turkey, is a knowledge-center for foreign direct investments and a solution partner to the global business community at all stages of investments. It provides customized guidance and qualified consulting before, during, and after entry into Turkey.
www.invest.gov.tr /investturkey /invest-in-turkey /investinturkeysocial