Turkey
2011-05-06
2010 was the most successful year in recent Turkish history from the economic perspective
Record-breaking business relationships
During Turkish president Abdullah Gül’s state visit to Austria at the beginning of May, intensive economic ties along with the complex political relationship between the two countries were high on the agenda. In 2010, Austria was the number one foreign direct investor in Turkey and Austrian exports to the country on the Bosporous exceeded the 1 billion euro threshold for the first time. The Austrian economic centres in Ankara and Istanbul can be pleased with the economic report that “with an export increase of 39.9%, it could be counted as the largest percentage increase in the top 30 export partners of Austria. In the list of Austrian export destinations, Turkey moved up one place to position 20 whereas it remained at position 20 for import destinations”. And for direct investment, Austria “lies in seventh position with a total volume of $4.5 billion in the period 2002-2010 (2002-2009- tenth position) and has consequently overtaken Germany ($4.1 billion, eighth position)”.
Most successful economic year in recent history
According to the Foreign Trade Centre in Ankara, for Turkey itself, 2010 was “the most successful year in recent Turkish history from the economic perspective. With an economic growth of 8.9%, Turkey is one of the fastest growing OECD countries. The strong growth is, amongst other things, resulted in an increase in consumption stimulated by low interest, a construction boom as well as the rise in exports. The banking sector is also jointly responsible as a structural change instigated by the self-inflicted economic crisis of 2001, brought about a new, strong foundation that was scarcely affected by the global financial crisis”. Inflation and interest remain at a low level, foreign trade is increasing rapidly, parts of production and retail show strong growth and the construction and steel industry is flourishing. However, the unemployment rate is relatively high at 11%, the gap between rich and poor is considerable and the budget deficit rises as strongly as the foreign trade loss.
Further development of tourist destinations
The Foreign Trade Centre, Ankara reports of booming tourism in Turkey: “With 33 million foreign visitors (+6%) a revenue of $20.8 million was generated. Since 2000, visitor numbers have tripled; in contrast per capita expenditure has declined ($732 in 2000 compared with $630 in 2010). The trend is set to continue for 2011, as an increasing demand in summer tourism is expected, not least because of the crisis in the Mediterranean countries. Health and winter tourism are also part of a new trend (110,000 patients in 2010). Alongside the existing 24 winter sport centres, a further 24 new centres are in planning. The bed capacity should be increased from the current 7,800 to 65,400 in the medium term”; a development that Austrian planning and consulting companies with tourism expertise could only profit from.
Water demand increases
Similar applies to many areas of infrastructure, as can be clearly demonstrated by the example of water supply. Increasing population, higher living standards, dynamic development in tourism and rapid growth in industrial demand, increase the demand for drinking and service water in Turkey and make efficiency and quality improvements in both water supply and disposal essential. According to Germany Trade and Invest (gtai), Turkey is working on a multitude of projects to find efficient solutions for the supply of drinking water (only about half of the water from the supply network actually reaches the consumer), as well as to satisfy the forecasted doubling of demand for water for irrigation and to supply a fourfold increase for industry that is expected in the next 15 years.
Cooperation in education
Every year approximately 1.6 million students apply for a place at one of the 136 universities in the country. Because of limited places, however, only one third of applicants can be offered a place, forcing many to study abroad. For the Foreign Trade Centre in Ankara, Turkey for the education sector is “a promising source for the recruitment of students, who seek a study or training position abroad. As Turkey is keen to further develop education opportunities within the country, good business opportunities are offered for Austrian providers of training in know-how transfer. Within the scope of the internationalisation offensive of the Austrian Chamber of Commerce (WKO) “go international” and the federal ministry for Economy, Family and Youth (BMWFJ) the scheme 4 “Competitiveness Through Education” was initiated. The aim of the scheme is to strengthen the position of Austria as education exporter and that Austrian providers abroad thereby achieve a decisively competitive advantage.”
The existing and ongoing cooperation between Turkish and Austrian educational institutions should, by all means, be promoted and supported. In the 6th EU-framework programme, 148 Austrian partner organisations have cooperated successfully with 124 Turkish partner organisations in 102 projects. In 2009, the 7th EU- framework programme saw cooperation in 62 successful projects between 79 Austrian and 69 Turkish partner organisations. The Foreign Trade Centre in Ankara sees an especially high potential in cooperation in education between universities of economics, in tourism, in languages in addition to vocational training.
Lucrative ICT Market
The young, technically open-minded and communicative population of Turkey (with an average age of 28.8, the inhabitants of Turkey are around half a generation younger as middle Europeans), from the perspective of country experts from Germany Trade and Invest (gtai), also offers the basis for the emergence of a lucrative ICT market: “Overall, the Turkish market for information and communication technology (ICT) grew by an average of 14% from 2005 to 2009. The driving force was telecommunication, netting around 70% of the total turnover of the branch. The EITO (European Information Technology Observatory) declared a business volume of $27.5 billion for 2010, $20 million of which was attributed to telecommunications and $7.5 million to IT. Furthermore, in the years up to 2014, Turkey is expected to be the fastest growing IT market, in front of Poland, following an analysis from Business Monitor International and according to estimations from EITO, 2011 should yield a plus of 7.2%. The official target mark for the 100 year anniversary of the Turkish Republic in 2023 is a market volume of $160 billion and an increase in the number of people employed in the ICT sector from the approximately 100,000 at present to around a million”.
As gtai reports, the government wants to now establish special technology parks for the branch, so called ‘IT Valleys’, in order to support this development. “The dynamic economic development, the large domestic market, the expanding role of Turkey as a manufacturing base and technologically sophisticated goods have brought domestic and foreign players into the arena.
International companies increasingly use Turkey as a regional centre, from which not only
the local market is served, but also the surrounding countries of the middle East, central Asia and eastern Europe.
Austrian Investment in the Energy Sector
According to the Foreign Trade Centre, Ankara, the largest investments made by Austrian companies includes “the activities of OMV, which took over the petrol station network of PetrolOfisi and began construction of a gas power plant near to the Black Sea town of Samsun in 2010. Further projects include the building of the Nabucco gas pipeline. Verbund, which has already put into effect an electricity supply for 5 million customers from Ankara to expansive Black Sea provinces, opened a gas power plant and a wind farm on the Marmara Sea in 2010. Spring 2010 saw the market entry of bauMax with the opening of the first store in Samsun, a second store was opened in Izmit, a catchment area of Istanbul. In summer, Voestalpine, in cooperation with the Turkish state-owned railway, broke ground at the site of a new track switch factory. There was also the takeover of 71.5% of Turkish Roma Plastik by Egger Holzwerkstoffe”.
That Austrian planning and consultancy companies have long identified the value of the Turkish market and have long successfully worked in it, is shown by the high number of Austrian International Consultants that can demonstrate project experience.
Publications & Events Austrian Foreign Trade Center in Istanbul/Ankara (German)
Website AdvantageAustria
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