US companies in Turkey to increase investments by 70 pct
Posted by meb at February 21st, 2008
A recent survey has revealed that US companies operating in Turkey plan to increase their investments by 70 percent.
The survey, titled “Business and Investment Climate in Turkey,” was conducted by the American Business Forum in Turkey (ABFT), which interviewed top executives of 70 US companies that have active investments and operations in Turkey.
Corruption was listed as a lingering problem by 60 percent of participants, though they also expressed satisfaction with overall macroeconomic conditions in Turkey. Only 30 percent of respondents believe that the exchange rate is where it should be, voicing concern and noting that an overvalued lira negatively affects Turkey’s competitiveness.
Customs services, transparency in decision-making and compliance with international standards and procedures in sector decisions were listed as the country’s weakest points. Personal income tax rates were cited as very high by 74 percent of the participants, who consider high rates as having a negative impact on employment.
Tendency to stay
Investments are safe, however, as 70 percent of the US companies’ top executives in Turkey plan to increase their investments in the country in the future. Red tape, exchange rates, taxation, the legal system, intellectual property applications and labor costs were given as obstacles standing in the way of the country’s worldwide competitiveness. A significant number of US executives expressed their belief that the new government will achieve macroeconomic stability, and two-thirds of those polled said the returns on their investments are worth the risk and that they are able to find qualified and highly motivated employees.
Slight decrease in future expectations
Galip Sukaya, chairman of the ABFT’s board, indicated that the executives of the US companies have a relatively more optimistic view of the overall business environment and that there are some developments in interactions with the government. The US companies have maintained their positive attitude vis-a-vis investing in Turkey, he said. Sukaya said the survey results implied that the US companies still see a “gigantic” potential in Turkey and are advising others to invest in the country. “According to this survey, the US companies say, ‘We are still happy and still have confidence in this government, and we hope that reforms will accelerate’,” he told reporters. Sukaya noted that about 300 US companies have investments amounting to $5 billion in Turkey.
source: Today’s Zaman
Related posts: