Foreign direct investment has played an integral part of building Turkey?s economy since Law No. 4875 was passed in 2003. This legislation made foreign direct investment more attractive by providing increased rights and a more secure environment for foreign capital, a legal guide for doing business in Turkey and guaranteed profit transfers.

Specifically:

• Turkey?s foreign investment legislation is based on the principle of equal treatment for the domestic and foreign investors. Foreign investors have the same privileges and obligations as the domestic capital.
• Free transfer of profits, dividends, proceeds from sale or liquidation of an investment, fees and royalties, interest payments on foreign loans is clearly restated.
• Foreign capital companies established in Turkey have the same rights to acquire real estate as domestic investors. Foreign real persons may own real estate according to the principle of reciprocity.
• National or international arbitration is allowed for disputes arising from contracts involving government concessions as well as for the disputes arising from agreements subject to private law, provided that the conditions in the related regulations are fulfilled.
• Foreign capital entities can employ foreign personnel in Turkey, provided that the work permits are obtained from Ministry of Labor.

As a result of these measures, FDI flows into Turkey have steadily increased. In 2003, they were at 1.8 percent; by 2007, FDI flows reached 22 percent. Manufacturing, financial services and energy sectors have attracted the most FDI.  

Visit the Republic of Turkey Prime Ministry Investment Support and Promotion Agency or the Undersecretariat of the Prime Ministry for Foreign Trade?s Export Promotion Center for more detailed information about foreign direct investment in Turkey.

Sources: CIA World Fact Book; Republic of Turkey Prime Ministry Investment Support and Promotion Agency; Undersecretariat of the Prime Ministry for Foreign Trade?s Export Promotion Center