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Doing business in Turkey

Using the internet as the only source can you locate information regarding the business
environment or business practices within Turkey. Need information regarding the
business environment or business practices within a single business segment in Turkey
(using business segments such as financial services, health care, heavy manufacturing,
retail trade, mining and other extractive industries, agriculture, food processing, and light
manufacturing.

Describe what can be learned about Turkey's or industry segment and based on the
information given discuss business opportunities and problems related to conducting
business in Turkey. What are some advantages and disadvantages of conducting business
in Turkey and if you were to open a business what type of business would you open.
Relevant information includes, but is not limited to labor force date concerning
availability, skills and education, financial institutions, government regulations, access to l
local and world markets, economic risk, and political risk. Use four internet resources
(please list them).

Solution Preview

Doing business in Turkey:

Located at the Eurasian crossroads between Eastern European, Mediterranean, Black Sea and the Caspian Sea regions, Turkey has had geographical, political and economic ties with Europe for many centuries. Turkey also has intense economic relations with the neighboring countries in the Middle East, North Africa and Eurasia.

With its network of developed infrastructure and a globally competitive work force, Turkey has become a geo-strategic base for international business. A rapidly growing emerging market of 68 million people makes the country today one of the key trading partners of the European Union.

Turkey's network industries and natural monopolies are being introduced to competition by the removal of entry barriers as the state withdraws to a supervisory role in a functioning market economy.

On the other hand, the current level of foreign direct investment in Turkey does not affect its qualified labor force, favorable market positioning, high absorption capacity, and tourism potential and strong entrepreneurial spirit.

With a services sector constituting almost 60 % of its GDP and a public procurement market of over ? 30 billion, Turkey offers immense opportunities for European companies in development projects from which they should get higher than usual rates of return. The elimination of political interference in the economy, public sector reform and the consolidation of the financial sector together pave the way to better functioning market economy and sustainable high growth.

Based on the above, Turkey is among the 20 biggest economies in the world. Furthermore, it is an unsaturated market in almost every category of consumption goods, ranging from fast moving consumer goods to high technology products

Source: http://www.businessinturkey.com/

Turkey is a large, middle-income country with relatively few mineral resources. Its economy is currently in transition from a high degree of reliance on agriculture and heavy industrial economy to a more diverse, more modern economy with an increasingly important and globalized services sector. Turkey's economy suffered from high--sometimes very high--inflation for 30 years, from the early 1970s until the recent reform period. Coming out of a tradition of a state-directed economy that was relatively closed to the outside world, Prime Minister and then President Turgut Ozal began to open up the economy in the 1980s. In the 1990s, Turkey's economy suffered from a series of coalition governments with weak economic policies, leading to a boom-and-bust cycle culminating in a severe banking and economic crisis in 2001 and a deep economic downturn (GNP fell 9.5% in 2001) and increase in unemployment.

Since the crisis, however, Turkey's economy has recovered strongly thanks to good monetary and fiscal policies and structural economic reforms made with the support of the International Monetary Fund and the World Bank. The independence of the Central Bank from political interference has been firmly established, a floating exchange rate system has been put in place, and the government's overall budget deficit has been substantially reduced. In addition, there have been substantial reforms in the financial, energy, and telecommunications sectors that have included the privatization of several large state-owned institutions.

Thanks to these efforts, Turkey's economy grew an average of 7.5% per year from 2002 through 2005--one of the highest sustained rates of growth in the world. Inflation and interest rates have fallen significantly, the currency has stabilized, government debt has declined to more supportable levels, and business and consumer confidence have returned. At the same time, the booming economy and large inflows of portfolio investment have contributed to a growing current account deficit. Though Turkey's vulnerabilities have been greatly reduced, the economy could still face problems in the event there is a sudden change in investor sentiment that leads to a sharp fall in the exchange rate. Continued implementation of reforms, ...

Solution Summary

Located at the Eurasian crossroads between Eastern European, Mediterranean, Black Sea and the Caspian Sea regions, Turkey has had geographical, political and economic ties with Europe for many centuries. Turkey also has intense economic relations with the neighboring countries in the Middle East, North Africa and Eurasia.

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