Foreign Investment

While the Turkish government officially promotes foreign investment, there have historically been strong disincentives including high inflation, macroeconomic instability leading to abrupt currency fluctuations, and a formidable bureaucracy. In addition, laying off workers is difficult. As a result, investment levels have been below those of countries that do not present these types of obstacles to investors. Still, the trend is moving in a positive direction. In the first 11 months of 2007, Turkey attracted USD 16.6 billion in foreign direct investment (FDI). The year 2008 is predicted to show a similar figure. This upswing in investment has been credited to the government’s commitment to pursuing a reform program.