Direct investment by residents in Turkey abroad has increased

PwC Turkey conducted research on foreign investments with leading companies in various sectors as part of its "Foreign Investment Research." Within the scope of the research, the views of senior executives of these companies were sought regarding their current and planned future investments abroad, and trends in this context were analyzed.

The report published on the research noted that approximately 66 percent of participants preferred the regions of Europe (30 percent), North America (USA and Canada, 18 percent), and Eurasia (18 percent) for their investments.

When examining the countries with the highest investment, it is seen that the total share of Germany, Romania, the USA, and Russia among all options reached 54 percent. When participants ranked the three most important factors in determining investment locations by degree of importance, "Geographical Location Advantage," "Investment Environment," and "Market Size/Access to Alternative Markets" stood out.

MARKET ACCESS IS THE LEADING MOTIVATION FOR FOREIGN INVESTMENT

When research participants were asked about the primary motivations enabling their foreign investments, 17 percent of participants chose market access, while foreign currency-based income generation (12 percent) and physical proximity to the customer (11 percent) were also among the responses.

On the other hand, the report noted that approximately 89 percent of participants were satisfied or very satisfied with the contribution of their existing foreign investments.

According to the Balance of Payments data from the Central Bank of the Republic of Turkey, it was observed that the amount of direct investment made by real and legal persons residing in Turkey between 2013 and 2022 was at an annual average of 3 billion dollars. It was observed that the investment amount increased rapidly from the early 2000s until 2008, and began to decline in 2008 due to the global economic crisis experienced worldwide.

According to the data, it was noted that the amount of direct investment made abroad reached its highest annual levels in 2014-2015 with 5 billion dollars. It was observed that the amount of direct investment made abroad by residents in Turkey, which hovered at an annual average of 3.3 billion dollars between 2016 and 2020, reached an average of 4.7 billion dollars in 2021 and 2022.

MINING'S SHARE OF ALL INVESTED SECTORS REACHED 25 PERCENT

When the foreign investments of real and legal persons residing in Turkey are examined sectorally, it is seen that the mining and quarrying sectors come to the fore. It was observed that the mining and quarrying sector had a 25 percent share of all sectors invested in, with 16 billion dollars of investment made between 2002 and 2023. This sector was followed by the manufacturing sector with 14 billion dollars of investment and a 22 percent share.

The "finance and insurance" sector, which includes holding company activities, banking, insurance, reinsurance, and pension funds (19 percent share, 12 billion dollars capital position), real estate (9 percent share and 5 billion dollars capital position), and construction (4 percent share and 2 billion dollars capital position) sectors constituted a significant portion of total investments.

News Source: 12punto