Turkey's position in the global economy

摘要

Turkey's appeal to foreign investors traditionally stemmed from the large size of the country's markets, its perceived political stability and the relative sophistication and efficiency of its productive industries. The economy has also benefited from gradual convergence with EU regulatory norms over the past several decades. Going forward, Turkey's ability to attract and retain foreign investment will depend greatly on how it navigates through acute political and economic challenges from within and beyond its borders. The attempted coup in 2016, the government's severe response and an increasingly assertive foreign policy in the country's immediate neighbourhood all appear to be leading to a more insular (and less stable) Turkey. Popular perception that the government is mismanaging the economy and the tense political situation has led to an increase in capital flight, as have a dramatic weakening of the lira and rising inflation. Other long-standing deterrents to foreign investment include regulatory uncertainty, a slow and unpredictable judicial system, weak (but improving) intellectual-property protections, and unfair competition from smuggled goods and the informal sector. In the meantime, the lockdowns imposed in Turkey in response to the coronavirus (Covid-19) pandemic have caused a severe contraction of the already fragile economy.