Country Profile:
Turkey
Turkey
Turkey has always been a cultural and economic crossroads. It straddles western Asia and eastern Europe, lies between the Mediterranean, Aegean and Black Seas, sits at the foothills of the Caucasus and shares borders with the Arab world. The country has been a gateway, as well as a rest stop, for scores of civilisations. 2008 has been a challenging year for the country, with domestic political instability and the effects of the global financial crisis, but the country’s recent reforms have helped it maintain strong fundamentals. Turkey’s EU accession talks continue to move slowly, but it is likely that they will bring further reforms to a variety of sectors over the next few years.
ISBN: 978-1-902339-13-9
ISSN (Online): 1755-2303
ISSN (Print): 1755-229X
TABLE OF CONTENTS
COUNTRY PROFILE
This section provides an overview of the country, its population, languages, natural resources, geography, climate, religion and history..
POLITICS
It has been an eventful year in the political life of Turkey. After 2007 threw up a number of surprises and an overwhelming electoral triumph for the incumbent Islamic-rooted Justice and Development Party (AKP), many analysts expected 2008 to be a more sombre affair. However, with the ruling party emboldened by a clear public mandate, its ambitious legislative programme has been met with stiff opposition from the leading opposition party, the Republican People’s Party (CHP), and elements of the secular establishment. In March 2008, a closure case was brought against AKP for anti-secular and anti-constitutional activity, particularly the AKP’s determination to allow the headscarf in public universities. Ultimately the constitutional court decided not to ban the AKP, a decision that was popular with a population tired of political instability. By the summer, the atmosphere of the country had changed and gloom was replaced with bullish optimism that political, social and economic reform could be enacted with a significant degree of consensus. Furthermore, despite problems at home, Ankara exercised an ambitious and largely fruitful strategy abroad as both a third-party broker in foreign conflicts and a willing partner in resolving disputes closer to home. The government remains cautious over the PKK insurgency in the east and the prospect of sporadic terrorist attacks by the group in the west, but relations are warming with Armenia and Greek-Cyprus. There are still many challenges facing the government, from the Ergenekon trial of suspected coup plotters to constitutional reform. While Prime Minister Recep Tayyip Erdoðan and his party have reasserted their commitment to the EU-driven reform programme, the sensitivities of the opposition and the secular elites will have to be taken into consideration. The AKP was expected to push on with the reform after the resolution of the crisis over Abdullah Gül’s election to president in 2007, which was adamantly opposed by secularists. However, 12 months on the party was facing closure. With their latest reprieve, it is to be hoped the AKP will have learned a lesson and that their ambitious reform programme is matched by an appetite for consensus and reconciliation.
This chapter provides interviews with Abdullah Gül, President of the Republic of Turkey; Ali Babacan, Minister of Foreign Affairs; Jorge Sampaio, former President of Portugal and President of the Alliance of Civilisations; and Mahmood Ayub, UN Resident Coordinator, Turkey. M Rifat Hisarciklioðlu, President, Union of Chambers and Commodity Exchanges/Foreign Economic Relations Board, provides a viewpoint on the country’s growth prospects. Caroline Flint, UK Minister of State for Europe, provides a viewpoint on Turkey’s potential accession to the EU.
THE ECONOMY
Turkey has not been immune from the global financial crisis and economic slowdown in 2008 and, additionally, it has also had its own internal political issues to grapple with. Most Turks are just grateful that five years of reform have put the economy on a sound footing and have made it better able to cope with the uncertainties sweeping the global economy, although it is now widely accepted that the growth rate will suffer in 2009. The closure case against the AKP could have launched the economy into turmoil, but the constitutional court decided against its ban and there was a revival in confidence among both consumers and financial market investors. However, the court decision did not mean that the political issues were entirely resolved, and serious economic issues, such as the rising current account deficit, remained. The late 2008 economic slowdown in the EU and the worsening global financial conditions also affected Turkey’s economic prospects. By the end of July 2008 the deficit was up to a record level of $47.1bn, equivalent to 7% of GDP. The annual second-quarter growth rate of just 1.9% was well below expectations and low enough that analysts at Fortis revised their expectations for the full year down to 3.8% and to 3.7% for 2009 from the previous 4.5% and 5%, respectively. There is also concern that the pace of investment is slowing, with private sector investment expanding by just 0.6%, the lowest annual rate since the 2001 economic crisis. Stronger consumer confidence in the second half of the year also did not translate into stronger domestic demand. The export picture was unpromising with statistics from the Automotive Manufacturers Association showing a decline in sales to Europe – a key market for a sector that has been one of the major drivers of Turkey’s overall economic growth. Higher demand from other markets could help soften the impact but Turkey’s economic fortunes over the coming year will still be tied to those of its leading trading partner and source of investment. Still, with the reforms of the past five years, the Turkish economy is much better placed to cope with the impact of a slowdown, just so long as it is not too severe or prolonged.
This chapter provides interviews with Bülent Bulgurlu, CEO, Koç Holding; Hüsnü Akhan, CEO, Dogus Group; Alpaslan Korkmaz, President and CEO, Investment Support and Promotion Agency; and Tahir Uysal, Chairman, International Investor’s Association of Turkey (YASED). Muhtar Kent, President and CEO, The Coca-Cola Company, provides a viewpoint on modern retailing and Turkey’s prospects for growth. Kivanç Dündar, Senior Macroeconomic and Political Analyst, Intellinews – ISI Emerging Markets, provides a viewpoint on the economic outlook for 2009. Norbert Walter, Chief Economist, Deutsche Bank Group, provides a viewpoint on Turkey’s accession to the EU.
BANKING
Early 2008 was a rough time for Turkey’s banks. Their stocks led the fall on the Istanbul Stock Exchange and earnings growth was more moderate than in recent years, even as loan growth outpaced expectations. Catalysts for the slump in performance included the global reach of the US sub-prime-loans crisis, fears of a worldwide economic slowdown due to inflationary prices for energy and food and domestic political instability at home. All the headlines, however, obscured solid bottom-line fundamentals. There is still growth, albeit at a single-digit percentage rate that is slower than the usual 15% growth of recent years. Few expect full-year results for 2008 to outpace 2007, but concerns about access to funds proved overblown and so far the banks appear to be managing the risks inherent in a slowdown. Earnings growth in 2008 is expected at about 8%. Loan growth superseded all expectations for the first half of 2008, even in such a tough market. The drop at the ISE had Istanbul’s financial community seeing considerable value in bank stocks by mid-summer, with some analysts forecasting as much as 18% of upside, meaning the stocks were trading far below a fair market value based on their earnings prospects. The 13 banks trading on the bourse account for more than a third of its market capitalisation. The short-term outlook for Turkey’s banks seemed better with the constitutional court’s ruling against banning the AKP. Although the performance in 2008 may not measure up to that of recent years, the sluggishness seems mostly tied to outside factors. And as the Turkish economy grows, those factors may loom smaller and smaller.
This chapter provides an interview with Durmus Yilmaz, Governor, Turkish Central Bank. It also provides a roundtable with Yunus Nacar, General Manager, Türkiye Finans; Adnan Büyükdeniz, General Manager, Albaraka Türk; and Ufuk Uyan, General Manager, Kuvey Türk.
CAPITAL MARKETS
In 2008 the Istanbul Stock Exchange (ISE) has struggled to cope with potential and actual bad news at home and abroad. It has generally performed badly both as a result of global conditions and the uncertainty surrounding the fate of the AKP. The market did revive in August 2008 when the constitution court handed down a decision that gave the AKP a slap on the wrist but did not ban it. However, there is little anyone in Turkey could do to combat uncertain global conditions that looked set to worsen as the year progressed. The ISE 100 ended 2007 at 55,538 points, but it did not take long for the decline to start, and by the end of January 2008 it was down to 42,697. Although it rallied somewhat in February, from March onwards it declined, and at the beginning of September closed at 32,216 points. The losses were felt across the market as consumer services shares lost 4.53%, oil and gas shares lost 2/9% and technology shares lost 2.47% on average. The only gainers in the index were health-care companies with a very modest 0.3% rise, on average. The market gained 3.4% with the US Congress’ move to shore up Wall Street, but a permanent recovery is not guaranteed. The ISE has relatively few local investors and companies, with just 130 of the 1000 largest companies in the country listed. The ISE and the Union of Chambers and Commodity Exchanges of Turkey (TOBB) are now working on a programme to raise awareness of the benefits of listing for companies. This drive is part of an effort to expand the market overall, which includes the introduction of new funds.
This chapter provides interviews with Hüseyin Erkan, Chairman, Istanbul Stock Exchange (ISE) and Ahmet Yildirim, General Manager, Yapi Kredi Yatirim (YKY). The chapter also provides share analyses by Yapi Kredi Yatirim on Akenerji, Türk Hava Yollari, Tekfen Holding, and Tüpras.
INSURANCE
Competition is king in Turkey’s contemporary insurance market – companies are in such a heated battle to gain market share that some are willing to take on loss leaders in certain segments in order to build up their reputation and size. The penetration rate for insurance policies in Turkey has historically been much lower than in European countries, particularly in Western Europe, and insurance executives believe that the coming few years will see a major shift in attitude and a corresponding spike in underwriting. Turkey has the world’s 17th-largest GDP, but is just 68th worldwide in insurance penetration. Total spending on insurance was about $9.7bn in 2007, but that could triple to $30bn within the next 10 years. Premium-based income has been rising 11% (compound annual growth) since 2003, outpacing GDP growth. Most of the growth has come from non-life policies, as a growing private pension system has sapped demand for life insurance. Premium income rose 13% in 2007 to a total of TRY10.93bn ($9bn). The highest rates of increase were in credit insurance, which doubled, and agriculture insurance, which grew by 75%, helped by government subsidies of as much as 50% of policy costs. New additions to the market boosted the total number of insurance companies to 60 in 2008. The industry is growing now due to a confluence of factors led by the revamped regulatory and legal environment created by an overhaul of insurance laws in 2007 and the recent lifting of price controls on motor insurance, which accounts for about half of the policies underwritten. The result is renewed confidence in the insurers of Turkey and a mad rush by foreign companies eager to buy into the sector and enjoy a growth rate projected to easily outpace that of Western Europe. Foreign insurers had already bought up almost 75% of market share as of summer 2008. Foreign stakes are predicted to grow, as two locally owned major insurers were in acquisition talks throughout the year.
TRANSPORT
The EU accession process is one of the major reasons for Turkey to improve its transport sector. Building more and better roads is key as car ownership levels rise, but developing its mass-transport systems is even more essential. As part of the endeavour to create a modern infrastructure, Turkey is bolstering its maritime shipping business, building bigger airports and enhancing its railway grid. The plans made in 2008 are efforts to reduce congestion, particularly in Istanbul, and to increase the ease of crossing the Bosphorus. Projects such as the Bosphorus car tunnel and the Marmaray require the destruction of old buildings and infrastructure, but they will offer a better link between Turkey’s two continents and will enhance the country’s position as a strategic trade route. The government considers development through privatisation efforts the way forward and, despite some of the legal challenges, stands to attract private investment and know-how to get the job done.
This chapter provides an interview with Temel Kotil, President and CEO, Turkish Airlines.
ENERGY
BP’s 1760 Baku-Tblilisi-Ceyhan (BTC) link is the crown jewel in the East-West pipeline network. The line carries up to 1m barrels of oil per day, or 1% of the world’s crude oil supply, and BP plans to raise capacity to 1.2m bpd in 2009. The pipeline, which loaded its first tanker in July 2006, bypasses Russia, and at its inception was envisioned as one way to reduce Europe’s energy dependence on Moscow. But when a fire engulfed a Turkish section of the pipeline and forced a three-week closure in August 2008, prices shot up in New York, making security a major concern for the supply route. Turkey has few reserves of its own and flows from exporters such as Russia and Iran have prompted the country to take steps towards securing its energy needs. Exploration increased in 2008 and steps are also being taken to increase reliance on renewable energy. Plans for nuclear, wind and geothermal energy plants are in the works. In total, Turkey is seeking $130bn of energy investments by 2020 to cover demand that has soared during the past seven years of economic expansion, during which incomes have tripled in the nearly $700bn economy. Dozens of Turkish firms and the world’s biggest companies, such as ExxonMobil and General Electric, have responded to that call. It is a simple calculation: demand will continue to grow after years of under-investment and as the economy matures. Meanwhile, Turkey’s role as a reliable Western partner belonging to NATO and seeking EU membership while straddling the East means its strategic significance is here to stay.
This chapter provides interviews with Berat Albayrak, CEO, Calik Holding; Selahattin Hakman, President, Sabanci Energy Group; and Melih Türker, CEO, Petrol Ofisi.
INDUSTRY
With its proximity to the massive European market and a large and relatively skilled and motivated labour pool, Turkey has come a long way through industrialisation. Productivity is rising across all sectors, and exports were reaching record highs each month in 2007 and early 2008. But questions about the strength of the global economy kept growth projections modest for 2008, and political instability and high interest rates led some consumers to delay purchases of big-ticket items, such as cars and appliances. In addition, concerns about energy prices have translated into an expectation that profit margins may be smaller in 2008 and 2009 than in previous years. As measured by exports, Turkey’s most important industrial activities are vehicle assembly; basic metals production, such as steel and iron; chemicals, petroleum products and plastics; and textiles. Proximity to Europe is a selling point for Turkish goods, as transport costs are low and getting lower as infrastructure in Eastern Europe improves. For the future, investment in innovation is needed. With lower-cost producers such as China competing in price, Turkey is looking to boost its workers’ skills and become a bigger player in innovation. An April 2008 law passed to spur research and development is a good start, and investors seem to think that industrial policy is headed in the right direction.
This chapter includes interviews with Haluk Dinçer, President, Sabanci Retail and Ýzzet Karaca, Chairman, Unilever. It also includes a roundtable with Michael Flewitt, General Manager, Ford Otosan; Mehmet Buldurgan, CEO Temsa Global; and Mustafa Bayraktar, CEO, Bayraktar Holding
CONSTRUCTION & REAL ESTATE
The construction sector, which grew by 16% in 2007, is now the third-largest sector in Turkey after the food and textile industries. It contributes over 6% to GDP and, when its impact on other sectors is evaluated, contributes almost 30% to the total industrial output of the country. While the sector continues to expand at home with a raft of private real estate and public infrastructure projects, Turkish contracting firms penetrate more markets abroad. Large scale domestic infrastructure projects include thermal, hydro and nuclear power plants, the third Bosphorus bridge, the Marmaray Tunnel, The Izmit passage and the Izmir-Istanbul highway. There is also a significant shortfall of housing units that the sector will work to eliminate. These projects have attracted the interest of local and foreign contractors. The availability of work allows the largest firms to offset increasing costs of materials and labour by working on large-scale projects. While some clouds remain on the horizon, such as illegal construction jeopardising quality and material prices that remain volatile, most firms are looking forward to a bright future. With national demographics spurring demand for construction at home and oil money taking companies further afield, the options for construction firms are only growing more and more varied.
The real estate market has proved particularly resilient in 2008, absorbing the adverse effects of the economic slowdown globally and political instability domestically to remain in a strong position. This is a testament to the fundamentals of supply and demand, which are still in good health, suggesting that once interest rates begin to drop and the mortgage market takes off, the Turkish real estate sector will be set for a period of rapid and extended growth. The sector grew on average by 12.7% annually in the period 2002-06. Although growth slowed in 2007, real estate remains one of the primary economic activities in Turkey. In 2007 ownership and dwellings accounted for 10.6% of GDP, while real estate services and renting accounted for 4%. The emergence of a young, mobile and increasingly wealthy population is also expected to sustain the retail sector, which is currently experiencing symptoms of oversupply in limited pockets of Istanbul. Other cities, such as Ankara, Izmir, Bursa and those in the Anatolian heartland, are well placed and bracing themselves for sustained retail development. The office sector is also expected to experience a substantial increase in grade-A supply, particularly in Istanbul. While supply has been limited, prices have begun to rise to European levels. Yields remain high in the commercial sector, and residential property is expected to offer healthy long-term returns. As such, the future looks bright and the current lull in the market is likely to give way to sustained growth over the coming years.
This chapter provides interviews with Erdogan Bayraktar, President, Housing Development and Administration of Turkey (TOKI); Ali Ibrahim Agaoglu, Chairman, Agaoglu Group; and Levent Eyüboglu, CEO Multi Turkmall.
TOURISM
With neither the strength of the lira nor the credit crunch impacting arrivals, as many travel agents had feared, the target of 25m foreign tourists was all but met by the end of the third financial quarter of 2008. The government’s tourism strategy aims to attract 50m tourists per year by 2023, and while few doubt that the country has the natural beauty, good weather and cultural highlights to appeal to such vast numbers, the increase in mass tourism means that more attention needs to be paid to the sustainability and diversification of the industry in the future. In late 2008, the lira slid sharply against the dollar and tourists flocked to Turkey as a cheaper option than the Eurozone. Germans, Russians and Brits are the largest sources of tourists for the country. Between 1997 and 2007 visitor numbers grew at an average annual rate of 9.3%, while visitor spending grew at an average rate of 10.2% over the same period, reaching $18.5bn in 2007. The 2023 strategy sets a target of 50m tourists and $50bn in tourism receipts, equivalent to $1000 per tourist. As the Turkish economy grows across all sectors, the tourism sector’s share of GDP has decreased from 3.8% in 2005 to 2.8% in 2007. Nevertheless, as a key source of foreign capital receipts, tourism remains an important sector for tackling the growing current-account deficit. Some 7% of the total workforce is employed in the tourism sector. The goal is to increase that figure from 1.66m to 5m by 2023. In addition to the sun, sea and sand mass tourism segments, Turkey is working to diversify the sector by targeting wealthier tourists, MICE business and health tourism. The strategies outlined in the 2023 plan, with its emphasis on sustainability and diversification, addresses the most salient issues facing the country but it still, for the most part, is yet to be acted upon. Greater government incentives are required if the country’s sleepier cultural spots are to attract investment on any large scale. A new set of regional incentives, to be introduced in 2009, may help improve investor sentiment but they are not expected to introduce reforms geared specifically towards tourism activities. The development of new tourism cities in currently undeveloped areas of the coast should pick up pace over the coming years. Such large-scale projects will be crucial, given the sheer capacity required in order to hit the 50m tourist goal.
This chapter provides an interview with Nuri Colakoglu, Chairman, Istanbul European Capital of Culture.
TELECOMS & IT
Taxes on mobile phones are higher in Turkey than anywhere else in the world, and by a wide margin. So it is a testament to the Turkish enthusiasm for mobile telephony that the country has emerged as one of the world’s most important markets for mobile communications. Turkey’s dominant mobile-services provider, Turkell, is among the largest in Europe and the Middle East, and competition thrives between it and competitors. Future market highlights will likely include a higher-than-ever number of customers switching carriers and the introduction of 3G services. There is a large pool of willing customers and room for growth, as evidenced by low penetration rates in internet connectivity. The market has been historically shaped by its two largest companies: Türk Telekom, the dominant fixed-line provider, and Turkcell, the market leader in mobile telephony. The coming years may be marked by an increase in competition. Number portability for mobile phones is almost certain to inject competition into that market segment. In the fixed-line market, the last stages of implementing the liberalisation laws that were instituted in 2004 should finally free up the market for competition. For Turks and Turkish businesses, this is all good news. The telecoms companies are ploughing money into their capital expenditure budgets in order to boost network capacity and add new technologies. The firms themselves, however, may see squeezed profit margins in the coming years as they spend on capacity and cut prices in hopes of winning customers away from competitors. In the long term, however, the price wars and capacity building should pay off, leaving Turkish telecoms with robust networks and customer bases.
Turkey’s technology sector has significant room for growth and more significant investments in communications infrastructure, research and development. Intellectual property rights are needed to spur that development within the sector. The IT market was estimated at €4.4bn in 2007 and that figure is expected to reach €5.7bn by 2012. Turkey has the 11th-largest population of internet users worldwide and employers in the tech sector have said they have a solid labour pool to hire from, as the massive under-30 demographic in the country contains large ranks of university-trained engineers and graduates of local training schools. With Turkey already facing a large current account deficit, the government hopes to capitalise on the sector’s potential to boost local production and cut down on technology imports, or at least develop some exports to even out the trade imbalance. A new law aims to foster research and development and may help existing special economic zones meant to act as incubators for young technology companies. Other government initiatives seek to use technology to modernise government services, train Turks and spread access to technology beyond the big cities and into more rural villages. Ultimately, many sector watchers believe that the future lies with SMEs. Getting smaller companies to commit to using technology, and to do so legally instead of using pirated software, will not only be a boost to the sector but to the economy overall.
This chapter provides interviews with Cüneyt Türktan, CEO, Avea and Ali Faramawy, Vice-President, Microsoft International.
MEDIA & ADVERTISING
The Turkish media landscape is open, vibrant and relatively unencumbered by governmental interference. A multitude of national newspapers compete daily and the line-up of television channels is among the world’s largest. Turks have also adapted well to the internet. Turkey has the 11th-largest number of internet users in the world. Ownership is concentrated, with one dominant newspaper chain, Doðan Yayin Holding, and a few others controlling the vast majority of the newspaper market. Official interference is light compared with some of its neighbours, but Turkey’s media workers still suffer a lack of press freedom, chiefly due to laws that allow for the prosecution of journalists who say the wrong things, address political taboos, or “insult Turkey, Turkish ethnicity or government institutions”. The latter is a violation of the infamous Article 301, which the current government refuses to scrap, to the disappointment of EU officials.
The year 2008 will be the sixth consecutive year of growth for the advertising sector, with a growth rate for spending at about 20%, far outpacing economic growth. The growth in exports, which gives Turkish companies more money to spend on advertising, and the increase in imports of globally recognised brands, which means that Turkish brands have to spend more to compete, has led to the increase. Additionally, the market is still maturing. Even with the expansion of the past seven years, advertising spending in Turkey is low compared with most of Europe. The sector accounts for about 0.45% of GDP compared with an average above 1% in most long-time EU countries. Total ad spend in Turkey was about $2.5bn in 2007, and the figure is expected to grow to an estimated $4bn in 2012 or 2013. Television advertising represented just over half of ads, capturing a 51% market share. Growth is almost certain in internet advertising. Turkey’s internet penetration rate is low but growing, meaning that advertisers will reach a greater audience in coming years. Secondly, market research is now showing that internet users in Turkey are younger and have more discretionary income than the average person. TV and print media currently capture the vast majority of spending, but the internet is expected to develop into a third major sector within about three years.
HEALTH & EDUCATION
Turkey is well placed for healthcare investment, with rapid reform and growth underway. However, although healthcare expenditure per capita has grown by 49% since 2002, it still stood at only 5.3% of GDP in 2006, well short of EU averages of 8-10%. However, the State Planning Organisation is predicting an annual growth of 3.8% in healthcare expenditure up to 2030, bringing Turkey closer to EU levels. Further investment in the sector will help the government meet its ambitions of altering the fundamental indicators by bringing life expectancy up from 71.5 years and the infant mortality rate down from 22.6 per 1000 people. The government is working in conjunction with the private sector to ensure that the standards reached in western cities such as Izmir and Istanbul, where several internationally accredited hospitals are located, are duplicated in the less-developed east. Although costs are inevitably rising, the returns available from the local market ensure that the profit margins of private operators have not been dwindling. This should be bolstered in the coming years by an increasing demand for care and services from foreign patients drawn to Turkey by its competitive cost and quality. Indeed, private hospitals are already providing a benchmark for the sector, which should guarantee that the government’s push for accessibility and affordability will be supported by a high standard of patient care.
While progress has been made on the Turkish education system, the country still has some way to go to ensure that it produces graduates able to compete in the 21st-century. Total public spending on education as a percentage of GDP stood at 2.2% in 2004, well below the Organisation for Economic Co-operation and Development (OECD) average. The Turkish education system mandates eight years of primary schooling from the age six to 14. This is followed by four years of secondary education, up from three years as of the academic year 2007-2008. Enrolment has increased markedly in recent years, but problems remain, especially when it comes to ironing out regional disparities. Education remains highly politicised, often to the detriment of the system and the government still has a lot of work to do to bring this system up to international standards in terms of both accessibility and enrolment on one hand, and quality and content on the other. It is hoped that a more decentralised model, which places greater emphasis on individual schools and universities, will create fertile ground for innovation. While the lack of a clear-sighted evaluation scheme obscures the current impact of curriculum reform, a shift to a more inclusive and less teacher-dominated approach should help students acquire the necessary skills to compete in the modern labour market.
AGRICULTURE
It was a difficult year for Turkish agriculture, a sector that employs nearly a quarter of the workforce and accounts for about 8% of GDP. Record global oil prices and inadequate rainfall in much of the country conspired against yields and farmers’ incomes. The recovery from a drought in 2007 – worst in 80 years – has been mixed and some crops have not returned to the previous years’ levels. Wheat, barley and chickpea output declined, but maize, sunflower-oil seeds and hazelnuts fared a bit better. Government programmes and private sector investment are key to boosting output. As the government strives to meet EU standards and make agriculture more competitive, the restructuring seen this decade will continue into the next. What will make Turkey more attractive, perhaps, is the search for suitable growing regions as global food prices rise and climate change impacts food production worldwide. For Turkey to benefit from that, however, it will have to make its own farms more sustainable and help them deal with high input costs and the droughts that have ravaged the industry in recent years.
This chapter provides an interview with Sadrettin Karahocagil, President, Southeastern Anatolian Project (GAP).
THE BUSINESS GUIDE
In conjunction with Deloitte, OBG explores the taxation system, examining the environment for investors. The accountancy section provides a viewpoint from Anthony Wilson, Partner in Charge, Deloitte. OBG also introduces the reader to the different aspects of the legal system in Turkey, in partnership with Güner Law Office. The legal coverage provides a viewpoint from Ece Güner, Partner, Güner Law Office.
THE GUIDE
This section includes articles about Istanbul’s churches and The Glass Furnace, an artists’ retreat dedicated to the glass arts, as well as information on hotels, government and other listings, alongside useful tips for visitors on topics like currency, visas, language, communications, dress, business hours and electricity.
