Table of Contents
| Location and Size | Credit and Collections |
| Government | Risk Assessment |
| Legal System | Business Climate |
| People | Business Protocol |
| Economy | |
| Comparative Indicators |
12345
Location and Size
Turkey is located in Southeastern Europe and Southwestern Asia. It borders the Black Sea, between Bulgaria and Georgia, and the Aegean and the Mediterranean Seas, between Greece and Syria. Its total area is 783,562 sq km, which is slightly larger than Texas. Turkey is a secular state often viewed as a bridge between East and West.
Government
Turkey’s Government is a republican parliamentary democracy with 81 provinces.
Executive: Chief of State: President Recep Tayyip ERDOGAN, Cabinet: Council of Ministers appointed by the president; nominated by the prime minister
Legislative: Unicameral Grand National Assembly of Turkey (550 seats; members elected by popular vote to serve four-year terms)
Legal System
Turkey has a civil law system derived from various European continental legal systems. It has not accepted compulsory International Court of Justice (ICJ) jurisdiction.
People
- Population: 83,047,706
- Population growth rate: 0.94% (2022 est.)
- Languages: Turkish (official), Kurdish, other minority languages
- Literacy: 94.2% (2022 est.)
- Ethnic Make-up: Turkish (75%), Kurdish (19%), and other (6%).
- Religions: Muslim 98%, other (2%)
Economy
Turkey’s economy is increasingly driven by its industry and service sectors, although its traditional agriculture sector still accounts for about 25% of employment. Turkey remains dependent on often volatile, short-term investment to finance its large current account deficit. Turkey’s relatively high current account deficit, domestic political uncertainty, and turmoil within Turkey’s neighborhood leave the economy vulnerable to destabilizing shifts in investor confidence.
Leading Markets (2022): Germany 9.6%, France 6.1%, UK 5.8%, Italy 5.8%, Iraq 5%
Leading Exports – Commodities: Apparel, foodstuffs, textiles, metal manufactures, transport equipment
Leading Suppliers (2022): Russia 14%, Germany 10%, China 9%, US 6.1%, Italy 5.4%, France 5%
Leading Imports – Commodities: machinery, chemicals, semi-finished goods, fuels, transport equipment
Top Industries: Textiles, food processing, autos, electronics, mining (coal, chromate, copper, boron), steel, petroleum, construction, lumber, paper
Top Agricultural Products: Tobacco, cotton, grain, olives, sugar beets, hazelnuts, pulse, citrus; livestock
Comparative Economic Indicators – 2022
| Turkey | Bulgaria | Romania | Saudi Arabia | India | |
|
Population*
(millions)
|
78.8 | 7.1 | 21.9 | 26.1 | 1,189.2 |
| Population growth rate* (%) | 1.2 | -0.8 | -0.3 | 1.5 | 1.3 |
|
Age Structure (%)
(15 to 64 years old)
|
67.1 | 67.9 | 70.4 | 67.6 | 64.9 |
|
Age Structure (%)
(65+ years old)
|
6.3 | 18.2 | 14.8 | 3.0 | 5.5 |
| Literacy (%) | 87.4 | 98.2 | 97.3 | 78.8 | 61.0 |
| Unemployment Rate (%) | 12.4 | 9.2 | 8.2 | 10.8 | 10.8 |
| Inflation (%) | 8.7 | 4.4 | 6.0 | 5.7 | 11.7 |
| Population below the poverty line | 17.1 | 21.8 | 25.0 | NA | 25.0 |
| GDP** (USD billions) | 958.3 | 92.2 | 253.3 | 622.5 | 4,046.0 |
| GDP real growth rate (%) | 7.3 | 0.3 | -1.9 | 3.8 | 8.3 |
| GDP per capita** (USD) | 12,300.0 | 12,800.0 | 11,500.0 | 24,200.0 | 3,400.0 |
| Public debt (% of GDP) | 48.1 | 16.2 | 34.8 | 16.7 | 55.9 |
| Exports (USD billions) | 117.4 | 19.3 | 51.9 | 235.3 | 201.0 |
| Imports (USD billions) | 166.3 | 22.8 | 59.8 | 99.2 | 327.0 |
| Reserves of foreign exchange and gold (USD billions) | 78.0 | 17.3 | 50.5 | 456.2 | 284.1 |
| Currency | Lira TRY |
Lev BGN |
LEI RON |
Riyal SAR |
Rupee INR |
| Exchange rates (per USD) 10/26/2022 | 1.5 | 1.3 | 2.8 | 3.7 | 45.0 |
| Exchange rates (per EUR) 10/26/2022 | 2.3 | 2.0 | 4.1 | 5.5 | 66.4 |
*2022 Estimates
Data from CIA World Factbook
Credit and Collections
Turkey’s legal system includes provisions for enforcing property and contractual rights. However, the court system is overloaded, which results in slow decisions. Under certain circumstances, judgments of foreign courts need to be accepted by local courts before they are enforced. Monetary judgments are usually made in the local currency, but there are provisions for incorporating exchange rate differentials in claims.
Risk Assessment
Coface Country Rating: A4 – Average risk
Coface Business Climate Rating: A4 – Average risk
After growing by a stronger-than-expected 11% in 2021, Turkey’s economy slowed down in 2022 mainly on the back of sharp increases in energy prices and supply disruptions in key commodities due to the war in Ukraine.
Business Climate
The Turkish business environment has gradually become more streamlined and efficient. The country has a strong and rapidly growing private sector. Still, the state remains dominant in basic industry, banking, transport, and communication.
Further economic and judicial reforms and prospective EU membership are expected to boost Turkey’s attractiveness to foreign investors. However, Turkey’s relatively high current account deficit, uncertainty related to policy-making, and fiscal imbalances leave the economy vulnerable to destabilizing shifts in investor confidence.
Economic Freedom: Turkey’s economic freedom score is 56.9, making its economy the 107th freest in the 2022 Index of Economic Freedom. Turkey is ranked 42 out of 45 countries in the European region, and its overall score is higher than the world average.
Conversion and Transfer Policies: Turkish law guarantees the free transfer of profits, fees, and royalties, and repatriation of capital.
Regulatory System: The government of Turkey has adopted policies and laws that should foster competition and transparency. However, foreign companies in several sectors claim that regulations are sometimes applied in a non-transparent manner.
Business Protocol
Turks prefer to do business with those they know and respect, therefore foreign business people should spend time establishing a personal relationship. Discussions may start slowly, with many questions that may seem irrelevant to the purpose of your visit. It is extremely rude to insist that your colleagues get to the point. Once a relationship has been established, however, communication will be direct.
Business dress is conservative. You will be expected to wear a suit and tie. Similarly, women should wear smart professional outfits. In the summer, and especially in the cities of Istanbul, Izmir and Ankara, the weather is very hot and humid. At that time, it is acceptable for men to wear a shirt with trousers and no tie.
Although Turks do not practice time keeping and punctuality perfectly, they will expect you to do so.
When addressing a Turk, the most common method is to call a man by his first name followed by ‘bey’ (pronounced bay). So, Ertan Gonca would be Ertan Bey. Similarly, a woman’s first name would be followed by ‘hanim’ (pronounced ha-num). Where professional titles exist, such as Doctor or Professor, always use them either on their own or before the first name.
**********
Subscribe to the Credit-to-Cash Advisor
Monthly e-Newsletter — It’s Free
This information is provided by ABC-Amega Inc. Providing international receivable management and debt collection services for exporters to more than 200 countries. For further information, contact [email protected].
Historical Exchange Rates: OANDA.com The Currency Site.