Turkey's new development plan to bring investment breakthroughs

Published 11.07.2019 00:10

Turkey is bearing witness to historical breakthroughs in both the economy and investment environment in the five-year development period. Accordingly, private investments will be taken under legal protection, followed by the establishment of an investment ombudsman system. Investments will be completed through a single interlocutor. Licensing procedures will be accelerated and investment coordination units will be formed in ministries. Customized incentives will be implemented for new investments and a standard cost model will be introduced. Local companies will be brought together with global investors for investment cooperation opportunities.

The Presidency Investment Office will also have a stronger and more active structure.

The first development plan of Turkey's presidential governance system, which has been in effect for the last year with the formation of the government on July 10, 2018, outlines a road map for Turkey's social and economic development until the centennial anniversary of the republic in 2023. It is said to be a road map to improve the country's position in the international arena and enhance its welfare.

The 11th Development Plan was submitted to Parliament on Monday following the approval of President Recep Tayyip Erdoğan.

Under the title of advanced business and investment environment, the important headings in the Development Plan, which serves as the guarantee of incoming capital to Turkey and the protector of domestic and foreign investors, have been announced. The plan indicates that a framework legal arrangement will be introduced for private investments, thus accelerating bureaucratic and legal predictability. There will also be a renewal of legislation that reinforces investor confidence. A strong legal infrastructure will be established to make Turkey more attractive for international direct investments.

The plan also stresses that infrastructure for the dissemination of investments in international standards will be strengthened to resolve investment-related disputes. The establishment of an investment ombudsman system is also underway between public administrations and investors.

The finalization period of licensing procedures for investment will also be announced, according to the plan. In case of deviation from the prescribed period, the investor will be notified regarding the new period. Investment transactions will be completed in a short time through a single interlocutor. An information system will be created to ensure that transactions such as permits, approvals and licenses for investments remain fast and cost-effective.

Investment coordination units will be established in the ministries, while technology-oriented industry movement program will be implemented in priority sectors.

The plan also foresees the introduction of grant-based incentives. Accordingly, a flexible investment incentive system that includes grant support will be implemented. Strategic and advanced technology products will be given priority in project-based incentives for global investments. Customized incentives will be implemented for new investments.

Investment Coordination Units will also be established to ensure contact with the Presidency Investment Office. These units will be developed in cooperation with local development agencies.

Meanwhile, a central Investment Information System will be established in which regular information entry will be made by the relevant administrations for monitoring the processes such as permission, approval and license related to investments. Additional support will be provided for investments based on technology transfer.

The new development plan also emphasizes the collaboration between domestic companies and global investors. Direct investments will be guided toward exporting sectors in this regard.

During the Development Plan period, an interest rate policy will be established to ensure that the financial costs incurred by investors are stabilized at low levels.

In addition, legislation related to the Standard Cost Model will be implemented. Thus, investment permits will be simplified, and compelling applications will be removed.

Specialization in justice services will be provided to improve the legal process related to the business and investment environment. This item suggests that specialized courts will be established in areas such as reconstruction, energy and environment. Studies will also be carried out to move commercial, intellectual and industrial rights lawsuits to the specialized courts in provinces.

In public investments, on the other hand, priority will be given to the manufacturing industry, research and development, digitalization, human resources, logistics, energy, agriculture, tourism and defense industries. Public investments will be allocated to reduce development disparities.

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