A presentation on Country analysis for International business

1. TURKEY
AN OVERVIEW
Presented By:
Sulabh Subedi : Roll No – 13271
Mayank Bhagat : Roll No –13101

3. CONTENTS
1) EXECUTIVE SUMMARY
2) PRESENT AND PAST IN SHORT
3) The Corridor Between Continents
4) Demographic and Economic Indicators
5) Sector of Prominence
I. AGRICULTURE
II. MANUFACTURING
III. CONSTRUCTION
6) What does Turkey offer as a Business Partner
7) PESTEL Analysis
8) PESTLE linked to Porter's Diamond
9) TURKISH CULTURE
10) Cultural Issues
I. Religion
II. Location
III. Gender Equality
11) Hofstede Analysis of Turkey

4. 11) Hofstede Analysis of Turkey
12) Applying the Lewis Model to Turks
13) Trompenaars’ 7 Dimensions of Turkish Culture
14) Business meetings in Turkey
15) Do’s and Don'ts
16) Basic Etiquette
17) Things to avoid
18) Global Competitiveness Index
a. Closer look d. Macroeconomic environment g. Market Efficiency j. Innovation
b. Institution e. Health and Primary Education h. Technological Readiness
c. Infrastructure f. Higher Education and Training i. Business Sophistication
19) SWOT Analysis
20) Conclusion

5. 1. EXECUTIVE SUMMARY
Undeterred by the 2009 global economic crisis, Turkey has managed to flourish in
the global market. The Turkish economy is expected to experience robust growth at
a13.2% CAGR over the next five years and reaches $1,226 billion by 2017.
The service sector is the key driver of the Turkish economy. The service sector
contributed a major share in GDP in 2011 and is likely to expand in the upcoming
years. Strong domestic demand and abundant natural resources are driving the
economy. Turkey is the world’s fifteenth largest economy in terms of the
Purchasing Power Parity (PPP). Turkish economy is not totally void of challenges
such as increasing current account deficit and increasing debt, which have
decreased the foreign exchange reserves of the country.
Turkey is one of the strong contenders for gaining membership in the EU
(European Union). The country has huge potential in the automotive, retail,
telecom, and construction sectors. More important, the modified Turkey
Commercial Code is expected to make the investment environment smoother for
investors. Stability in the government supported the industrial sector and
accelerated the GDP growth except during the crisis period.

6. 2. PRESENT AND PAST IN SHORT
The Romans had a saying, “By your friends they will know you.” In essence, this
meant that you could tell a lot about a person based on who their friends were.
Substitute “neighbours” for “friends” and the same could be said of nations. In
other words, “By your neighbours they will know you.”
 This is especially true for Turkey. Considering a few of its neighbours: Syria, Iran
and Iraq. With neighbours like these who needs enemies.
 Turkey has to be at turns: tough, worried and extremely vigilant in dealing with
these eastern neighbourhoods.
 Historically bad relations between Turkey and the nations of Armenia, Greece
and Bulgaria there is the potential for a conflict at almost anytime.
 Turkey’s only really friendly neighbour is Georgia as it provides a buffer
between Turkey and Russia, at least for the time being.
 Turkey’s great external challenge in the 21st century will be keeping the
neighbours in their place.

7. Continued…
 In both Europe and Asia, with elements of Europe, but more influenced by the Orient.
Turkey is both an outlier and of great strategic importance, close to the Middle East, but
not quite part of it.
 But the real query is “where does it fit in?”
 There is truly no other nation in such a critical position. The Orient, Europe (at least
geographically), and the Islamic World takes hold in turkey and the Classical World has
left an unforgettable mark.
“The most inspiring city in the world”
 There is a reason Istanbul market’s itself.
 A panoramic sweep of the horizon offers a window on two continents, some of the holiest
sites in both Islam and Christianity. A place that human civilization cannot help but leave
its historical, political and spiritual marks on. For Turkey today, much it has always been
for whatever state possessed in this area.
 Whether it ascends or descends will greatly impact the future. Here is the place where
everything and anything is always possible.

8. 3. The Corridor Between Continents
The Foundation of several civilization.
 Turkey with it’s unique location, bridges East to the West not only
geographically but also culturally.
 It has a strong ties with CIS as well as Middle Eastern countries which are
the energy source of the world..
 It’s economic and political systems are leveled with European Standards.
 It is leading democratic nation in the EURASIAN Region.
 It is the member of UN, OSCE, NATO, ECO, BSEC

9. 4. Demographic and Economic
Indicators
Population annual growth rate is 1.4%
GNI per capita 2012- $10,830
Average annual rate of Inflation 1990- 2012 is 41
 16th biggest economy in the world.
GDP is nearly $789.3 billion (est. 2012)
Member of G-20 group.
Declared as one of the emerging markets in the forthcoming Decade (by US
Department of Trade and International Financial Institution).
Per capita income on PPP ( Purchasing Power Parity ) is $ 17,500

10. 5. Sector of Prominence

11. A. AGRICULTURE
a. One of the main sector
b. Possesses 28 million Hectares of Irrigable land
c. frozen food is the fastest growing sector with a annual
growth rate of 25%
d. World's largest producer and exporter of Hazelnuts, Dried
Figs, Dries Apricots
e. World’s second largest producer of Lentils, Raisins,
Chickpeas and Tomato.
f. Ranks third in the world for Tomato concentrate production
g. Largest European producer of Cotton, Tea, Tobacco

12. B. MANUFACTURING
a. Product line of many brand name such as VERSACE, NIKE,
LEVIS, ARMANI, ADIDAS, LACOSTE, HUGO BOSS, are
produced in Turkey.
b. Textile is the strongest sector in the Turkey economy, it’s share
is about 37% of total exports and 43% of total Industrial exports
and accounts for 24% of GDP
c. Turkey has become production and export base for RENAULT,
FIAT, FORD, GM, TOYOTA, HONDA, MITSUBISHI, ISUZU,
HYUNDAI, BMC, MAN, DAIMLER-CRYSLER, PEUGEOT.
d. Automotive production capacity is 1,080,155 units.

13. C. CONSTRUCTION
a. Has built construction PLAZA in Russia
b. Record time has been restored by Turkish construction
companies many a times.
c. It Under takes projects in more than 45 nations with earnings
of $42 billion.
d. Offers great Investment opportunity both for Foreign and
Local Investors.
e. Total share in world’s construction is 2%.
f. Turkey is Europe largest cement manufacturer and 7th in the
world

14. 6. What does Turkey offer as a
Business Partner
Turkey has abundant educated and trained manpower
Developed financial services and foreign banks are present to handle all
sorts of International Trade activities.
 Has easy access of Sea, Air , Land including Railway Transportation.
 It possesses sufficient infrastructure in the Information and Computer
Technologies.
A regional center for finance and financial services trade transportation and
shipment.
 It is highly experienced in the formation of free trade zones.

16. 7. PESTLE ANALYSIS of
TURKEY

17. A. Political
One of the current political strengths in Turkey is that their government have
policies on liberalisation. Turkey is supporters of liberal trade and investment
policies which allow open trade between different countries in the EU. Turkey
forged a custom union agreement in 1996 to allow many Turkish firms to get
bigger and more successful in the global economy. Exports have been rising on
average at a rate of 10% every year and this will allow the industry to flourish
with the exports produced in the Turkey
One of the current political challenges in Turkey is the series of violent terrorist
attacks that have happened in the country due to Islamic extremist, Kurdish
radicals, Turkish militants that may have link with Al-Qaeda. This is a
disadvantage for doing business, or bring plants to Turkey as it may be targeted by
these terrorist.

18. B. Economical
One of the current economic strengths in Turkey is that there is a high flow of
foreign investment coming from abroad. The investment plays apart in Turkey's
speedy expansion and this has been driving the country's economic growth. In
Turkey there is a privatisation program which was started in 2008 that will allow
the sale of major bridges, highways, electricity grids and a share in the partly
commercial bank. The money generated from foreign investment will be used for
expanding the infrastructure of the country; this will be an advantage for bringing
the business and industry into Turkey as the Turkish economy will be in growth
and to bring the industry here will only benefit the company and the industry.
One of the current economic challenges in Turkey is the current account deficit for
Turkey. The declining current account has delayed the economic stability. The
import market has seen a quick rise as an outcome of increased global commodity
prices and a sturdy Turkish lira. Turkey is even more vulnerable during times of
global financial doubt. This will be a disadvantage for Turkey as the company may
need to relocate if there is a financial crisis which may happen with Turkey

19. C. Social System
One of the social system strengths in Turkey is that they have growing proportion
of young population as they have more than half the population being aged below
30. This will allow Turkey to increase their employment rate by getting the most
out of the young labour force. This is an advantage for the business and Industry
being brought into Turkey as shows there is a healthy supply of young population
willing to work so the company could create jobs for these people.
One of the social system challenges in Turkey is that they have a high level of
unemployment. Turkey unemployment level rose by 9.20% in 2012 but then in
2013 it rose again by point 5% from the previous year, 2.75 million people are
unemployed so this shows that there is increase from the previous year. This is a
disadvantage to do business or bring industry in Turkey due to the high level of
unemployment as they may not be skilled workers in the pool of unemployed
people. There is another side to this where it can become an advantage by hiring
these unemployed and training them to work sufficiently for the company.

20. E. Technological
One of the technological strength's in Turkey is the significant development in the
ICT sector. During 2001-2012, Turkey's ICT sector expanded so rapidly it
expanded by double-digits so that shows that it was a very successful growth. In
2012, Turkey's ICT market reached $14.4 billion and in the previous year it
reached $7.9 billion so this shows that in a space of one year the market grew by
double which is a very substantial amount of money. The reason for this sharp
increase is due to the Turkish telecommunications sector as they have been
privatised by the government. This is an advantage for the plant being brought
into Turkey as this will attract more foreign investment project as well as creating
more jobs for the people of Turkey.
One of the current technological challenges in Turkey is the low expenditure cost
on the research and development. Turkey's research and development cost in 2009
was around 0.85% which is below the average of the European countries. This is
an disadvantage for Turkey as there is not that much investment being put into
the Turkish research and development, they will need investment from both the
private and public sector because the country will need to have a healthily amount
of investment in order to grow into a country which is in the EU. In the future if
the research and development cost are still low then this will erode and stop the
competitiveness of different industries in Turkey which will be bad for the long
run.

21. F. Legal
One of the legal strength's in Turkeys is the comprehensive legal structure they have.
The judicial system is made up of general courts which deal with domestic cases, heavy
penal courts which deal with more serious case, military courts which will deal with the
military cases and the Constitutional Court which is the highest level of courts that will
deal with many different cases which is essential in the Turkish government such as
war crimes. This is an advantage for Turkey as this shows that the Turkish government
are strict on the law and will enforce the law if need be, it will allow the company to
have a fair trial if any form of disruption were to come up such as trade union issues
that would cause the company any serious problems.
Another legal advantage in Turkey would be the robust framework for the business
entities, as the company who are looking to invest into Turkey will not need to go
through a very long and lengthy business registration process as there is a freedom to
start, operate and close a business by the Turkish regulatory environment. so for
example in Turkey, it will take on average 6 day to starting up a business compared to
43 days in the other world countries which is a much longer time and could be beneficial
for the type of market the company is involved with.
One of the current legal challenges in Turkey is the judicial inefficiencies as there are
some delays in the Turkish judicial system which can cause some serious issues. There
are also judges who are politically biased and this has affected legal outcome. This is a
disadvantage for Turkey.

22. G. Environmental
One of the environmental strength's in Turkeys is the prosperous biodiversity
they have. Turkey has a very comfortable natural resource base and has
ranked ninth on biodiversity in the European countries. The biodiversity has a
very great potential for the development for Turkey and this is an advantage
for Turkey as this will provide home grown raw material in cheaper price.
One of the current environmental challenges in Turkey is the high pollution
levels and the global warming being caused. The water treatment facilities,
wastewater treatment equipment and solid waste management in Turkey
needs urgent attention. The air pollution has increased over the past since
1990s an the air pollution is quite severe in the capital of Turkey, Ankara and
other city such as Istanbul. Smog in these cities is due to the increasing
number use of cars. Also there is a lot of industrial air pollution from power
plants and facilities used by the fertilizer, cement and sugar industries.
Turkey loses on approximately one billion tons of top soil annually and this
has an increasingly level of environmental pollution and that could harm the
people and economy of Turkey.

23. 8. PESTLE linked to Porter's
Diamond

24. Turkey's PESTLE analysis that links to the Porter's diamond would be how the
Turkish government :
 are creating new legislation to help the industry and different companies to grow
and foreign investment to improve and make it better for Turkey as a national
advantage.
 are making the market more demanding by stimulating foreign investment to
make them more competitive for different industries and companies so it will
benefit Turkey as a national advantage.
 can use to create new job by encouraging and training young generation to have
new skills and qualified to work in different sectors for having a very skilful
workforce.
 are improving the ICT sector so that not only it is modern but its structure would
benefit Turkey and support different industries to enable them to achieve their
optimum.
 have created a strict system for the courts to keep companies and people within
the law so that it will help them grow.
 is trying to maintain good biodiversity and create job in the process so that it can
supply rich resource of different material to different countries and for various
industries.

25. 9. TURKISH CULTURE

26. “Culture is that complex whole which includes knowledge, belief, art, morals,
law, custom and any other capabilities and habits acquired by man as a
member of the society” – by Edward Tylor
The culture of Turkey combines a largely diverse and heterogeneous set of
elements that are derived from the Ottoman, European, Middle
Eastern and Central Asian traditions
Turkey share border with thirteen counties which make grim to analyses
culture of Turkey.
 Islam is the religion of the majority of Turks although the state is fiercely
secular

27. 10. Cultural Issues

28.  The three main cultural issues in Turkey would be religion, location and gender
equality that need to be considered.
a. Religion:
Turkey's main religion is Islam and it is heavily influenced in the
many aspect of Turkish life .
faith of people in religion.
population taste and religion restrictions. Especially in the female
section there are many restrictions.
but in recent year the restriction have been very flexible as the country
is becoming more modern and more western.

29. b. Location:
where the plant or Industries will be positioned will need to be
thought over as there may have effect on environment and market.
 In terms of environmental consideration it has to be well thought
off. i.e. pollution.

30. c. Gender Equality:
Males are the dominate species in Turkey society.
A serious issue within the Turkish government.
Company may need to consider this could be a chance to break the
gender barrier and provide same wages for the female as the
males.

31. 11. Hofstede Analysis of Turkey

32. Score of Turkey on Hofstede
Parameters
66
37
45
85
46
49
77
48
56
40
51
26
90
80
70
60
50
40
30
20
10
0
PDI IDV MAS UAI LTO IVR
Parameters Parameters2

33.  Power distance
Dependent, hierarchical, superiors often inaccessible and the ideal boss is
a father figure. Power is centralized and managers rely on their bosses and on
rules. Employees expect to be told what to do.
 Individualism Vs Collectivism
Turkey is a collectivistic society. This means that the “We” is important,
people belong to in-groups (families, clans or organizations) who look after each
other in exchange for loyalty. Communication is indirect and the harmony of the
group has to be maintained, open conflicts are avoided. The relationship has a
moral base and this always has priority over task fulfillment. Time must be
invested initially to establish a relationship of trust. Nepotism may be found more
often. Feedback is always indirect, also in the business environment.

34. Masculinity Vs Femininity
Turkey is on the feminine side of the scale. This means that the softer
aspects of culture such as leveling with others, consensus, sympathy for the
underdog are valued and encouraged. Conflicts are avoided in private and work
life and consensus at the end is important. Leisure time is important for Turks, it
is the time when the whole family, clan and friends come together to enjoy life.
Uncertainty avoidance
There is a huge need for laws and rules. In order to minimize anxiety,
people make use of a lot of rituals. For foreigners they might seem religious, with
the many references to “Allah”, but often they are just traditional social patterns.

35. Long term orientation
Turkey's intermediate score of 46 is in the middle of the scale so no dominant
cultural preference can be inferred
Indulgence Vs Restraint
With an intermediate score of 49, a characteristic corresponding to this dimension
cannot be determined for Turkey

36. 12. Applying the Lewis Model to
Turks

37. Cultural Types

38.  According to the Lewis Model, Turks are mostly Multi Active, and partly
Reactive
 The Lewis Model therefore suggests that Turks are mostly:
Warm
Emotional
 Talkative
 Impulsive
And a little:
 Courteous
Amiable
 Accommodating
 Compromiser
 Good Listener

40. 13. Trompenaars’ 7 Dimensions of
Turkish Culture
 Particularism Vs Universalism Turkey continues to influence cultural life,
beliefs, language, teaching, social relationships and democracy. It infiltrates all
levels of society, providing guidance, values, and rules for personal life, public
behavior and ways of doing business.
 Collectivism Vs Individualism The most essential social unit in Turkish culture
is the family. A Turk’s personal life is dependent on and revolves around family,
friends and other community groups.
 Affective Vs Neutral Relationships
Affective
1.Not revealing what one is thinking or feeling

41. Diffuse vs. Specific Relationships
Diffuse
1.Turkish People appear indirect and introverted and work and private life
are linked
2.Indirect communication - does not always say what is really meant
Ascription vs. Achievement
1.Respect for rank, education and authority
2.Seniors take Decision
However, due to the strong sense of collectivism that underlines Turkish business
culture, the decision maker will often consider the group involved in that decision.

42. Relationship to Time
1.Try to do several activities and issues at the same time and continue
multiple conversations simultaneously
2.Common having phone call during meeting
3.Enter the meeting room without invitation
Relationship to Nature
1.Turkish people Believe in letting things take their own course

43. 14. Business meetings in Turkey
 A handshake is the accepted custom at the start of a business meeting
 Men should wait for women to extend their hand first.
 Appointments are necessary and should be made 1 to 2 weeks in advance
 On meeting people for the first time, it is customary to use their first name
 Engaging in small talk before beginning business discussions is important
 Establishing a personal relationship will be beneficial to future business dealings as
Turks prefer to do business with those they know and respect.
 Avoid business meetings in the months of July and August or around the times of
national holidays. (Try not to make appointments during Ramadan).
 As a secular Islamic Society daily routines, appointments and meetings must be
fitted around each of the 5 daily prayer times

44. 15. Do’s and Don'ts
DO’s
 Greet Seniors or most elderly first
Maintain eye contact while speaking-For them it is sign of sincerity
 Visiting Mosque-Women should wear long sleeves and a long skirt on visiting a
mosque and a hat or scarf as a head covering.
Don'ts
 DON’T use deadlines or high pressure tactics on Turkish colleagues as they will
be counterproductive.
 Be patient during negotiations as decision making can be slow.
 DON’T offer alcohol. Be sure to check that your Turkish counterparts drinks
 DON’T back away If your Turkish colleagues stand close to you during
conversation.
 Don't point with your finger at someone

45. 16. Basic Etiquette
 Don't blow your nose during meals, even discreetly
 Don't pick your teeth during meals, even discreetly
 Do not put your feet up while sitting and try not to show the bottom of your feet
to someone
 Don't bear hug or back slap someone, especially in formal situations and
occasions and with someone you just met and/or you do not know well enough.
 Don't use swear words during conversation or while talking to oneself in public
and also among friends
 Certain gestures, common in the western world, are considered rude expressions
in this culture. Making an ‘O’ with your thumb and forefinger (as if to say “OK!”)
is rude because you are making the gesture for a hole - which has connotations
referring to homosexuality in the Turkish psyche
 Public drunkenness is definitely not appreciated and is frowned upon, especially
in more conservative areas of the country

46. 17. Things to avoid
Politics
1. Turks in general have very strong nationalistic views, and would view any
criticisms of their country and expressions and attitudes insulting the
Turkish flag, the republic and Atatürk - the founding father of the republic
as very offensive and with varying degrees of hostility.
2. Don't mention the Armenian Genocide, Kurdish separatism and the
Cyprus problem
Religion
1. Turks are extremely proud and sensitive of their heritage and culture
Government
1. Issues like blocking “ YouTube “
2. Cyprus issues.

47. 18. Global Competitiveness
Index

49.  In this section we have carried out an analysis of Turkey’s performance in the overall
GCI, as well as in each of the sub-indexes and pillars of the index
 The table underlines Turkey’s relative competence in business sophistication (47th), goods
market efficiency (38th ) and, to a certain extent, innovation (55th), demonstrating the
economy’s preparedness to evolve to more advanced stages of development. However, it
also highlights some areas of particular concern, such as the stability of the
macroeconomic environment (55th), infrastructure (51th) and primary education and
health (63rd), pointing to the fact that Turkey has sorted out some of the basic
requirements of competitiveness in comparison to its 2006-2207 GCI.
 Turkish authorities now face the double challenge of needing to fully prepare for a more
advanced stage of development while, at the same time, still addressing some of the more
basic areas, such as reducing macroeconomic vulnerability, improving the access to and
quality of education, upgrading infrastructure, as well as achieving higher levels of
institutional accountability and transparency.

50. A. Closer look
 a closer look at Turkey’s comparative performance in the three sub-indexes and
nine composite pillars of the GCI.
 The factors included in the basic requirements sub index are very important for
Turkey’s productivity and competitiveness, given its present stage of
development. As Table shows, and as mentioned above, Turkey does not score
particularly well on this sub-index: with a score of 4.75, Turkey ranks 57th (which
has been lowered by 15 points since 2006-2007) out of 125 countries.
 Turkey moves up by 16 places this year to attain the 43rd spot. The country’s
economy grew by 8.4% in 2011 and benefits from considerable progress in a
number of areas covered by the GCI. Macroeconomic stability has improved and
the financial sector is assessed as more trustworthy and finance as more easily
accessible for businesses.
 Improvements to the institutional framework and greater competition in local
markets have also been registered; these will further strengthen the country’s
competitive position. Turkey’s vibrant business sector derives important
efficiency gains from its large domestic market (ranked 15th), which is
characterized by intense local competition (16th).

51. Turkey also benefits from its reasonably developed infrastructure (51st), particularly
roads and air transport, although ports and the electricity supply require additional
upgrading.
 In order to further enhance its competitiveness, Turkey must focus on building up its
human resources base through better primary education and healthcare (63rd) and
higher education and training (74th), increasing the efficiency of its labour market
(124th), and reinforcing the efficiency and transparency of its public institutions
(67th).

52. Institution
 Turkey’s institutional environment is rated as somewhat mediocre. Regarding
public institutions, ranked 64rd and with a score of 3.9, Turkey’s performance is
well behind that of the EU average. While it is clear that much remains to be
achieved.
 Turkey’s public institutions are characterized by better protected property rights,
a more independent judiciary, a higher degree of even-handedness on the part of
public officials, less wasteful government spending and better overall security in
the country.

53. Infrastructure
 quality of Turkey’s infrastructure, ranked 51 overall and with a score of 4.38, is
significantly below that of the EU average (5.03).
 Although all infrastructure assessed is well below European averages, of
particular concern is the general lack of quality of Turkish railroads and an
electricity supply that is characterized by relatively frequent interruptions and
shortages

54. Macroeconomic Environment
 Although progress has clearly been made since the 2001 crisis, with a number of
key policy reforms, Turkey still demonstrates a number of gloomy weaknesses in
its macroeconomic environment. Ranked 55th overall in this pillar, Turkey’s
performance has improved significantly than past.
 compared with the other emerging market economies which have experienced
financial crises in recent years, such as Argentina, Brazil and Russia, Turkey
remains stable to external shocks.

55. Health and Primary Education
 Turkey ranks 63rd overall and scores 5.78. In terms of health indicators, Turkey
performs significantly worse than the EU average but has improved over a
period of time . This echoes the fact that per capita spending on healthcare
remains low in the country by international standards.

56. Higher Education and Training
 As an economy begins to take on more complex production tasks, higher
education and training become critical. With an overall ranking of 74 the
Turkish higher education and training pillar gets significantly lower marks
than primary education attainment.
Concerning the quality of the educational system and its ability to meet the
needs of a competitive economy in a rapidly changing business environment,
Turkey is also falling short compared with the European average.

57. Market Efficiency
 The existence of well developed and functioning markets is a necessary
precondition for an economy to achieve sustained levels of productivity and
growth and ensure that national resources – goods, workers, services or capital –
are allocated to their most effective use. Market efficiency becomes especially
important as economies move from factor-driven, lower stages of development to
more advanced stages.
 Turkey’s overall ranking of 38th for this pillar masks a rather uneven
performance in goods , labour (128th ) and financial market (44th ) components.
Turkey seems to have achieved a relatively satisfactory degree of goods market
efficiency.
With respect to the labour market, flexibility is a major concern, with low degree
for hiring and firing practices, flexibility of wage determination and degree of
cooperation between labour and employers.

58. Technological Readiness
Technological readiness indicates the extent to which a country is
harnessing existing technologies to enhance the productivity of its
industries. The technological readiness pillar measures countries’ capacities
to absorb technology and this is complemented by the innovation pillar
which assesses countries’ endogenous innovation potential.
Turkey, with a score of 4.29, ranks 53nd overall in technological readiness.
 In terms of technology absorption, Turkish firms are assessed as being
relatively aggressive in adopting new technologies

59. Business Sophistication
 Turkey presents quite an interesting case given its stage of development since it,
in fact, shows a competitive advantage in this pillar. Turkey is assessed as doing
well regarding business sophistication compared with its own performance in the
other GCI pillars
With a rank of 47 and a score of 4.25, business sophistication is by far the pillar
in which Turkey does best.
 Turkey’s competence in business sophistication not only promises well for its
prospects to evolve toward more advanced stages of development, but also
upholds the progress achieved in recent years

60. Innovation
• In current knowledge-based and interconnected economic systems, innovation
becomes the only sustainable driver of productivity growth for firms and
countries alike.
• Turkey has not reached the innovation-driven stage and can still improve its
productivity with a rank of 55 and a score of 3.33.
• Shortcomings underlined in this section are not extremely worrisome at the
present time, but should be addressed in coming years as the country moves to
more advanced development stages

62. 18. SWOT Analysis of Turkey
Economy

63. A. Strength
1. Fast Growing Economy
!6th in the world GDP (PPP)
Open up free market
Improved import and export opportunity.
Banking sector is structurally strong, improved credit condition in the market.
Increased resilience against external shocks
2. Investment Incentives
Very involved in global Market
FDI is encouraged
3. Demographics
Growing population , younger population
4. Location
Essential hub for import and export as Turkey borders eight countries
Great ties with Western and European countries

64. B. Weaknesses
1. Political and Legal Issues
Some level of political and legal issues persists with in Turkey regarding
neighboring countries
2. Corruption Level
Ranked 61 in the world in corruption level
Turkey is 4.2 in the corruption Index
3. Issues regarding religion
Government imposes some restriction on religion and is mostly expressed in
offices and State run Institution.
4. Equality Issues
Men and Women are not treated as equal.

65. C. Opportunities
 Reduced Barrier more stable
 Countless opportunities for workforce use and physical labor
 Advantage of increased incentives and tax allowance
 Increase global integration

66. D. Threats
1. Location and Territorial issues
Neighboring country territorial dispute poses challenge to for foreign investor
through way of border.
2. Crime Rates
High lucrative underground sex-slave trade provides opportunity
3. Terrorism and war

67. 20. Conclusion
 Turkey should be much-admired for the great progress it has achieved in recent
years, which is reflected in the country’s impressive rise in the competitiveness
rankings. However, reforms and actions must still be carried out on several
fronts to achieve higher stage of development and European standards of
competitiveness. There is a challenging road ahead.
With rapid growth rates and a young and increasing population of over 70
million, Turkey has the potential to be the largest economy in Europe after
Germany. Turkey is now a member in the G20 club of important economies, and
it is almost on par with the emerging giants of the BRIC club. Some forecasts
even suggest that during the next decade Turkey will grow faster than any other
country besides India or China.
 Nevertheless Turkey still has problems that need attention. Inflation is still
prevalent, the current account deficit is large, corruption is widespread,
competitiveness is an issue, and most problematic, unemployment is exceedingly
high, especially in the east and south east, and among women and those first
entering the labour market. The current semi autocratic leadership and the
growing fears about limits to free press are also an increasing matter of concern.
Turkey must overcome these obstacles in order to sustain healthy long term
economic growth.