Successfully investing in Türkiye

German companies seeking to invest or conduct business in Türkiye face a range of specific challenges. One of the key tasks is establishing trustworthy, long-term partnerships – an aspect of particular importance in Turkish business culture. Entering the market also requires a solid understanding of the local legal and tax frameworks, which in some cases differ significantly from European standards.

Another critical factor is the strategic evaluation of the numerous government support programs, especially those targeting manufacturing firms and start-ups. While these programs offer attractive incentives, they require careful analysis and planning. Flexibility and adaptability are essential, as Türkiye’s economic environment is highly dynamic and demands swift corporate responses. Language and cultural differences can pose additional barriers, making intercultural competence and local expertise crucial success factors. Early and professional advisory support is therefore strongly recommended.

Persistently high inflation and the significant depreciation of the Turkish Lira against foreign currencies present particular challenges for companies focused on the domestic market. The Turkish government is addressing these issues through structural measures aimed at curbing inflation and stabilizing the currency. Notably, the exchange rate has shown a more moderate trajectory compared to inflation – an indication of emerging stabilization trends.

In the wake of the pandemic, many companies have re-evaluated their business models, placing greater emphasis on innovation and strategic realignment. This includes increasing local value creation to reduce dependency on global supply chains.

Economic fluctuations in recent years, combined with multiple minimum wage increases, have led to a noticeable rise in labor costs. Many companies have had to adjust salary structures and introduce additional benefits to retain qualified personnel.

Although Türkiye, as a non-EU member, is not directly subject to the German Supply Chain Due Diligence Act or ESG regulations, these frameworks are increasingly affecting subsidiaries and suppliers indirectly. Companies are therefore well advised to implement sustainable and responsible business practices in Türkiye as well, in order to meet international standards.

Its adaptability, combined with continued economic growth, supports a fundamentally positive outlook for the coming years. In the medium to long term, companies can expect favorable opportunities – driven by solid growth rates in international comparison, a young and well-educated population, and a strong entrepreneurial spirit.

To stabilize the economic framework, the government has introduced a series of policy packages, including measures to cushion exchange rate losses and curb inflation. Early signs of stabilization became evident in the first quarter of 2024, particularly through a notably steady exchange rate trend since March.

Türkiye’s economic prospects remain promising: if inflation is successfully contained, current account deficits are reduced, and investor confidence is strengthened, the country could experience robust growth in the years ahead. The government is increasingly pursuing a structural policy agenda focused on sustainable development and regional value creation.

Another key advantage lies in the country’s pronounced crisis resilience. Experiences from past economic and geopolitical crises have enhanced the adaptability of both public institutions and the population – an often underestimated competitive edge in the international context.

As an economic and geopolitical bridge between East and West, Türkiye remains a competitive and strategically important partner – both for European companies and for global trade.​​