Turkey Economic Outlook: Resilience and Growth Point to Positive Prospects for Investors
January 22, 2024 · Türkiye · 10-minute read
Türkiye made significant progress in finance and investment in 2023, demonstrating notable economic resilience and strategic growth. For investors following the Turkey economic outlook, recent positive signals point to the country’s ability to attract foreign investment and implement effective monetary policy, positioning Türkiye as a promising destination for international investors in the years ahead.
Türkiye is one of the fastest-growing economies in the Middle East and Europe. Its strategic location makes it an important gateway to the European Union, a market of 448 million consumers. In recent years, the Turkish government has continued to introduce reforms and effective policies that have strengthened the country’s credibility, which it has used as a lever to sustain domestic economic growth and attract foreign investors.
Moody’s raises Türkiye’s outlook to positive on a decisive shift in economic policy
Moody’s Investors Service (MIS) is one of the world’s leading credit rating agencies. Its data, analysis, and insights into the creditworthiness of companies and governments worldwide help investors make better-informed decisions, and its ratings are designed to give investors transparent, impartial information. On January 13, 2024, Moody’s revised its outlook on Türkiye’s credit rating from “stable” to “positive,” citing the many decisive and effective changes the Turkish government had made to its economic policy.
Economic analysts noted that Türkiye’s return to orthodox monetary policy would significantly reduce the country’s macroeconomic imbalances. Although inflation may continue to rise in the near term, there are signs that inflation dynamics are beginning to turn, suggesting that monetary policy has regained credibility and effectiveness. Moody’s indicated that its assessment of the country’s creditworthiness would continue to improve quickly if Türkiye stays the course with its new policy program.
Hafize Gaye Erkan, Governor of the Central Bank of the Republic of Türkiye (CBRT), recently reaffirmed the country’s commitment to disinflation, a key marker of economic stability. She pointed to a marked improvement in the inflation outlook and the bank’s determination to maintain price stability. The CBRT’s efforts to rebuild foreign exchange reserves have made considerable progress, strengthening investor confidence in the Turkish economy.
Building credibility to attract foreign investment to Türkiye
Türkiye has many strengths that support growth, including its strategic geographic location, a large and highly skilled workforce, strong capacity for technology adoption and innovation, and continued investment in infrastructure. These strengths have long made Türkiye a business-friendly environment and an attractive destination for foreign direct investment (FDI). The country draws foreign investment across a wide range of sectors, and the government aims to make Türkiye a global investment hub that meets investors’ needs and addresses the challenges they face.
In the first 11 months of 2023, the country recorded US$642 million in investment inflows, with banking investment playing a key role. Wholesale and retail trade accounted for a notable 14% of total inflows. Manufacturing, particularly computers and electronic and optical products, also saw a sharp rise in interest from foreign investors. Real estate and services were another major contributor to Türkiye’s FDI, accounting for 36% of total inflows in the first 11 months of 2023. Property sales to foreign buyers were a key driver, reflecting the country’s appeal to international real estate investors.
Turkish real estate investment: a route to second citizenship with significant benefits
The real estate investment route to Turkish citizenship is one of the most sought-after citizenship by investment options available today. The program has drawn even more attention since Türkiye and the EU resumed talks on visa liberalization for Turkish citizens. If an agreement is reached, it could significantly enhance the value of the Turkish passport.
With a real estate investment of at least US$400,000, investors, together with their spouse and children under 18, can obtain Turkish citizenship with the same rights as other Turkish citizens. The Turkish passport offers visa-free or visa-on-arrival access to 116 destinations and can make it easier to apply for visas to the EU and the Schengen Area (France, Germany, Italy, Greece, and others). Turkish citizens may also qualify for certain US visa categories that allow them to live and work in the United States.
Processing is relatively fast, typically around 12 months. The program’s requirements are straightforward:
- A minimum property holding period of just 3 years, among the shortest of any citizenship by investment program.
- No medical examination required.
- No asset declaration required.
- No blanket nationality restrictions; open to applicants of most nationalities.
- No upper age limit, and no education, work experience, or language requirements.
- No requirement to reside in Türkiye.
The property used for the citizenship application must be appraised by an independent third-party valuer, as required by the program, to protect foreign investors. Investors may resell the property after 3 years. Türkiye’s real estate market offers potential for returns, supported by its growing economy and tourism sector.
If you are interested in Turkish citizenship by investment, please contact IMM Group or leave your details below. Our experienced advisors will provide detailed guidance and help assess your eligibility. We are committed to protecting your personal data and will use the information you provide only to advise on your family’s application.
IMM Group
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