Receiving $13 billion foreign direct investment (FDI) in 2018, Turkey will attract more investment across from the world, according to a strategist and analyst.
Commenting on the Global Investment Report 2019 of the United Nations Conference on Trade and Development, Cuneyt Paksoy told Anadolu Agency that Turkey attracted more investment in an era while the global FDI was performing in a downward trend.
If Turkey diversifies investment instruments and completes its reforms on justice, education, agriculture, and livestock, it can steer the global FDI, Paksoy asserted.
Last year, the FDI received by Turkey increased by 13% while the global FDI saw a decrease of 13% to drop $1.3 trillion, according to the report published in June.
The report said the FDI dropped by 27% in developed countries while it climbed by 2% in developing countries and 4% in developing Asian economies.
"Four countries absorbed approximately 90% of the FDI in West Asia. Turkey was the largest recipient, with inflows rising by 13% to $13 billion, despite slower than usual economic growth and uncertainty surrounding the Turkish lira," the report noted.
Foreign investors trust Turkey
Turkey makes structural reforms and provides financial balance, Paksoy said, also stressing its production-based growth, and its increase in exports and tourism revenues.
Foreign investors did not lose confidence in Turkey, he said, the FDI flow to the country was not cut, and foreign investors consider Turkey's steps.
"Turkey became a strong country in its region and in the world, it is a factor before the global major countries, especially the U.S., China, and Russia," Paksoy noted.
The report showed the Turkish economy was the most active in concluding international investment deals in 2018 with eight bilateral agreements.
Turkey is also the fourth country among the developing Asian economies with the 102 special economic zones -- China has 2,543, the Philippines has 528, and India has 373.
Trade tensions axe global FDI
Paksoy also recalled that Turkey is the only country which is a bridge between the east and west.
"Turkey is also a permanent transition zone of trade and energy routes, there can be no solution in the eastern Mediterranean without Turkey," he stressed.
Despite a weaker growth performance of Turkey, foreigners continue to invest in the country due to its young population and growth potential, he said.
Paksoy cited Azerbaijan's SOCAR investment and German Volkswagen's investment plan in Turkey as a proof of it.
The $6.3 billion SOCAR was one of the largest foreign investments in Turkey, according to the UN report.
Also addressing the recession in the global FDI, Paksoy said the U.S.-China trade tension and structural problems in the EU countries are the main reasons.
The report forecasted that the FDI would see a weak recovery by 10% in 2019 to reach $1.5 trillion, under the average during the last decade.
Uncertainty affects global economy
Enver Erkan, an economist at GCM Menkul Kiymetler in Istanbul, said: "As the global economies are heading to uncertainty, it is seen that the investments are in a decreasing trend."
He said that the uncertainty stemmed from the trade wars and other political issues such as Brexit had negative effects on the global economy.
"Many countries will be affected by the economic downturn created by the trade war, especially the economies growing by exports will suffer from this situation," Erkan added.
He also said problems in developed economies may highlight some unsatisfied markets within the scope of market diversification strategy.
