The security situation in Turkey and the failed coup attempt in July have raised questions in the Finnish business community on the current situation and the future prospects of the country. Uncertainty in both internal and external politics of Turkey can have indirect effect on business.
It is still too early to estimate the impact of the coup attempt on the business environment in the long run. Since the coup attempt, the Turkish government has taken measures to protect the monetary and fiscal policy, and to ensure a stable business environment. There have also been attempts to reassure foreign investors that Turkey remains a good target country for foreign investments.
After the failed coup attempt, the Turkish currency was depreciated and stock prices went down, but the Central Bank took quick measures against liquidity issues. Turkey is dependent on foreign trade and therefore the aim is to stabilize the business environment quickly. The long term situation of the Turkish economy depends also on the credit rating agencies´ decisions on Turkey. Moody’s rating for Turkey remained Baa3 after the coup attempt, which is still on investment grade level.
After the failed coup attempt, a state of emergency was announced for three months. The government underlined that it will not affect the daily life of citizens or businesses and that the state of emergency will only root out the culprits behind the coup attempt. Big multinational companies (such as BP, PepsiCo, Mercedes-Benz, P&G and Unilever) have stated that they will continue their investments and operations as planned.
The value of Turkish lira has regained its value and is catching up the pre coup attempt level. There is still a lot of potential in the Turkish market. Even with the unpredictability, the Turkish economy grew at a speed of 4.8 % in the first quarter of 2016. In addition, due to complementary nature of Turkish and Finnish companies and Turkey’s good geographical location, cooperation in third counties is a good business opportunity for Finnish companies.
Finland has a very positive country image in Turkey and the Finnish government puts a lot of effort into developing trade relations with Turkey. Finland is considered as a forerunner in high technology which creates more demand for Finnish companies in Turkey. Some of the most potential sectors for Finnish companies are cleantech, education, health technology and design.
Turkey has unfortunately been faced with several terrorist attacks over the past year. Security situation remains unpredictable throughout the country, but the situation is the most volatile in the South-Eastern Turkey. The Embassy of Finland in Ankara recommends tourists and Finnish citizens living in Turkey to send a travel notification. The Finnish Embassy in Ankara monitors the security situation closely. The risk of further terrorist attacks cannot be excluded. Check out the updated security situation regularly in the travel information on the embassy website: http://www.finland.org.tr/public/default.aspx?nodeid=37338&contentlan=1&culture=fi-FI (in Finnish)
We advise you to fill in a travel notification before travelling to Turkey: https://matkustusilmoitus.fi/public_html?command=browse&lang=en
And in Finnish: https://matkustusilmoitus.fi/public_html?command=browse