A new foreign direct investment (FDI) strategy which was revealed recently by the presidential Investment Office, targets enhancing the country's integration into global supply chains and bolstering its digital-oriented strategies, according to a report on Saturday.
"Türkiye Foreign Direct Investment Strategy 2024-2028," was published late in July and outlines the general framework of the country's FDI policy and guides practices in this area.
The main goal of the strategy is to increase the country's share of the FDI pie to 1.5% on the global scale through qualified projects by 2028 and increase its regional share in FDI inflows to 12%, according to the country's Official Gazette and the Investment Office.
According to information compiled by Anadolu Agency (AA), the level of alignment with international trade policies in the areas of green and digital transformation is set to be increased to strengthen the country's integration into global value chains within the scope of the global supply chain.
In this context, legislative work would be carried out to improve the competitive environment in digital markets. The dimensions of EU digital economy regulations affecting Turkish trade and the steps that need to be taken are also set to be identified.
Considering the economic developments in national and world trade, efforts would be made to update bilateral and multilateral agreements (the customs union, free trade agreements, agreements to prevent double taxation, etc.) that Türkiye is a party to and to implement new agreements.
At the same time, Türkiye's preferential trade network would be strengthened, new free trade agreements (FTAs) are set to be negotiated and efforts would be made to expand the scope of existing free trade agreements.
Similarly, negotiations to update the customs union are expected to be conducted, and national negotiation preparations are anticipated to be completed by taking the opinions of the public, private sector, nongovernmental organizations and academics.
To strengthen Türkiye's position in global value chains, logistics capabilities and infrastructure in all modes of transportation are also being developed, considering environmental and green transformation sensitivities.
In port operations, the use of low-emission/non-emission machinery and equipment will be encouraged to increase energy efficiency and minimize environmental impacts, supporting green port practices.
Moreover, the strategy envisions making infrastructure and technology investments for the use of electric or other alternative fuel vehicles in all modes of transportation, along with compliance and legislative arrangements for new generation, sustainable, integrated mobility services that are also expected to be completed.
Efforts to increase the effectiveness and diversity of the transportation corridors in which the country is located would continue to ensure the sustainability of the global supply chain.
In addition, a main port would be constructed in the Eastern Mediterranean region to serve as an exit gateway for Middle Eastern and Central Asian countries, focusing on transit cargo, contributing to the region's development, and increasing exports, as per the AA report.
The report also cited the target for establishing new industrial zones and logistics lines, considering disaster risks and with existing rail infrastructure set to be used more effectively, strengthening connections with industrial zones and ports.
Collaboration, integration
Furthermore, by developing collaborations between existing international investors in Türkiye and local supplier companies, the integration of local companies into global value chains is set to increase.
Small and medium-sized enterprises (SMEs) are also set to be encouraged to cluster around large-scale companies to strengthen the local supply chain.
Facilitation of the integration of SMEs into the supply chains of major industrial producers and large enterprises will be provided, and the necessary quality, efficiency, capacity increases, and product development (R&D) activities will be supported within the supplier development processes.
Information and communication technologies will be utilized to the maximum extent to increase efficiency and productivity in customs procedures, and customs services will be aligned with green and digital transformation.
Innovative technologies such as blockchain and optical character recognition (OCR) are also due to be used in foreign trade transactions to spread paperless customs applications.
The studies on the use of blockchain technology in export transactions are set to be developed to include the Computerized Customs Activities System (BILGE).
Additionally, efforts will be made to increase the share of qualified service inputs such as R&D, product development, design, supply chain management, distribution, and maintenance repair to increase the added value in the manufacturing sector.