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By Steve Bideshi Citibank A.Ş Türkiye Content 1) Rising FDI environment world wide 2) Competition with other EM (FDI) 3) Turkey moving to build FDI 4) Why Turkey? 5) Why Turkish Banking Sector? 6) Moving Forward (Strategies and Efforts).... 1 Worldwide Phenomenon FDI inflows are growing worldwide Regulatory regimes more liberalized in many countries Intense competition, market seeking and search for lower costs Intensified policy and promotion efforts by countries Opening of major new markets e.g. BRIC countries For the first time we have witnessed a big movement from EM to developed markets 2 Competition Staying competitive will require constant flow of new ideas and smart work China, India new ‘centers of gravity’; in addition to major developed countries Asia and Central East Europe remain highly competitive. Turkey competes with BRIC Countries, Eastern Europe, and with traditional markets like USA to attract FDI.. 3 FDI as a % of GDP 40,0 35,0 30,0 Turkey Turkey 25,0 Bulgaria Bulgaria 20,0 15,0 Romania Czech Rep. Romania Hungary 10,0 5,0 0,0 2003 Russia Czech Rep. Brazil Hungary Russia Brazil 2004 2005 2006 4 Turkey Moving to Build FDI-2006 Over the past two years, Turkey has enjoyed an unprecedented inflow of foreign investment FDI financed almost 40% of Turkey’s external deficit in 2006. Promotion: Investment Advisory Council 70.000 FDI (US$ mn) 60.000 50.000 40.000 30.000 20.000 10.000 na Ch i Tu rk ey a Ru ss i l Br az i Ro m an ia In di a Po la nd y Hu ng ar Bu lg ar ia Cz ec h Re pu bl ic 0 5 Why Turkey It’s economic size Significant momentum to grow Dynamism Quality of labor source and higher productivity Young and dynamic population Political stability EU reform process where significant progress has been made and continuing. 6 Why Turkish Banking Sector Strong and Respected Regulator Sector's renewed strength after five years of restructuring Banking Sector has vast Management talent Improving Efficiency Stronger capitalization Reduced market risk Stronger liquidity Under banked 7 Moving Forward Moving forward in a competitive global environment demands: Strategy + Structures Shared Vision 2007 – 2027 and Targets Government Endorsement and Support 8 More Specifically Working with existing investors. Investment environment: continue reform… Invest in Education Judicial Reform Keep EU negotiation process alive Maintain privatization and structural reforms Continue Fiscal Discipline Political Stability Consistent Monetary Policies and Discipline Incentives the Long Term FDIs Greenfield investment: make it a priority Strengthen Existing Capacities 9