In efforts to ensure the safety and operational maintenance of German investors as a robust investment haven, Turkey has managed to secure investments from German companies, keeping plans intact
Last week, German Foreign Minister Sigmar Gabriel told German firms that investing in Turkey is no longer safe and implied that economic sanctions on Turkey must be imposed after German press published allegations that Turkey launched investigations into a list of German firms operating in the country on the grounds that they support terror groups.
However, not only were allegations rebutted by Turkey, but German firms also stated that their investment decisions will not be affected by the political tension, and they will be executed as planned. Operating in what is now Turkey since the second half of the 19th century, MAN Trucks & Bus Company employs almost 2,000 people in the country.
Speaking to Daily Sabah about the recent political row between Turkey and Germany, which was stoked by German Chancellor Angela Merkel’s aggressive rhetoric, MAN’s officials in Germany underscored that the company has no restrictions on production, nor on the procurement of components or on the export of vehicles.
“All the buses left the factory as planned. This is very important for us, after all. MAN Truck & Bus in Ankara supplies the whole world with travel buses of the brands MAN and NEOPLAN,” the official said, adding that the plant management as well as the production managers at MAN headquarters are closely following the course of events.
Drawing attention to MAN’s growing business in Turkey and extensive long-distance bus network in Turkey in the country’s road transportation, the official noted, “The Turkish market for touring coaches has shown modest behavior over the last year. In the first half of the year, MAN was able to record some major orders, for example 20x MAN Lion’s Coach for Pamukkale Tasimacilik Turizm, 16x MAN Lion’s Coach for Platforum Turizm Tas. Gida Insaat and 14x MAN Lion’s Coach for Cimen Turizm Ins. Plast. Ürün,” in a bid to highlight that the company’s production operations will continue in Turkey. Seeing no reason to change the existing production network, MAN expects to preserve its operations plans intact.
Furthermore, prominent Turkish economists also see no reason as to why German companies will be affected by the political row ignited by the country’s government.
Highlighting that Turkey attaches utmost importance to foreign direct investment and does its best to provide foreign investors with a safe investment climate, Investment Support and Promotion Agency of Turkey (ISPAT) President Arda Ermut said that Turkey has an exclusive foreign direct investment law enshrining equal treatment for all investors, regardless of being foreign or local, and providing investors with certain guarantees such as international arbitration for dispute settlement and protection against expropriation or nationalization.
ISPAT President Ermut told Daily Sabah that German investments are also protected by the bilateral investment promotion and protection treaty between Turkey and Germany, which has been in force for more than 50 years and is the first bilateral investment treaty that Turkey signed.
“It is, therefore, German investments in Turkey that are fully guaranteed by the domestic and international laws as well as by Ankara, which views FDI as an important component of its economic development. None of German companies are under any investigation, in fact as the investment agency we are in close contact with them and facilitating their investments in Turkey,” Ermut said, dismissing allegations of a government probe into German companies and highlighting the agency’s efforts to provide an investor-friendly environment in Turkey.
Pointing out President Recep Tayyip Erdoğan’s extensive support to bring in FDI to Turkey, crystallized in the foundation of the agency, Ermut said that since its establishment, the agency has been providing foreign investors in Turkey with facilitation services at all stages of their investments and will continue to do so.
“I have been working with the agency since its establishment and during my more than 10 years of experience, we have always kept investment relations separate from bilateral political issues and never allow such issues to jeopardize the investments,” he said.
Speaking to Daily Sabah, Economy professor Kerem Alkin recalled the recent comments by President Recep Tayyip Erdoğan that German companies are wiser and more intelligent than the German government.
As the best proof, Alkin underscored the fact that four German companies were included in eight consortia, which submitted proposals yesterday for the 1000 MW Wind Energy Renewable Energy Resource Areas (YEKA) tender from the Ministry of Energy and Natural Resources, indicating that German companies did not abide the warnings issued by the German officials.
He also pointed to yesterday’s meeting between Prime Minister Binali Yıldırım and the managers of 19 German companies operating in Turkey, emphasizing that the meeting was a positive development.
Underlining the importance of the relations between the two countries, Alkin said that German companies should actually warn their own government, and he also underscored that the ties between Germany and Turkey are extremely important for the future of the European Union.
TURKEY SAFEGUARDS GERMAN INVESTORS FROM ROW
The government sees German companies operating in Turkey no different than their Turkish counterparts, Prime Minister Binali Yıldırım told company executives yesterday.
Speaking at a meeting with the executives at the Çankaya Prime Ministry Office in Ankara, Yıldırım said that Turkey highly values their companies, in response to German Foreign Minister Sigmar Gabriel’s statements urging firms to avoid doing business in Turkey.
“For us it is crucial to ensure that you do not sustain any damage or become a part of this tension” Yıldırım said and added that they see German companies as part of Turkey.
The prime minister assured companies that they will not pay the price for the problems between the two countries.
Moreover, speaking at the Justice and Development Party’s (AK Party) parliamentary group meeting Tuesday, President Recep Tayyip Erdoğan said that German officials made a bigger deal out of an investigation into the Turkish firms who are affiliated with the Gülenist Terror Group (FETÖ) and turned the matter into an issue related with the German companies operating in Turkey.
Explaining that the issue emerged due to miscommunication, Erdoğan accused the German politicians of escalating the problem. Regarding the allegations about the targeting of German companies in Turkey, he said, “Nevertheless, it is clear that German politicians escalated this issue. We can see that the companies of this country [Germany] are more intelligent, more visionary and more prudent than its politicians.”
Emphasizing that the signals coming from the business world point to the continuity of existing activities and new investments, Erdoğan said that there is no investigation or prosecution concerning any of the German companies in Turkey.
GERMANY HAS HIGHEST NUMBER OF FOREIGN-INVESTED FIRMS
Currently, there are 6,969 German companies in Turkey as of April, which puts Germany at the top country with highest number of foreign-invested companies operating in Turkey. According to the data compiled by the Ministry of Economy, the foreign direct investment (FDI) from Germany to Turkey between 2002 and May 2017 was recorded above $9 billion, featuring Germany as the sixth among the top 20 countries investing in Turkey. The FDI from Germany, which generally makes investments in the energy, insurance and manufacturing sectors, is calculated to compose 6.3 percent of the total FDI in the country. Moreover, the ministry’s data shows that the amount of German investors in Turkey during the January-April period this year increased more than 100 percent as the German FDI was recorded at $123 million during the said period while it was $58 million last year in the same period.
* Contributed by Yunus Paksoy