Country Analysis of Turkey

Turkey is located in Southeastern Europe with borders on the Black Sea, the Aegean Sea, and the Mediterranean Sea. This is considered an advantage for Turkey as it controls the straits that link these bodies of water. Another advantage is that Turkey is filled with many natural resources which benefit its people and its economy through exports (CIA, 2009). In spite of these advantages Turkey is still a developing country. Turkey's economy has seen many growth opportunities through foreign investments, economic and judicial reforms, as well as new emerging markets within the last decade, however, is left vulnerable due to the global economic slowdown (2009).

Turkey can further develop its economic systems by increasing and improving its foreign direct investments (FDIs), better developing its trade, and increase its productivity. Some important country factors that have an impact on these types of economic growth are the culture, geography and natural resources, as well as political and social issues in Turkey. The following sections discuss and consider the impact of these factors on the growth and development of FDIs and the economy in Turkey.

Cultural Impacts

In addition to being a large country, Turkey is considered to have a large population (Lammers, 2006). The estimated population in July, 2009, is ranked 18^th in the world comparison (CIA, 2009). Less than 10% of Turkey's population is unemployed, and less than 18% is below poverty levels (Sansal, 1996-2009). Approximately 85% of the total population of Turkey is literate and educated (CIA, 2009). Every citizen has the right to a free primary education, and the set up for schooling is much like that of the United States (Sansal, 1996-209). While Turkish is the official language taught, there are five languages spoken within the Turkish culture. These language differences really have no barrier effects on the state of the economy, with the exception of the language and cultural differences among the Turks and the Kurds, which will be discussed in the evaluation of the country's social issues. Turkey's primarily Muslim religion, however, does set their culture apart from many of the other European nations, making it difficult to assimilate (GoCurrency.com, 2005).

Turkey's culture and religion do seem to have a profound effect on economic trade and investments. It is also seen that even with its high numbers of population and employment, the underdevelopment of Turkey's economy is primarily due to its low productivity, which keeps the per capita income also very low (Lammers, 2006). An increase in productivity would be a positive contribution to Turkey's economic growth, as it would aid in bringing the interest of outside investors. The continued support of education in Turkey may also influence the productivity.

Environmental Impacts

Turkey is located in Southeastern Europe and Southwestern Asia with 780,580 square kilometers of landscape varies with mountainous ranges, lakes and bodies or water, with many coastal plains (worldfacts.us, 2004-2008). Turkey is encircled by seas on three sides with 7,200 km of coastline, and has control of the straits that connect the bordering seas (CIA, 2009). The agriculture of the land composes 12% of the country's GDP sector, and provides 40% of the population's workforce (worldfacts.us, 2004-2008). These agricultural goods help the country's industry provide its exports and investments. The country is also rich in natural resources which would benefit its foreign investments. Turkey's electricity also comes from the land through fossil fuels and hydropower both (2004-2008).

Political and Social Impacts

Political

Turkey's political positions are some of the greatest hindrances on the growth of its economy and its foreign investments. Since the country was founded in 1923 its political system has seen many changes. When Turks defeated the Ottoman Empire the country experienced a period of a single party rule with a wide-range of social, legal, and political reforms put in place by Mustafa Kemal (CIA, 2009). In the 1950's Turkey started to experience multi-party politics and tried to become a democratic nation. The growing military coups caused many upsets and instabilities for a Turkish democracy, but by the 1980's the political power had returned to the people (2009). Turkey has undertaken many reforms trying to strengthen its economy, and join groups such as the UN, NATO, and the EU (CIA, 2009).

These governmental and economical instabilities make it hard for investors to find Turkey attractive for their investments. Turkey has in fact strengthened its economy through its membership and economic reforms with the above mentioned groups. Trade barriers were abolished when the Turkey joined the EU and this increased both exports and imports for the country (Lammers, 2006). Adopting EU standards and norms helped to increase Turkey's competitiveness and gain foreign investments (2006). While Turkey's fragile economy was hit hard by the global recession, its 45+ banks made it through much better than other economies, as not a single bank has gone under (Sansal, 1996-2009 & The Economist Newspaper Limited, 2009).

Social

While the Turkish government continues to promote a secularized state, in the matters of religion this causes some controversy. Since 99% of the total population in Turkey is Muslim, they would like to see a more public display of religion and less secularism (MSN Encarta, 1993-2009). Such changes include that religion become a part of education in schools, and removing the ban of women having to wear headscarves in schools and government offices (1993-2009). This conflict brings economic reforms to help improve the social and economic status' of Turkey's Muslim people.

Another social issue concerns the cultural rights of the Kurdish minority in Turkey. Kurds are the tens of thousands of Iraqi refugees who fled the chemical weapons attacks of their government and now reside in Turkey (US Library of Congress, 2009). The Kurds have publicly been acknowledged as a separate ethic group and culture, and various political parties are now promoting the full equality of the Kurds and the Turks within Turkey (2009). However, according to an Encyclopedia article found in MSN Encarta: "Some Turkish nationalists view the Kurds' demands for Kurdish-language radio and television broadcasts, publications, and education as a threat to the country's national integrity. These Turks have organized vigilante-like groups who have attacked Kurds and their property in cities with mixed Kurdish and Turkish populations. Groups who defend the rights of Kurds complain that the Turkish government does little to protect Kurds from such attacks and even may encourage them" (paragraph 2).

This type of social conflict can also impact political issues within the country. There can be separate political parties for the two cultures, which may cause more problems for the local government when trying to strengthen the democratic practices.

Conclusion

In closing, Turkey's location in Southeastern Europe and Southwestern Asia, gives it the best of both worlds (European, Asian). It neighbors eight different countries through its land and sea borders, giving opportunity for exports and investments to grow. Its vast amount of natural resources and ability to live off the land, as well as its agricultural impacts on industry also strengthen Turkey's trade growth.

Turkey is a large country with both developed and non-developed parts. The CIA lists Turkey as a developed country because of its association with NATO, the OECD, the EU, and having a developed industrial base within its western regions (CIA, 2009). While Turkey is still trying to further develop its economy and investments, Turkey's past economic crashes were mostly due to its once political instabilities. Through its memberships with other political councils Turkey has strengthened its trade and investment opportunities while increasing its imports and exports. Turkey continues to grow its economy though its adoption of both social and political reforms. Moving forward with these changes, Turkey may be robust enough to get through these economic hardships.

References

CIA. (2009). CIA - The World Factbook - Turkey. Retrieved on August 20, 2009.

GoCurrency.com. (2005). What is the Turkish Lira (TRY)? Retrieved on August 22, 2009 from.

Lammers, K. (September/October 2006). The EU and Turkey - Economic Effects of Turkey's Full Membership. Intereconomics.

MSN Encarta. (1993-2009). Turkey. Retrieved on August 22, 2009.

Sansal, B. (1996-2009). All About Turkey. Retrieved on August 22, 2009.

The Economist Newspaper Limited. (2009). Fund Management. Retrieved on August 22, 2009.

US Library of Congress. (2009). Turkey - Government. Retrieved on August 22, 2009.

Worldfacts.us. (2004-2008). Facts About Turkey. Retrieved on August 22, 2009.