More Singapore firms flocking to Turkey

Straits Times (Singapore) Tuesday, December 11, 2012, p. 34               Türkçe

Yasmine Yahya

Rise of its middle-income population, strength of economy are pull factors. With its wealth of natural resources and its prime geographical location at the crossroads of Asia and Europe, Turkey is fast becoming a top investment destination among Singapore firms.

Just last week, Temasek Holdings was said to have bought a small stake in Turkiye Halk Bankasi, Turkey’s second-biggest bank.

Other Singapore firms and institutions have also made forays into the market this year, citing the rise of Turkey’s middle-income population and the strength of its economy among the pull factors.

After an economic boom between 2002 and 2007, Turkey’s economy took a beating in 2008 in the global financial meltdown.

However, the Singapore Business Federation (SBF) noted that its well-regulated financial markets and banking system helped the country weather the global economic crisis and the economy rebounded strongly with an expansion of 8.2 per cent in 2010.

Since then, many investors have swooped into the country of about 80 million.

Among them was local brokerage group PhillipCapital, which acquired a securities and futures brokerage firm in Turkey in March.

In June, trade agency IE Singapore opened an overseas centre in Istanbul.

And in September, the Singapore Exchange signed a memorandum of understanding with its Turkish counterpart to enhance cooperation and exchange best practices.

Malaysian health-care firm IHH Healthcare, which launched Singapore’s biggest initial public offering this year, also counts Turkey among its main markets.

Indeed, the increased engagement between Singapore and Turkey has been broad based. Bilateral trade grew 79 per cent last year to $2.2 billion.

SBF said it has also seen greater interest from Singapore companies in the Turkish market this year. The federation had five engagements with Turkey this year, including two business forums and a business mission to Turkey in May.

This is quite a rise from the past three years, during which SBF had only one engagement with Turkey on average each year.

« Turkey lies between Asia and Europe, serving as a bridge geographically, culturally and economically, » SBF said in a country brief for Turkey.

« Its location on two continents plays a central part in Turkish history and gives the country a major advantage in serving the markets of Europe, the Middle East and North Africa. »

Turkey has a vast range of mineral resources. Major minerals produced include pumice, marble and basalt.

Turkey also possesses energy resources such as coal, petroleum, natural gas, hydroelectric energy and geothermal energy.

In addition, the country is a major crossroads for pipelines carrying oil and natural gas to the Mediterranean region and western Europe, from Russia, the Middle East and Asia.

SBF noted in its country brief that an aggressive privatisation programme has reduced state involvement in basic industry, banking, transport and communication in the country.

« An emerging cadre of middle-class entrepreneurs is adding dynamism to the economy and expanding production beyond the traditional textile and clothing sectors, » it added.