Istanbul loses its foreign investment lure in 2012

ISTANBUL

Foreign investment amount in Istanbul falls a 17.5 percent in 2012, after the huge hike in 2011, the ITO figures say.

The number of Iranian businesses launched in Istanbul dramatically jumped in 2012, a year that foreign capital into the city fell 17.5 percent from a year earlier, according to a study released by the Istanbul Chamber of Commerce (İTO).

“The value of foreign investments in Turkey declined in 2012, which was a cooling-off year for the Turkish economy,” the chairman of İTO, Murat Yalçıntaş, has said.

At the same time, the total number of foreign investors decreased by 2 percent to 4,539 investors who have established companies amounting to around a total of 1.5 billion Turkish liras. The number was down from 4,639 foreign investors who invested roughly 1.8 million liras in Istanbul in 2010. Last year, the increase of foreign investment in Istanbul had skyrocketed with a 110.77 percent rise from 2010.

Despite the fall of figures compared to 2011, Yalçıntaş said last year’s foreign investment inflow to Istanbul still marks the second highest amount of investment in seven years. “Continuing risks in global economies spur foreign investors to invest in Turkey as a powerful economy. The partial contraction in our economy, which has been growing rapidly since 2008, also caused a regress of foreign investments last year. Despite that, the capital value is still above most of the previous years’ figures.”

Soaring Iranian investments

Among the foreign investors in Istanbul, Iranians posted an impressive spurt with a nearly 30 percent increase in the number of investors in addition to increases of inflow capital value of around 8 percent.

Over the course of 2012, 1,335 Iranian investors set up businesses in Istanbul, amounting to roughly 125 million liras of investment.

While the highest number of businesses have been launched by Iranians, they had to be content with third place in terms of value of investment. The 39 Lebanese businesses established last year in Turkey took the top seat by far in terms of foreign investment amount with around 534 million liras, while investors from Luxemburg had set up 30 businesses worth 235 billion liras, ranking them second.

Germany is the fourth country that invested the most in Istanbul in 2012, with 394 investors and 65 million liras in capital.

In 2012, the sector that attracted the most foreign investment was the banking and insurance sector.