Country Spotlight: TURKEY

QUICK FACTS

Full name: Republic of Turkey
Capital city: Ankara
Population: 82,003,882 (2018)
GDP in Current prices: USD $713.51 billion (2018)
GDP real growth: 2.6% (2018)
Area: 783,356 km²
Government: Unitary presidential constitutional republic
President: Recep Tayyip Erdogan
Vice President: Fuat Oktay
Currency: Turkish Lira (₺) (TRY)
HDI: 64th (2018)
Ease of doing business index: 43rd (2018/19)
Time Zone: GMT +3
Dialling code: 90

 

The Republic of Turkey is a transcontinental country based mainly in West Asia. The total area of Turkey is 783,356 km², (which makes it the 36th largest country in the world), of which just over 3% (roughly the same size as the US state of New Hampshire) lies on the Balkan Peninsula in Southeast Europe. This European area is bordered by Bulgaria to the northwest and Greece to the west. It is separated from the rest of Turkey by the Sea of Marmara and the Turkish Straits – which include the Dardanelles and the Bosporus Strait – connecting the Aegean Sea in the south to the Black Sea, which washes Turkey’s northern shorelines. The rest of Turkey is bordered by Georgia to the northeast, Armenia and Iran to the east and Iraq and Syria to the south.

The population of Turkey is nearing 83 million, of whom approximately 71 million live in Asia and 11.7 million in Europe. 15 million live in the Istanbul metropolitan area that straddles the Bosporus Strait across which three suspension bridges link the European and Asian sides. Istanbul is the largest city in Turkey and one of the most popular tourist destinations of the world. 65% of its metropolitan population live on the European side (Eastern Thrace) and 35% on the Asian side (Anatolia). 92.3% of Turkey’s population live in cities and district centres compared with 7.7% in towns and villages (source: Turkish Statistical Institute 2018).

History

The Republic of Turkey was officially proclaimed on 29 October 1923 following the Turkish War of Independence (1919-1923) in the aftermath of World War I which saw the Ottoman Empire defeated and its capital, Constantinople, occupied by Allied French, British, Italian and Greek troops. The Ottomans had entered WWI by launching a surprise attack on Russian Black Sea coastal ports on 29 October 1914. Russia responded by declaring war against the Ottomans on 1 November and was joined by its allies Britain and France four days later.

Prior to the rise of The Ottoman Empire, much of the Anatolian Peninsula had been inhabited by various settlements and civilisations including Assyrians, Greeks and Armenians. The region became predominantly Hellenised after Alexander the Great defeated the Persian rulers in 334 BC and liberated much of Asia Minor. This became the Roman province of Asia in 129 BC and, as Rome began its transition from Republic to Empire, the region’s cities, including the provincial capital of Ephesus, flourished under Roman rule.

In AD 324, the Roman Emperor Constantine the Great chose the city of Byzantium – founded as Byzantion on the shores of the Bosporus Strait in around 660 BC – to be the new Christian capital of the Roman Empire and renamed it Nova Roma in AD 330. Following his death in 337, the city was renamed Constantinople and it became the capital of the Eastern Roman Empire after the permanent sub-division of the Roman Empire in 395. After the fall of Rome in 476, the Roman Empire continued in the east with Constantinople as its capital and enjoyed a golden age under the reign of Justinian I (Roman Byzantine Emperor from 527 to 565). The magnificent Hagia Sophia in Istanbul was built during 532-537 as a church and remained the world’s largest cathedral for nearly a thousand years; the domed building later became an Ottoman mosque and today is a museum that epitomises Byzantine architecture.

The Ottoman state arose at the end of the 13th century in northwest Anatolia and crossed into Europe around 1354, conquering much of the Balkans. In 1453, they captured Constantinople, bringing the Byzantine Empire to a close. At its peak during the 16th and 17th centuries, the Ottoman Empire extended well into central and southeast Europe, across north Africa and much of west Asia. But by the late 17th and 18th centuries, Ottoman power was waning and beset with internal rebellions while the Russian Empire expanded and asserted itself as a protector of Christians in Ottoman territories.

Having lost much of its Balkan territories during the Ottoman Great Eastern economic crisis and the Russo-Turkish War of 1877-78, many Balkan Muslims migrated to Anatolia and ethnic tensions increased. The Armenians in particular suffered huge losses in genocidal attacks shortly before, during and immediately after World War I. The Ottoman Empire joined WWI with the German, Austro-Hungarian and Bulgarian side which ultimately was defeated. In 1916, the British engineered an Arab Revolt within Anatolia and this helped to destabilise the Ottoman government. Unhappy with the terms of the Armistice signed on 30 October 1918 which allowed the Allies to occupy Constantinople and other key ports and garrisons, a Turkish National Movement sprung up in Ankara and declared itself the legitimate government of Turkey on 23 April 1920.

The Turkish Parliament formally abolished the Sultanate on 1 November 1922, finally bringing the Ottoman Empire to an end after 623 years, and the Treaty of Lausanne of 24 July 1923 gave international recognition to the new Republic of Turkey with Ankara as its capital. On 6 October 1923 – two days after the last of the allied British, French and Italian troops had left Constantinople – the troops of the Ankara government marched ceremoniously into the city and declared Liberation Day, the anniversary of which is celebrated every year. The Republic of Turkey was officially proclaimed on 23 October 1923 and the city of Constantinople was renamed Istanbul.

 

Foreign relations

Turkey remained neutral during most of World War II, before joining the side of the Allies in February 1945. Turkey is a founder charter member of the United Nations and a founder member of the G20. In 1949, Turkey was one of the first countries to join the Council of Europe and in February 1952 Turkey was one of the first two countries to join the founding 12 members of NATO as it sided with the US and Western Europe during the Cold War with Russia. In 1961, Turkey was one of the founder members of the Organisation for Economic Co-operation and Development (OECD) and two years later became an associate member of the EEC.

Turkey applied for full membership of the European Community in 1987 but a decision was deferred partly due to events in Cyprus. Turkey had invaded Cyprus in July 1974 in response to a Greek-led military coup and this led to the UN-organised partition of the island. In 1983, the Turkish part of the island declared its independence as the Turkish Republic of Northern Cyprus, but Turkey is the only country to recognise it.

In 1996, a customs union between the European Union and Turkey came into effect and a free trade area was established for certain industrial products. This gave a significant boost to Turkey’s trade and helped increase its GDP per capita. In December 1999, Turkey was officially given candidate membership status. However, UN efforts to resolve the Cyprus situation failed to win enough Cypriot approval in a referendum, with the result that, whilst the Republic of Cyprus was accepted as a full member on 1 May 2004, the rights of EU membership were (and still are) suspended for Northern Cyprus, and Turkey has still not achieved the criteria for full membership.

Turkey historically has good relations with the US and has assisted international missions under NATO and the United Nations. It has the second largest standing military force in NATO and has been actively involved in trying to find a resolution to the ongoing conflict in neighbouring Syria.

 

Politics and administration

Turkey was a parliamentary representative democracy from 1923 until a referendum, held under a state of emergency in April 2017 following a failed military coup attempt in July 2016, narrowly approved 18 amendments to the Turkish constitution. The new rules came into effect with the presidential election of 24 June 2018, abolishing the office of prime minister, increasing the number of seats in parliament from 550 to 600 and giving complete control of the executive to the President, who is head of state. Parliamentary and presidential terms are extended from four to five-year terms with the elections being held on the same day, allowing for a presidential run-off if no candidate wins an outright majority in the first round.

Turkey is divided into 81 provinces administratively. The most populous province is Istanbul which lies on both the European and Asian sides. Three other provinces lie fully on the European side. The second most populous province is Ankara, which includes the country’s capital city of the same name, and is effectively at the heart of the country. Turkey is a unitary state and each of the provinces is run by governors and senior city officials appointed by the central government in Ankara rather than by locally elected mayors.

Officially, Turkey is a secular state with no official religion. Freedom of religion and conscience is provided for within the Turkish Constitution and there are no questions relating to religion or ethnicity within the Turkish censuses. However, around 96% of the population are Muslims, most of whom are Sunni Muslims.

 

Economics and trade

Turkey’s economy has tended to fluctuate in recent years, rising by 7.4% in 2017 in real terms, but going into recession at the end of 2018 after two successive quarters of falling growth (Q3 down by 1.6% and Q4 down by 2.4%). The annual real growth rate for 2018 was +2.6% which is the lowest figure since the global downturn of 2009. The full year’s nominal GDP of US $713.5 billion ranked 19th largest globally, having slipped from 17th in 2017. On the GDP by PPP (Purchasing Power Parity) tables, Turkey still ranks 13th largest. Turkey’s currency dropped by 30% against the US dollar as a result of a trade war with the US, making imports a third more expensive on average and prompting the central bank to raise interest rates while annual inflation peaked at over 25% in October 2018.

Turkey is a net exporter of agricultural products and has been self-sufficient in food production since the 1980s. Around 11% of Turkey’s land is used for agriculture with wheat as its main crop. The country is also the world’s largest producer of hazelnuts, figs, cherries and various other fruits. Much of the produce still comes from small farms. In 2018, 18.75% of the employed population worked in agriculture (compared with 29.5% in 2009) and contributed 6.1% of the GDP. Industry accounted for 29.2% of GDP with automobile manufacturing and textiles being the main sectors. The services sector grew rapidly in the 2000s, peaking at 59% of GDP in 2009, but slipped back to 53.3% of GDP in 2018.

 

Tourism

Tourism is an important part of Turkey’s economy and had been growing rapidly since 2000, with the country becoming the 6th biggest tourist destination in the world in terms of numbers of international arrivals (source: UN World Tourism Organisation). However, the numbers took a big dip during 2016 due to a spate of terrorist attacks, the attempted military coup and heightened political tension with Russia. The Russian tourists – who are usually the number one tourism market for Turkey – started returning in 2017 after the restoration of bilateral relations and heavy advertising campaigns, and 2018 saw an 18.1% increase in visitor numbers to 45.6 million. Of these, 85.4% were foreign – with Russia (15% of foreign tourists), Germany (11%), Bulgaria (6%), UK (6%) and Georgia (5%) being the top five countries of origin – and 14.6% being Turkish citizens residing abroad. According to Turkey’s statistical authority, tourism revenue during 2018 reached $29.5 billion compared with $26.3 billion in 2017.

Turkey is famous for its historical sites and has 17 UNESCO World Heritage sites as well as two of the seven Wonders of the Ancient World. The Turkish Riviera has many excellent beach resorts along the Aegean and Mediterranean coastlines. The country is also renowned for its cultural experiences and excellent food.

 

Residency and Citizenship by Investment

Turkey was the first Middle East country to introduce a Citizenship by Investment (CBI) programme, launching it in January 2017. Originally, the scheme had required investments of US $3 million in government bonds or deposited into a Turkish bank for three years, or purchasing real estate valued at US $1 million, but after a relatively slow take-up, the government reduced the charges in their Citizenship Act amendment published on 19 September 2018. Having received just over 250 applications for citizenship by investment worth slightly less than $100 million by the end of 2018, the number of applications is expected to boom during 2019.

The options available for anyone aged 18 or over applying for Turkish citizenship are as follows:

 

  1. Real Estate – invest a minimum of US $250,000 (or the equivalent in Turkish Lira or other convertible currency as in all options) on the stipulation that the immovable property is not sold within the next three years.
  2. Bank deposit – that $500,000 (or equivalent) be deposited for at least three years in one of the Turkish banks.
  3. Fixed capital investment – that a minimum of $500,000 (or equivalent) be made in fixed capital investment and confirmed by the Ministry of Industry and Technology; previously the minimum required investment was US $2 million.
  4. Government bonds – that a minimum of $500,000 (or equivalent) be used to purchase government bonds and bills on condition that they be held for at least three years and that the investment shall be confirmed by the Ministry of Treasury and Finance.
  5. Job creation – it is also possible under the new regulation to gain Turkish citizenship by employing a minimum of 50 new personnel; previously the requirement was for 100 personnel.

Benefits of Turkish Citizenship

  • Visa-free or visa-on-arrival travel to 115 countries including Hong Kong, Singapore and Japan
  • Dual nationality is allowed
  • Citizenship is granted within 3-6 months after receipt of the application and investment
  • No requirement to reside in Turkey or to learn Turkish language
  • No military service requirements for applicants
  • Citizenship covers spouse and children under 18 years of age
  • Access to full free medical assistance for life, including all direct family members
  • Turkey offers a democratic and safe environment for the whole family with high quality education facilities and social healthcare reforms
  • Prospective visa-free travel facilities to EU Schengen Zone in near-term future.
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