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Foreign firms are increasingly interested in establishing operations in Turkey, where a young and educated population offers the perfect opportunity to develop R&D centers for the region.
In terms of education, we have great integration with Europe, where many students join the Erasmus program and spend six months or a year in Western Europe. I would say that more European companies should look to Turkey, instead of looking at distant countries such as India, China, or Southeast Asia. From a cultural and educational perspective, and considering prospects for EU accession, Turkey is a good place for investment. Many companies have profited from such previous investments, including Ericsson, Microsoft, and Oracle, and they have major regional offices based out of Istanbul. It is a win-win situation for these companies to invest in Turkey. We have a huge market in Turkey, and the B2C area is already consolidated. We have E-Bay, Amazon, and private equity companies already invested in large players in the country. The next waves of investment and growth are going to come from the B2B side.
In terms of technology, Turkey has to cover quite a bit of ground in internet penetration, improving services, and transitioning into an innovation society. ICT spending is still relatively low at around 3.5% of GDP. The FATİH education project is a good example—smart boards and wireless tablets coupled with content for collaborative learning will transform the way we learn and support innovation. Established in 1997, Cisco in Turkey has been doing well and growing steadily, well in excess of Turkey's GDP. We address the needs of enterprises, SMBs, the public sector, and service providers through a network of over 600 business partners. They are certified in Cisco technologies, create solutions to address customer challenges, and our top partners undertake the largest ICT projects in the country. Over the years, we have also established 140 plus Cisco Networking Academies in Turkey with close to 10,000 students in attendance today. Cisco expects to invest over $1 billion to build its expanded cloud business over the next two years.
We have been active in Turkey since 1985. The company changed its name to Motorola Solutions, and we are focusing on two areas that depend on our product portfolio: government and enterprise. We did well in both areas in 2013 and achieved all of our goals and targets. For our enterprise portfolio, we have tablets and handheld terminals, and over 185 dealers working with two distributors. The government portfolio primarily involves the radio business, and we have over a 50% market share on both sides, so we are a market leader in Turkey and around the world. Moreover, we are pursuing public safety communication projects for the Ministry of Transport, which is working on a nationwide digital radio system. From a sales and technology perspective, we have 50% more staff than our competitors. As Turkey is one of the largest countries in the region, depending on consumer and government expectations, we may have a local assembly unit in Turkey to serve the region.
We have been active in Turkey since 1985. The company changed its name to Motorola Solutions, and we are focusing on two areas that depend on our product portfolio: government and enterprise. We did well in both areas in 2013 and achieved all our goals and targets. For our enterprise portfolio, we have tablets and handheld terminals, and over 185 dealers working with two distributors. The government portfolio primarily involves the radio business, and we have over a 50% market share on both sides, so we are a market leader in Turkey and around the world. Moreover, we are pursuing public safety communication projects for the Ministry of Transport, which is working on a nationwide digital radio system. From a sales and technology perspective, we have 50% more staff than our competitors. As Turkey is one of the largest countries in the region, depending on consumer and government expectations, we may have a local assembly unit in Turkey to serve the region.
Turkey has a significant proposition; it is the second or third economy following China in growth terms, and by 2023 aims to rank among the top-10 economies in the world. Xerox has realized this opportunity and decided to increase its focus on the country because these countries, while not necessarily offering a large population or GDP, are nonetheless high-potential markets. When you talk about services in a country like Turkey, which has a large population with an average age of 28 years, and which is highly educated, the services side offers huge potential for the future. Transportation, HR, and IT services are the main areas where we are poised to experience commercial growth. Essentially, when compared to developed markets, the services business remains at the very early stage of development. Xerox's acquisition of ACS in 2010 with its 75,000 employees at a cost of $6.4 billion was a major step.
Demographically and geographically, Turkey is by nature a very attractive market for global companies like SAP. All in all, this country represents promising and attractive opportunities for our company, which is keen to become a more relevant player on the international stage through greater competitiveness. Also, I would stress here the considerable economic stability of Turkey over the last few years, which has made the country an even more attractive investment address. We have been present in the Turkish market as SAP Turkey for 12 years. By the end of 2014, we expect to have grown our staff body by 10% to 190 employees. SAP is also investing in an innovation center in Turkey, which we consider a must for the Turkish IT sector today. It will be SAP's second innovation center in what is a three-year project with a €20 million investment plan. SAP investments in Turkey are paying back; in 2012, we experienced very positive growth of 27% and 2013 was even better, at more than 30%.
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TABLE OF CONTENTS
Review: Capital Markets
Remake Remodel
Borsa İstanbul, with a market capitalization of $280 billion, has positioned itself as a regional lightning rod for the financial markets, and while in 2013 the renamed exchange took some heavy blows, it nonetheless augmented its international currency.
read articleFocus: North Iraq Pipeline
South of the Border
In December 2013, oil finally started pumping across the Northern Iraqi border to Turkey. For years previously, with the increasing independence of the Kurdistan Regional Government (KRG) and an accordingly defiant attitude toward the Baghdad administration's insistence on monopolizing resource exports, extensive convoys of trucks managed the transport of oil from the area. Though criticized by the Iraqi administration, a number of international firms signed E&P agreements with the KRG. Ultimately, however, corporations have respected official Iraqi law and waited for Baghdad's approval.
read articleInterview
Volker Hammes, Head of BASF Business Center Turkey, Middle East & North Africa and CEO, BASF Türk
TBY talks to Volker Hammes, Head of BASF Business Center Turkey, Middle East & North Africa, & CEO of BASF Türk, on sustainability, Turkey's R&D potential, and the long-term outlook for the sector.
read articleInterview
Majid Kaddoumi, Vice-President and Regional Director of Middle East, Turkey, and Africa, Medtronic
TBY talks to Majid Kaddoumi, Vice-President and Regional Director of Middle East, Turkey, and Africa for Medtronic, on the company's global strategy, plans for Turkey, and long-term regional goals.
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