Multinationals evaporating from Turkish business scene

Foreign manufacturers operating in Turkey are losing their sway over the business world and economy, Dünya newspaper reported, citing a league table published by the Istanbul Chamber of Industry (ISO).


The number of foreign firms ranking among Turkey’s top 500 manufacturers dropped to 110 last year from 148 in 2009, Dünya said on Tuesday. Their share in the country’s exports has declined to 43 percent from 48.9 percent, it said.


Turkey’s government says it is seeking to attract foreign direct investment to the economy to help drive growth and boost employment. But FDI dropped to $8.79 billion in 2019 from a peak of $22.1 billion in 2007, according to World Bank figures.


Foreign firms have cut back their investments after the global financial crisis of 2008 forced them to consolidate their international operations and economic instability in Turkey increased, culminating in a currency crisis in 2018.


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The share of foreign companies in total factory sales fell to 31.3 percent last year from 33.4 percent in 2009, Dünya said.




The Istanbul Chamber of Industry (ISO) released its traditional ISO-500 Surveys (Top 500 and Second Top 500 Industrial Enterprises) 2020 results. In a nutshell, the most striking point of the results was the high profitability figures. Leverage continues to increase, but thanks to the high profitability, financial expenses/operating profit ratios improved. Employment performance was not bad and finally, due to the pandemic-related conditions,  the export performance was weak, wrote Global Source Partners


On the Top 500 front, EBITDA rose sharply by 43% from a year earlier;  while EBITDA to net sales ratio rose to 14.1% from 11.3%. A decrease in the share of financial expenses to operating profits to 62.2% in 2020 from about 69.3% in 2019 is encouraging, but likely reflects the strong increase in operating profit (55%),rather than efforts to cut leverage.

Debt to equity ratio remained almost unchanged, while the share of short-term financial debt in total financial debt declined slightly to 41.2% from 41.4% in the same period.


Sources:  ISO500, Ahval, GlobalSource Partners


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Published By: Atilla Yeşilada

GlobalSource Partners’ Turkey Country Analyst Atilla Yesilada is the country’s leading political analyst and commentator. He is known throughout the finance and political science world for his thorough and outspoken coverage of Turkey’s political and financial developments. In addition to his extensive writing schedule, he is often called upon to provide his political expertise on major radio and television channels. Based in Istanbul, Atilla is co-founder of the information platform Istanbul Analytics and is one of GlobalSource’s local partners in Turkey. In addition to his consulting work and speaking engagements throughout the US, Europe and the Middle East, he writes regular columns for Turkey’s leading financial websites VATAN and and has contributed to the financial daily Referans and the liberal daily Radikal.