Originally commissioned end of 2014
As we noted last year in “Unrest in Iraq Impacts Turkish Businesses,” Turkey’s export regime has taken a serious hit from the ongoing crisis in Iraq. Moreover, Turkey’s ranking dropped by five points on Transparency International’s Corruption Perception Index from 2013 to 2014, ranking 64th out of 174 countries surveyed. Indeed, perception is the key word here. With unrest at its doorstep and often making unflattering headlines, Turkey risks being lumped into the same category as more problematic, high-risk markets. Turkish businesses have a lot to offer potential investors, but these positives risk being buried under a growing perception nightmare involving Turkey’s domestic issues and wider regional unrest. Istanbul or Ankara are not Mosul or Bagdad in terms of instability, but to investors based outside the region, the difference (which is so obvious to those on the ground or in th know) might not be readily apparent.
Turkey is currently facing a series of high-profile perception problems related to varying criticisms of its government’s foreign and domestic policies. Articles such as the highly influential Huffington Post’s 2012 criticism of Turkish policy (“The Lonely Man of the Middle East”, 27 August, 2012) should have set alarm bells ringing for Turkish IR departments, as should the growing chorus of commentators claiming that Turkey and Europe are drifting apart with respect to international relations (see: Reflections Turkey “The European Perception of Turkey in the Syrian Crisis”), an issue with a huge potential impact for Turkish businesses.
These potential problems can be viewed as opportunities, however. If Turkish businesses would choose to harness the media attention that Turkey receives as a result of negative occurrences, then they could redirect the narrative and position themselves more positively. With the spotlight firmly on Turkey at the moment, now is the time for IR departments to add to the discussion a well-argued, coherent story of why investing in the country makes solid sense. And according to what we’re hearing from investors and analysts, this is exactly what is being demanded but not supplied.