1. Republic of Turkey Prime Ministry Investment Support and Promotion Agency of Turkey ISPAT Investment Climate of Turkey Ahmet İhsan Erdem Vice President - Head of Investor Services Department

2. AGENDA The Agency Turkey With Some Key Figures Top Reasons to Invest in Turkey Investment Environment Turkey & Arab Countries Relations

3. The Agency

4. Established in 2006 Attached to the Prime Ministry and Reports directly to the Prime Minister Private sector approach ONE STOP SHOP approach Guidance on; Laws, Regulations, Site Selection, Sectoral Reports, Local Market Players, Potential Partners Confidentiality, Free of Charge 2 offices (Ankara – Istanbul) REPUBLIC OF TURKEY PRIME MINISTRY INVESTMENT SUPPORT AND PROMOTION AGENCY invest.gov.tr ANKARA ISTANBUL

5. REPUBLIC OF TURKEY PRIME MINISTRY INVESTMENT SUPPORT AND PROMOTION AGENCY invest.gov.tr  www.invest.gov.tr www.invest.gov.tr  Available in 12 languages including Arabic  User-friendly «Invest in Turkey» app for iOS and Android devices.  All aspects of doing business, investment opportunities, incentives, key facts and more about Turkey. Website & Mobile Apps

6. REPUBLIC OF TURKEY PRIME MINISTRY INVESTMENT SUPPORT AND PROMOTION AGENCY The International Network invest.gov.tr

7. REPUBLIC OF TURKEY PRIME MINISTRY INVESTMENT SUPPORT AND PROMOTION AGENCY invest.gov.tr ISPAT chairs the World Association of Investment Promotion Agencies WAIPA was established in 1995 244 national and sub-national agencies from 162 different countries HQ of WAIPA will be relocated from Geneva to Istanbul

8. Turkey With Some Key Figures

9. Turkey is the 17th largest economy in the World (6th when compared to EU Countries – IMF/2013)

10. will continue to increase and reach 93,4 million in 2050

12. 57 million credit card users (2013) 70 million GSM users (2013) 33 million broadband internet subscribers (2013)

13. (OICA 2013)

15. Source: Worldsteel Association, 2013

16. 150 million airline passengers in Turkey (2013) Turkish Airlines flies to 103 countries in the World

18. Top reasons to invest in Turkey

19. One of the biggest emerging economies invest.gov.tr Source: IMFGDP GROSS DOMESTIC PRODUCT 5% annual average growth in the last 11 years Average Annual Real GDP Growth (%) 2002-2013 Average Annual Real GDP Growth (%) 2002-2013

20. Source: TURKSTAT USD Increasing income per capita GDP Per Capita invest.gov.tr

21. Source: OECD Economic Outlook No.93 Average Annual Real GDP Growth (%) Forecast in the OECD Countries 2012-2017 Turkey will be the fastest growing economy among the OECD countries invest.gov.tr GDP Growth Future Projection by the OECD

22. invest.gov.tr Source: Eurostat, Treasury Turkish Government’s gross debt stock to GDP ratio is %36 while the EU28 average is %87 (2013) General Government Gross Debt Stock Maastricht Criteria: 60 %

23. invest.gov.tr General Government Budget Balance Source: Eurostat, Treasury Turkish Government’s budget balance to GDP ratio is - 1.6% while the EU27 average is -3.3 (2013) Maastricht Criteria: -3 %,

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25. Multinational Company Number of Countries Managed from Turkey Coca Cola90 GE Healthcare80 Microsoft76 Intel67 Unilever36 Verifone30 Schneider Electric27 Ericsson22 Cargill20 Pfizer20 Volvo18 BASF18 PepsiCo14 P&G11 LG Electronics9 Adobe9 invest.gov.tr

26. Source: TURKSTAT Exports invest.gov.tr Billion USD Manufacturing industry constitutes 93% of Turkey’s total export

27. invest.gov.tr Source: TURKSTAT, Products with 2-digit HS Codes, EU includes 27 countries (new members in 2004 were included in 2002 figures), *Data for 2012 Product & Market Diversification of Exports 20022013 Number of export products with over $1 billion*93535 Number of export markets with over $1 billion834 Share of top 5 countries in total exports (%)4732 Share of MENA in total exports (%)1324 Share of EU in total exports (%)5741 Exports

28. Customs Union with the EU: There is free circulation of goods between Turkey and 28 European Union member countries. Source: Undersecretariat of Foreign Trade, * In ratification process EU Customs Union and FTAs invest.gov.tr 1. Albania7. Israel13. Switzerland19. Jordan25. Moldavia* 2. Bosnia & Herzegovina8. Lichtenstein14. Syria20. South Korea 3. Croatia9. Macedonia15. Tunisia21. Mauritus * 4. Egypt10. Morocco16. Montenegro22. Lebanon* 5. Georgia11. Norway17. Serbia23. Ghana* 6. Iceland12. Palestine18. Chile24. Malaysia* Free Trade Agreements with 25 countries:

29. invest.gov.tr Source: OECD *Harmonized Unemployment Rate, seasonally adjusted Employment Generating Economy Turkey generated 4,2 million new jobs after the global financial crisis in 2009

30. invest.gov.tr Source: *MERCER - Pan-European Employer Health Benefits Issues Survey 2008, **EUROSTAT 2012: The average number of hours corresponds to the number of hours the person normally works. This covers all hours including extra hours, either paid or unpaid, which the person normally works Days Annual average number of sick days per employee in Europe* Hours Productive and Cost-effective Labor Force Hours worked per week of full-time employment Annual average**

31. Investment Environment

32. invest.gov.tr National Treatment = Guarantee of Transfers Access to Real Estate International Arbitration Employment of Expatriates Freedom to Invest Protection Against Expropriation The New Commercial Code Structural Reforms Corporate Income Tax

33. Structural Reforms Source: World Bank Doing Business Reports Improving Doing Business: Number of days to set up a company

34. Incentive System NEW INCENTIVE SYSTEM 1. General Incentives 2. Regional Incentives 3. Incentives for large-scale Investments 4. Incentives for Strategic Investments VAT Exemption Custom Duty Exemption VAT Exemption Custom Duty Exemption Tax Deduction Employer’s share for insurance premium payment Land provision VAT Exemption Custom Duty Exemption Tax Deduction Employer’s share for insurance premium payment Land provision Interest Support (except 1 st and 2 nd regions) VAT Exemption Custom Duty Exemption Tax Deduction Employer’s share for insurance premium payment Land provision Interest Support VAT Refund

35. FDI inflows to Turkey invest.gov.tr Source: The Central Bank of Turkey & Ministry of Economy More than 4.000 of them are from Arab countries

36. Increasing Confidence in the Turkish Economy invest.gov.tr Source: The Central Bank of Turkey & Ministry of Economy Source: Respective rating agencies Turkey’s Sovereign Credit Ratings S&PMoody’s Fitch JCR ScaleJan 2010 Feb 2010 Mar 2013Scale Dec 2009 Jan 2010 May 2013 ScaleDec 2009 Jan 2010 Nov 2012 Scale Jan 2010 Feb 2010 May 2013 AA2 A AAA+ AAA AAA- A-A3 A- A+ A A- BBB+Baa1 BBB+ BBBBaa2 BBB BBB-Baa3 Turkey BBB- Turkey BBB- Turkey BB+TurkeyBa1 Turkey BB+ Turkey BB+ BBTurkeyBa2 BB Turkey BB-TurkeyBa3Turkey BB-Turkey BB- Turkey B+B1 B+ BB2 B B B-B3 B- CCC+Caa1 CCC+ CCC Caa2 CCCCC CCC-Caa3 CCC-C SDCa DDDD D Investment Grade by Fitch in Nov 2012 Investment Grade by Moody’s in May 2013 Investment Grade by JCR in May 2013

37. Turkey & Arab Countries Bilateral Economic Relations

38. FDI inflows to Turkey invest.gov.tr Source: CBRT Arab investors are among the top investors in Turkey, over the past decade, they have invested over $10 billion in Turkey FDI Flows from Arab Countries into Turkey ($ Million, equity) Cumulative 2004-2013 United Arab Emirates3.931 Saudi Arabia2.114 Kuwait1.379 Lebanon1.099 Qatar743 Bahrain522 Jordan180 Libya98 Other countries12 TOTAL10.078

39. Major M&As in Turkey M&As deals with over $100 million invest.gov.tr Source: Deloitte, E&Y YearAcquirerOriginTargetSectorStake Deal Value (US$ million) 2005Saudi OgerSaudi ArabiaTürk TelekomTelecommunication55% 6.550,0 2007National Commercial BankSaudi ArabiaTürkiye Finans Katılım BankasıFinancial Services60% 1.080,0 2008Abraaj CapitalUAEAcıbadem Sağlık HizmetleriHealthcare54% 586,7 2013Commercial Bank of QatarQatarAlternatifBankFinancial Services71%71% 448,0 2007St, Martin's PropertyKuwaitCevahir Shopping CenterReal Estate50% 393,0 2012Burgan BankKuwaitEurobank TekfenFinancial Services99% 359,0 2006 Saint Gobain Isover ve Alghanim Industries France-KuwaitİzoGlass Sanayi ve Ticaret A.Ş.Insulation61% 171,3 2007Abraaj Capital LimitedUAEAcıbadem Sağlık HizmetleriHealthcare22% 162,5 2007National Bank of KuwaitKuwaitTurkish BankFinancial Services40% 160,0 2007Global Investment HouseKuwaitFFK Fon LeasingFinancial Services60% 120,0 2013Jadwa Investment CompanySaudi ArabiaCemre İnşaatConstruction37% 100,0

40. ON

41. Thank you very much for your attention..