As famously said by Napoleon, “If the world was only one country, Istanbul would be its capital”. Indeed, for over a thousand years Constantinople served as the capital of the Byzantine Empire, the successor of the Roman Empire and therefore, by extension, was an epicenter of Western civilization. Today, it remains a bridge between East and West, a thriving cornucopia of old and new. Golden sun crests the horizon as azure waves break upon alabaster sand.
Although world-renowned travel destination for decades, in recent years, Turkey’s growing economy and rising regional and global influence have begun to attract an ever-expanding number of investors looking to take advantage of the country’s promising future. Among them are a growing number of high net worth individuals.
But why are so many high net worth clients now interested in Turkey?
A significant factor in the growing interest in Turkey is its new citizenship-by-investment program, allowing investors to obtain the passport for an investment of 250,000 euros.
Domestic Market, the EU and the free trade zone
The Republic of Turkey, occupying a unique and strategically important geographical position as a gateway between Europe and Asia. As an important emerging market, Turkey’s economy is currently experiencing a period rapid growth and development – it is one of the fastest growing countries in the world and is a candidate to become a member of the European Union.
While Turkey’s positive development prospects make it an attractive target for investment, the true extent of its value for investors lies not only in generating returns from the local market but also taking full advantage of Turkey’s convenient geographical position as a staging area in order to access markets in the Middle East, North Africa, Europe, Central Asia and Russia, thus comprehensively improving their international reach and business capabilities.
Joining the European Union
Turkey applied to join the European Community (the predecessor of the EU) in 1987, won candidature in 1999, and began the process of negotiating EU accession in 2005, but progress on the negotiations have been slow, and further complicated by the country’s internal political situation following the July 2016 military coup and constitutional referendum, leading the European Parliament adopted a non-binding resolution calling on the European Union to suspend negotiations in March 2019.
The Turkish Ministry of Foreign Affairs expressed opposition to the resolution and reiterated its intention to join the EU. Recep Erdogan, the President of Turkey formally stated on May 9 that Turkey’s formal accession to the European Union is a strategic goal for the country, and that Turkey will speed up reforms in various fields, with the aim of joining the EU within the next five years.
Why invest now?
A series of internal and external events have contributed to turmoil in Turkey’s capital markets in recent months. On March 22, Turkish equity bonds and lira exchange rates began to adjust sharply, while the Turkish lira fell 5.2 percent on the same day. In order to prevent further devaluation, the government implemented austerity measures, causing the cost of borrowing lira by foreign banks and hedge funds to soar. Offshore overnight swap rates rose sharply, and exchange rates recovered steadily following the rise in interest rates. In fact, the depreciation of the Turkish lira has persisted for more than a year, brought on mainly by the country’s political instability.
Recently, the cost of a five-year CDS, which represents sovereign default risk, rose by 11 basis points to 483 basis points – a level in line with those seen before Turkish elections in late March. Turkey’s exchange rate is therefore currently at a historical low, making now a good opportunity to invest.
Benefits of the Turkish CBI program
- Visa-free travel to 110 countries
- Fas approval period – average application processing time is only 6 months
- Stable investment and fixed income opportunity
- No wealth declaration is required
- Suitable for family citizenship applications (including children under 18 and spouse)
- No physical residence requirements
- No restrictions on dual nationality
- Convenient geographical location with ease of access to Europe, Asia, the Middle East, and Africa.
Our experienced team of immigration consultants are available around the clock (and the world!) to discuss your specific requirements and offer advice on the optimum immigration solutions for you and your family. To find out more, please contact one of our representatives.