What Will It Take to Improve Turkey’s Investment Climate? A Look at the 2025 Action Plan

This article is about a topic that doesn’t always make headlines but seriously matters for Turkey’s long-term economic future: the investment climate in the country. The article is written by Economist Dr. Burcu Aydın in Turkish on economist.com and was edited and translated into English by BTT.

“A Bit of Background

If you’ve followed Turkey’s economic history, you might remember the YOİKK—short for Coordination Council for the Improvement of the Investment Environment—which was originally launched back in 2001 as part of the IMF-backed reforms of the early 2000s. The goal? To help fix bureaucratic bottlenecks and improve coordination between public institutions to make Turkey more attractive to investors.

It actually worked pretty well in the early 2000s, but over time, especially after 2010, it lost momentum. Fast forward to the post-2023 election landscape, and YOİKK has been dusted off and revived under the new economic leadership.

If you check their official websites you’ll only find action plans from 2024 and 2025. No archives from the past 25 years, which in itself says a lot about continuity and transparency—or the lack thereof.

So… How Do You Improve the Investment Environment?

According to the World Bank, it’s not just about reducing red tape or rolling out tech platforms. Real, sustainable improvement depends on a strong mix of independent institutions, legal certainty, administrative capacity, governance quality, and digital infrastructure. And if those sound like heavy-lifting reforms—it’s because they are.

At the core of investor confidence, the World Bank highlights one thing: good governance. That means rule of law, anti-corruption mechanisms, consistency in policy, and predictability.

And here’s the tough part: these are exactly the areas where Turkey has been losing ground over the past 15 years. Governance indicators show a steep decline, even compared to countries like China and Saudi Arabia, which traditionally haven’t been known for top-tier governance scores.

What Does the 2025 YOİKK Plan Offer?

Now to the heart of the matter. The 2025 Action Plan is out, and while it touches on some key investment-related topics, it largely avoids addressing the governance gap.

Under the Justice Ministry’s leadership, three initiatives are being proposed: aligning Turkey’s data protection law with EU standards, strengthening the judicial expert system, and expanding alternative dispute resolution methods. All of which are fine on paper—but fall far short of systemic governance reform.

When it comes to public procurement, an area frequently criticized for lack of transparency, the action plan plays it safe. No serious reform proposals here either—just vague mentions of digitalization, innovation, and sustainability.

Focus Areas: Tech, Green Transition, and Industrial Strategy

Instead of tackling governance, the action plan turns its attention to three main themes: sustainability, digital infrastructure, and industrial policy.

On the green transformation front, the plan includes efforts to create a national taxonomy, establish a carbon offsetting system, align with EU environmental regulations, and expand green certifications. There’s also talk of building the legal and tax framework for carbon pricing.

In terms of digital transformation, there’s a strong push for end-to-end digitalization of investment processes, new data and cloud strategies, and a revision of the national AI strategy. The plan also wants to make it easier to establish businesses digitally and roll out broader fiber and 5G infrastructure.

Then there’s industrial policy, which leans heavily on expanding organized industrial zones, launching energy-specialized regions, and pushing new sectoral roadmaps. Interestingly, there’s a noticeable emphasis on green hydrogen development and domestically focused 5G technologies, paired with targeted financing via development banks.

The Bottom Line

So, is Turkey’s investment environment about to get a whole lot better? Well, it depends on how you define “better.”

If we’re talking technical upgrades, digital tools, and sustainability alignment, then yes—there are some promising steps. But if we’re talking about core reforms like rule of law, institutional independence, and consistent economic policy—then this plan falls short.

As Dr. Aydın points out, Turkey seems to be focusing on what’s doable without ruffling too many feathers. But investors, especially those making long-term bets, are likely to keep asking the bigger questions. We’re in a new global political era where soft power and strong institutions don’t always go hand-in-hand.

Until then, the investment environment in Turkey will keep walking the tightrope between ambition and reality.

source: https://www.ekonomim.com/kose-yazisi/yatirim-ortami-nasil-iyilesir/829844 / Author Dr. Burcu Aydın