Foreign investors have maintained their confidence in the Turkish market in 2020, despite global uncertainties related to the economic effects of the pandemic, which will likely persist into 2021. M&A deals completed last year totaled 304 transactions and reached a value of $ 9 billion which corresponds to an increase of 30% in number of transactions and 70% in value compared to 2019. The share of foreign investors represented 51% of the total value of transactions or $ 4.6 billion (for 84 transactions), up 35% compared to the previous year. Investors, looking for good opportunities in key sectors, especially those who will be able to adapt to the post-Covid era, have benefited from the volatility of the Turkish lira.
Confidence was maintained at the beginning of the year; the month of january is characterized by investment announcements of several types: industrial establishments for some such as Lacoste and the chinese giants Tecno Mobile and Xiaomi who have decided to manufacture in Turkey ; acquisition have been also realized in various sectors such as the automotive industry, the food industry, digital entertainment, chemicals and even the packaging industry.
Despite a 4.3% contraction of world GDP last year according to calculations published by the World Bank, Turkey is expected to avoid a severe recession, unlike many countries, thanks to its economic attractiveness. According to the latest World Bank estimates, Turkey should indeed register 0.5% growth in 2020 (against -3.8% previously predicted), 4.5% in 2021 and 5% in 2022. The OECD has also revised its GDP contraction forecast for Turkey from -1.3% to -0.2% and estimates a growth of 2.6% in 2021 and 3.5% in 2022. IMF predicts highest growth by 6% in 2021.
The prospects for a rapid recovery should accelerate with the vaccination campaign which started on January 13. To date, more than 1.3 million people have been administered the SinoVac vaccine, of which 9.5 million of the 50 million doses ordered have been received. The country is expected to order soon 50 million additional doses of the Pfizer-BioNtech vaccine. The Ministry of Health has established a four-phase vaccination schedule by age group and working conditions. In the first place, it is health professionals and people over 65 who will be vaccinated. As a reminder, vaccination is free and not mandatory.