Turkey: Economic Analysis, Challenges, and Recommendations Report

This report provides a detailed economic analysis of Turkey, examining various challenges and proposing solutions. It begins with an overview of the economic conditions, identifying key problems related to political instability, religious issues, and economic factors such as current account balance, energy supply, and the education sector. The analysis employs models like PESTLE, Porter’s diamond, and the Global Competitiveness Index to evaluate the external market and assess the country's performance. The report then delves into specific issues, including constitutional reform, terrorist attacks, and the role of Islam. Furthermore, the report offers proposed solutions to the identified problems, addressing both political and economic challenges, and discusses limitations of the analysis. The study highlights the need for policy changes to improve the economic outlook of Turkey.

Turkey: a work in progress?

TABLE OF CONTENTS
Chapter 3: Problem statement and Plan of Analysis............................................................................
3.1 Plan of Analysis..............................................................................................................................
3.2 Problems.........................................................................................................................................
Political Problems.................................................................................................................................
Turkey political issue:..................................................................................................................1
Constitutional Reform:................................................................................................................2
Terrorist Attacks..........................................................................................................................2
Models.........................................................................................................................................2
PESTLE Analysis........................................................................................................................2
Turkey’s Pestle analysis linking to Porter’s diamond.................................................................4
Economic Problems..............................................................................................................................
Current account balance...............................................................................................................4
Savings investment balance.........................................................................................................5
Energy Supply..............................................................................................................................5
Education sector...........................................................................................................................5
Global Competitiveness Index Model.........................................................................................5
Religion Problems................................................................................................................................
Secularism issue and Freedom of Expression..............................................................................7
Kurdish problem..........................................................................................................................7
Cultural issues..............................................................................................................................7
Hofstede Model............................................................................................................................8
Chapter 4: Analysis and Findings.......................................................................................................
4.1 Introduction..........................................................................................................................10

Political problems......................................................................................................................10
Religious Problems....................................................................................................................13
Chapter 5: Proposed solution to problems/ recommendations, limitations of the Analysis...............
5.1 Solution to Political Problems.............................................................................................15
5.2 Solution to Economic Problems..........................................................................................16
5.3 Solution to Religion Problems.............................................................................................17
References..........................................................................................................................................

CHAPTER 3: PROBLEM STATEMENT AND PLAN OF ANALYSIS
3.1 PLAN OF ANALYSIS
In the present given case study, researcher focuses on evaluating the economic conditions
of Turkey which has suffered major setbacks in past but after the 2009-10 post recession period,
country is able to enhance and maintain its position. Herein, plan of analysis is to evaluate varied
problems that are associated with the economic conditions of Turkey according to the given case
so that use of effective economic conceptual tools and models proper analysis can be made and
desired enhancement can be made in different areas.
Considering the formal economy of Turkey which was mixture of modern and traditional
industries. In which, services accounted for 64% of the economic activity whereas,
manufacturing contributes 27% and remaining 9% is from agriculture. Thus, the main focus on
this study is to analyze the major problems associated with the economic prospects of the
Turkey. Furthermore, on the basis of given case study, researcher has evaluated varied problems
that affects the course of economic conditions of the country.
3.2 PROBLEMS
Following are the problems identified through given case scenario:
POLITICAL PROBLEMS
Turkey is not only economically bound but politically as well as they are trying to
modernize the country and to become a powerful and a significant within the world. Turkey
implemented a policy of «zero problems with neighbour countries» but unfortunately this failed.
For Turkey to think this was achievable illustrates that their government was too confident in its
ability to bring stability to its region where there are no agreements and a lot of parties in
conflict. So their policy failure was inevitable given these factors and the relationships they have
with countries they boarder with.
Turkey political issue:
According to the given case study, the distinguished issue in Turkey is role of Islam. In
past, modernization and Islamization were intermingled in the evolution of Turkish nationalism.
It is because of the fact that there are some parties who thinks that issue of women’s headscarves
is a testing ground to the commitment to the secular state. However, to have stable political
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environment it is important for the government of Turkey to promote the thought of never
involving religion into state because this will help in better social living standards.
Constitutional Reform:
Within the country, constitutional reform remains the pressing challenge faced by the
government. Despite of efforts made by the government parties to introduce more civilian
friendly constitution than the current one but still they are failed to protect minority and civil
rights.
Terrorist Attacks
Current political challenge that Turkey is facing is related to terrorist attacks which had
taken place due to Islamic extremist, Kurdish radicals, Turkish Militants that may have link with
Al-Qaeda.
Models
In order to understand the political problems it is important for the researcher to make in-
depth analysis under the constitutional reform of Turkey. In this regard, models like Pestle,
Porter’s and SWOT analysis has been used. The main purpose behind using these models is that
they will help in evaluating and analysing the external market of Turkey in appropriate and
reliable manner. Further, each and every aspects will be covered in detailed manner.
PESTLE Analysis
In general, Pestle analysis can be defined as the model of external analysis of the country.
Herein, researcher has used this method to understand the external market of Turkey so that
problems related to political environment can be resolved in the appropriate manner.
 Political: Looking at the current political environment of Turkey it can be said that one of
the current political strength in the country is that its government have polices on
liberalisation. However, it is was one of the major supporter of liberal trade and
investment policies which allow open trade between different countries in EU (Ozbudun,
2015). Export in the country has been raised with the average rate of 10% every year
which will assist fashion industry to flourish with the exports produced in the Turkish
plant.
 Economical: Considering the present condition, economic strength in Turkey is related to
high inflow of foreign investment from abroad. However, this investment source plays
significant role in speedy expansion of country’s economic growth. From 2008,
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privatisation program in Turkey has encouraged the sale of major bridges, highways,
electricity grids and share in the partly commercial bank. The main purpose of foreign
investment is that it will assist in course of expanding the infrastructure of the country.
By the means of this, government could bring more civilian friendly constitution than the
current which promotes better growth in the market.
 Social: The social strength of country is related to youth power because half of the
population in Turkey is aged below 30. By the means of this, country can improve its
employment rate because young people are enthusiastic and highly motivated to work
and this will enhance young labour force. High percentage of skilled labour will
encourage industrialisation in the country that directly improve the overall economic
conditions of Turkey (Öniş and Kutlay, 2013). Contrary to this, at present country is
suffering from high level of unemployment because of high percentage of Islamic people
or Kurds are located in rural areas as well as they are poor people.
 Technological: From the current situation of Turkey it can be said that its technological
strength is significant development in the ICT sector. In recent past, the ICT sector of
Turkey has shown rapid extension just because of the sharp increase in Turkish
telecommunication sector as they have been privatized by the government. But on the
other hand, one of the major problems related to technological aspect of country is low
expenditure costs on the research and development.
 Legal: Looking at the present legal system of Turkey it can be said that Turkey have
comprehensive legal structure. However, the judicial system is made up of general courts
which deals with domestic cases, heavy penal courts which deals with more serious
cases, military courts deals with military cases and the constitutional courts which are at
highest level of courts that deals with the essential cases related to Turkish government
i.e. war crimes (Guney, 2013). Another legal advantage that Turkey will possess is
related to relaxation of paperwork or lengthy process of registration for business this will
encourage more companies to enter into the market and generate higher foreign fund.
 Environmental: Environment condition of Turkey is relatively challenging because of
high pollution level due to which global warming is cased. Further, the solid waste
management in Turkey need to be taken care of appropriately because high level of
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environmental pollution is caused due to increase chemical and detergent flow which
indeed causes severe illness to people.
Turkey’s Pestle analysis linking to Porter’s diamond
On the basis of pestle analysis it can be said that, government of Turkey is focusing on
creating new legislation to assist to the industry and the companies to grow from foreign
investment. By the means of this, country will attain the national advantage and develop suitable
base for modernizing its overall functioning. Along with this, government is making the market
more demanding by stimulating foreign investment so that companies can become more
competitive and it will benefit Turkey as national advantage (Rosenzweig, 2014). By promoting
liberalization and industrialization, government can create new job by encouraging and training
young generating to have new skills and qualified to work in different sectors so that varied areas
can be developed and promote the modernization of the country. Furthermore, government is
constantly focusing on improving the ICT sector so that, it will help not only to modernized the
structure as well as benefit Turkey’s different industries to carry out their operations by making
optimum utilization of available resources. To manage the home affairs and judicial system in
the country different courts have been developed through the means of which companies and
people can be kept under the law and motivate them to carry out operations ethically to attain
growth in near future.
ECONOMIC PROBLEMS
Another factor is the political landscape and how religion impacts politics and legislation
which in turn impacts the economic performance of the country greatly. Turkey is really
interesting since it is a developing country that faces many challenges. Over the past two decades
Turkey has shown some definite signs of strong economic development, however a lack of
stability still exists for Turkey given its relationship with Europe, the US and the rest of the
world.
Current account balance
Looking at the balance of payment of Turkey it is it is relatively poor because of current
account negative balance nearly $78 billion or 10% of GDP. However, this is because oil shocks
in late 1970s pushed country to financial crisis. With the scare of energy resources, Turkey
imported 93% of its petroleum and 95% of its natural gas. Similarly, balance of payment for last
15 years also shows that Turkey is facing major concerns in exporting goods as in 2001 34.7 to
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143.4 in 2011 while on the other hand its import of goods in increasing at significant rate as in
2001 -38.1 to -232.5.
Savings investment balance
With the domestic investment at 21.7% not enough savings this directly leads to the need
for capital inflows of 9.4% of GDP and leads to constant rise in foreign debt. This is one of the
major problems in substantial growth for Turkey economy led by insufficient savings as people
always try to save under the pillow not in any bank or financial institution.
Energy Supply
Despite of increasing foreign direct investment, energy supply remained an outstanding
weakness for Turkey. Further it can be supported by the fact that, despite of some domestic coal
reserves, Turkey’s electric utilities imported 69% of their fuel and 97% of the natural gas in
2010. Further, the oil companies imported 91% of their crude oil which amount energy bill of
around $52 billion in April 2012 which leads to current account deficit of $67 billion.
Education sector
This is another major problem for government of Turkey as country’s educational system
is not able to generate better results. However, teachers were poorly trained and poorly
motivated. Further, there is no such initiatives related to incentive within the sector leads to
dissatisfy the people associated with this sector. Inequalities in schools of rural and urban areas
has led to the variances of education system, weak infrastructure etc.
Global Competitiveness Index Model
In general, global competitiveness index (GCI) is a report which published by World
Economic Forum. However, this report rank the countries on the basis of their global competitive
index. Through the means of this index, researcher is focusing on carrying out the analysis of
Turkey’s performance in the overall GCI, as well as in each of the sub-indexes and pillars of the
index.
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Figure 1: Global Competitiveness Index
(Source: Civelek, Uca and Cemberci, 2015)
There are three major categories of this model which are as follows:
 Basic requirements subindex: Under this category there are several pillars that need to be
taken care of i.e. institutions, infrastructure, Macroeconomic environment and health and
primary education. These pillars play key role for factor-driven economies (Zalengera
and et.al, 2014).
 Efficiency enhancer’s subindex: Under this category there are several pillars that need to
be taken care of i.e. higher education and training, goods market efficiency, labour
market efficiency, financial market development, technological readiness and market
size. These pillars play key role for efficiency-driven economies (Gillam and Siriwardena
2013).
 Innovation and sophistication factors subindex: Under this category there are several
pillars that need to be taken care of i.e. business sophistication and innovation. These
pillars play key role for Innovation-driven economies.
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RELIGION PROBLEMS
Turkey is a Muslim country as 99% of the Turkish population practice Muslim habits.
Politically it is really hard to manage this fact and the one to be part of EU where Muslim
religion is almost not existing within. On top of that, Turkey seems really specific by the way it
should be manage regarding the place that religion take.
Secularism issue and Freedom of Expression
In the era between 1950 and 1980 the Turkish government gradually made the transition
to democracy. The major issue identified in evaluation of democracy is related to secularism
because there are some members of establishment believed that issue of women’s headscarves is
a testing ground to the commitment to the secular state. However, Turkey is unable to promote
religious freedom and scarves is the major part of expression of freedom. Another major issues
between secular and religious group is received international attention when Turkish pianist Fazil
Say was convicted of insulting Islam by positing on Twitter which was seen as critical of Islam.
Kurdish problem
In several, foreign policy issues identified, Kurdish problem is the most preeminent one.
It is because of the fact that, around 20% of Turkish population had Kurdish roots. However,
majority of Kurds are mainly rural and poor located in southeast Turkey. In such region,
unemployment has led the people to live outrageous life which indeed affects the overall
economy of the country.
Cultural issues
Cultural issues of Turkey can be divided into three major categories that is religion,
location and gender equality. However it is important for the government of Turkey to consider
all the three aspects to resolve the culture issues:
 Religion: On the basis of given case study it has been evaluated that, Turkey’s main
religion is Islam and it heavily influenced the life of Turkish people in many ways.
However, people have faith in their religion and due to which government is constantly
suffering from issues like expression of freedom, as Islam promote women’s headscarves
and government in order to promote more freedom for women is trying to remove such
foundation. But still with lot of restrictions for female have caused major limitations of
the country in terms of growth and development. Therefore, encouraging modernization
will lead to provide flexible environment of females also to live in the country.
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 Location: Government is facing issues in establishing the plant and industries this due to
which liberal trade is not up to a great level (Cravens, 2014). Pollution is one of the major
problem for the country and in order to encourage industrialization, environment
considerations should be taken into account as a major priority.
 Gender equality: Looking at the current demographic prospect of the Turkey, it has been
analyzed that males are the dominate species in the societies. In order to maintain gender
equality several efforts have been made but still it is one of the serious issue with the
Turkish government. Promoting expression of freedom, equality will assist in breaking
the shackles for the government.
Hofstede Model
In general, Hofstede’s cultural dimension theory is a framework for cross-cultural
communication, proposed by Geert Hofstede. The main purpose of this model is that it helps in
illustrating the effect of a society’s culture on the value of its members and how these value
related to behaviour using structure derived from factor analysis.
Figure 2: Hofstede Model of Turkey
(Source: Turkey Hofstede Model, 2016)
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 Power distance: This dimension deals with the fact that all individual in the society are
not equal. However, Turkey have the major issue of gender equality which leads to lack
of freedom of expression for the people especially women. However, Turkey high score
on this dimension of 66 indicates that there are following characteristics possess in
Turkish style: dependent, hierarchical, superiors often inaccessible and ideal boss is
father figure. In this regard, males are more dominant species in the country and women
are not given better opportunity to explore themselves to different sectors in the country
(Kolios and Read, 2013).
 Individualism: This factor focuses on evaluating the degrees of interdependence a society
maintains among its members. With the score of 37 it can be said that Turkey is a
collectivistic society. This indicates, “We” is important and people belongs to groups
such as families, clans or organisations.
 Masculinity & Feminine: In general, high score on masculinity defines that society is
driven by competition, achievement and success in different areas or sectors. Wherein,
low score on the dimension of Feminine indicates that dominant values in society are
caring for other and quality of life (Blanke and Chiesa, 2013). Looking at the score of 45
it can be said that, it is more towards feminine this indicates softer aspects of culture such
as levelling with others, consensus, sympathy for the underdog are valued and
encouraged. This clearly defines that leisure time for Turks is very important and they
prefer such lifestyle.
 Uncertainty Avoidance: This dimension focuses on the way through which a society deals
with the fact that future can never be known or make any efforts to change the future.
With the high score of 85 on Uncertainty avoidance clearly indicates that there is need of
laws and rules for the country (Acs, Szerb and Autio, 2015). However, maximum number
of Islamic in the country and they remove their anxiety by using lot of rituals. However,
for foreign people, Turks looks more religious.
 Long term orientation: The main purpose of the dimension is to show how every society
should maintain some links with its own past so as to deal with the challenges of the
present or future. However, with the score of 46 indicates the moderate long term
orientation. However, no dominant cultural preferences can be inferred.
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 Indulgence: This factor of Hofstede model deals with the degree to which small children
are socialized. Significance of this factor can be defined as on the basis of the fact that,
without socialisation we do not become “human” (Kwasnicki, 2013). With the
intermediate score of 49, a characteristic corresponding to this dimension cannot be
determined for Turkey.
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CHAPTER 4: ANALYSIS AND FINDINGS
4.1 Introduction
This is an important section of the study, it helps the researcher to present the findings on
the basis of data or information generated. According to the present given case study, it focuses
on economic conditions of Turkey. However, through the means of this case study different
problems associated with the cited country has been evaluated which are related to political,
economic, religion (Ülengin and et.al, 2014). In the previous section, relevant models have been
identified which address the problems faced by Turkey in varied aspects. In the following
section, analysis has been presented on the basis of above evaluation of different models for
identified problems. In this regard, problems related to political environment is addressed
through Pestle and Porter’s Diamond model. While on the other hand, issues and obstacles
related to economic aspect of Turkey will be addressed through Global Competitiveness Index
model through the means of this recommendation will be given to the government of cited
country for the appropriate economies. Lastly, religious problems and issues has been assessed
through Hofstede cultural model.
Political problems
Pestle Analysis
Findings:
On the basis of pestle analysis of Turkey it has been identified that there are several
strengths and challenges that country is facing in each aspect. However, considering the political
environment it possess strengths because government is promoting the policies on liberalisation.
The main benefit of this judiciary move is that it will improve the relationship of Turkey with
other country as well as allow open trade between the countries in European Union. In this
regard, high inflow of foreign investment is enhancing the economic conditions of the country.
Further, it will lead to bring expansion in infrastructure of the country. Further, with maximum
youth power liberalisation will improve the young labour force for the country. This will indeed
encourage industrialisation for the Turkey as skilled and enthusiastic people of Turkey willing to
work hard and long. In addition to it, foreign investment will lead to the technological
advancement of the country as its results have been already seen in Turkish telecommunication
sector. Lastly, with the comprehensive legal structure, government is making valiant efforts to
motivate people to work ethically.
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Analysis:
From the above findings it has been analysed that, it order to overcome the problems
related to constitution reform, political issues and terrorist attacks. It is important for the
government of Turkey to make sure that encourage foreign investment so that with the help of
funds different sectors of the country can be enhanced. Moreover to this, literacy rate can be
improved by motivating or encouraging rural and poor people to learn or educate so that they can
work for the better of country (Ozdalga, 2013). By promoting liberalisation within the country,
government of cited country has enhanced the level of export with the average rate of 10%every
year. This indeed help the course of companies or plants operating in Turkey to produce more
and generate higher business volume. Through the means of this encouraging high inflow of
foreign investment will assist in improving the expansion of country’s economy as well as
enhance infrastructure to promote growth and development within the market. Bringing
industrialisation within the country will helps the course to employee people from backward
areas such as Kurds (Kurdish People) who are mostly from rural areas and poor background.
Looking at the financial background of the country is relatively week as compared to other
nations in European Union. However, it is because of the fact that, technological advancement in
the country is not up to the mark except sectors like telecommunication which are privatised by
the government and showing better technological advances (Sarigil and Fazlioglu, 2013).
Considering the legal system of Turkey it can be said that it has improved a lot because of
judiciary system installed for each level of cases. By the means of this, country can handle the
terrorist attacks more effectively than earlier as well as built better security system to mitigate
such harmful incidents.
Economic problems:
Findings:
A closer look to Turkey’s comparative performance in the three sub-indexes and nine
composite pillar of the global competitiveness index. However, the all the factors included in the
basic requirement of sub index are essential for the country’s productivity and competitiveness,
considering its current stage of development. Looking at the GCI report, Turkey does not score
particularly well on the subindex because with the score of 4.75 it ranks at 57th which is lower by
15 points as compared to 2006-07 out of 125 countries. Contrary to this, present position of
Turkey has jumped up by 16 places to 43rd spot. It is because, country’s economy grew by 8.4%
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in 2011 and benefits from considerable progress in a number of areas covered by GCI.
Furthermore, macroeconomic stability has improved and the financial sector is assessed as more
trustworthy and finance as more easily accessible for businesses. Institutional framework and
greater competition in local markets have been registered as they will help the course of Turkey
in strengthening its efficiency gains from large domestic market where it is ranked at 15th
position and in intense local competition at 16th. On the basis of index report it has been found
that, Turkey also benefits from its reasonably developed infrastructure which ranked at 51st,
particularly roads and air transport. Still there is updation required in ports and the electricity
supply. In addition to this, if Turkey wants to improve its competitions, government should focus
on building yup its human resource base with better primary education and healthcare and higher
education and training. Furthermore, increasing the efficiency of its labor market and reinforcing
the efficiency and transparency of its public institutions will assist in mitigating the problems
related to economic conditions in the country.
Analysis:
On the basis of above findings it has been analyzed that overall economic conditions of
Turkey is relatively good on the basis of GCI report of 125 countries. However, in whole Turkey
is ranked at 51 position (Göçmen, 2014).
In this regard, Turkey’s institutional environment is rated around mediocre because this
part is ranked at 64 with the score of 3.9. In comparison to countries associated with European
Union, performance of Turkey is considered as low (Sarkar, 2009). However, the public
institutions of Turkey are characterized by better protected property rights a more independent
judiciary, higher degree of judiciary on the part of public officials, less wasteful government
spending and better overall security in the country.
In context to infrastructure, Turkey is ranked at 51 with the score of 4.38 which is
significantly below that of the EU average of 5.03. The major concern in infrastructure for
Turkey is related to lack of quality of railroads and an electricity supply that is characterized by
relatively frequent shortages (Huggins and et.al, 2014).
Macroeconomic Environment has shown progress since 2001 crisis through the means of
effective policy reforms. Despite of this, there are different weaknesses that Turkey possess in its
macroeconomic environment. In comparison to emerging market economies that have
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experienced financial crises in recent past such as Argentina, Brazil and Russia, but in all Turkey
has remain stable to external shocks.
Education system is one of the major problem of Turkey because of lack of proper
training and development sessions for the growth and stability of people. In this regard, higher
education and training become critical. However, with the score of 74 Turkish higher education
and training pillar gets significantly lower marks than primary education system (Mehrotra and
Kant, 2010). Need of quality of education system is because it helps in meeting the expectation
of competitive economy in constantly altering business environment. Herein, also Turkey is
falling short in comparison to European average.
Religious Problems
Findings:
According to the given case scenario, the biggest issue or problems that Turkey is going
through from many decades is related to religion or cultural. However, majority of Islamic
people in the country has drawn several restrictions to growth and development of the country. In
order to analyze problems such as freedom of expression, religion, location and gender equality
are the major concern for the Turkish government. On the basis of Hofstede model it has been
identified that there is gender inequality within the country as male are more dominant against
female and still women headscarves are the major concern that government is still trying to
overcome. Despite of high power distance score, Turkish female have to follow all the rules and
regulations define in Quran from Islam. Furthermore, in several foreign policy issue it has been
identified that, Kurdish is one of the major problem for the government as 20% of Turkish
people have Kurdish roots which are associated from rural areas and poor backgrounds. This is
the major reason behind increasing unemployment rate which directly or indirectly affects the
overall economy of the country. Further, low individualism score indicates that people of Turkey
are collective in nature and are dependent on their families or clan. Due to high influence of
cultural preference people are not long term oriented as they does not maintain the link from past
to resolve the problems in present or future moreover focuses on rituals.
Analysis:
In order to overcome the religious problems government of Turkey must westernize to
modernize. However, several author defines that there should be reform which promotes western
style of dress on all male and female (Coleman, and et.al, 2010). This is because of the fact that,
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by doing so thinking of people can be changed from traditional to modern. Turkish population
have to step out of their comfort zone and concentrate on becoming independent individual that
can lead to economic development in the country as well as mitigate the barriers of religion
within the country. The belief of people towards their rituals is so high that they do not follow
varied rules and regulations developed by the government (Akan, 2005). Thus, in order to
modernize the country, it is important for the government to impose several rules and regulation
that promotes the gender equality as well as encourage women to wear what they feel is best for
them. By the means of this change, people will be more socialize and improve the overall score
of indulgence for the country (Cultural Issues. 2014).
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CHAPTER 5: PROPOSED SOLUTION TO PROBLEMS/
RECOMMENDATIONS, LIMITATIONS OF THE ANALYSIS
5.1 Solution to Political Problems
Solution:
On the basis of above analysis of case study, problems related to political environment of
Turkey has been identified as the major concern for the Turkish government. In order to resolve
problems related to constitution reform, political issues and terrorist attacks. Mainly government
has to concentrate on foreign investment so that different sectors can be enhanced. Legal bodies
should promote liberalisation and industrialisation within the country because it will generate
employment opportunities for the people such as Kurds who belongs to backward community.
Furthermore, encouraging liberal trade will mitigate the financial problems of the country and
make it more stable in terms of future development and technological advancement. In addition
to it, improving the overall legal system will help the course of Turkish government to handle the
severe problems such as terrorist attacks from its neighbour countries like Iraq and Iran.
Considering the legal system of Turkey it can be said that it has improved a lot because of
judiciary system installed for each level of cases.
Recommendations:
 Government is recommended to promote liberalisation and industrialisation.
 Should develop more rules and regulations to bring stability within the country.
 Should encourage foreign investment for enhancing different sectors by better investment
in development and advancement strategies.
Action Plan:
Government should maintain relationship with its neighbour countries so that essential
resources can be imported at low rate. Further, framing committee that focuses on defining rules
and regulations that also promotes flexibility within the country.
Limitations:
The major limitation in executing this action plan is the support of neighbour countries
like Iran and Iraq as they may cause problem for Turkey in maintaining its position among the
European Union countries.
5.2 Solution to Economic Problems
Solution:
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On the basis of global competitiveness index, different pillars of Turkey economy has
been identified. However, some of the areas are improving at significant pace while some of
them are still cause of major concern for the government. Looking at the institutional
environment of the country it is generating average outcomes. Therefore, in order to improve the
foreign trade should be promoted so that companies from around the globe can enter into Turkey
and establish their business. This will benefit in enhancing the economy as well as improving the
overall institutional environment. Further, problems related to current account balance, education
system etc. can be improved by the means of encouragement in foreign direct investment (FDI).
Considering the infrastructure it has been evaluated that, privatisation program in Turkey has
encouraged the sale of major bridges, highways, electricity grids and share in the partly
commercial bank. The main purpose of foreign investment is that it will assist in course of
expanding the infrastructure of the country. Furthermore, educational system in country is facing
major problems thus, to improve the overall literacy rate and enhance employment opportunities
Turkish legal bodies have to improve its primary education system. There is need of better
education system to meet the expectation of competitive economy in business environment.
Recommendations:
 Foreign trade should be promoted by the government of Turkey so that advancement in
infrastructure can be carried out.
 Privatisation program in Turkey should be organized more which leads to increase in
demand of infrastructural sector.
 Teachers of primary education system should be given proper training and development
opportunities so that they can improve their skills and abilities and enhance the overall
education system.
Action Plan:
Government should focus on indulging latest technical equipment so that betterment in
various areas can be carried out such as more plants or industries must be introduced to minimize
the unemployment rate. Foreign scholars and professors should be hired in primary education
system to improve the level of learning.
Limitations:
The major limitation that Turkey would face in executing this action plan is related to
funds. Despite of better FDI, country is lacking in its financial conditions. Therefore, more and
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more foreign investments should be attracted so that inflow of fund can be improved to carry out
the action plan.
5.3 Solution to Religion Problems
Solution:
Looking at the cultural and religious problems, government of Turkey should employee
different strategies to mitigate the issues related to Secularism. However, in male dominating
country women are suffering from several issues related to restriction and limitation from the
Islam rules and regulation. However, one of the major concern is related to women headscarves.
This is the major reason behind lack of country’s growth because women are not given proper
attention and flexibility within the society. In order to overcome such issues, proper education
awareness among the rural and poor people who are in majority as compared to other European
Union associate nation. Further, promoting industrialisation will help in encouraging people to
work and earn income for the livings. By the means of this, living of standard within the country
can be improved to great extent.
Recommendations:
 Promote gender equality.
 Women empowerment programmes should be organised.
 Education should be spread to rural areas for the development of poor people.
 Encouraging people to work will improve overall standard of living.
Action Plan:
Turkish government should encourage gender equality by employing male and female
and make them same work. Further, spread information about respect and equality so that people
can develop better working environment.
Limitations:
There are some limitations in that the action plan intended to be taken through in
promoting gender equality because, Turkish people follow their religion to a great extent and in
that women have several restrictions and limitations.
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