Swiss investments in Turkey drop by half

Swiss products exported to Turkey may also be too expensive for local markets because of the current weakness of the Turkish lira. Keystone

The severe policies of President Recep Tayyip Erdogan have led to Swiss companies decreasing their investments in Turkey by 50% compared to the average over the past decade, Swiss Public Television SRF reports.

Over the last ten years, Swiss companies have on average invested some CHF200 million ($202 million) in Turkish markets, but today the figures amount to roughly half that. The decline was confirmed by the president of the Swiss chamber of commerce in Turkey, Arpat Senocak in an article for the business magazine ECO.

Turkish President Erdogan’s policies have led to high inflation and currency collapse, as well as legal and personal security concerns for staff on the ground, SRF reported on Tuesday.External link

Winterthur-based textile machinery manufacturer Rieter says Turkey is an important market for them, but the currency weakness is affecting exports.

“The investment propensity of our customers in Turkey is low overall because of the existing uncertainties,” the company said.

Senocak added that big Swiss multi-nationals like Nestlé, Roche, Novartis or Schindler are interested in investing large sums in Turkey but are waiting for the political and economic situation to become more stable. “Some big ones are waiting…until tensions are settled with Europe,” Senocak told SRF.

However, he said that the investments of Swiss companies already operating in Turkey as well as their staff “have never been at risk”.

Moreover, some Swiss companies like the radiator and ventilation manufacturer Zehnder are expanding their investment in Turkey, still seeing an economic opportunity as well as a chance to bring a positive impact in the form of jobs and decent salaries.

Board chairman Hans-Peter Zehnder told SRF that his company, which has no permanent employees on the ground in Turkey, is investing €200 million (CHF228 million) in a new production facility in the Turkish city of Manisa. “With our investment, we help to ensure that part of the country can develop, that welfare increases,” Zehnder said.