- $30bn for Turkish tech
- Focus on EVs and green energy
- Full details yet to be revealed
Turkey has committed up to $30 billion to woo foreign tech investors and bolster its domestic technology sector.
It is offering a mix of tax incentives and direct grant funding to kickstart sectors identified as crucial to the country’s industrial development.
The country’s new High Technology Incentive Programme (HIT-30) aims to attract $20 billion in private sector investment, President Recep Tayyip Erdoğan said at the scheme’s launch in Istanbul on July 26.
Headlining the programme is $5 billion in incentives for the electric vehicle industry and $4.5 billion to develop battery production, which is intended to fuel domestic EV output to 1 million units annually.
Turkey has already attracted foreign investment in the EV sector. Chinese EV maker BYD announced earlier in July that it planned to build a $1 billion plant in Manisa, near the Aegean coast. The facility, to be operational by 2026, will have the capacity to turn out 150,000 vehicles a year.
Significantly it would also allow BYD to circumvent the EU’s newly imposed tariffs – of up to 47.6 percent – on Chinese-made EVs, through Turkey’s customs union with the bloc.
Turkey has already begun producing its own EVs, with a state-backed consortium manufacturing the TOGG car. These accounted for 13,000 of the 39,000 units sold in the segment in the first half of the year.
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Under HIT-30 $2.5 billion of grant funding will go towards solar-cell facilities with a combined capacity of 15 gigawatts online and $1.7 billion will be used to develop wind energy component manufacturing.
At present Turkey has to import most of the technology used in its expanding wind energy sector.
There is also funding to promote the production of semiconductors, with the government offering up to $5 billion to back creating a dedicated manufacturing facility, along with support for research and development staffing costs.
The Turkish technology sector has welcomed the initiative, although there is still some caution on how the programme will be deployed.
If the government can transform the new initiative into a sustainable industrial policy it will make a significant contribution to Turkey’s high tech growth, according to Dr A Mete Çakmakcı, secretary general of the Technology Development Foundation of Turkey.
Howeve, the new policy will need to lay a solid platform to ensure the basic needs of value-added investment are met, Çakmakcı told AGBI.
“Two important conditions for attracting added value to Turkey are a vertical value chain and skilled human resources,” he said.
“It is necessary to have vertical integration of the incentive system and an industrial policy supporting a skilled workforce.”
The details of how the incentive programme will operate and when it will come into force will be announced at a later date.