Restrictions on Overseas Trade in Turkey Case Study

Restrictions on Overseas Trade in Turkey - Case Study ExampleTurkey being a natural bridge in the midst of the old continents of Asia, Africa and Europe, has a vast scope of overseas trading. But still the government of Turkey plump down restrictions on overseas trade. (Fletcher, 2006)The investment funds climate of Turkey, that forms barriers for any outsider, whether large or small, domestic or foreign, driving problems that affect all economic sectors of the country, particularly the telecommunication sector. The major problems which agitate Turkeys economy are shortfall of well functioning capital market, limited expertise in banking system and technologically oriented companies, partial derivative regulatory process that always intend to restrain new companies and buoy up existing companies, peculiarly those belonging to prominent business families of the country.Companies in Turkey both the reclusive enterprises and public enterprises specially, suffer from rottenness in various levels of the organizational hierarchy. The judicial system of the country, up to some extent, can be suspect to be influenced by external political and commercial mal forces. Growing personal and political relationship in the midst of government officials and business representatives form the basis of corruption, which appears to be the most serious problem biting up the economy of the country.Barriers in investment of the private sectors and the foreign companies in the markets in Turkey is also a matter of concern. The Bilateral investment Treaty (BIT) between Turkey and United States of America came into force in May 1990. Due to liberal investment regime of turkey, foreign investors are provided with national treatment in the country. In Turkey companies possessing foreign capital are treated as local companies. Regardless of nationality, private sector investments are always hindered by the facts like political and economical uncertainty, lack of judicial stability, and wild bureaucracy, and high tax rate, unpredictable changes in legal and regulatory environment, fragile framework for corporate giving medication etc. All areas except finance and petroleum sectors are fully open to foreign intimacy. though the petroleum and financial areas are open to the private sectors and foreign investors in Turkey, Special permission is undeniable for the foreign companies to establish business in these sectors. (Lamb, 2006) Foreign share holders have restricted equity participation ratio, such as near about twenty percent in Broadcasting industry, forty society percent in aviation, marine transportation and value added telecommunication services industries. Sometimes arbitrary legislative action under cut the rationale for the investments of the foreign companies committed to the Turkish market. International settlement of investment disputes between foreign investors and the state remain bonded by efforts of the government of turkey, following the inscriptions mentioned in the Bilateral Investment Treaty (BIT) signed by both the concerned parties. For several years the government of Turkey was providing concessions in public services, to the private investors and specially the foreign investors. According to the