UPDATE - Turkey unveils fresh incentives to boost investment

ADDS DETAILS OF INCENTIVE PACKAGE

By Gokhan Ergocun and Jeyhun Aliyev

ANKARA (AA) - President Recep Tayyip Erdogan announced Monday a new set of economic incentives to encourage more investment in the country.

"The system will provide incentives to firms in several areas including health, defense, automotive, and mining and metal sectors," Erdogan told a meeting in the capital Ankara.

He said the new set of incentives worth 135 billion Turkish liras ($33.16 billion) would support 23 projects by 19 selected Turkish firms.

The president said the measures were designed with an eye to narrow Turkey's current deficit by nearly $19 billion as they are expected to boost exports by $6.3 billion and cut imports $12.3 billion.

Turkey's current account deficit was $47 billion last year, according to TurkStat, the country's main statistics agency.

Erdogan said the incentives package would help boost production and create more jobs.

He said the package will include corporate tax discounts twice the size of the investment made, exemption from customs tax, insurance premium as well as support to employ qualified personnel.

Also speaking at the meeting, Prime Minister Binali Yildirim said that the incentive system will help manufacture high- and medium-scale value-added products, narrow current deficit and increase the share of value-added products in exports.

"We work for turning Turkey into an investible country," he stated.

Incentives are estimated to add 169,000 jobs to the economy, he added.

The 19 Turkish firms to get government support includes armored vehicle manufacturer BMC, dairy producer Sutas, polyester company SASA, aviation industry TUSAS, technology and appliance manufacturer Vestel, and car producer Oyak Renault, the Economy Ministry had announced.

Four out of the 19 selected companies will get 75 percent of the total allocated government budget, amounting to some 101.3 billion Turkish liras ($25 billion), the Economy Ministry announced.

The lion's share will go to leading polyester producer Sasa -- 29.48 billion Turkish liras ($7.27 billion) -- for two projects, the ministry said.

Appliance manufacturer Vestel, mining company Tosyali, and energy company Metcap will receive 28.4 billion liras ($7 billion), 28 billion liras ($6.9 billion) and 15.32 billion liras ($3.78 billion), respectively, according to the ministry.

Nearly 170,000 jobs will be added to the economy with a total of 23 investment projects as five of those alone will create around 68,000 jobs.

Companies under the new incentive package include aviation company Tusas, metallurgical firm Yildiz, petrochemical supplier CFS, petroleum refinery Ersan, aluminum supplier Assan, renewable energy company Ekore, metal producer Siirt Bakir, armored car manufacturer BMC, composite firm Dow Aksa, machine manufacturer Most, medical technologies company Alvi Medica, another renewable energy company Atayurt, furniture company Ipek, dairy producer Sutas and vehicle producer Oyak Renault.

They will be rewarded funds ranging from 4.8 billion Turkish liras ($1.2 billion) to 493 million Turkish liras ($121.7 million).