weighted score 6.3 · ten dimensions
Sourcing Attractiveness Index · ten dimensions
Turkey
Labour cost, supply base depth, logistics infrastructure, trade access, and innovation scores for Turkey as a sourcing destination.
Labour cost competitiveness
5
Manufacturing wages below Western Europe but above South and Southeast Asia. Lira depreciation has periodically improved cost competitiveness in USD/EUR terms, but high domestic inflation erodes gains.
Supply base depth
7
Deep supply chains in textiles, automotive components, white goods, and steel. Tier-2 supplier ecosystems well-established in organised industrial zones across western and central Anatolia.
Logistics & infrastructure
8
Proximity to EU markets is a major advantage. Modern port infrastructure at Mersin and Ambarli. Road and rail connections to southeastern Europe. Istanbul Airport is a major cargo hub.
Workforce skills
6
Large engineering graduate pool. Strong technical skills in automotive assembly, textiles, and white goods manufacturing. English proficiency moderate in export-oriented sectors.
Scalability
7
85 million population provides a large labour pool. Organised industrial zones offer structured capacity expansion. Automotive and textiles sectors have demonstrated ability to scale for European demand.
Ease of doing business
5
Customs Union simplifies trade procedures for industrial goods. However, regulatory unpredictability, currency volatility, and bureaucratic complexity remain challenges for foreign buyers.
Trade access & tariffs
6
EU Customs Union provides duty-free access for industrial goods — a significant advantage. However, agricultural products and services are excluded. Turkey has FTAs with numerous countries but is not an EU member.
Sustainability baseline
5
Turkey ratified the Paris Agreement in 2021. Renewable energy investment growing (wind, solar, geothermal). However, coal remains significant in the energy mix and factory-level ESG audit maturity varies.
Innovation & IP
7
Growing R&D investment, particularly in automotive and defence sectors. Arcelik and Vestel hold significant patent portfolios. Technology transfer from European OEMs has built domestic capabilities.
Quality standards
7
Automotive supply chains operate to IATF 16949 standards. White goods manufacturers meet EU CE marking requirements. Textile exporters comply with REACH and EU product safety directives as standard practice.
Trade Access & Manufacturing Base
Trade Access & Manufacturing Base
- EU Customs Union
- Turkey has been in a Customs Union with the EU since 1996, covering industrial goods. This means duty-free access for most manufactured products entering the EU — a significant cost advantage over competitors outside preferential trade frameworks.
- Key export sectors
- Textiles and apparel, automotive components (Fiat, Ford, Hyundai assembly plants), white goods (Arcelik/Beko, Vestel), steel, chemicals, and agricultural products. Turkey is a top-five global exporter of textiles and apparel.
- Domestic champions
- Arcelik (owner of Beko and Grundig brands) and Vestel are globally competitive white goods and electronics manufacturers. Both operate large-scale factories supplying European retail chains directly.
Labour, Logistics & Scale
Labour, Logistics & Scale
- Population & workforce
- Turkey has a population of approximately 85 million with a young demographic profile. Large manufacturing workforce with experience in textiles, automotive, and consumer goods production.
- Proximity to EU
- Turkish ports (Mersin, Izmir, Istanbul/Ambarli) are approximately 2 hours by air and 5-7 days by sea to major EU ports. Road freight to southeastern Europe is viable for time-sensitive shipments, offering a nearshoring advantage over Asian competitors.
- Infrastructure
- Modern container port infrastructure at Mersin and Ambarli. Istanbul Airport (opened 2018) is a major cargo hub. Organised industrial zones (OSBs) across Anatolia provide structured manufacturing environments with shared utilities and logistics.