Investing in Turkey
Turkey’s incoming tourist figures have fallen sharply since August 2015, with the decline exacerbated by the travel ban on Russian tourists – the country’s secondbiggest source of visitors - implemented by Moscow. However, there are signs of light at the end of the tunnel according to Mehmet Önkal CHA, ISHC, managing partner of BDO Hospitality Consulting
Rewind to the mid-1980s, and Turkey’s tourism industry was undeveloped, with visitor numbers totaling less than three million. However, driven forward solely by the vision and initiative of Prime Minister Turgut Özal, a new era in tourism dawned. Special ‘tourism development’ laws were enacted for the development of seaside resorts, which provided investors with useful advantages. Many monetary and non-monetary incentives were applied to tourism investments in Turkey in the 1980s, which helped to boost the number of hotel beds almost 1000-fold to over 1.3 million. The number of arrivals also rocketed, surpassing 37 million in 2015, marking an increase of more than 1200 percent in less than 40 years.
Turkey is well situated geographically for all of the prime tourist-generating countries of Europe and the Middle East. The most convenient means of travel for visitors is by air. International scheduled services are mainly provided by the national carrier, Turkish Airlines, alongside other international airlines. Turkish Airlines flies to more countries and destinations than any other airline in the world.
Turkey offers a vast array of experiences, from beach holidays along its 7200 kilometers of coastline to winter sports in the mountains and countless historic sites to explore. Visitors can immerse themselves in its rich history, discovering more about the successive peoples that have occupied Anatolia over the last 10,000 years (Hittites, Lycians, Lydians, Lonians, Phoenicians, Trojans, Persians, Hellens, Romans, Byzantines, Seljuks and Ottomans) and catch a glimpse of their remains. The country boasts more than 60,000 sites of historic interest, as well as the natural wonders of Pamukkale and Cappadocia. Turkey also has huge potential for niche tourism, including the cultural, congress and convention, shopping, healthcare and religious segments.
The bad news
Turkey’s tourism sector is currently grappling with huge losses, with bomb attacks, unrest in the southeast of the country and a violent coup attempt, followed by mass arrests during a state of emergency, keeping visitors away.
Russia was one of Turkey’s most valuable markets for incoming tourism. However, in the first four months of 2016, the number of Russian tourists entering Turkey dropped by 40 percent, driven down primarily by political differences between Ankara and Moscow. Bilateral tension was triggered by the shooting down of a Russian bomber plane by Turkey’s air force in north Syria. Millions of Russians who traditionally populate Turkey’s beaches stayed away. Russian visitors to Antalya, Turkey’s tourism capital, decreased by 95 percent. In 2016, the number of visitors to Turkey plummeted to 25 million.
Bomb attacks in Istanbul, Ankara and other cities have also severely affected the country’s broader tourism industry. In June 2016, ISIS militants killed 45 people and injured many more in an attack on Istanbul’s Atatürk International Airport, the main point of entry to Turkey. In Istanbul, the number of foreign visitors dropped over 25 percent. The situation deteriorated further on July 15, when Turkey was hit by a failed coup, in which 246 people were killed. As a consequence, the tourism
industry in Turkey experienced a significant decline in visitor numbers, with bookings for the summer holiday season down by 50 percent.
The bright side
Despite the current challenges stemming from the recent drop in Russian tourist numbers and the violence still ensuing in several parts of the region, Turkey’s tourism industry is battling hard to maintain growth. Turkey achieved a yearon-year increase in tourism revenue of 1.3 percent in 2016, inching up to about USD 4.87 billion in the first quarter of 2017. Tourist arrivals were up by 2.37 percent, with foreign visitors reaching 1.9 million.
Turkey is also hoping to continue repairing the damage by attracting tourists from other markets. The country is proving especially popular among visitors from China and the Arab region, with tourists from Tunisia, Algeria, Jordan, Bahrain and Lebanon arriving in increasing volumes. The number of visitors from Macedonia, Bulgaria and, especially, Georgia and Ukraine, is also on the rise.
Turkey and Russia have agreed to improve their relations, which is being seen by many as a prelude to the return of Russian tourists to Turkey. Tourism officials and professionals are claiming a revival in reservations from Russia.
While erasing the effects of such an extensive crisis will take time, Turkey has, again and again, proved its resilience and ability to successfully emerge from challenging situations. The strength of the Turkish reaction was evidence after the Atatürk airport bombing. Whilst closed with flights blocked in the immediate aftermath, the airport resumed operations just a few hours later.
Securing a recovery in Turkey’s tourism industry will take a period of peace, something that has been missing in the country for around a year. Perhaps unsurprisingly, in times of relative calm, tourists have been shown to return.
Known for centuries as a strategic stop along the Silk Road, Istanbul is celebrated for its traditional street food and sweets, and as a melting pot of Middle Eastern, Mediterranean, Balkan and Central Asian flavors. However, in Istanbul, as elsewhere in the world, globalization and urbanization have led to people losing touch with their food’s origins.
A growing middle class, rising household incomes and a young Turkish population – over 50 percent are under 30 years of age – are combining to bring about changes in the culinary tastes of young, urban Turks. Driven by urbanization, the traditional food markets called ‘bakkal’ are being substituted by modern grocery retailers, such as ‘Eataly’. Globally-known brands and products are also being given more and more space on the shelves of supermarkets. So what’s next for Turkey? As long as the country’s economy continues to grow, the food industry will strengthen in its role as a place for local and international companies to do business. Let’s take the example of chocolate as a trend and growth area. Consumers have been able to find industriallyproduced chocolate made by multinational and local brands and high-end confectionery items in supermarkets or pastry shops famous for their chocolates since the early days of the Turkish republic.
However, today, small patisseries and chocolatiers are also popping up, selling handmade bonbons, such as truffles, pralines or the chocolate Napolitains called ‘Madlen’. These outlets are producing high-cocoa content bars with health benefits, which means that the quality of the chocolate itself is being given more importance.
In addition, classical Turkish recipes are being revamped and created with chocolate as an ingredient. My team and I have decided to respond to this demand and create Turkish classical recipes revisited at Chocolate Academy™ center. These include a favorite across the generations - ‘sutlac’ - a milk rice pudding with white Callebaut chocolate; a ‘baklava’, with an orange-pistachio and dark-chocolate filling; and the classical, iconic breakfast ‘acma’ and ‘simit’, with dark Callebaut chocolate. These are only a few examples of the classical desserts we have created using chocolate, but giving it a modern twist.
TRADITIONAL TURKISH DELIGHTS GET A MAKEOVER