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Turkish GDP Growth in Recent Years

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Over the past 10 years, the Turkish economy has grown at one of the fastest and most prosperous rates which resulted in a growth in GDP values of Turkey as well. In this article,  Turkish GDP growth in recent years is explained.

According to the Turkish state website invest.gov.tr, macroeconomic strategies, fiscal policies and structural reforms have brought stability and security to the Turkish financial sector. Thanks to this stability, Turkey has been able to rank among the countries in its region with the highest FDI (foreign direct investment) figures in recent years.

Nevertheless, 2019 will be marked by negative GDP growth in Turkey due to the collapse of the pound since last year. Turkish GDP growth had so far shown exemplary results with an average annual rate of 5.3% between 2003 and 2016. This rate had even been ranked among the best in the world during this period.

Let’s see how this was distributed over the country’s activity in 2017.

GDP by sector in Turkey

In 2017, Turkish GDP by sectors was estimated as follows:

– Agriculture accounts for 6.8% of Turkish GDP

This sector, which, according to the Société Générale study on Turkey, employs nearly 19% of the population, is in constant decline and suffers from a decline in productivity, too. The 11% of land used for agriculture mainly produces wheat, tobacco, and hazelnuts but is not enough to supply the country whose imports, particularly in livestock, are growing exponentially.

– The industry represents 32.3% of Turkish GDP

Turkey has a rich industry that maintains constant and stable growth. The workforce and local know-how allow Turkish industry to stand out while being competitive. Very large infrastructure projects also allow the industry to constantly evolve. The automotive sector, as well as the textile sector, are the two main areas of Turkish industry.

– Services represent 60.7% of Turkish GDP

Globalization and the modernization of the country have strongly elevated the service sector since the early 2000s to undergo a significant decline and then stabilization after 2010. The sector which employs 58% of the Turkish workforce also includes the tourism sector which, after having experienced a significant decline, is returning to the forefront with significant growth which directly affects the Turkish GDP growth.

In 2019, the most active and prosperous Turkish sectors were textiles, automotive, construction, software, jewelry, and chemicals.

Future and forecasts

According to the OECD, Turkey’s growth is expected to be one of the most dynamic between 2015 and 2025 with an average annual rate of 4.9% and its foreign trade should be stimulated. In times of recession, Turkey’s economic performance and Turkish GDP growth are now lower than in previous years (estimated at 0.4% for 2019) but satisfactory given the crisis it is experiencing. Gita Gopinath, head of economic affairs at the IMF, estimates that 2020 will be a better year for Turkey’s economy, which should “emerge from its recession”. In her view, any aid would be “useless”, as the country could recover on its own, focusing in particular on greater transparency.

For further reading, you can have a look at our article about why you should invest in Turkey.

Business Management Service in Turkey

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ERAI Turkey is a business development consulting company based in Istanbul, the economic capital of Turkey, which has been supporting international companies since 2006. The business management service is one of ERAI Turkey’ most sought-after services, that form its core business, along with the following services:

  • the search for Turkish business partners,
  • the comprehensive market research in Turkey,
  • analysis of the potential development projects in Turkey,
  • recruiting employees in Turkey,
  • PEO services in Turkey etc.

You can consult the list of all these services offered by ERAI Turkey on its website.

Over the past 10 years, the ERAI Turkey team has very naturally built lasting trust with its loyal customers who, over time, have increasingly delegated more services to their trusted Turkish partner. This led to the spontaneous creation of a unique service in the consulting field: Business Management in Turkey.

What is Business Management Service? What Does It Include?

The tailor-made business management service tends to support companies in the management of a large number of their administrative, financial, legal and commercial activities in Turkey so that they can focus solely on their business development and turnover. The consulting company ERAI Turkey is part of the management of the client company as a consolidating actor of the puzzle, which brings together all the activity around it with the aim of a harmonized and homogeneous coherence.

Business management service provided by ERAI Turkey, which are carried out thanks to the professional team and partners, includes:

  • The creation of subsidiaries and their administrative management

This service is for any company wishing to set up on the Turkish market with its own entity. This action brings together a large number of very heavy administrative tasks that ERAI Turkey team promises to take care of throughout the laborious process while providing its expertise on the creation of subsidiaries for which it has the know-how along with the support of its loyal partners.

  • Legal management

ERAI Turkey also makes it possible to centralize legal activities by providing its team of legal experts from the Turkish market who have already proven many times their speed and efficiency in the advancement of certain projects that take a lot of time through conventional channels.

  • Financial management

Thanks to its financial service made up of professional accountants and many partners, ERAI Turkey offers to manage all the financial activities, from payroll management, insurance and various payments to companies that trust it.

  • Back office management

Our service of managing the follow-up of your sales from Turkey is one of the facets of the ERAI Turkey team. Indeed, many companies have entrusted ERAI Turkey with their back-office service in order to deal only with sales and marketing.

Why Dedicate Business Management to ERAI Turkey?

Having a single service provider for different activities is always an undeniable advantage. It makes it possible to consolidate and maintain the harmony and homogeneity of the various departments of the company. In addition, ERAI Turkey is one of the few consulting companies in Turkey to offer so many varied services under one roof, which facilitates the relationship with the client company.

This business management, which brings together a large number of tasks that activity must perform in order for it to function properly, especially abroad, is a laborious task that consumes a lot of time, money and energy, three very precious elements when developing a business. Today, ERAI Turkey is, therefore, proposing to consolidate and delegate these tasks, which are delaying the successful development of its customers’ turnover.

For more information on this unique service in Turkey, do not hesitate to consult our page on ERAI Turkey’s services or by contacting us via the form on this contact page.

Feel free to follow us on the social networks LinkedIn and Twitter for more information on the commercial and business activities in Turkey on a daily basis.

Here are some other articles that may be interesting for you:

·        Domiciling your business in a virtual office in Istanbul

·        ERAI Turkey celebrates its 12th year in consulting at the service of companies around the world!

·         Looking for a prestigious office for rent in Istanbul

Celebration of 12th year in consulting!

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The company ERAI Turkey is proud to celebrate its 12 years of consulting activities this year with a team of 9 people as well as 22 people working for partner companies, hosted in the premises of ERAI Turkey. Indeed, the company was created in 2006 as a subsidiary of ERAI France in Turkey, in Istanbul. Since then, more than 200 companies have trusted the ERAI Turkey team to guide them into the Turkish market, more than 30 people have been hired and nearly 25 companies have been hosted under the roof of the company.

The core of the company’s activity is consulting and business development support service on the Turkish market with market research, feasibility studies, financial studies or potentiality studies, ERAI Turkey is proud to present you today its most beautiful case studies, the most successful development stories in Turkey supported by the company so far.

It should be noted that each company requesting ERAI Turkey’s consultation has a problem specific to its project and its expectations. The role of ERAI Turkey is first and foremost to understand the stakes of the project to define a procedure to follow and to propose the best implementation option to its client. Thanks to its network of experts and professionals in many sectors as well as its expertise of more than 12 years, supported by many Turkish and French official institutions, ERAI Turkey is today the French/English-speaking leader of the consulting in Turkey.

Here are 3 case studies of companies with very different issues and the evolution of their implementation with the support of the consulting service of ERAI Turkey team yet all our references can be seen here as well.

 

Example 1: CEGID, a leading French company in the computer software industry

Context:

CEGID is a leading provider of enterprise management solutions for retail and industry. In 2012, during its first steps in the Turkish market, CEGID contacted ERAI Turkey to conduct a feasibility study of its project and define a market entry strategy. ERAI Turkey has prepared a comprehensive report consisting of recent information on the relevant sector, general information on retail and industry, market intelligence, competitor’s analysis, distribution networks, price analysis as well as the testimonials of actors and users of the market.

Result:

After finalizing the report, an implementation strategy was put in place and the search for value-added resellers (VAR) in retail and production was started. A total of 4 partners matching the criteria were found and presented to CEGID who interviewed each.

Thanks to its retail value-added resellers (VAR), CEGID has obtained very large projects including very large retail chains as well as the billing system of the largest cosmetics company present in Turkey.

Through its value-added resellers (VAR) in production, CEGID has become the official solution provider for OSTM (Defense and Aviation Cluster) member companies operating in the defense sector. Product localization has been successfully completed.

 

Example 2: NTN SNR, a pioneer in the automotive sector settled permanently in Turkey

Context:

This Japanese-French company, one of the largest bearing manufacturers in the world, has been consulting ERAI Turkey for almost 8 years. The company wanted to develop expansion strategies in the Turkish industrial market with the long-term objective of knowing the industrial sectors in Turkey and the best solution that would increase local sales and finalize a sustainable implementation.

Result:

A large feasibility study explaining the promising sectors, the potential and how to succeed in Turkey has been drafted. Recruitment, hosting and management of the sales team to better manage distributors and key accounts in Turkey. Implementation has been finalized, the local team has been successfully set up, three highly qualified sales managers and a marketing manager on this team have been recruited by ERAI Turkey since 2012.

 

Example 3: PERNAT, a company that imposed itself in the heart of Turkish industry

Context:

PERNAT Industrie is a supplier of machining of high precision metal parts of any machinable material. A leading French automotive supplier! PERNAT Industrie contacted ERAI Turkey in 2006 to ask for advice on the strategy to adopt for its project to set up in Turkey. The strategy adopted would be that of creating a liaison office and subsequently a joint venture or the acquisition of a local company. As a result of these projects, ERAI Turkey supported the greenfield creation project and was present throughout the process of creating the local company PERNAT TURKIYE, both for wage-carrying and accounting, or looking for a production site and its activation.

Result:

The company has made an investment of more than 2 million euros in the Organized Industrial Zone of Eskisehir. Every year, the company sees its turnover and its number of employees increase and provides local quality service to third-party automotive suppliers as well as in various other sectors (defense, etc.).

We have dozens of other projects that we have successfully completed so far. We are confident in our expertise and guarantee success through tailor-made solutions always adapted to the specific circumstances. Do not hesitate to contact us if you are interested in our consulting service.

Invest in Turkey in 2019?

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The offices of ERAI Turkey, based in Istanbul, are like a window that receives the echoes of everything that happens in Turkey as in France, at the economic level and at the level of trade. Since the fall of the value of the Turkish lira in the summer of 2018, the question that is most often asked to the director Simay SOYLU is: “Is it wise to invest in Turkey in 2019 when the country is in such a complicated economic phase? And to this question, she always answers:

“ERAI Turkey offices have never been as busy and as busy with their services as they are today. Why? Because the crisis has not scared those who know the Turkish market well: our old customers. They are realistic about the fact that Turkey is a country that has seen a great many economic, political and social crises, and that it has always been successful. Turkey will also recover from this crisis very quickly. Only companies that know nothing about the Turkish market are afraid of this climate. Turkey will be better tomorrow, and to prepare for it, it is now! We are here to answer any requests and to accompany the most separate in their discovery of the Turkish market.”

Invest In Turkey has published a list of 10 reasons to invest in Turkey and ERAI Turkey supports each of the points which are stated below:

1 / A well-performing economy

If we look at economic indicators such as the growth rate or the economic ranking of Turkey in the world rank, it is well positioned as it is in 19th place and intends to improve.

2 / The population (80 million inhabitants)

3 / A qualified and competitive workforce

4 / A liberal and reformist investment climate

5 / Infrastructures

6 / An ideal central location

7 / A corridor and an energy terminal for Europe

8 / Reduced taxes and incentives

9 / Customs union with the European Union since 1996.

10 / A large internal market

To read the details of these points, click here.

To contact ERAI Turkey and get an appointment, send an email to [email protected] or call us on +90 216 463 33 66.

Work Permit Application Process in Turkey

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In 2017, Turkey has more than 87,000 foreign employees who go through a work permit application process with the Turkish administration. This number is increasing every year with a growth of more than 14% for the last 4 years. One of the reasons for the significant increase in recent years is notably the massive influx of Syrian citizens (this is about 20,970 applications for work permits in 2017). Around 5,000 to 6,000 work permit applications are from Europe, between 500 and 600 a year come from France.

Although the Turkish administration is more efficient than that of a large number of European countries, it still has some shortcomings and is known to be quite slow with respect to the time required to issue permits, which can range up to 4 to 6 months for some cases. Procedures are also slower because massive demands from Syrians have significantly slowed internal systems.

Our advice to avoid this prohibition of an organization like ERAI Turkey which is in direct contact with the administration and which issues the license in 2 months for the longest and 3 weeks for the fastest.

Some important information to know about obtaining a work permit in Turkey:

  • A single person cannot apply for a work permit. The request must be made by a local company.
  • The Turkish company has the right to hire 1 foreign employee for every 5 Turkish employees. For example, if the company has 25 Turkish employees, they can, therefore, employ 5 foreign employees.
  • The capital of the company in question must be equal to or greater than 100,000 TL or the company’s turnover must be equal to or greater than 800,000 TL or its exports must be equal to or greater than 250,000 $.
  • If the employee is already in Turkey, he/she must have a 6-month residence permit and must be valid when the work permit application is made to the Ministry.
  • If the foreign employee is in another country, his application should be addressed to the Turkish Consulate of the country in which he is located.
  • All documents must be submitted to the Ministry of Labor and Social Security within 6 days after the employer’s work permit application.
  • If the employee is declared as a senior manager, pilot, director, architect or engineer, his local salary must be at least 4 to 6.5 times higher than the Turkish minimum wage. See more details on salary restrictions here.

To know the administrative procedure, do not hesitate to consult this link.

Do not hesitate to visit the ERAI Turkey website for your further needs!

Interview of General Manager of ERAI Turkey on Hurriyet newspaper

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ERAI TURKEY HAS BEEN CONTRIBUTING TO THE DEVELOPMENT OF TURKISH-FRENCH ECONOMICAL RELATIONS BY SUPPORTING AND GUIDING FRENCH COMPANIES

ERAI Turkey’s General Manager Simay Soylu stated in her interview that; “Business relations between Turkey and France are getting better every year, even under the changing circumstances.”

Since 2006, ERAI Turkey has been actively involved in business development projects of French companies as well as introducing the Turkish market to them. ERAI Turkey has been contributing to the development of Turkish-French economical relations and behind this successful process; there is a multi-cultural team with 12 years of experience. ERAI Turkey offers market research, competitor and product analysis, partner research, hiring employees for companies, payrolling and office service, setting up a company or a production facility, etc. to its clients. ERAI Turkey provides the same services to Turkish companies who are interested in entering the French market. General Manager of ERAI Turkey, Simay Soylu, answered our questions about the company who contributed more than 35 million Euro to Turkish economy directly or indirectly with more than 200 projects within these years.

This interview was published on 2 March 2018 in the Turkish national newspaper Hürriyet, under the heading “France-Turkey Trade Exchanges”.

  • What is the current situation of Turkish-French collaborations at the moment and which sectors are interesting for French companies in the Turkish market?

France is the 6th country that makes a direct capital investment to Turkey. More than 500 French companies provide more than 50.000 employment. Most of the French companies are large-scaled and they are making investments in important sectors such as automotive, automotive supply industry, energy, food, construction, insurance, banking-finance, etc. On the other hand, France has strong SMEs in aeronautics, medical instruments, medicine, dermo-cosmetics, industrial equipment, and material design, machinery, and plastics sectors which are needed by Turkish companies. We have been working to introduce the Turkish market to those companies in order to actualize their projects and make the process easier.

  • What kind of companies prefer ERAI Turkey?

At first, the company was set as French Development Agency Turkey Office and in 2015 the office was completely turned into a Turkish company. Our company’s specialty is SME consultancy. ERAI Turkey offers tailor-made services to the French companies who are willing to enter the Turkish market with specific projects. Our company provides the most efficient solutions for the French SMEs and for the large-scale companies or start-ups we offer especially recruitment and payroll services. After so many years in this sector, we help and guide all types of French companies who are motivated, honest and innovative with an entrepreneurial spirit.

  • Why is ERAI Turkey a different consultancy company?

After 12 years and numerous research and business development projects in many different sectors; we have a wide business network and our most important difference is our to the point solutions for each and every project of our client companies. Our young and dynamic team has the motivation to evaluate all the cases as if their own. This leads to success undoubtedly.

  • What are your future plans and growth targets?

In the long term, ERAI Turkey aims to be the first name that comes to minds of dynamic and innovator French companies who would like to come to Turkey or Turkish companies who would like to go to France. For detailed information please check www.eraiturkey.com.

Erai Turkey Welcomes The New Year With Gifts!

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For its 12th year in the sector, ERAI Turkey offers three feasibility studies to three different companies interested in the Turkish market. This is an opportunity for the companies concerned to take the first step on the risk-free market and to learn more about the opportunities but also the difficulties that could be encountered when setting up their business in Turkey.

To enter the draw, all you have to do is send an e-mail to [email protected] or fill out the form at the following link: http://tiny.cc/eraitr 

Always on the go: Construction sector in Turkey

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Turkey is a developing country and the needs of the country are increasing accordingly. The construction sector in Turkey is one of the most important sectors as well as in other developing countries. Dams, energy manufacturing facilities, roads, airports, urban spaces, factories, hospitals and all the other places necessary for the public are directly related to the construction sector.

Data in numbers

  • About 2 million employees (in 2016)
  • %5 growth in 2017
  • %8 share in GDP
  • Total investment in the construction sector was 52,2 billion $ in 2016
  • Foreign Direct Investment was more than 8,1 billion $ in 2016 and 3,5 billion $ of it was the direct investment in real estate purchase.

Top 10 Turkish Companies in the Construction Sector in Turkey

  1. Enka Construction – Turnover (TL): 10.581.750.000
  2. İçtaş Construction – Turnover (TL): 10.118.155.000
  3. Polimes Construction – Turnover (TL): 8.811.070.294
  4. Mapa Construction – Turnover (TL): 4.207.910.434
  5. TAV Airports – Turnover (TL): 3.450.223.000
  6. Limak Construction – Turnover (TL): 2.847.073.357
  7. Tekfen Construction – Turnover (TL): 2.882.750.000
  8. Gap Construction – Turnover (TL): 2.556.288.066
  9. TAV Tepe Akfen – Turnover (TL): 2.473.210.390
  10. Nurol Construction – Turnover (TL): 2.304.234.000

Foreign Companies with Turkish Partners

In the Star Refinery Project, there is an international consortium consisting of Spanish Técnicas Reunidas, Italian Saipem, South Korean GS Engineering and Japanese ITOCHU.
– Yeşil Construction – Salamanca (England) They have been partners since 2007 and they have completed many projects together.
– Beyttürk Investment – Tasweek Group (UAE) They have signed an agreement on 280 million dollars to build villas in Turkey.
– Cathay Construction – Al Omari Group (Saudi Arabia) They became partners in 2012 and they have signed a contract of 20 million dollars including 32 villas in Istanbul.
– İnanlar Construction – 32 Group (USA) They have started their partnership in 2010 and have been working on important projects since then.
– Keleşoğlu Construction – 32 Group (USA) The company has one more partnership in Turkey and they have created an associated company.
– Aşçıoğlu Construction – Bin Laden Group (Saudi Arabia) Aşçıoğlu Construction and Bin Laden Group have created a new company in Turkey and have started working on important projects together.
– Ağaoğlu Group – CPBAU (Germany) They have become partners in 2014 and since then they have been working together on big projects not only in Turkey but also in Europe.
– Garanti Koza – Maeda Corporation (Japan) One of the biggest construction companies Garanti Koza has become partners with Maeda Corporation in 2014.
– Dap Construction – Rotana (Saudi Arabia) They have become partners, worked together and opened their first hotels in Istanbul.

Some Foreign Companies that Develop Projects in Turkey

  • Emaar Group (UAE) They alone started an enormous project in the heart of Istanbul including a shopping mall and apartments in the same place. They invested a lot in the construction and in 2017 they have opened the mall to the service of people.
  • ALJ Group (Saudi Arabia) They have been the biggest distributor of Toyota cars and now they are investing in the construction sector as well. They have started their own company in Turkey and they are about to start their projects in the construction sector.
  • Bilfinger Berger (Germany) The company is mainly involved in mall projects in Turkey. Most of the biggest shopping centers are in their portfolio.

Potential of the Construction Sector in Turkey

According to sector experts, the construction sector is promising regarding the increasing number of foreign demands, the potential requirements of the sector and the rising urban transformation projects. Besides this, the share of the construction sector in GDP has almost reached to %8 which is the highest rate since 1998.

The need for housing, the tendency of investment in the real estate and foreign demands show the high potential of the sector. When these are all taken into consideration it is possible to say that in the following years the construction will go on being one of the leading sectors in the economy.

The Latest News of the Construction Sector

  • Construction sector to continue boosting Turkey’s economic growth
    Growth is expected to continue in the construction sector that has come to the fore with its contribution to the overall growth rate of 5.1 percent for the Turkish economy in the second quarter of the year. https://goo.gl/myyjCx
  • Istanbul’s 3rd airport to welcome 1st plane by Feb 2018
    Istanbul’s third airport will welcome its first plane before February of next year, according to Turkey’s transport, maritime, and communications minister. Speaking at Anadolu Agency’s Editors’ Desk in Ankara on Friday, Ahmet Arslan said: “We will land the first plane at Istanbul’s third airport before February 2018.” https://goo.gl/cDDYqT
  • TANAP to be tested in late 2017: Turkish minister
    The testing of the Trans-Anatolian Natural Gas Pipeline (TANAP) will start at the end of 2017, Turkish media outlets quoted Minister of Energy and Natural Resources Berat Albayrak as saying on November 1. https://goo.gl/EtuSwX

If you are interested in the construction sector in Turkey you can contact us from the button below. Click here to see our references.

ERAI Turkey is expanding and moving this summer 2017!

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If you are registered with the ERAI Turkey Newsletter, you are already aware that ERAI Turkey team is expanding and moving to new premises which are more spacious, more prestigious and more welcoming than ever. Indeed, since 2006, ERAI Turkey has not ceased to provoke the Turkish economy by continuing to develop and promoting good commercial relations between foreign and Turkish companies. This move also represents the real commercial interest of foreign companies towards Turkey and the demands for information and settlement in Turkey still very present.

In the beginning of September 2017, the ERAI Turkey agency will be located on a full floor of the luxurious Plaza Business Istanbul in Göztepe (along the E5 highway, on the Asian side of Istanbul) and will welcome you in a much more professional and intimate office atmosphere. This move will, of course, be accompanied by new offers of office rental in the Asian part of Istanbul, within our beautiful space.

Are you looking for a professional and friendly office in Istanbul? All in a pleasant international environment, ERAI Turkey offers you new options adapted to your needs. To see our listings for office rentals in Istanbul, click here!

Reminder:

→ ERAI Turkey is the reference consulting agency for companies wishing to set up business in Turkey. Thanks to its team of experts, ERAI Turkey guides all types of implementation projects (salary wage, recruitment, search for partners etc. see all our services by clicking here)!

→ More than 200 companies from all walks of life have already trusted ERAI Turkey to accompany them on the Turkish market. Why not you? See our references.

If you have any questions about the new ERAI Turkey offices, the move of our offices or a project concerning Turkey that you would like to share with our expert team, do not hesitate to contact us by writing or calling us!


Read also: Looking for a professionnal office to rent in Istanbul or Indroduction of ERAI Turkey.

ERAI TURKEY, your business partner on the Turkish market

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To find out more about ERAI Turkey, the development agency based in Istanbul, you will find a description of the services offered by the ideal business partner of foreign companies on the Turkish market on the picture above.

This non-exhaustive list of services offered by ERAI Turkey is divided into 3 phases:

The discovery phase

The discovery phase of the Turkish market corresponds to companies that have no knowledge of the Turkish market but wish to test the potential market for their company. During this phase, ERAI Turkey offers services such as:

  • The complete market analysis
  • The feasibility study of your project
  • Contact with key market players in Turkey
  • Organizing and accompanying exploratory trips or commercial tours in Turkey

The implementation phase

During the implementation phase in Turkey, companies are facing challenges to which ERAI Turkey brings fast and efficient solutions. Thanks to a team of bilingual experts, ERAI Turkey offers services such as:

  • The search for Turkish partners (distributor or agent)
  • Supplier sourcing
  • Quality control on the field
  • The domiciliation of companies on our address
  • Research of potential clients in Turkey

Development phase

Companies already established in Turkey would have very different but equally complex needs that ERAI Turkey could take care of like:

  • The recruitment of a local employee or VIE (via Business France)
  • The installation of employees in the offices / Rental of a professional office in Istanbul or else
  • Management of the administrative, financial or legal tasks of the company in Turkey
  • The creation of a Turkish subsidiary
  • The acquisition of Turkish companies

The agency ERAI Turkey is also available to answer all your requests in relation to Turkey such as the translation of brochures, complex texts, calls for tender, etc., assistance in the appointment, drafting of contracts in Turkish, Networking (accountants, lawyers, professionals in your sector in Turkey) …

Do not hesitate to contact your favorite business partner to share your projects and find the best solutions to your problems concerning the Turkish market with ERAI Turkey!

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