Factors affecting foreing direct investment: A research field in İstanbul, İzmir, Bursa and Manisa

Foreign direct investments made by the foreign investor towards the host country are realized in the form of establishing a new plant in the host country, purchasing an existing plant or becoming a partner in an existing plant. Especially after the 1980s, with the increase of globalization, the amount of foreign direct investments has increased considerably. These investments made by multinational companies have become a major source of foreign exchange for developing countries, which have to import capital goods for their economic growth. In addition to increase foreign exchange supply, foreign direct investments improve the production structure of the countries by transferring technology to the countries they visit. In this context, countries that have attracted foreign direct investment have shown a sustainable economic growth performance in recent years. The effect of foreign direct investments on economic growth increases the importance of the factors affecting foreign direct investments. The purpose of this study is to identify factors that influence investment decisions of companies established by foreign direct investment in Turkey. For this purpose, interviews have been done with 28 senior executives of foreign-owned companies established in Turkey. As a result of the research conducted, the most important factors which effects decision of foreign investors in Turkey are respectively that; Turkey's geographical location and proximity to markets, the Turkey's volume of demand and markets, qualified workforce in Turkey, the state of development of financial markets, low wages in Turkey and economic growth rate of Turkey. Besides, the scores given to Turkey by international rating agencies, inflation, exchange rate and natural resources as some of the elements haven't been found more effective in the investment decisions of firms. This result context, to increase the advantages of geographical location, improving Turkey's around the country with transportation network, improving foreign language education by making the right reforms in the education system and to invest in the workforce by vocational training and life-long learning are important. In the first part of this study, theoretical information about foreign direct investments is given. In the second part of the study, the studies examining the relationship between foreign direct investments and economic growth, employment and export as well as the factors affecting foreign direct investment are systematically reported. In the third part of the study data obtained from surveys conducted with managers of established companies with foreign capital operating in Turkey has been given by the tables. The results obtained from the study are given in the last section. Keywords: Foreign Direct Investments, Turkey, Field Research, Face to Face Interview Method