Question

1- Turkey's fiscal (financial) Describe the overall structure of the sector as outlined

2-Express your views on the future of Volkswagen company

Answer 1

Dear Student,

Introduction

The Turkish economy has been moderately free for more than a decade. GDP growth had been robust until 2018, when a currency and debt crisis pushed the economy into recession.

1) Finance Sector

The resilience of Turkey’s economy is due to solid public finances, well-capitalized banks, and a dynamic and diversified private sector. Moving into the mostly free ranks of economic freedom, however, will require reforms to make the labor market more competitive. More urgently, the government will have to strengthen judicial effectiveness and the fight against corruption.

2) Economic Index

Turkey’s economic freedom score is 64.4, making its economy the 71st freest in the 2020 Index. Its overall score has decreased by 0.2 point due to a lower fiscal health score. Turkey is ranked 36th among 45 countries in the Europe region, and its overall score is well below the regional average and above the world average

3) Govt. Regulation

Secured interests in property are recognized and enforced, and public record-keeping is reliable. Following the July 2016 coup attempt, the government confiscated over 1,100 companies. Judicial independence has been severely weakened since the coup attempt. Corruption, including money laundering, bribery, and collusion in the allocation of government contracts, remains a major problem even at the highest levels of government.

4) Tax and income

The top personal income tax rate is 35 percent, and the top corporate tax rate is 22 percent. Other taxes include value-added and environment taxes. The overall tax burden equals 24.9 percent of total domestic income. Government spending has amounted to 34.6 percent of the country’s output (GDP) over the past three years, and budget deficits have averaged 2.8 percent of GDP. Public debt is equivalent to 29.1 percent of GDP

5) Government Policies

Government decision-making can be opaque, and arbitrary regulatory enforcement hampers businesses. Several business-friendly reforms were adopted in the past year, but transferring property became more costly. The workforce is relatively well educated, but the labor market remains rigid. Although Turkey had few price controls historically, the government tried to tamp down increases in food prices in 2019 by imposing price controls at the wholesale level.

6) Foreign Trade

The total value of exports and imports of goods and services equals 60.4 percent of GDP. The average applied tariff rate is 3.5 percent, and 335 non tariff measures are in force. Foreign investment is welcome, but restrictions remain in effect in a number of sectors. Investors face lingering bureaucracy in the regulatory environment. The financial system is evolving toward greater transparency and competitiveness.

* Future of Volkswagen company

1) Electric Cars

Volkswagen is launching into what could be a huge electric decade that reinvents and rejuvenates the large global automotive group. Yes, the Volkswagen ID.3 — which is sort of supposed to be the VW Beetle or Golf of this century.

Volkswagen Group is aiming to become the #1 producer of electric vehicles within the next handful of years. That may be a little more hyperbole than is warranted, but I think the intention is clear and solid. Volkswagen Group aims to produce 3 million electric vehicles a year by 2025

2) Automation in Vehicles

Volkswagen has some investments in this space, and it has a MOIA ride-sharing pilot running in Germany that currently uses human drivers but is supposed to utilize self-driving vehicles someday.

Like all automakers, Volkswagen aims to be “a leader” in autonomy. It is certainly focusing more than ever before on software and appears to be going in the right direction

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