For Turkiye\u2019s government, the Iran war has complicated efforts to turn around an economy still reeling from one of the worst financial crises in the country\u2019s history.<\/p>\n
But even as the conflict has driven up Turkiye\u2019s fuel prices and forced authorities to dip into their precious foreign currency reserves to defend the lira, it has also presented an opportunity.<\/p>\n list of 4 items<\/span>end of list<\/span><\/section>\n As the fallout of the war has reverberated across the Middle East, Ankara has jumped at the chance to promote Turkiye as a model of security and stability for businesses and investors.<\/p>\n While Iranian missiles and drones have inflicted significant damage on infrastructure in the United Arab Emirates, Saudi Arabia and Qatar, Turkiye, which is protected by NATO air defences, has emerged largely unscathed from aerial attacks blamed on Tehran.<\/p>\n Turkish officials have made little secret of their desire to capitalise on the shadow that the conflict \u2013 which is officially on pause until Wednesday under a two-week ceasefire between the United States and Iran \u2013 has cast over regional business hubs such as Dubai, Doha and Riyadh.<\/p>\n In remarks earlier this month, Turkish President Recep Tayyip Erdogan, who last month met with 40 global CEOs to discuss ways to boost his country\u2019s competitiveness, cast the war as a boon to Ankara\u2019s ambitions to transform Istanbul into one of the world\u2019s leading financial centres.<\/p>\n \u201cJust as in the pandemic period, we wholeheartedly believe that this global crisis, too, will open new doors before our country,\u201d Erdogan said in a statement posted on social media.<\/p>\n Turkish Treasury and Finance Minister Mehmet Simsek confirmed soon afterwards that the government was preparing \u201cradical\u201d incentives to lure foreign capital.<\/p>\n Turkiye\u2019s improving economic stability in the wake of its 2018 debt crisis and various financial incentives have helped to reposition the country as a regional hub and \u201csafe haven\u201d, said Bilal Bagis, head of the economics department at Fatih Sultan Mehmet Vak\u0131f University in Istanbul.<\/p>\n \u201cA liberal investment environment, ease of entry and new comprehensive incentive packages should help boost its position,\u201d Bagis told Al Jazeera.<\/p>\n While Ankara has yet to confirm the measures in the pipeline, they are likely to involve tax breaks for companies that sell goods through Turkish entities without importing them into the country, said Guney Yildiz, a Turkish-born adviser at Anthesis Group who has clients in the Gulf.<\/p>\n \u201cSo you\u2019d have a commodities trader or a logistics company booking transactions through Istanbul and getting a meaningful tax benefit for it,\u201d Yildiz told Al Jazeera.<\/p>\n \u201cThat\u2019s a direct play for the kind of intermediation business that Dubai has owned for two decades,\u201d he said, adding that \u201cthe timing is obviously shaped by the war.\u201d<\/p>\n Turkiye\u2019s Ministry of Treasury and Finance did not respond to questions about the measures under consideration, but its plans follow a series of recent initiatives aimed at luring\u00a0foreign investment,\u00a0including the opening of the Istanbul Financial Center (IFC) in 2023.<\/p>\n The special economic zone offers tax incentives to financial institutions, including a 100 percent exemption from corporate tax on export earnings until 2031.<\/p>\n An IFC spokesperson said the district has recently seen \u201cgrowing and concrete\u201d engagement from both foreign governments and private institutions.<\/p>\n \u201cThere is a particularly strong strategic focus from Far Eastern institutions,\u201d the spokesperson told Al Jazeera.<\/p>\n \u201cThis is not limited to private sector companies; we are also seeing engagement at the government level. We remain in close contact with Japan and South Korea, while our discussions with the United Kingdom continue,\u201d the spokesperson said, adding that Istanbul has a \u201cpowerful triple advantage built on geography, innovation and economic depth.<\/p>\n \u201cFrom Istanbul, institutions can reach around 1.3 billion people and a 30 trillion-dollar economy within a four-hour flight,\u201d the spokesperson said.<\/p>\n Still, Istanbul faces a steep climb to seriously compete with hubs such\u00a0as Dubai.<\/p>\n Istanbul currently ranks 101st on the latest Global Financial Centres Index, compiled by Z\/Yen Partners in collaboration with the China Development Institute, far behind Dubai (7), Abu Dhabi (21), Doha (48) and Riyadh (61).<\/p>\n Turkiye\u2019s economy has been plagued by double-digit inflation and a depreciating currency since the onset of the 2018 crisis. \u201cThe lira loses roughly a fifth of its value against the dollar every year,\u201d Yildiz said.<\/p>\n \u201cFor a financial firm that earns in multiple currencies and pays staff in lira-denominated salaries, the math gets complicated fast. You\u2019re constantly managing FX exposure in a way you simply don\u2019t have to in a pegged-currency jurisdiction like the UAE or Singapore.\u201d<\/p>\n Critics have also accused Erdogan\u2019s administration of economic mismanagement by keeping interest rates low despite fears of inflation. But the government says the move is aimed at boosting the economy and ending foreign currency manipulation.<\/p>\n While the IFC has reported growing interest from firms, less than half of its office space has been filled, though officials say they expect occupancy to reach 75 percent by the end of this year.<\/p>\n \u201cWhen we look at surveys of European firms with a subsidiary in Turkiye, their main complaints are unpredictability of economic policy, political instability, legal uncertainty, high bureaucracy, high inflation and imported inflation,\u201d Meryem Gokten, an economist at The Vienna Institute for International Economic Studies, told Al Jazeera.<\/p>\n \u201cNone of these issues can be resolved in the short term \u2026 Turkiye has not been a financial hub so far, and I do not see it becoming one without addressing these structural issues,\u201d Gokten added.<\/p>\n Selim Koru, a doctoral researcher who specialises in public policy at the University of Nottingham, expressed similar scepticism.<\/p>\n \u201cPart of Dubai\u2019s attractiveness was that it\u2019s a tabula rasa of sorts. There is no firmly established cultural, legal, political climate, and foreign parties can have a say in what they want it to be,\u201d Koru told Al Jazeera.<\/p>\n \u201cThat\u2019s not the case with Istanbul, or anywhere else in Turkiye, really.\u201d<\/p>\n For some analysts, whether Istanbul can directly challenge Dubai is not the right question.<\/p>\n Hasan Dincer, a finance professor at Istanbul Medipol University, said Turkiye\u2019s bid to draw investment from overseas should be viewed as a \u201cgradual positioning rather than direct short-term competition\u201d.<\/p>\n \u201cIn emerging financial systems, investor confidence is primarily driven by predictability, transparency,\u201d Dincer told Al Jazeera.<\/p>\n \u201cAnd the credibility of long-term economic policies initiatives, such as the Istanbul Financial Center, represent important strategic steps whose long-term impact will depend on sustained implementation and institutional alignment,\u201d he said.<\/p>\n<\/div>\n For Turkiye\u2019s government, the Iran war has complicated efforts to turn around an economy still reeling from one of the worst financial crises in the country\u2019s history. But even as the conflict has driven up Turkiye\u2019s fuel prices and forced authorities to dip into their precious foreign currency reserves to defend the lira, it has […]<\/p>\n","protected":false},"author":1,"featured_media":19453,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8],"tags":[],"class_list":["post-19452","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-middle-east-news"],"_links":{"self":[{"href":"https:\/\/inernews.online\/index.php?rest_route=\/wp\/v2\/posts\/19452","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/inernews.online\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/inernews.online\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/inernews.online\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/inernews.online\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=19452"}],"version-history":[{"count":0,"href":"https:\/\/inernews.online\/index.php?rest_route=\/wp\/v2\/posts\/19452\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/inernews.online\/index.php?rest_route=\/wp\/v2\/media\/19453"}],"wp:attachment":[{"href":"https:\/\/inernews.online\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=19452"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/inernews.online\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=19452"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/inernews.online\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=19452"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}Recommended Stories <\/h2>\n
\u2018New doors\u2019<\/h2>\n
![\"Turkey's](\"https:\/\/www.aljazeera.com\/wp-content\/uploads\/2026\/04\/AFP__20260217__97WK9T3__v1__MidRes__EthiopiaTurkeyDiplomacy-1776490759.jpg?w=770&resize=770%2C513&quality=80\")
![\"Dubai\"](\"https:\/\/www.aljazeera.com\/wp-content\/uploads\/2026\/04\/AFP__20241231__36RU6CE__v3__MidRes__TopshotUaeNye-1776490877.jpg?w=770&resize=770%2C513&quality=80\")
\u2018Math gets complicated fast\u2019<\/h2>\n
![\"IFC\"](\"https:\/\/www.aljazeera.com\/wp-content\/uploads\/2026\/04\/2026-04-06T121234Z_876635712_RC2OHKA1HEEG_RTRMADP_3_IRAN-CRISIS-TURKEY-FINANCIALCENTER-1-1776491009.jpg?w=770&resize=770%2C514&quality=80\")
<\/p>\n","protected":false},"excerpt":{"rendered":"