Education Investments for Foreigners in Turkey

Turkey needs a serious amount of investment for the education sector with the excess rate of young people and further development in line with the objectives of education. Although the education investments in are largely made by the state, the share of private schools providing special opportunities for students in today’s modern world can’t be ignored. Turkey is rapidly increasing need for new schools every day with increasing population. At this point, private school investments provide support to the Turkish education system. We will mention about the share of private education investments in Turkey in this text.

Discover the Potential of Turkey

Thanks to the young population structure, one of the most promising sector investment that can be made Turkey’s position is education sector. As of 2020, having about 83 million people and an annual population growth of 13.9% Turkey, it stands out as one of Europe’s most populous country. Approximately 60% of Turkey’s population is under 35 years of age and urbanization rate is high.

However, Turkey’s economic success in recent years, giving precise information about the future of the country has affected many professionals and international institutions. For example, according to OECD estimates Turkey, a member of the OECD with an annual average growth rate of 43% between countries will be one of the fastest growing economies in the period between the years 2015-2025.

Structure of Turkish Education System

The growth potential of Turkish economy is affected by 12-year obligatory education system and developing education system at the last years.  It brings with it investment opportunities. The Turkish education sector is largely fragmented locally and is mostly dominated by Turkish investors. Although some private schools have superior brand recognition and are popular with the public, no school has a significant market share and there are some shortcomings in its institutional structures. Therefore, a well-planned and inclusive education investment in this field will be successful throughout the country in a short time.

Private Schools are Developing

The market share of private schools, which had a 4.5% share in the Turkish education system in 2016, reached 25% by the end of 2019. The sector is developing rapidly recently and the number of private school investments is increasing. The most important parameter causing this increase is that the private education institution investments in the last 3 years have reached at least 20% to 25%. Therefore, investment in education in Turkey to provide quite a high rate of return.

Most of the private school investments have been made in Istanbul. Other major cities such as Ankara and Izmir also follow this trend. All the data above, the huge demand for educational investment in Turkey clearly demonstrates. In addition to this great demand, the government supports the education sector with incentives (tax, etc.). According to the data of the Ministry of National Education, the number of students attending private schools in the 2019-2020 academic year has reached 1.5 million with a great increase compared to the previous year.

Incentives for Education Sector

According to the new incentive system in Turkey, the education sector priority were included in the investment. First of all, pre-school education services, primary education, secondary education services, high school education services, primary and secondary education services for physically and mentally disabled people, technical and vocational education services can benefit from regional investment incentives. Private education investments at university and higher education levels are supported by the state at the general incentive level.

As a result of that, educational investments should benefit from the new investment incentive system to be built to build new schools. Especially, the idea of turning them into schools through the closure of private courses is considered. If the course owners receive investment incentives before turning into school, the investment costs of the investors will decrease. Other educational institutions, especially private educational institutions, should also benefit from the investment incentive system. In addition, new supports have been introduced for incentive investments documented by the law enacted to improve the investment climate. Financial support, tax exemptions for insurance and investment incentives package that the space allocation in the education sector in Turkey has been covered by state support priority.