Abstract:

Developing countries offer incentives, such as “financial and tax incentives”, to encourage Foreign Direct Investment (FDI) in any case by focusing on the “quantity” of FDI rather than its “quality”. The study maintains that Turkey constitutes a typical developing country in terms of both her relatively liberalized policies aiming at attracting FDI in quantity and her failure about not attracting sufficient FDI compared to the other countries, both developed and developing. On the other hand, the study argues that it is not a typical developing country in terms of attracting “the right quality of FDI”, which is tackled here in terms of “the entry mode of FDI”. The aim of this study is to investigate these arguments through comparisons of FDI inflows to Turkey with the others in terms of both its “quantity” and “quality”. According to this, while the “greenfield investments” as an entry mode of FDI dominates the FDI inflows to developing countries, “brownfield investments” take the dominance in Turkish case. When it is looked at the year base data this finding seems consistent with the mass privatisation era of Turkey started in 2004. The study uses UNCTAD (2010)’s new database on cross-border Merger&Acquisitions (M&As) and obtain greenfield investment data

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