Abstract:

The current account deficit problem, which is of great importance for the growth and development of a country's economy, has gained a continuity in the Turkish economy since the past. Foreign direct investments are preferred at the most accurate financing point of this deficit. In this study, the effect of foreign direct investments on the current account deficit was analyzed theoretically and then Granger Causality analysis was used to explain the relationship between foreign direct investment and current account deficit using the data of Turkey for the period 2000-2020, and the long-term relationship with the Johansen cointegration test and the short-term relationship with the vector error correction model were examined.. The aim of the study is that, under the influence of the program "Transition to a strong economy" implemented after 2000, relevant work should be added to the literature using data from recent years.

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