Brussels Mediterranean Days
Economy Day, Brussels 27 November 2003 

M. Yassar Tümbas
Président de la Tosed, « Turkish Business Group Brussels »

(Allocution)

Ladies and Gentleman,

Before starting my presentation about the potential of Turkish migrant entrepreneurs in the EU countries, please allow me to first give you a short introduction of what my association TضSED is all about.  TضSED (in Turkish, Friendship Group of Turkish private sector, which we called Turkish Business Group in English) is a non-governmental, non profit and non-political organisation that aims to bring together its members (roughly 100: executive managers or senior members in international companies, Belgian representatives of Turkish and Belgo-Turkish entrepreneurs in Belgium, architects, lawyers, academics linked to the business community) in order to introduce them to high level business and social circles in Belgium and thereby enhancing the image of Turkey and more particularly that of the Turkish Private Sector Community in Belgium.

I have chosen as the theme of my presentation today: The Economic potential of Turkish Migrant Entrepreneurs in the EU.

Why? Because Turkish entrepreneurs in EU are showing dynamic developments on the European Continent and because the Turks living abroad contribute in Turkey's economic and cultural strength in those countries.

This becomes even more evident when, in addition to those living in the EU, we consider the Turks living in the USA and Australia.

Turkey's power abroad cannot be measured solely by looking at the income levels of the citizens living in foreign countries.  In fact, Turkey's greatest gain from these people is the know how they acquire by living overseas.

The investments made in Turkey by the Turks who live abroad should also not be underestimated. Consequently when determining Turkey's place in the world, it would be a mistake to ignore the fact that there exists a large and powerful Turkish economy abroad, which Turkey can and does profit from enormously.

Just a quick reminder: after world war 2 one of the problems faced by Europe was lack of populations (workers)!  As there weren't enough people locally, it was necessary to import labour in order to rebuild the European (mainly German, French, Belgian, Dutch,…) economies.  Turkey was among the most important suppliers of this labour.  This year we commemorates 40th anniversary of their arrival to Belgium.

According to official German statistics relative to their population, foreign workers, in particular the Turks, add as much value to the German economy as the Germans themselves.  It is important to note the fact here that Turkish workers in Europe, who are viewed as a source of concern, even considered a reason to block Turkey's membership in the EU, are those who have shouldered the heaviest and most difficult jobs in Europe and contributed enormously to the Economy.

According to the "Turkish Studies Center (Stiftung Zentrum für Türkeistudien) in Essen, 3.772.000 Turks live in the EU.  70 % of these Turks live in Germany, followed by France (10 %), Benelux (10 %), Austria (5,4 %), etc…

Turkish Population in the EU

Countries	Turkish origin		Turks EU naturalised
	Total	Turkish nationality	Total	%
Austria	200	120	80	40,0
Belgium	110	67	43	39,1
Denmark	53	39	14	26,4
France	370	196	174	47
Germany	2.642	1.912	730	27,6
Netherlands	270	96	174	64,4
Sweden	37	14	23	62,2
United  Kingdom	70	37	33	47,1
Other EU	20	19	1	5,0
Total EU	3.772	2.500	1.272	33,7

Source: Eurostat Source: Turkish Studies Center-Essen

In the year 2001 a total of 3,7 million Turks were living in the EU and the majority of them have integrated themselves in the host society.  In comparison to the EU population, the Turkish community has a high number of young people.  Thus, it is a community which is dynamic and can be integrated into the labour market.  Many are motivated and want to build a future for themselves.  The link to their new home country is often portrayed through the fact that many of them have been naturalized.  However, although around 35 % of the Turks have been naturalized they do not loose their touch with their country of origin in the social, cultural and business aspect.  This often results in an intercultural exchange in schools, universities and in the workplace.

Turkish Entrepreneurs in the EU

The economic dimension of Turkish migrants is of a significant size for each of the individual countries.  According to Eurostat in 2001, 32.8 % of Turkish migrants were engaged in the labour market.  This figure is below the European average of 46.3 %.  There are several factors why the number of Turks in employment is below the EU average.  Firstly, a high number of Turks are still in school or are in vocational training. Secondly, a very small number of Turkish women are in employment, many are house wives or mothers.  Thirdly, many of the labour market areas where Turks were employed have been affected by the stagnation in the economy.

Of those Turks who are active in the labour market in the EU the majority of 70 % live in Germany, followed by France and the Netherlands. 

One of the main areas of the labour market which is covered by the Turks are Small Medium Sized Enterprises (SME’s) where many have chosen the path of self employment.  The proportion of Turks who are self employed in the EU lies at 4.8 %, which is significantly below the EU average of 12.3 %.  The main reason behind this is that in many EU countries the transition from a guest worker to employer took place relatively late.  In Germany however, this transition took place sooner and thus entrepreneurship is of significance.  A total of nearly 70 % of the Turkish entrepreneurs live in Germany.

Number of Turkish entrepreneurs in the EU (*1000)

Country	1996	1998	2000	2002
Austria	2,9	3,1	4,0	5,0
Belgium	1,4	1,6	1,7	2,3
Denmark	0,5	0,6	0,8	1,0
France	4,5	5,2	7,1	8,2
Germany	42,0	51,0	59,5	56,8
Great Britain	0,6	0,7	1,3	1,6
Netherlands	4,2	4,5	5,0	6,0
Sweden	0,3	0,5	0,8	0,9
Other EU	0,1	0,2	0,4	0,5
Total number	56,5	67,4	80,6	82,3

Source: Center for Studies on turkey, Essen, 2002

The Economic power of Turkish entrepreneurs in the EU

Data	1996	1998	2000	2002
Number	56.500	67.400	80.600	82.300
Average investment by entreprise (100.000 €)	99.500	104.800	110.400	112.000
Total investment (Billion €)	5.6	7.0	8.9	9.2
Annual T/O (total) (in Billion €)	21.8	28.7	34.8	36.0
Average Nb of employees by enterpise	4,1	4,8	5,2	5,0
Total Nb of employees	232.000	323.000	419.000	411.000

Source: Center for Turkish Studies in Essen

The number of Turkish entrepreneurs in the EU has increased from 56.500 in 1996 to 82.300 in 2002.  The economic contribution however is highlighted through the investment which increased from € 5.6 billion in 1996 to € 9.2 billion in 2002.  This is turn resulted in a turnover of 35 billion €.  Furthermore, the number of employed nearly increased from 232,000 to 411,000 people.  This development has not reached its peak yet and will continue to increase in particular if the late development of entrepreneurship in other EU countries is considered.

In view of the fact that the only structured and scientific research was made in Germany by the "Turkish Studies Center in Essen", and also because of the important Turkish population in Germany, I would like to concentrate my presentation on  the situation of the Turkish Entrepreneurs in Germany.

Turkish Entrepreneurs in Germany

Between the period 1985 and 2000 the number of Turkish entrepreneurs rose from 22.000 to 59.500 respectively.  Between the period 2000 and 2002 there was a slight reduction in the number from 59.500 to 56.800.  This reduction is due to several reasons but is mainly due to the fact that the general boom of start ups has declined. The higher education level of the younger generation which comes in conjunction with the better job opportunities is also a significant factor.  Many of the younger generation do not take over the businesses which their fathers or mothers have built up.  Alternatively they choose something different that they want to do.

For example, rather than taking over the corner shop, they chose to start up an IT service based company because this relates better to the education they have received.

In the past 15 years there has not just been a quantitative change but also a qualitative change.

The small “Imbiss” snack shop has developed into a high class restaurant, the "dِner kebab" seller has become the producer and thus the distributor.  The stereotype jobs have developed and changed resulting in the migrants widening their horizons and expanding into other branches.  The Turkish migrants are represented in 100 different market sectors.  Although the weight still lies in the retail (34.9 %) and gastronomy (23 %), there has been a slight reduction in these areas whereas in the service sector there has been a significant increase from 19.2 % in 2000 to 22.2 % today.  The service sector is gaining particularly due to the younger generation.

The turnover and the investment of the Turkish SME’s are also significant.  The 56.800 Turkish entrepreneurs contribute a considerable amount to the German economy.  In 2002 the investment in Germany by the Turks was € 6.5 billion €.  This in turn resulted in a turnover of € 26 million €.  These indicators show that the Turks have not just managed to build up their own existence but have become an inseparable part of the German economy.

The Turks do not just contribute through the investment they do but also through the provision of jobs, particularly in a time where the labour market is negatively affected by the economic situation.  Not only do they provide jobs for themselves and their families but they also offer a perspective for other people.  The competitive pressure of the labour market forces the Turks to have a professional management and a better understanding of the market. 

Thus many employ qualified staff.  In 2002, (in Germany) 290.000 people were employed in a Turkish business, it is expected that this figure will increase (411.000 people for EU).

The Future Perspective

The Turkish entrepreneurs identify themselves with their new country, Germany, Belgium, France….  The path to self employment shows that they wish to have a future in the country they now call "home". This is also the reason for the high naturalization figures.  Around 27,6 % of the Turks in Germany have taken German citizenship (in Belgium 39 %).  73.4 % of the entrepreneurs have been living in Germany for 11 to 30 years.  The relation that has been built up with Germany is also reflected in the fact that the customers of the entrepreneurs are not just Turks but also Germans.  The economic potential of Turkish entrepreneurs has not yet been exhausted.  It will all depend whether or not the opportunities and the chances of working together are used effectively.

The question of Turkey’s EU membership is not at debate when considering Turkish migrants in the EU.  They have integrated themselves the best they can into the Union and are contributing to the development and profiting from the European market.

Impulse for the German Economy

It is not only the number of the self-employed which makes the case of the Turkish self employed important for the German economy.  It is also important to which extend they are doing business with the German suppliers.  Turkish businesses buy from German suppliers, and thus create an impulse in the economy.  A chain reaction occurs, where every Turkish start-up affect with their revenues the upper levels creating employment.  77 % of the Turkish businesses buy from German suppliers.  At the same time more and more Turks target German customers.  The more they attract them the more they are successful.  Although I was not able to find precise data, the same situation applies in the other EU countries.

German employees working for Turkish employers

A Turkish business where Germans are also working is not an exception anymore.  Especially in the marketing, consulting and management sectors.  In the administration departments, the lack of high skilled Turkish labour causes the employer to approach Germans.  Especially at times like this where the economy is under recession, the importance of the Turkish businesses is more significant.  They do not provide employment only to family members but also to others.  Today they are providing employment for more than 290.000 workers.  And the trend shows that this number will grow further.  Today 17 % of the employees in the Turkish businesses are Germans, and 9 % from other nationalities.  One of the factors causing this numbers at low levels may be the prejudice of German job seekers.

Contribution of Turkish people in the GDP of their host country in the EU (2001)

Country	Total GDP (billion €uro)	Contribution of Turkish people (billion €)	%
Austria	211,8	3,86	1,82
Belgium	254,3	1,83	0,72
Denmark	180,4	1,37	0,76
France	1.463,7	6,45	0,44
Germany	2.071,2	47,42	2,29
Netherlands	429,2	5,27	1,23
Sweden	234,2	0,84	0,32
Other EU countries	2.394,0	0,31	0,01
Total EU countries	8.827,1	68,9	0,78

As you can see in this table, the total contribution of Turks to the GDP of the EU is 68,9 billion Euro.  In 2001 every Turk living in the EU contributed, on average, 19.000 Euro per year to the GDP of the country he (or she) was residing in.  This is almost equal to the amount contributed by EU citizens themselves which is 23.200 Euro.

In other words, Turks on average, are creating as much value as the citizens of the EU.

To conclude, I would like to repeate what I said at the beginning of my presentation: the Turkish or Euro-Turkish population living in the EU countries constitute an important element of the Turkish and European economy.  A young, dynamic and innovative generation of Turkish entrepreneurs I merging in the EU.  The investments made in Turkey by this people should not be underestimated.  They play a very efficient role in the marketing of European products in Turkey and vice-versa.  They contribute greatly to the development of economic relations between EU and Turkey, and to the value creation between their respective countries.

* This conference took place in the framework ofthe Brussels Mediterranean Days - Economy Day