The transformative role of foreign direct investment in Türkiye's tourism economy

In line with worldwide trends, Türkiye's tourist industry makes a substantial contribution to its economy. With 56.7 million tourists and $54.3 billion in revenue in 2023, it made up around 5% of the GDP. Even though the industry has grown significantly since 2004 due to the construction of new infrastructure, it is still susceptible to outside shocks like the 2016 coup attempt and the COVID-19 pandemic, which makes market diversification necessary because it relies on a small number of important supplier nations. Nominal GDP and Net FDI have a substantial positive connection (0.69), according to econometric analysis conducted between 2004 and 2024, suggesting that economic expansion draws in foreign investment. On the other hand, there is a very poor correlation (0.015) between GDP and unemployment, indicating that Türkiye's expansion has a limited capacity to create jobs. Net FDI and unemployment have a moderately positive connection (0.37), suggesting that foreign investments may prioritise capital-intensive industries over labour-intensive ones. Infrastructure, alternative tourism, service quality, public-private collaboration, and sustainability are all prioritised in government policies. Türkiye leads the region in tourist volume, according to comparisons, although its GDP contribution is less than that of some of its peers because of other robust economic sectors. This study suggests that although the Turkish tourism industry has a lot of room to grow, its vulnerability to external shocks will bring more positive results by turning to high-quality tourism to promote market diversity and sustainable development.