Performance overview: Turkey
Turkey drops four places to 55th (note that the data were collected before the attempted coup in July 2016). Nevertheless, considering the unstable geopolitical situation in neighboring countries and the pressures from migration—Turkey accounts for 56 percent of all registered Syrian refugees38—the country has proven economically resilient. Its relative strengths include infrastructure, despite a lower score this year, and its macroeconomic environment (up 14 places to 54th)—in the face of persistently high inflation, the fall in oil prices has helped the country reduce its government budget deficit and debt. Turkey has made gains in higher education and training (up five places to 50th), increasing enrollment rates in secondary and tertiary education. However, building a highly skilled workforce will require improving the quality of education and investing in on-the-job training. Weaknesses in the labor market (126th) need to be urgently addressed through structural reforms to increase flexibility and use talent more efficiently. To create a more dynamic business environment, domestic competition needs to be improved (Turkey drops 11 places to 53rd), and investments are needed to develop a sound innovation ecosystem to help the country move up the global value chain. This includes improving business sophistication and fostering companies’ innovation by boosting workforce qualifications—the quality of scientific research institutions drops this year to 103rd. Reforms are also needed to make public institutions more efficient and transparent.