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Based on the case study and recent research please answer the following questions: 1. The challenges Ford faces in Turkey and how it should address
Based on the case study and recent research please answer the following questions:
1. The challenges Ford faces in Turkey and how it should address them.
2. Assuming you were in the top management for Ford's Turkish business, what are your most challenging concerns considering the political-economic landscape?
3. Give detailed reasons why would you recommend or not recommend Turkey as an emerging market for Ford.
4. What pragmatic solutions would you recommend for Turkish political reform to make it a more desirable foreign investment?
Page 75 In the International Spotlight Turkey Situated on the Aegean and Mediterranean Seas at the intersection of Europe and Asia, Turkey's location played an important role in its long history. The cultural, geographically, and biologically diverse country borders Bulgaria and Greece in eastern Europe and Syria, Iraq, Iran, Armenia, and Georgia in western Asia. Because of its strategic ownership of Turkish Straits, Turkey controls access to the Black Sea.$4 Turkey is the 18th largest country in the world, with over 81 million residents. Turks are the largest ethnic group in the country, constituting over 70 percent of the population. The remaining population is primarily Kurdish, making up about 19 percent of the population. Religiously, Turkey is 99.8 percent Muslim, of which most are Sunni. About three-quarters of the population live in urban environments. The country ranks 109th in the world for life expectancy, with the total population averaging 75.3 years.5 Turkey is the 19th largest market in the world, with an annual GDP of US$909 billion in 2018. The economy has consistently expanded in recent years, with a growth rate of 4.4 percent in 2018; however, GDP per capita remains relatively low atUS$11,000. The largely free-market economy is driven by its industry and service sectors, although agriculture still accounts for about 25 percent of employment. Turkey's increasing participation in the global economy has revealed some persistent underlying imbalances and financial difficulties. In particular, Turkey's large current account deficit means it must rely on external investment inflows to finance growth, leaving the economy vulnerable to destabilizing shifts in investor confidence. Other troublesome trends include double-digit unemployment and high inflatiOn, the latter of which reached nearly 25 percent in late 2018.5'32 Political uncertainty has plagued Turkey in recent years. A failed coup attempt in 2016 resulted in increased authoritarianism and the declaration of a two-year \"state of emergency.\" Shortly after being sworn in for his second term in July 2018, President Recep Tayyip Erdogan ordered a complete restructuring of the Turkish government. The changes consolidated the president's hold on power and nearly eliminated any governmental system of checks and balances. As a result, many major media outlets were shut down and information outflow from the nation was limited. Later that summer, the value of the Turkish lira plunged to record lows, losing 38 percent of its value against the U.S. dollar, due to U.S.-imposed sanctions and global uncertainty over the nation's impending economic crisis}53 To penetrate the Turkish market, U.S.-based Ford Motor Company partnered with Turkish Koc Holding in 1977. The longstanding joint venture, Ford Otosan, employs a staff of over 10,600, making it the largest employer in the Turkish automotive industry. To date, Ford Otosan has spent US$1.6 billion building factories in the country. The rapidly growing economy and increasing wealth within Turkey have proved to be lucrative for Ford. However, with the recent political and economic uncertainty in Turkey, questions have been raised about Ford's continued investment in the country and whether the company should take drastic steps to lessen its exposure to the instability in the region.EmStep by Step Solution
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