TURKEY’S MODEL OF EXCELLENCE«AEGEAN FREE ZONE»What is a Free Zone

• A Free Zone is an area inside a
country’s borders but
considered to be outside thecustoms area.
• The purpose of the area is toencourage exports by offering
special incentives forcommercial and industrial
activities.

2

Basic Objectives of the Free Zones in Turkey

Developing international
trade

Accelerating foreign direct
investment

Promoting export oriented
investment and production

Technology access andemployment

Directing enterprises
towards export3Free Zones in Turkeyİstanbul Trakyaİstanbul Ind.
Istanbul Ataturk Airport
KocaeliSamsun
TrabzonRize

Tubitak - MAM
BursaDoğu Anadolu

Izmir

Kayseri

AEGEAN FREE ZONE
Denizli

Gaziantep
Antalya

MersinAdana Yumurtalık

4Types of Operating License

Manufacturing

Trading

Maintenance

AssemblyDisassembly

Others (Banking,Consulting)5Free Zone Advantages | Tax Advantages

100% Corporate Tax Exemption for manufacturing companies
100% Income Tax Exemption on employee’s salaries for manufacturing companies which
export 85% or more of their products
No Customs Duties for goods, equipment and machinery brought into the Zone.
Opportunity to buy Turkish products at export prices without the Sales andValue Added Tax
Special Consumption Tax Exemption

Stamp Taxes, Tariffs and Duties Levied Exemption

Resource Utilization Support Fund (RUSF) Exemption

Witholding Tax Exemption
6

Free Zone Advantages | Tax Advantages According to Type of Operating License

Manufacturing

Assembly-Disassembly,
MaintenanceCorporate Tax%22

Corporate Tax **%22

Value Added Tax

Income Tax*
%15-35

Value Added Tax

Customs Duties

Value Added Tax

Customs Duties

Special Consumption
Tax

Customs Duties

Special Consumption
Tax

Stamp Taxes, Tariffs andDuties Levied

Special Consumption
Tax

Stamp Taxes, Tariffs andDuties Levied

Resource Utilization
Support Fund (RUSF)

Stamp Taxes, Tariffs andDuties Levied

Resource Utilization
Support Fund (RUSF)

Witholding Tax

Resource Utilization
Support Fund (RUSF)

Witholding Tax

Witholding Tax

Trading** %100 export* Minimum %85 export

7

Comparison of the Tax Rates with Other Countries

Total Tax RateCountries# of Different
Taxes

Profit Tax

Labor Tax

Other Tax

Turkey

41,1

11

118,2

119,9

9

3USA (NY)45,811227,1

4

1058,7

Hungary

46,5

11

29,9

234,3

7

2,3

Italy

48

14219,5143,4

11

1,9Germany

48,99223,2

121,4

64,3

Japan (Tokyo)

47,4

14

324,6

2

18,5

9

4,3

Morocco

49,8

6

125,1

123,3

4

1,4Czech Republic

50

8

19,1

238,4

5

2,5

India (Delhi)

55,3

13

123,5

4

20,4

8

11,4

China (Shanghai)

67,1

9

3

11,1

147,6

58,4

France

62,2

9

10,7

251,1

610,4

Source : Paying Taxes 2018 Report - Pwc
8

Free Zone Advantages | Other Advantages

UnlimitedTime
Stocking

Minimum
Port Costs

Minimum
Bureaucracy

Logistical
Advantages

Guaranteeof transfers

One Stop
Shop

Ready toUse
Buildings

9About Aegean Free Zone

Foundedin1990

BuiltOperate
TransferSystem176
InvestorFirst inPrivateSector

2.200.000 m2






21.158600.000 m2
23.000
Employment Expansion
Goal forArea
Employment

About ESBAŞ

•Developed and Operated by ESBAS(US Company)•

530 Employees On-Site• Shareholders••

EAC International (USA)•Aegean Region Chamber of Industry•İzmir Chamber of Commerce•İzmir Metropolitan Municipality•Ministry of Finance

Certificates•ISO 9001 Quality Management SystemCertificate•

ISO 14001 Environmental Management
System Certificate•OHSAS 18001 Occupational Health and Safety
Management System Certificate•

ISO 22000 Food Safety Management SystemCertificate•EFQM Management Systems

11

Main Services

 Leasing Services: Land, Open Area, General-Modular Warehouses

 Electricity, Natural Gas, Water, Telecommunication
 Food Service, Catering Service
Loading/Unloading & Handling Services
Project Examination and Construction Control Service,
Construction/Repair Service
Industrial Waste Collection Service, Environmental Clean-up andGarbage Collection Service12

Optional Services Occupational Health and Safety Department Service
Child Care Center Service
Landscape Service
Foreign Trade Service

 Personnel Transportation Service

 Cleaning ServiceConference and Training Hall Rental Service
13

1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013

487.110704.059912.886
1.429.659
1.446.381
1.188.186
1.662.598
1.291.910
1.828.870
2.642.599
3.241.026
3.766.021
4.001.498
4.092.781
3.763.964
2.658.772
3.985.295
5.000.095
4.710.012
4.680.244

1991

34.58656.3251990

0

193.573

YEAR

TOTAL
1000000

2000000

4000000

2.658.772

5000000

5.000.095

4.327.519

4.075.581

3.878.766

4.293.418

4.680.244

4.710.012

3.985.295

3.763.964

4.092.781

4.001.498

3.766.021

3.241.026

2.642.599

3000000

1.684.972

1.828.870

1.291.910

1.662.598

1.188.186

1.446.381

1.429.659

912.886704.059487.110193.573

56.32534.5860

Aegean Free Zone Trade Volume [1000$]

6000000

0

2014
2015
2016
2017
2018/5TOTAL

4.293.418
3.878.766
4.075.581
4.327.519

1.684.972
72.038.706
14Annual Trade Volume of the Free Zones in Turkey [1000$]

25.000.000
21.898.769

20.000.000

3.196.087

22.589.564
21.748.016

3.334.483

1.571.5793.767.837

2.059.462

1.532.317
2.364.905

1.797.351
1.723.960

1.352.280
1.288.563

2.241.525

2.718.109

1.533.749

2.103.566

1.907.396

1.443.596

2.439.926

18.675.410
3.375.893

1.518.423

1.480.979

2.693.049

3.832.246

3.306.716

1.633.495

1.320.816

1.934.418

5.000.000

3.220.084

1.135.613
1.096.455
1.121.673

1.746.707
1.835.433

2.447.756

3.367.449

3.328.734

2.901.539

1.972.379

1.264.041
1.766.082
2.030.141

3.096.676

2.939.453

2.768.490

2.823.959

2.959.513

2.498.723

2.564.087

2.227.309
3.603.223

3.822.761

1.271.013

2.338.769
10.000.000

20.006.920

19.830.877

3.771.593

18.572.205
2.731.215

15.000.000

22.541.209

4.270.831
5.000.095

4.710.012

4.680.350

4.293.394

3.878.713

4.075.541

4.327.519

2011

2012

2013

2014

2015

2016

2017

2.502.919
2010

Source: Ministery of Economy

Aegean Free Zone

Mersin Free Zone

Istanbul Industrial

European Free Zone

Bursa Free Zone

Istanbul Trakya FZ

Istanbul Atatürk Airport FZ

Other Free Zones

TOTAL

15

5.00010.000

9.000

7.150

6.100

5.200

3.367

3.200

2.300

1.542

853

600

600

400

0

15.00014.00014.50014.50014.00012.90012.50011.20020.00021.15819.64018.20018.20018.27019.37019.20017.500Aegean Free Zone Employment

25.000016

Employment of the Free Zones in Turkey

Adana-Yumurtalık
2%İstanbul Trakya
4%İzmir Free Zone
3%

Gaziantep Free Zone0%
SamsunTrabzon Free Zone
Free0%
İstanbulZone
Atatürk
1%
Rize Free Zone
Airport0%
2%

Denizli Free Zone0%

Kayseri Free Zone
6%
Aegean Free Zone
29%

European Free Zone
6%TÜBİTAK-MAM
2%
Kocaeli Free Zone2%İstanbul Industrial
9%
Antalya Free Zone
6%

Bursa Free Zone
15%
Mersin Free Zone
12%

Total employment is 66.984 persons

Source: Ministery of Economy

17Prominent Sectors at the AFZ

Electric &Electronics

Food
Processing&Packaging

TextileMachinery
Aviation,
Avionics,
Aerospace

Automotive
Medical
DevicesIT18

156.683

120.000-56.98945.08447.35534.822
20.21020.58526.91921.72013.078

3.192

3.225

6.732

4.962

20.0004.285

40.00017.97860.00051.65157.16580.00061.14977.335100.000

1.054

USD(.000)

140.000

119.111

DOMESTIC: $ 493 Million
FOREIGN: $ 1.275 Billion
TOTAL: $ 1.769 Billion

127.950160.000

138.696152.582

180.000

162.182

163.804

200.000

174.860

Aegean Free Zone Total Investment Volume [1.000$]

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

FOREIGN

604

3.49

2.53

4.20

1.91

1.91

7.02

10.6

13.8

25.4

18.2

18.8

27.4

36.2

43.6

32.0

32.0

36.3

59.6

51.6

108.

86.8

107.

126.

90.8

113.

112.

101.

DOMESTIC

450

793

2.42

2.53

1.301.27

6.04

7.37

7.86

1.50

2.38

1.33

7.32

20.9

17.5

19.6

15.3

8.76

17.6

5.30

10.9

76.9

54.9

47.9

61.6

25.1

41.8

26.1

TOTAL

1.05

4.28

4.96

6.73

3.22

3.19

13.0

17.9

21.7

26.9

20.5

20.2

34.8

57.1

61.1

51.6

47.3

45.0

77.3

56.9

119.

163.

162.

174.

152.

138.

156.

127.

19

Dispersion of User Companies

Others12%

Trading
18%

Manufacturing
70%

20

Breakdown of Job Creation

19%

81%

FOREIGN INVESTORSDOMESTIC INVESTORSFOREIGN INVESTORS : 74
DOMESTIC INVESTORS : 102
TOTAL: 17621

Some of the Leading Multinational Companies

Hugo BossGermany(Manufacturing men’s apparel)

Delphi Diesel
USA(Manufacturing injector nozzles,valves and pump parts for dieselmotors)

FTB Lisi Aerospace
France(Manufacturing air craft fasteners)

Gates
USA
(Manufacturing tensioners and oilpump parts)

Safe SpiceEngland(Spice sterilization and packaging)

Aero
Germany/Netherlands(Manufacturing wind turbine blades forwind energy power plants)

22

Some of the Leading Multinational Companies

Eldor Electronics
Italy(Producing ignition coils andbobbin of ABS braking systems)PFWGermany(Manufacturing aviation fueltanks and tubes)

MahleGermany(Manufacturing pistons andcylinder liners)

Fokker ElmoNetherlands(Manufacturing wire harnessesfor aircrafts )Kale – Pratt & Whitney
Turkish/U.S.A.
(Manufacruring Aircraft engineparts)

DEZEGA
Ukraine(Manufacturing respiratory
protective equipment )23

Pigeon – Lansinoh in AFZPIGEON - LANSINOH IN THE AFZPigeon – Lansinoh in AFZ

Sector Specific Projects•ESBAŞ has organized nearly 50
national and international
conferences since 2001.

•We have hosted approximately 9.000
guests through its organizations todate.

•Turkey’s first Aerospace Clustering
Association-ACA established as aresult of ESBAŞ’s initiative.

•Izmir’s first aerospace sector specifictechnical school “AircraftTechnologies Technical School”
established in cooperation with theEge University.

26

Space Camp Turkey• Space Camp Turkey is one of threespace camps in the world whichhave brought together more than
200,000 young people from 60
countries.

• As a space and science education
center, Space Camp Turkey is
primarily focused on motivating
young people from around the worldto pursue careers in science, math,and technology.
• Through interactive, space-related
simulations, both youth and adults
learn about communication,teamwork, and leadership in a
dynamic, fun-filled environment.

27

Some of the Corporate Social Responsibility Projects

KİT-VAK Guest House
Building Construction

Gaziemir WomenCounseling Center

Gaziemir Sports HallTEC Project

DLD Sparking Project

Gaziemir Health Village
Project

28

Aegean Free Zone Occupancy Rate

THE AEGEAN FREE ZONE (AFZ)

550 Acres (220 Hectares)

99% FULL

Aegean Free Zone Expansion Area

A New Opportunity
30

AFZ From Past to Present | Entrance in 1990

32

AFZ From Past to Present | Entrance in 1991

33

AFZ From Past to Present | Land Subdivision 1991

34

AFZ From Past to Present | Land Subdivision 1991

35

AFZ From Past to Present | Sport Center Construction in 1991

36

AFZ From Past to Present | Entrance in 2003

37

AFZ From Past to Present | General Overview in 2003

38

AFZ From Past to Present | General Overview in 2010

39

AFZ From Past to Present | General Overview in 201440

AFZ From Past to Present | General Overview in 201841

ありがとうございました。
ESBAŞ Marketing & Leasing Department
info@esbas.com.tr

www.esbas.com.tr