Turkey updates the system of state support for investments in the steel sector

The new system includes 5 types of incentives for metallurgical investments across the country

On May 31, 2025, a new presidential decree on state support for investment came into force in Turkey. The document updates the incentive system in the country, in particular for the strategic steel sector. This is stated in the press release of the Turkish Steel Producers Association (TCUD).

According to the new rules, investments in the steel industry will be supported in five main areas, taking into account the scale of the project, the level of technology, geography, and environmental characteristics.

General support includes basic benefits such as VAT and customs exemptions. It applies to the modernization and expansion of small and medium-sized industries that reach a minimum investment threshold.

Regional incentives differ depending on the location of the project. In regions with developed steel production, such as Marmara, the Black Sea, and the Mediterranean, additional benefits are provided, such as tax rebates, insurance premium compensation, and loan subsidies.

Priority investments include green initiatives: energy efficiency, emissions reduction, renewable energy and hydropower projects, and waste management. They receive an expanded support package, including VAT refunds, long-term social contributions, and tax benefits.

Strategic investments are focused on high-tech production, in particular flat and alloy steel, to reduce import dependence. Such projects receive land, loan subsidies, VAT refunds, etc.

Project-oriented support – the so-called “super stimulus” – is provided to large investment projects with high added value. This includes integrated production using renewable energy and hydropower.

The Turkish government says the updated incentive system should make the steel industry more sustainable, competitive, and environmentally friendly.

As GMK Center reported earlier, in 2024, Turkish steelmakers increased steel production by 9.4% compared to 2023, to 36.89 million tons. Pig iron production in the country increased by 17.2% y/y last year – to 10.19 million tons. The average monthly steel production amounted to 3.07 million tons compared to 2.81 million tons in 2023, and pig iron production was 848.8 thousand tons and 724.2 thousand tons, respectively.

Turkey’s steel industry grew last year after 2 years of stagnation. This was facilitated by the active development of infrastructure projects, including the recovery of regions after the earthquake, export growth in the face of changes in global markets, and the modernization of metallurgical facilities.