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Made in Turkey September 17

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Monthly Economic Newspaper

September 2017

ww.img.com.tr

Turkey to expand capacity to meet energy

needs with 3 nuclear power plants

“Before the end of this year, we will

lay the ground for the construction

of the Akkuyu Nuclear Power Plant.

The efficiency of nuclear energy

exceeds 90 percent,” Albayrak said

President Erdoğan urges Turkish

business world to boost domestic

investments

We will work harder.

It is time to make

investments. Never

delay doing business.

Do not lose your spirit

of entrepreneurship

and investment.”

Automotive

exports rise 41

pct to $2.4B in July

Turkey’s İhlas signs

strategic partnership

with Chinese company as part

of project to revive Silk Road

İhlas has become a partner of China’s groundbreaking

“One Belt One Road” initiative to

revive the ancient Silk Road. The company,

which signed a strategic partnership with one

of leading Chinese firms, the China Silk Road

Group, will establish an joint company and

will take an active role in the coordination of

future projects. Having signed a remarkable

agreement, İhlas Real Estate Development

will aim to bring together Turkish companies

seeking to fund projects with Chinese companies.

P7

Energy and Natural Resources

Minister Berat Albayrak delivered

an extensive elaboration of Turkey’s

national energy strategy, featuring

the plan for the nuclear power plants set

to be launched, drilling operations in the

Mediterranean, solar and wind power plants,

and the utilization of coal with clean technologies

in a live broadcast on the Turkish TV

P2

Tourist arrivals in

Turkey jump 43.1

percent in June

channel Bloomberg HT. Emphasizing the

importance of nuclear power for the national

energy supply, Minister Albayrak recalled his

meeting with university professors on nuclear

power plants. Stating that the operational

nuclear power plants will be greatly beneficial

for the energy needs of the industry, the

minister said that Turkey will be more active

in the realization of nuclear projects. P5

P4

Turkish President Recep Tayyip Erdoğan

called on Turkish business people, urging

them to increase their investments

saying, “Now, it is time to invest.”

In an address to the Turkish business world at

the ordinary General Assembly of the Independent

Industrialists’ and Businessmen’s Association

(MÜSİAD), President Erdoğan said, “I want

to call on all businessmen, especially members

of MÜSİAD: If we value our country, if we love

our country, if we want to pay our debt to these

lands, it is time to act now.”

Addressing businesspeople across the country,

Erdoğan stated that business professionals

and investors must take action now to further

develop the country economically. “We will work

harder. It is time to make investments. Never

delay doing business. P3

Ties between Russia, Turkey

‘promising’, says new envoy

“In the meantime, it requires a serious effort

to bring them [relations] to a higher level,”

Yerkhov told Ankara representatives

of various media groups, including Anadolu

Agency Editor-in-Chief Metin Mutanoglu,

who met the diplomat at the Russian

Embassy in the Turkish capital. The newly

appointed ambassador, previously the head

of the Russian Foreign Ministry’s Crisis

Management Center, replaces Andrey Karlov,

who was assassinated at an art exhibition

in Ankara on Dec. 19 last year. Karlov

had been delivering a speech at the opening

of an art gallery when a gunman shot him

several times. Turkish-Russian relations

were tested after Karlov’s assassination.

However, Russian leader Vladimir Putin

described the shooting as a “provocation”

designed to undermine ties with Turkey. P7

Current

relations

between Moscow

and Ankara are

“promising”, Russia’s

new ambassador to

Turkey, Alexei Yerkhov,

has told Turkish

media.

Foreign companies

eager to fi nance

Turkey’s megaprojects

P7

Alexei Yerkhov

Russia’s new ambassador

As global halal tourism

grows, Turkey eyes

bigger share

In a report, “A Strategic Vision for Turkish Tourism:

Halal Tourism,” prepared by the Independent Industrialists’

and Businessmen’s Association (MÜSİAD) Antalya

Branch, the current situation of Turkish tourism

was assessed, data related to the world halal tourism

market was shared and suggestions to develop halal

tourism were presented. According to the report, the

tourism sector, which started to develop after the 1950s

all over the world, continues to grow globally every

year, with the number of international travelers rising

to 1.2 billion people last year from 25 million in 1950. P3

Turkey’s industrial

production sees year-onyear

increase in June

Turkey’s industrial production advanced 3.4 percent

in June 2017 compared to the same month last year,

the Turkish Statistical Institute (TÜİK) announced.

Turkey’s industrial output is deemed a vital indicator

for the economy as it is seen as a preliminary gauge

for GDP growth. On an annual basis, the manufacturing

index saw the biggest rise in June, up 3.8 percent,

among all three main sub-indices, TÜİK said. In the

same period, the electricity, .P4

Go to barter

before bank P4

Turkey, Qatar cooperates

for cybersecurity

Turkey’s state-run Scientific and Technological

Research Council (TÜBİTAK) and

the Qatar National Research Fund (QNRF)

have signed a deal for scientific and technological

cooperation. The agreement’s first

stage involves cybersecurity as the two allies

face increasing online threats. TÜBİTAK’s

chairman, professor Arif Ergin, told Anadolu

Agency (AA) that they would support

projects for the protection of energy grids. P3

Turkish wind

power project P5

Antalya eyes over

10 million tourists

in 2017 P8

Turkish banking sector remains

structurally stable

Turkish banking sector is regulated

and monitored more favorable

than emerging economies,

but it is still reliant on short-term

external debt, according to global

rating agency Standard and Poor’s.

“Our assessment of [banking]

industry risk in Turkey, at [group]

six, largely reflects relatively low

domestic savings, which partly explains

why Turkish banks are more

reliant on short-term external debt

than their peers in other countries,”

S&P said. P6

Norwegians

launch

campaign

for Turkish

tourism

Norwegians have reacted to airline

companies and travel agencies reducing

flights and tours to Turkey and selling

flight tickets at high prices. Having

launched a campaign on social media,

Norwegians wanted tourism companies

to increase capacity, especially in 2018.

A campaign initiated on Facebook to

voice annoyance under the hashtag

#JaJegReiser (YesIamgoing) has

reached half a million people so far. P8


EconomicNewspaper

September

2 Please mention

2017

Made in Turkey” when writing to advertisers Monthly Economic Newspaper ww.img.com.tr

Mehmet Soztutan

Editor-in-Chief

Dynamism in action

once more

Actually, the Turkish

economy has recorded

remarkable performance

with its steady growth over

the last decade. A sound

macroeconomic strategy in

combination with prudent

fi scal policies and major

structural reforms in effect

since 2002 has integrated

the Turkish economy into

the globalized world, while

transforming the country

into one of the major

recipients of Foreign Direct

Investment in its region.

The main objectives

of these efforts were to

increase the role of the

private sector in the Turkish

economy, to enhance the effi

ciency and resiliency of the

fi nancial sector on a more

solid foundation. As these

reforms have strengthened

the macroeconomic fundamentals

of the country, the

economy grew with an average

annual real GDP growth

rate of 4.7 percent over the

period of 2002 to 2016.

With ambitious targets

set by the current government,

the Turkey of 2023

is expected to be a more

prosperous and added-value

generating member of the

Letters to the Editor

turkey@ihlas.net.tr

Fed policymakers

Fed policymakers view economic

or policy developments

through the prism of their economic

forecast. Developments

that push the forecasted path

of the economy away from the

Fed’s employment and infl ation

objectives require a compensating

policy response; other

changes do not. Consequently,

to assess the appropriate monetary

response to a new fi scal

program, Fed policymakers

fi rst have to evaluate the likely

effects of that program on the

economy over the next couple

of years.

M. Brown/Paris

Soros

Soros used Quantum Fund

in 1992 to bet successfully

that sterling was over-valued

against the Deutsche Mark,

forcing then-Prime Minister

John Major to pull the pound

out of the European Exchange

Rate Mechanism (ERM).

“The moment of truth is fast

approaching,” Soros said in an

article emailed to reporters.

“The fact is that Brexit is a

lose-lose proposition, harmful

both to Britain and the European

Union. It cannot be undone,

but people can change their

minds.”

“The divorce process would

take at least fi ve years to complete,

and during that time new

elections would take place,”

Soros said. “If all went well, the

two parties may want to remarry

even before they have

divorced.”

M. Bailey/ Franfurt

Letter From

The Editor

international community

with a vital contributing role

to global peace and welfare.

Active on a global scale, Turkey

is also offering investors

a platform to benefit from

emerging opportunities in

other countries, particularly

in the surrounding region.

In this respect, the

exports strategy of Turkey

establishes a production

plan towards export performance.

Basic elements

of this strategy are shifting

production from low technology

sectors to high value

added areas and achieving

new investments in hightech

sectors.

Turkey, with an improved

and investor-friendly business

environment, achieved

considerable success in

both domestic and foreign

investments over the decade,

not only raised the bar

a notch, but is now also on

track to realize its real and

deserved potential; to be

home to investments that

will contribute to new jobs,

new technologies and new

visions.

So, a bright future lies

ahead for Turkey.

Euro versus dollar

The euro began to depreciate

against the dollar in 2014

when the European Central

Bank (ECB) decided on monetary

expansion. However,

the waning expectation that

U.S. President Donald Trump

would deliver his pledges for

economic growth, the failure

of European far-right parties in

elections and the recent statements

of ECB President Mario

Draghi which were construed

as “hawkish” by the markets,

which gave a boost to the euro

and carried it to the highest

point of the last two-and-a-half

years. Following four months of

consecutive soaring, the euro

has been able to spike against

the greenback in July and provided

an almost 10.5 percent

yield to investors.

H. Grag/Basel

Dollar overvalued

The International Monetary

Fund said that the U.S. dollar

was overvalued by 10 percent

to 20 percent, based on U.S.

near-term economic fundamentals,

while it viewed valuations

of the euro, Japan’s yen,

and China’s yuan as broadly in

line with fundamentals.

The IMF’s External Sector

Report - an annual assessment

of currencies and external

surpluses and deficits of major

economies - showed that

external current account defi -

cits were becoming more concentrated

in certain advanced

economies such as the United

States, while surpluses remained

persistent in China and

Germany.

K.Haw/ Nice

Automotive exports rise

41 pct to $2.4B in July

The Turkish automotive industry, a leader in the economy, continued to provide

more than one-fifth of overall exports, increasing 41 percent to $2.4 billion in

July, while its share in total exports rose to 21.2 percent, according to Uludag

Automotive Industry Exporters Association (OIB) data.

While passenger car exports, which

increased 74 percent, were the main

determinant in July, double-digit growth

was experienced with all major export

items. When examined in terms of countries,

exports to Germany - the industry’s

largest market - increased 30 percent

while exports to the U.K. rose 101 percent.

Among others, exports to the U.S.

surged 125 percent while automotive exports

to Italy, Iran, Morocco and Russia

also increased 43 percent, 72 percent, 70

percent and 113 percent, respectively.

According to OİB data, automotive

exports in July surged 41.2 percent to

$2.4 billion when compared to the same

period last year. Also, maintaining the

upward trend, the share of the industry

in total exports rose to 21.2 percent in

July. The sector has been exporting over

$2 billion for 10 consecutive months

since October 2016, while exports from

January to July of this year increased 25

percent to around $16.79 billion.

While passenger cars exports were

dominant in July, all major export items

such as automotive sub-industry, motor

vehicles for goods transportation and

bus-minibus-midibus experienced double-digit

increases as well. When examined

on a product class basis, exports of

Debt and tax

restructuring plan

netted Turkey $6.5 bln

ANKARA-The

Turkish government has

collected almost 23 billion

Turkish Liras ($6.5

billion) through its latest

debt and tax restructuring

plan, Finance

Minister Naci Ağbal

told Anadolu Agency

Tax debt restructuring

Naci Ağbal

Finance Minister

proceeds in May alone totaled 2.57 billion

liras ($726 million), he said. Ağbal said some

12.3 billion liras ($3.48 billion) were collected

in 2016 after the government introduced a

comprehensive tax and public receivables

restructuring plan.

A comprehensive tax and public receivable

restructuring plan went online in August

2016. In the framework of the plan, the

authorities started to receive applications

in November 2016 and the last deadline for

such applications were extended to May

31 from the end of January. Ağbal earlier

noted that a payment postponement system

has been added to the new debt restructuring

plan, which is numbered 7020, adding

that the system would make a further debt

restructuring plan unnecessary.

cars increased 74 percent to $1.56 billion

while automotive sub-industry exports

increased 26 percent to $751 million.

Among others, exports of motor vehicles

for good transportation saw an increase

of 15 percent to $436 million while

bus-minibus-midibus exports soared 60

percent to $136 million.

While car exports increased 54 percent

to Italy, which is the biggest market

for passenger cars, exports to the U.K.

surged 477 percent. There was also an

export increase of 47 percent to France,

77 percent to Spain, 22 percent to Germany,

100 percent to the U.S. and 108

percent to Belgium.

Automotive sub-industry exports to

the top two countries of Germany and Italy

increased 26 percent and 27 percent,

respectively, while there was an increase

of 17 percent to France and Iran. Among

others, the sub-industry exports to the

U.S. and Russia increased 32 percent

and 74 percent, respectively.

Exports of motor vehicles for goods

transportation to the U.K., the country

with the largest share of the exports, increased

37 percent, while exports to Italy,

Belgium and Spain increased 40 percent,

113 percent and 144 percent, respectively.

There was a decrease in exports of

The business volume of

Turkish contractors worldwide

reached approximately

$220 billion during the last

10 years, according to data

from the Economy Ministry.

The contractors ranked

second in the world after

China, taking up 4,152 projects

overseas between 2008

and 2017.

The first contracted project

was carried out in Libya

in 1972; since then until the

last July Turkish firms have

carried out 9,018 projects in

117 countries, totaling $344.7

billion in business volume.

The average project cost

was $37.1 million in 2008,

which doubled to $79.3 million

in July this year. Russia

ranked first with $67.6 billion

(19.6 percent) among projects

carried out in the last

45 years. This was followed

by Turkmenistan with $46.8

motor vehicles for goods transportation

to Slovenia, the Netherlands and the

U.S. by 22 percent, 29 percent and 38

percent, respectively.

In the bus-minibus-midibus product

group, exports to the top-four countries

of France, Germany, Bulgaria and

Italy saw an increase of 96 percent, 139

percent, 700 percent and 110 percent,

respectively.

According to OİB data, exports to

Germany, which is Turkey’s largest export

market on a country basis, amounted

to $353 million in July, increasing 30

percent compared to the same period

of the previous year. The U.K. was the

second-largest market with $272 million

while export growth was recorded as

101 percent. Moreover, exports to the

third-biggest market of Italy were $270

million, an increase of 43 percent.

Automotive exports to EU countries,

Turkey’s biggest market receiving 78

percent of exports, increased 41 percent,

amounting to $1.9 billion. In the seventh

month of the year, a 102 percent increase

in exports to the U.S drew attention

among alternative markets while exports

Eastern European countries and Oceania

increased 64 percent and 50 percent,

respectively.

Turkish firms bag $220B projects

overseas in 10 years

billion (13.6-pct) and Libya

with $28.9 billion (8.4-pct).

Turkish contractors were

mostly involved in construction

projects of highways,

tunnels and bridges that

were valued at $44.1 billion.

Housing projects came in

second with $43.7 billion,

while commercial center

projects ranked third with

$29.1 billion. In 2008, 23

Turkish firms were in the

list of top 250 contractors in

the world, according to the

Engineering News Record,

which is a leading magazine

specializing in the contracting

sector; the number of

Turkish firms rose to 40 by

2016, seven of which were

among the top 100 while for

the first time two Turkish

firms ranked in the top 50

companies with revenues

more than $3 billion.


September

EconomicNewspaper

2017 Please mention

ww.img.com.tr

Made in Turkey” when writing to advertisers

Monthly Economic Newspaper

3

As global halal

tourism grows,

Turkey eyes

bigger share

A total of 121 million Muslims participated in the

international tourism movement around the world last

year, spending $156 billion on tourism activities.

Turkey, Qatar

cooperates for

cybersecurity

Turkey’s state-run Scientific and Technological

Research Council (TÜBİTAK) and

the Qatar National Research Fund (QNRF)

have signed a deal for scientific and technological

cooperation. The agreement’s first

stage involves cybersecurity as the two allies

face increasing online threats. TÜBİTAK’s

chairman, professor Arif Ergin, told Anadolu

Agency (AA) that they would support

projects for the protection of energy grids,

telecommunications and other infrastructure

from cyberattacks and bolster data security

for mobile devices.

Pointing to last May’s cyberattack against

a state-run news agency in Qatar that paved

the way for the Gulf crisis, Ergin said the

countries need higher security for their cyber

infrastructures. “We have to take measures to

prevent a repeat of what happened in Qatar,”

Ergin said, referring to the hack of Qatar’s

state-run news agency, which resulted in the

distribution of statements falsely attributed to

Qatari leaders, culminating in criticism from

Saudi Arabia. “Turkey has supported Qatar

economically and in terms of defense since

the crisis broke out, and this time TÜBİTAK

will combine its power with Qatar’s power,”

Ergin said, adding that about $2 million will

be contributed to joint projects by private-public

partnerships in cybersecurity.

Turkey plays critical

role in global energy

security

Turkey is a regional power with a “critical”

role in establishing energy security, Turkish

Economy Minister Nihat Zeybekci said.

Turkey is the center of regional energy

trade,” Zeybekci said at the opening of

EXPO 2017 Astana’s Turkish National Day

event in the Kazakh capital. Commenting

on the EXPO events, Zeybekci said these

expositions could encourage the advancement

of humanity, contribute to the sharing

of knowledge and increase cooperation.

The minister added that Turkey was participating

in EXPO 2017 Astana under the

sub-theme of “Global Synergy for Sustainable

Energy” and pointed out that ideas such

as sharing, equality and peace underlay this

message of synergy. Zeybekci said Turkey

had become one of the world’s leading trade

and investment bases thanks to the progress

achieved in the last 15 years, in particular.

“Our country’s decisive role in the global

economy will continue to increase. You can

be sure of that,” he said.

President Erdoğan urges

Turkish business world to

boost domestic investments

We will work harder. It is time to make investments. Never delay doing

business. Do not lose your spirit of entrepreneurship and investment.”

Do not lose your spirit of

entrepreneurship and

investment. If you make

use of investment opportunities

at such a time, the future will

be much more fruitful,” he said.

Erdoğan also emphasized that the

government is providing major

incentives, from loans to employment,

for anyone who wants to make

investments and grow their business,

adding that they expect businessmen

to take advantage of this and quickly

take action. “I truly believe in MÜ-

SİAD members in this regard. We

will build the new Turkey together,”

he said. Erdoğan requested that

all Ministries prepare a short-term

action plan of 180 days in attempts

to resolve the accumulated problems

of the Turkish people, with programs

that will be made public when preparations

are completed.

According to Erdoğan, preparations

for a much more comprehensive

program, including the period

leading up to the 2019 elections, are

already being carried out and the

2023 vision goals are being updated

while a new study for these goals has

also been initiated.

Erdoğan further said that the economy

has started to show signs of

being on a better course, adding that

there is a clear, steady rise in exports.

Relaying the signs of an uptrend

according to Erdoğan, Turkey’s

annual exports, which dropped to

$142.5 billion in 2016, reached $147

billion by the end of May. “I believe

we will surpass the 2014 record of

$157.6 billion in exports by the end

of the next year, at the latest,” he

said. The president also underline

In a report, “A Strategic Vision for

Turkish Tourism: Halal Tourism,” prepared

by the Independent Industrialists’

and Businessmen’s Association (MÜ-

SİAD) Antalya Branch, the current situation

of Turkish tourism was assessed,

data related to the world halal tourism

market was shared and suggestions to

develop halal tourism were presented.

According to the report, the tourism

sector, which started to develop after

the 1950s all over the world, continues

to grow globally every year, with the

number of international travelers rising

to 1.2 billion people last year from 25

million in 1950.

Emphasizing that participation in

tourism activities has turned into a

that the government will work harder

to achieve these goals, noting that

employment mobilization has begun

bearing fruits.

Meanwhile, Erdoğan also explained

that they achieved a rise of 1.2 million

in employment thanks to contributions

made by the business world,

vowing that they will closely follow

whether the promises in this regard

will be fulfilled.

Erdoğan said that those who attacked

democracy, freedom and the

future of the country in the July

15 coup attempt also attacked the

economy, underscoring that terrorist

attacks and attacks on the democratic

order of Turkey are also attacks

on the Turkish economy.

He said that despite the Gezi Park

protests and the Gülenist Terror

Group’s (FETÖ) attacks on December

17, 2013 and December 25, 2013,

the Turkish economy grew by 8.5

percent in the same year. Referring

to local and presidential elections

that were held in 2014, Erdoğan

also noted that the economy grew

by 5.2 percent that year. “Despite

two elections in 2015 and escalating

terror incidents, we challenged those

who masterminded these incidents by

achieving 6.1-percent growth in the

economy. And even though we experienced

a bloody coup attempt on

July 15, the most severe trauma we

faced in recent history, we engaged

in an intense struggle against terror

at home and abroad and achieved

economic growth of 2.9 percent in

2016,” Erdoğan added.

Touching on the rise in the Borsa Istanbul

Stock Exchange and the fall in

foreign exchange rates, Erdoğan said

need for people now, the report pre-

dicts that the number of international

travelers will reach 1.8 billion by 2030. It

is estimated that the number of people

participating in domestic tourism

activities around the world is around 5-6

billion people.

The report indicates that according to

the United Nations World Tourism Organization

(UNWTO), about 7 percent

of overall world exports ($1.5 trillion)

are due to the tourism sector; thus, one

out of every 11 jobs in the world are related

to tourism. The report points out

that Turkey is a top 10 country when it

comes to the greatest number of tourists

attracted since 2000, and one of the top

15 countries with the highest tourist

income for the same period. Thus, the

both of these indicate full confidence

in the Turkish economy. Moreover,

many indicators such as the surge in

home appliance sales show that the

wheels of the economy are turning

increasingly faster.

According to the president, it is necessary

to look at the economy with

a broader perspective to understand

Turkey’s economic size. Referring

to the fact that Turkey has attracted

$183 billion in international investments

since 2002, he said that the

number of jobs has risen to 27 million.

He said that by adding 6 million

new jobs in the same 14-year period,

Turkey became the only country in

Europe to achieve such a high increase

in employment.

Erdoğan stated that investments

made by Turkish entrepreneurs

exceeded $37 billion and the value

of projects that Turkish contractors

have undertaken abroad crept up to

nearly $300 billion.

“We are carrying out intensive activities

with our businessmen, non-governmental

organizations [NGOs]

and educators in the regions which

we could not have dared to visit as

tourists in the past,” he continued.

Erdoğan noted that Turkey’s total

humanitarian aid reached $6.5 billion

in 2016 alone, emphasizing that Turkey

adopts the principle of working

for the peace and welfare of Turkey

and all of humanity. To conclude,

Erdoğan touched on the significant

progress made in the country’s health

sector. He emphasized that the

Turkish people used to go abroad for

treatment in the past but last year, a

total of 360,000 foreigners came to

Turkey for treatment.

tourism sector has an important influence

on the Turkish economy, contributing

about $88 billion to the country’s gross

domestic product (GDP) last year.

According to the report, the number

of tourists from Organization of Islamic

Cooperation (OIC) member countries

(Malaysia, Indonesia, Uzbekistan, Saudi

Arabia, Iraq, Iran, Azerbaijan, Kazakhstan,

the United Arab Emirates, Kuwait,

Libya, Pakistan, Jordan and Egypt) was

approximately 47.5 million in 2014 with

4.9 million of them coming to Turkey.

The report pointed out: “A total of 12

of these countries are at most five-hour

flight distance to Turkey, and the number

of Muslim tourists they send abroad is

37.1 million people, while the number of

Muslim tourists coming to Turkey from

these close-distance countries is 4.8 million.

In other words, Turkey has managed

to attract only 13 percent of Muslim

tourists from countries that are located

at a flight distance of a maximum of 5

hours. Even an increase of this rate to 20

percent will boost the number of tourists

coming to Turkey by about 3 million

people.”

The report also noted that spending by

tourists from Saudi Arabia, the United

Arab Emirates, Qatar, Kuwait and Iran

during their tourism activities abroad is

about $62.2 billion.

Turkey working

to diversify

tourism market,

minister says

Turkey wants to diversify its tourism

market to reach $50 billion in annual

income by 2023, Culture and Tourism

Minister Numan Kurtulmuş said.

Speaking to reporters in Istanbul,

Kurtulmuş said that Turkey wanted to

expand its tourism offerings to appeal to

visitors from all over the world, including

Chinese, Indian and Japanese tourists,

and not only focus on certain countries

like Germany and Russia.

Turkey is traditionally a popular travel

destination for German and Russian

holidaymakers.

Kurtulmuş also said Turkey wanted

to expand its range of tourism offers to

include winter tourism, as well as more

environmental, ecological experiences.

In his speech, Kurtulmuş also rejected

claims about Turkey’s insecurity for

visitors, saying that Turkish cities are as

much secure as Western cities.

“Istanbul is as much secure as Berlin.

Izmir and Antalya are as much secure

as Vienna, London or New York,” the

culture and tourism minister said, adding

that terrorism is a “global problem

threatening all the cities of the world.”

According to Ministry of Culture and

Tourism, the number of tourists visiting

Turkey increased by 14.5 percent on

year-on-year basis in the first half of

2017. More than 12 million people visited

Turkey in the first six months of the year.

The largest number of foreign visitors

came from Russia in the January-June

2017 period with a total of 1.7 million

Russian tourists spent their holidays in

Turkey. Germany came just below Russia

in the list of foreign visitors coming to

Turkey with 1.2 million tourists.

Meanwhile, arrivals from Georgia, a

country with a population of nearly 4 million,

accounted for more than 1 million

tourists.


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Monthly Economic Newspaper

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September

2017

Go to

barter

before

bank

Turk Barter, which

activates the economy

of companies through

facilitating product and

service exchanges, is a

strong alternative to the

banking sector.

Turk Barter was founded a quarter

century ago during the 1994

economic crisis. The company

offered an alternative system

for payment and trade that revived the

country’s economy and later it was then

entitled Turk Barter with the permission

of the Council of Ministers. We

visited the Turkish Barter International

A.Ş. and talked with Chairman M. Sırrı

Simsek, about the details of the operations.

Explaining that they have developed

the barter industry with options

such as leasing, factoring, receivables,

debt restructuring, stock assessment

and idle capacity increase, Simsek said

they aimed to correct the problematic

points in the economy.

You told us about the establishment

of the Turkish Barter? It was born out

of a need for cash flow in the sectors,

but how was this broad information

network operated?

The world needs a new trading and

financing system. The banking sector

has been trying to meet this need for

a long time. The banking system that

is compatible with Islam, which we

call interest-free finance in the recent

period, also added value to the solution

of these problems. When we look at alternative

systems, we see that some are

not used well in some situations. When

we look at factoring in our own country,

we see that it is used very badly and

continues to do so.

Leasing was an intermediate mode,

but then it started to be less attractive

to taxpayers. When we look at

this sense, the market needs different

systems. Turkish Barter has celebrated

its 25th anniversary this year. But the

system is still new to the world. The

banking sector is going to ruins and

continues its classical structure.

Looking at the market, the economy

is running around the banking system,

the foreign exchange system and the

stock market volatility. This can also

be seen in the economic crush of the

whole world due to an incorrect mortgage

application.

The barter system we offer is a product

and service based system. If we look

at the exchange of barter system or the

purchase of companies,

we

cannot get enough

efficiency, so we

do

not define it as a clearing system. There

is a multi-station product and service

organization here. President of Turkey

have made a statement in Trabzon

and said that Turkey grew by 2% while

banking sector grew by 40%. While

the banking sector is growing by 40%,

some are losing money. The bank earns

this profit from the money the citizen

deposits. Where banks earn money

companies go to bankruptcy. Interest

rates are not so high anywhere in the

world. You will do a job in some fields,

you will use interest-bearing loans and

you will earn and pay your debts and

you will grow up. This is possible only

when sales are made at very exorbitant

prices as is the construction sector.

In this sense, the citizens invest the

money in the bank and other citizen is

using this money from the bank paying

higher interests. Those who use the

money and deposit money have no

way of knowing each other. In a barter

system, a product / service investor has

a chance to get to know each other

because we bring them together. The

citizen goes to the bank, deposits the

money at low interest, the bank uses it

at a high interest to another person. If

he knows the person, he will earn more

profit if he gives his money in a safe

way. We do this by bringing companies

together through products and services.

It is the company that negotiates

and buys in the market. In the same

way, the buyer company gains and does

not pay interest. When we look like

this, barter sector is an alternative to

banking in every sense. We have added

options such as leasing, factoring, debt

collection, debt restructuring, stock

assessment and idle capacity to our

service portfolio. Actually, the barter

in the world is not applied in this way

either. We designed this as an alternative

system for the future. For this, we

have told this to the universities, trade

and industry chambers. We made a

presentation about the law proposal to

the Undersecretariat of Treasury and

to BDDK, about a barter law. If the

barter sector obtains the desired legal

base, it will become a very different

system.

You are representing World Barter

in Turkey. You have taken the name

of ‘Turk Barter’ by the decision of the

‘Council of Ministers’. Can we listen

about this process?

In fact, we experienced the severe

1994 crisis when we started. When we

looked the outlook, there were stocks,

debts and receivables of companies.

They could not pay their debts, could

not get their receivable and they could

not sell their wares and inventories. We

used the barter system very well at that

time, and we prepared special projects

for the use of the barter system in the

domestic economy, both in the payment

of domestic debts and in foreign

debts, even in government tenders,

paying the debts of the institutions to

each other, and offered it to the governments

of that period.

We even offered Tansu Ciller, the

then prime minister of Turkey, the first

law proposal that we prepared for added

value of this system to the country’s

economy. We added the name ‘Turk’ by

the decision of the Council of Ministers

on the grounds that Turkey should be

represented abroad, transferred to such

a system, made economical and adapted

to the conditions of the country.

Turk Barter will be the shining star

of the future because everyone

needs a new plane now.

Turk Barter checks are more

robust than bank checks. For

example, you receive a bank

check of TL 20,000, the company

is paying you TL 1,500 when you

do not pay this money. Because the

guaranteed amount of withdrawal

for each check leaf is limited by TL

1,500.

There is a

different system

in Turk Barter

checks; you have

to get approval

at the beginning.

You ask first, by

saying that I’m

going to shop

but the company

wants

to give me a

barter check,

can I get

this check?

The barter

center checks

if you can get

it, you can get

it, if you have

the guarantees and

barter gives the code of authority. We

actually aim to correct many problematic

points with the barter system.

How many member companies do you

have?

We have signed agreements with

more than 10,000 companies. We told

these members about the barter system

and they were convinced. You open an

account at Barter, use it when you have

money, and you will be dealing with

your needs. We recommend anyone in

the economy using barter before applying

for credit to the banks.

Is there any risk that member firms

cannot get the service they need when

they need it?

We do not make any commitments;

a company that manufactures footwear

can sell shoes in its stocks. If you are

demanding raw materials, you have to

wait. We work on the basis of supply

and demand principles.

If the request is to be

processed when the

request is received,

it may wait and

may sell the shoe

after taking the

raw material.

Therefore, we do

not give a guarantee

of buying and

selling.

M. Sırrı Simsek

Chairman

Tourist arrivals in Turkey jump

43.1 percent in June

The number of tourists

visiting Turkey increased

by 14.5 percent on year-onyear

basis in the first half of

2017, Ministry of Culture

and Tourism said . According

to the ministry, 12.3 million

people visited Turkey in the

first six months of the year.

Nearly 3.5 million tourists

arrived in June alone, a

record 43.1 percent increase

in comparison to the same

month last year, the ministry

said. The largest number

of foreign visitors came

from Russia in

the January-June

2017 period

with a total

of 1.7 million

Russian tourists spent their

holidays in Turkey. Germany

came just below Russia in the

list of foreign visitors coming

to Turkey with 1.2 million

tourists. Meanwhile, arrivals

from Georgia, a country

with a population of nearly 4

million, accounted for more

than 1 million tourists. In

June, the number of Russian

Numan Kurtulmuş

Ministry of Culture and Tourism

tourists rose by 21.9 percent

reaching 763,727 people. The

three most preferred destinations

for foreign visitors in

the first half of the year were

Istanbul, Turkey’s tourism

capital Antalya, and western

Edirne. Istanbul hosted 4.39

million tourists in the first six

months of 2017, while 3.27

million visited Antalya.

Turkey’s industrial

production sees year-onyear

increase in June

Turkey’s industrial

production advanced 3.4

percent in June 2017 compared

to the same month

last year, the Turkish Statistical

Institute (TÜİK)

announced.

Turkey’s industrial output

is deemed a vital indicator

for the economy as

it is seen as a preliminary

gauge for GDP growth.

On an annual basis, the

manufacturing index saw

the biggest rise in June,

up 3.8 percent, among all

three main sub-indices,

TÜİK said. In the same

period, the electricity,

gas, steam, and air-conditioning

supply index also

increased by 2.5 percent

while the mining and

quarrying index decreased

by 0.5 percent.

Meanwhile, the country’s

industrial production

declined by 0.4 percent in

June on a monthly basis,

TÜİK noted.In June, the

mining and quarrying

index rose by 1.2 percent

while the electricity, gas,

steam, air-conditioning

supply, and manufacturing

indices fell by 0.6 percent

and 0.5 percent, respectively.

Turkey earns over

$2B from plastics

exports

Turkey exported $2.08 billion

worth of plastic products in

the first six months of the year,

marking a 1.8 percent increase

compared to the same period last

year, according to the Turkish

Plastics Industry Foundation

(PAGEV).During the first half

of 2017, the country exported

798,000 tons of plastic products

to around 150 countries, a press

release said. Total production

was 4.7 million tons and worth

$17.7 billion. Plastic household

and kitchen goods exports rose

30 percent to $197 million in the

same period, while the country’s

foreign trade surplus in plastics

production reached $612 million.

Turkey, which is the second

largest plastics producer in

Europe, and sixth in the world,

has some 6,500 companies and

employs around 250,000 people,

according to the PAGEV. If

the same trend continues in the

country, the production is expected

to increase by 9.4 million tons

and reach $35.5 billion at the end

of 2017, PAGEV said.


September

2017

Monthly Economic Newspaper

ww.img.com.tr

EconomicNewspaper

Please mention

Made in Turkey” when writing to advertisers

5

İbrahim Küpeli

ibnahim.kupeli@img.com.tr

Turkish

economy on

the right course

Turkey to expand capacity to meet

energy needs with 3

nuclear power plants

“Before the end of this year, we will lay the ground for the

construction of the Akkuyu Nuclear Power Plant. The efficiency

of nuclear energy exceeds 90 percent,” Albayrak said

Energy and Natural Resources

Minister Berat Albayrak

delivered an extensive elaboration

of Turkey’s national

energy strategy, featuring the plan

for the nuclear power plants set to be

launched, drilling operations in the

Mediterranean, solar and wind power

plants, and the utilization of coal with

clean technologies in a live broadcast

on the Turkish TV channel Bloomberg

HT. Emphasizing the importance of

nuclear power for the national energy

supply, Minister Albayrak recalled his

meeting with university professors on

nuclear power plants. Stating that the

operational nuclear power plants will

be greatly beneficial for the energy

needs of the industry, the minister said

that Turkey will be more active in the

realization of nuclear projects.

“Before the end of this year, we will

lay the ground for the construction of

the Akkuyu Nuclear Power Plant. The

efficiency of nuclear energy exceeds 90

percent,” Albayrak said and cited the

partnership with Japanese firms on the

construction of the second nuclear power

plant in the Black Sea city of Sinop.

He also announced that between 2023

and 2030, Turkey will put three nuclear

power plants – the Akkuyu, Sinop and

one other whose location has not been

officially announced yet – into operation.

These nuclear power plants, once

operational, are planned to meet 10

percent of the country-wide electricity

consumption, the minister said.

Regarding the allegations that

nuclear power is detrimental to human

health, the minister elaborated on the

unsubstantiated claims by a comparison

whereby he explained that the

amount of radiation one can absorb

from an x-ray machine exceeds by far

the amount of radiation that one will

receive by living nearby a plant for one

year.

Currently there are plans for three

nuclear power plants on Turkey’s

agenda. In May 2010, Turkey and

Russia struck a deal for the $20-billion

Akkuyu Nuclear Power Plant project

in the Mediterranean city of Mersin.

Dependent on imports for almost all of

its energy, Turkey has embarked on an

ambitious nuclear program, commissioning

Rosatom in 2013 to build four

1,200-megawatt (MW) reactors.

In June, Russia’s state nuclear

energy corporation Rosatom and the

Turkish consortium Cengiz-Kolin-Kalyon

(CKK) signed a deal for the transfer

of shares. At the ceremony organized

within the scope of the “IX International

Nuclear Energy Forum ATOM-

EXPO,” it stipulated that the latter

will acquire a 49-percent stake in the

Akkuyu Nuclear Power Plant.

The plant, where the first reactor

will start working in 2023 as announced

before by Minister Albayrak, will

produce approximately 35 billion kilowatt-hours

(kWh) of electricity every

year, once completed. The power plant

will have a service life of 60 years. The

project has repeatedly run into delays,

including being briefly halted after

Turkey downed a Russian jet near the

Syrian border in November 2015. Ties

between the two countries have since

normalized and work on the plant has

resumed. The Turkish Energy Market

Regulatory Authority (EMRA) announced

in June that it granted a power

generation license to Rosatom’s Akkuyu

Nuclear Company for a 49-year

period for its Akkuyu NGS project in

the southern city of Mersin. On May 3,

2013, an intergovernmental agreement

on nuclear power plant construction

and cooperation for the Sinop Nuclear

Power Plant, which is the second

nuclear power plant project in Turkey,

was signed with Japan. As stipulated by

the agreement, the Turkey Electricity

Generation Company (EÜAŞ) will

hold a 49 percent stake in the plant

while a Japanese and French company

will have 30 and 21 percent stakes,

respectively. The project is estimated to

cost more than $16 billion according to

Japanese sources.

The Sinop nuclear power plant will

have a total 4,480 megawatt capacity of

electricity generation with four reactors

each having a 1,120 megawatt capacity.

Moreover, despite yet no official announcement

by the government, some

sources have claimed that the third

plant will be constructed in the İğneada

district in the northwestern province of

Kırklareli and the preparatory works

on a third nuclear power have been

initiated in accordance with previous

announcements from President Recep

Germany’s Siemens wins

tender for Turkish wind

power project

Turkey picked Germany’s Siemens as the winning bidder for

a $1 billion wind power project recently, a sign Ankara wants

to keep business separate from the ongoing diplomatic row

between the NATO allies.

Ankara has reassured German

investors, saying their

business in Turkey is not at

risk. Germany was Turkey’s

top export destination,

buying $14 billion worth

of Turkish goods in 2016,

according to IMF data.

A consortium led by

Siemens was awarded

the tender for the project

- which includes the

construction of a 1,000

MW power plant and wind

turbines - after beating out

eight other bidders, Energy

Minister Berat Albayrak

said. The award will mark

an “important contribution”

to bilateral relations,

he said.

The Siemens consortium,

which includes Turkey’s

Kalyon and Turkerler, submitted

a bid of $3.48 cents

per kilowatt-hour, beating

Striving to

diversify energy supply

channels as much as possible,

Turkey plans to build three

nuclear power plants

between 2023 and 2030,

which are expected to provide

10 percent of domestic

electricity consumption,

Energy Minister

Albayrak

said.

Chinese firm Ming Yang,

Germany’s Enercon and

Denmark’s Vestas. The

turbines were due to come

online by 2019, Albayrak

said, adding the project

would increase Turkey’s

wind energy production

by 17 percent. Turkerler

Chairman Kazim Turker

said that 35 percent of the

project would be financed

through international

sources.

Tayyip Erdoğan. During his visit to

China in mid-May to attend the Belt

and Road Summit in Beijing, President

Erdoğan is reported to have discussed

the third nuclear power plant with his

Chinese counterpart President Xi Jinping.

According to presidential sources,

President Erdoğan and his counterpart

Xi Jingping agreed on the acceleration

of the construction of the third nuclear

power plant in Turkey.

“Nuclear energy is sine qua non,

essential for Turkey’s energy supply

basket. It bears significance for the

energy supply, security and geopolitical

strength of Turkey,” International Energy

Agency Chief Executive Dr. Fatih

Birol told Daily Sabah in a previous

interview when explaining the last main

energy area Turkey must keep focusing

on. Yet, he warned that the most vital

issue in appropriate energy actions

must be taken to establish nuclear

power plants and deploy the correct

technologies in association with project

partners. “Turkey is moving in the right

direction with regards to the use of energy,”

he said and cited the energy diplomacy

traffic Turkey has been caught

up in to be a home to energy projects

that will ensure the supply security of

Europe.

According to the economic growth

indicators such as national income,

per capita income and per capita

consumption, the Turkish economy

advances on the way to grow more in

the upcoming period...

Despite unstable conditions in its

geographic region, the country economy

sustains its growth more than lots

of countries in the world.

The country economy cannot operate

its potential completely regarding

current situation in the region. When

we have a look at the situation in the

region, the neighboring and surrounding

countries of Turkey, such as Syria,

Iraq, Iran, Egypt, Libya, Yemen do not

have a suitable condition to operate

its economic activities efficiently. Egypt

does not have exact democracy with

its all institutions to be able to run in

its course. Syria, Iraq, Libya and Yemen

suffer the most from terrorism and

strife since 2011 onwards.

Whenever these events, insurgences

end up, these countries’ investment

and development potential will

disclose and this might bring huge

business opportunities not only for

the Turkish business, but also for the

entire world.

Another advantage in this issue, the

location of Turkey has a crucial importance

in terms of doing business and

economic activities, because of intersecting

between the Europe and Asia

continents.

In this respect, one of the foremost

huge investments that would play a

triggering role in the economic development

and new investments is the

third airport project of Turkey.

Nearly one year later in 2018 the

world’s number one airport’s first

phase will be inaugurated for service

in Istanbul. Playing also an outstanding

role in the aspect of international air

transport, the third airport of Istanbul

will not only contribute to the Turkish

economy and employment as well as

for the international aviation sector

regarding the global businesses shifting

from the west to eastern countries…

Turkish economy has grown three

fold in the last 15 years. During this

period, growth percentage in the Turkish

economy averagely became 5-6

percent per annum. There is yearly 6-7

percent growth potential on average

in the Turkish economy. This means

that the country has a capacity for the

new business and investment as well

as generating job.

Surpassing the expectations the

fi rst quarter growth rate which was

5 percent urged to revise the growth

rate for the year 2017 that predicted

to be between 5 and 7 percent.

Growing 5 percent in the first quarter

is interpreted that the economy

is recovering swiftly beyond expectations.

With the first quarter growth rate

Turkish economy achieved a growth

rate more than 23 EU countries’ rate.

The stock market has also showed

a good performance and reached an

all-time high in August this year.

Featuring as a driving force in the

economy, the export enters upward

trend compared to last year’s figure.

All of these indicators show that

Turkish economy is on the right

course.


EconomicNewspaper

6 Please mention

Made in Turkey” when writing to advertisers

Monthly Economic Newspaper

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September

2017

Turkey’s İhlas signs strategic

partnership with Chinese company

as part of project to revive Silk Road

İhlas has become a partner of China’s

groundbreaking “One Belt One

Road” initiative to revive the ancient

Silk Road. The company, which signed

a strategic partnership with one of leading

Chinese firms, the China Silk Road

Group, will establish an joint company and

will take an active role in the coordination

of future projects.

Having signed a remarkable agreement,

İhlas Real Estate Development will aim to

bring together Turkish companies seeking

to fund projects with Chinese companies,

which will then pave the way for partnerships

with Chinese companies in terms of

investments and funding for major projects

in Turkey.

China has reportedly allocated $900

billion in total for planned investments in

68 countries as part of the “One Belt One

Road” initiative, which was announced at

a summit in May with the participation of

state officials, including President Recep

Tayyip Erdoğan.

As part of the agreement, China Silk

Road aims to boost cooperation by submitting

bids and proposals to various tenders,

including those by the Petroleum Pipeline

Corporation (BOTAŞ) and infrastructure

projects and to provide consultancy services

in partnership with Petro China. İhlas

is expected to participate in BOTAŞ gas

storage tenders. Speaking at the signing

ceremony held in Istanbul, Chairman and

CEO of İhlas Holding Ahmet Mücahid

Ören said that the agreement will take the

company to a next level, move it beyond

the borders of Turkey.

He noted that the summit attended by

President Erdoğan has proved to be a success:

“The company we jointly formed with

our Chinese partner is one that is assigned

by the Chinese government to boost the

Silk Road initiative” Ören said, noting that

the company had experienced obstacles

along the way and needed the help of companies

like İhlas to overcome such difficulties.

In this regard, Ören noted that İhlas

will be the starting point for the Chinese

company’s relations in Turkey and will

enhance bilateral cooperation. “One Belt

One Road” Forum held in China on May

14-15 focused on infrastructure, transportation,

economic collaboration, trade,

industrial investments, energy resources,

financial incentives, environmental protection

and naval cooperation.

The forum hosted the U.N. Secretary-General,

the Chairpersons of the

World Bank and the International Monetary

Fund (IMF) as well as the presidents

and prime ministers of 28 countries and

more than 250 ministers, with the aim to

revive the ancient Silk Road.

Ties between Russia, Turkey

‘promising’, says new envoy

Turkish banking sector

remains structurally

stable

Turkish banking sector is

regulated and monitored more

favorable than emerging economies,

but it is still reliant on

short-term external debt, according

to global rating agency

Standard and Poor’s.

“Our assessment of [banking]

industry risk in Turkey,

at [group] six, largely reflects

relatively low domestic savings,

which partly explains why

Turkish banks are more reliant

on short-term external debt

than their peers in other countries,”

S&P said.

According to the rating

agency’s report, Turkey’s banking

sector has been classified

in group six with Brazil, Italy,

Thailand, Slovenia, Brunei,

Colombia, Guatemala, Trinidad

and Tobago, and Uruguay.

S&P highlighted moderate

household and corporate

indebtedness in Turkey along

with bank regulation, supervision

and governance, comparing

it favorably with that

of many emerging economies.

“Positively, the [banking] system

remains structurally stable

and continues to adequately

price risks, as demonstrated by

healthy profitability metrics,”

the agency said.

Noting the factor of weaknesses,

the S &P underlined

moderate per capita income

and high inflation in Turkey.

“Although banks have

granular and well-diversified

loan books, their credit risk

is accentuated by rapid credit

growth in years of fast economic

growth and high share

of lending in foreign currency,”

the agency added.

S&P holds Turkey’s foreign

currency credit rating

at BB and its local currency

credit rating at BB+ in the

long term. The rating agency

released latest update for the

country in January by lowering

Turkish economy’s outlook to

“negative” from “stable.”

Current relations between Moscow and Ankara are “promising”, Russia’s new

ambassador to Turkey, Alexei Yerkhov, has told Turkish media.

In the meantime, it requires a serious

effort to bring them [relations] to a higher

level,” Yerkhov told Ankara representatives

of various media groups,

including Anadolu Agency Editor-in-Chief

Metin Mutanoglu, who met the diplomat

at the Russian Embassy in the Turkish

capital. The newly appointed ambassador,

previously the head of the Russian Foreign

Ministry’s Crisis Management Center, replaces

Andrey Karlov, who was assassinated at

an art exhibition in Ankara on Dec. 19 last

year.

Karlov had been delivering a speech at the

opening of an art gallery when a gunman

shot him several times. Turkish-Russian relations

were tested after Karlov’s assassination.

However, Russian leader Vladimir Putin

described the shooting as a “provocation”

designed to undermine ties with Turkey.

Yerkhov insisted political dialogue between

Russia and Turkey was growing. “I am

talking about the communication between

our senior management. Phone discussions

between Russia’s president [Vladimir Putin]

and Turkey’s president [Recep Tayyip Erdogan]

have gained significant momentum

recently,” he added. Yerkhov said Karlov’s

killing had left both the Russian Foreign

Ministry and the public in deep sorrow. “We

know that the investigation carried out by

Turkey continues. We know that the institutions

conducting the investigation in Russia

are in intensive contact with their Turkish

counterparts.

“We are sure that after completing the

investigation, the results will be shared

with the public and the Turkish people,”

Yerkhov said. He also said Moscow appreciated

Turkey’s steps to immortalize Karlov’s

memory. Ankara renamed Karyagdi Street

in Cankaya district, where the Russian embassy

is located, after Karlov.

Yerkhov also served as Russia’s consul

general in Istanbul between 2009 and 2015.

“During my six years of service, of course, I

had difficult and beautiful times, but these

six years were the happiest years of my life,”

he said. Yerkhov said there was “very tight”

coordination between Moscow and Ankara

on Syria, based on “the context of the

Astana process”. The ambassador said the

fundamental aim of the Astana talks process

Alexei Yerkhov

Russia’s new ambassador

was to produce a non-conflict atmosphere

in some regions of Syria. “We know that

the situation in northern Syria is now very

sensitive and it has become sensitive in the

light of recent developments. The sensitivity

of this situation indicates that we should

have close the cooperation between the two

countries,” Yerkhov said. About the Syrian

peace talks in the Kazakh capital Astana,

Yerkhov said humanitarian aid could be

delivered to regions where clashes had been

stopped. Yerkhov said the Astana process

did not collide with Geneva-based talks,

adding: “For this reason, institutions and

organizations that can contribute positively

to both processes should definitely take part

in it.”

Recep Tayip Erdoğan

Turkey president

Yerkhov said the trade volume between

Moscow and Ankara had decreased, but

economic relationships overall had developed.

“We think there is still substantial

potential in trade between the two countries

which has not been discovered,” he added.

Erdogan frequently reiterates that Turkey’s

desire is to increase mutual trade volume

with Russia up to $100 billion. After Turkey

shot down a Russian military jet over an

airspace violation in November 2015, Moscow

took several measures against Ankara,

including banning imports of Turkish agricultural

products and ending visa-free travel

for Turks. In June, Moscow lifted the ban on

some agricultural produce and Turkish companies

involved in construction, engineering,

and tourism. Yerkhov did not comment on

the delivery of a Russian air missile system

to Turkey, saying: “This is a question that I

do not want to answer.”

“Due to its sensitivity, it is being discussed in

detail by both Turkish and Russian media.

There is a huge humming noise both in

Washington and Brussels on this issue. If

you look at the Russian websites, you will

find many different interpretations,” he said.

Yerkhov said his every word on this issue

could be perceived as true or different, or it

can be abused. “My offer is to talk this issue

after a while,” he added. Erdogan previously

said negotiations on the missile system had

been “largely” completed and he said the

purchase of S-400 system is not “worrying”.

Russian presidential aide Vladimir Kozhin

said in late June that Moscow and Ankara

had agreed on the delivery of S-400 mobile

systems but that the Kremlin had not approved

a loan for the deal.

The S-400 system was introduced in 2007

and can carry three types of missiles capable

of destroying ground and air targets, including

ballistic and cruise missiles. It can track

and engage up to 300 targets simultaneously

and has an altitude ceiling of 27 kilometers

(17 miles).

Turkey’s

machinery

exports hit

$8 billion

in seven

months

Turkey’s machinery

exports rose by 5.2

percent to $8 billion

in the first seven

months of this year

compared with the

same period of last

year. According to

data from the Machinery

and Accessories

Exporters Union

(MAIB), one of the

sectors that provided

the biggest increase

in exports was machinery.

Between January and

July, Germany was

the top destination

for Turkey’s machinery

exports, while

there were also significant

inroads into

the Russian market.

Exports to Russia

rose by 62 percent to

$161 million during

the same period.

“Considering the

potential for new investment

in Russia, it

seems appropriate to

raise machine exports

to higher levels,” said

the MAIB’s Executive

Board Chairman,

Adnan Dalgakıran.

“We believe that the

increase in exports

will continue in the

second half of the

year,” Dalgakıran

added.

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September

2017

Monthly Economic Newspaper

ww.img.com.tr

EconomicNewspaper

Please mention

Made in Turkey” when writing to advertisers

7

Foreign companies eager to

finance Turkey’s megaprojects

Foreign banks, which saw

that political stability in Turkey

gained continuity following

the referendum, have put

major projects in the country

under their radar. Leading

banks in Germany have lined

up to finance the third airport

project. Accordingly, Germany’s

largest bank, Deutsche Bank,

has launched negotiations to

refinance the third airport.

A 4.5 billion-euro financing

agreement was signed with six

banks for the first round of the

150 million passenger-capacity

project. Previously, Deutsche

Bank offered to refinance the

first phase financing package for

the İzmir-Istanbul highway project.

The bank held talks with

eight Turkish banks again, and

the loan was renewed at a lower

rate. Moreover, Export-Import

Bank of Korea (KEXIM)

Turkey Chief Representative

Ahn Sang-Seon pointed out that

the Çanakkale 1915 Bridge is an

important project not only for

the development of the region

but also for Turkish history,

stressing that this project will

be realized where the Turkish

military achieved an important

victory and will be inaugurated

in 2023 when the 100th anniversary

of the Republic of Turkey is

celebrated. “During the bidding

process, we sent our letter of

intent about the financing of the

project to the consortium. We

currently continue our support

for the financing of the project,”

Sang-Seon added.

The consortium that won

the bid for the Çanakkale

1915 Bridge has two Korean

contractors and Turkey’s

leading groups, Limak and

Yapı Merkezi. Daelim and SK

fulfill an important criterion of

having a Korean investor group

among Kexim’s financing terms.

Sang-Seon, who met a group of

journalist, provided information

about the bank. Sang-Seon

said that Kexim, founded in

1976, has 28 agencies around

the world and that they opened

their agencies in Turkey three

years ago. Suggesting that Turkey

is a market that offers very

attractive opportunities for investors

in developing countries,

Sang-Seon said the country’s

economy entered the stabilization

process very quickly in

2017, indicating that dollar-TL

parity has currently stabilized

around 3.50 while occasionally

rising to TL 4. “Exports grew by

8 percent in the first quarter last

year. Turkey is a country with

strong potential. Investments by

Korean companies in Turkey are

increasing and their targets are

growing. We are here to support

these investments,” he said.

Sang-Seon said that Korean

investors recently undertook

some important purchases in

Turkey, noting that CJ CGV

purchased Mars Cinema for

$800 million and that they

financed $180 million of this

purchase. “Apart from this

project, we made a loan of $1.5

billion available in Turkey in

June, including financing for

the Eurasia Tunnel, the Third

Bridge, the Kırıkkale Natural

Gas Power Plant and the Gaziantep

City Hospital project,”

he said, adding that the Çanakkale

1915 Bridge and Highway

project is next. Underlining

that the project will contribute

to development in the region

in many ways, Sang-Seon said

that they are also aware of its

importance in terms of the history

of the Republic of Turkey,

stressing that this project will

be realized in the region where

the Turkish army achieved an

important victory and will be

inaugurated in 2023 when the

100th anniversary of the Republic

of Turkey is celebrated.

Pointing out that the bridge will

be the longest suspension bridge

in the world, with a central span

of 2,023 meters, Sang-Seon said:

“During the bidding process, we

sent our letter of intent about

the financing of the project to

the consortium. We currently

continue our support for the

financing of the project,” The

consortium of banks to finance

the project is expected to be

formed in August or September

and financing will be provided

as soon as possible, while the

closing is expected to be completed

by March 2018. Detailed

engineering and design studies

for the bridge continue.

Humor

“Quality is

remembered long after

the price is forgotten.”

PARADOX

The paradox of our time in

history is that we have taller

buildings, but shorter tempers;

wider freeways, but narrower

viewpoints; we spend more,

but have less; we buy more,

but enjoy it less.

We have bigger houses and

smaller families; more conveniences,

but less time; we have

more degrees, but less sense;

more knowledge, but less

judgment; more experts, but

fewer solutions; more medicine,

but less wellness.

We have multiplied our

possessions, but reduced our

values.

We talk too much, love too

seldom, and hate too often.

We’ve learned how to make

a living, but not a life; we’ve

added years to life, not life to

years.

We’ve been all the way to

the moon and back, but have

trouble crossing the street to

THOUGHT OF THE

MONTH

meet the new neighbor. We’ve

conquered outer space, but

not inner space; we’ve cleaned

up the air, but polluted the

soul; we’ve split the atom, but

not our prejudice.

We have higher incomes, but

lower morals; we’ve become

long on quantity, but short on

quality.

These are the times of tall

men, and short character;

steep profits, and shallow

relationships.

These are the times of world

peace, but domestic warfare;

more leisure, but less fun;

more kinds of food, but less

nutrition.

These are days of two incomes,

but more divorce; of

fancier houses, but broken

homes.

It is a time when there is

much in the show window and

nothing in the stockroom.

THE ECONOMIST

What is a problem?

Well!!!

If the only tool you have

is a hammer , you tend

to see every problem

as a nail.


EconomicNewspaper

September

8 Please mention

2017

Made in Turkey” when writing to advertisers Monthly Economic Newspaper ww.img.com.tr

Norwegians launch campaign for Turkish tourism

A campaign that was launched on

Facebook to voice annoyance using the

hashtag #JaJegReiser (YesIamgoing) has

gone viral which has reached half a million

people so far

Norwegians have reacted to airline companies

and travel agencies reducing flights and tours

to Turkey and selling flight tickets at high

prices. Having launched a campaign on social

media, Norwegians wanted tourism companies

to increase capacity, especially in 2018.

A campaign initiated on Facebook to voice

annoyance under the hashtag #JaJegReiser

(YesIamgoing) has reached half a million

people so far.

Number of Iranian

tourists may exceed

German visitors to

Istanbul

Those who supported the campaign, initiated

by Steinar Johansen, 67, and a student of

communication named Çınar Şimşek, have

complained of the low number of flights and

high ticket prices.

A user on a Facebook page called Alanya Scandinavian

Community (Alanya Skandinaviske i

Samfunn Alanya), which has more than 10,000

followers, wrote: “What can I do if airlines and

charter companies cut off all the roads?” and

another suggested a direct complain should be

conveyed to travel companies.

Other followers of the page wrote: “It is time

for people to understand that there is not a war

in Turkey and it is safe to visit the country,”

“Here in Norway winter is cold, I recommend

warm coast in the far south” and “I returned

from Alanya two weeks ago and I am looking

forward to going again.”

Iranians ranked second after Germans in the distribution of tourists

visiting Istanbul by country, which is leading to expectations

that Iranian tourists, who account for 7.5 percent of all tourists

coming to Istanbul, will soon replace Germans, who make up for

9.4 percent of the tourists visiting the city.The number of Iranian

tourists in Istanbul, which is visited by about 10 million tourists

every year, has followed an upward trend in recent years. The effects

of the economic revival experienced after the removal of the

embargo on Iran have been also reflected in Istanbul’s tourism.

Antalya

eyes over

10 million

tourists in

2017

Health tourists

spend 10 times

more in Turkey

than vacationers

“We will likely attract nearly 10.5 million tourists this year

if no negative incident occurs,” he added. Antalya Governor

Münir Karaloğlu said the number of arrivals to the

resort rose by 65 percent by mid-August compared to the

same period of 2016. The resort has thus hosted nearly

6.5 million tourists over the course of this year. “The

extension of the public holiday for the Eid al-Adha to 10

days is of great importance for reviving Turkey’s local

tourism. We have needed to fill our gap in foreign tourists

with local tourists,” he said, adding that hotel occupancy

rates during the 10-day holiday would hit 100 percent.

As Turkey becomes a growing destination in the health sector,

offering high-quality services and attracting patients

from around the world, it was reported that per capita

expenditure of foreign tourists who come to Turkey for

treatment is 10 times higher than of those who come on

vacation. Foreign visitors coming to Turkey for healthcare

tourism are reported to spend almost 10 times more than

those who come for vacation, according to the Association

of Health Strategies and Social Policies (SASOMER).

Number of

properties sold

to foreigners

soars by 65.3

percent,

TurkStat

reveals

The number of residential properties

sold in Turkey advanced by

42.3 percent year-on-year in July,

according to Turkish Statistical

Institute (TurkStat) data revealed..

The data showed that a total of

115,869 houses changed hands in

the month, up by 19 percent compared

with a month earlier.

Commenting on the July

figures, Melih Tavukcuoglu, head

of the Istanbul Anatolian-side

Contractors’ Association, said that

the rise in housing sales reflected

the trust in the sector as well as the

positive effects of real estate campaigns.

“House sales to foreigners

became 1,726, increasing 65.3 percent

compared to the same month

of the previous year,” TurkStat

said. Nearly 31 percent (or 528

units) of the total sales to foreigners

were in Istanbul, the country’s

largest city by population.

Following Istanbul, the Mediterranean

holiday resort city of

Antalya came second with 386

properties, while the Black Sea

province of Trabzon came third

with 121 units.

The TurkStat figures showed

that Iraqis topped the list of buyers

with 293 properties, followed by

Saudis with 248 units, Kuwaitis

142, Russians 118 and Britons 76.

FDI inflow from EU countries

to Turkey up by 61 pct

Foreign direct investment (FDI)

by European Union countries into

Turkey increased by 61 percent

in the January-June period when

compared to the same period

last year. Data provided by the

Ministry of Economy indicates that

government measures to strengthen

the economy and incentives

for foreign investors increased the

investment inflow to Turkey from

many countries, especially the EU.

Foreign direct investment inflow to

Turkey from EU countries reached

$2.7 billion in the first half of this

year, an increase of 61 percent

compared to the same period last

year when FDI from the region

amounted to $1.7 billion.

This accounted for 66 percent

of the total investment of $4.1

billion that came to Turkey in the

same period.

While investment inflow from

the Netherlands increased 104

percent from $403 million to $821

million during this period, investment

from Germany decreased

by 6 percent from $181 million to

$170 million.

In the first half of this year, investment

inflow from Asian countries

also increased significantly. In

the January-June period, investment

inflow from Asian countries

rose by 138 percent to $1.1 billion

from $481 million in the same

period last year. Investment inflow

from Gulf countries, on the other

hand, amounted to $561 million,

an increase of 322 percent in the

same period.

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