Istanbul’s Atatürk Airport broke the air traffic all-time record with 1,171 landings and take-offs on April 25, ahead of an approaching tender for the third Istanbul airport.
The largest of Istanbul’s airports has the highest growth rate of any of the world’s airports that host more than 10 million passengers per year, the General Director of State Airports Authority (DHMİ) Orhan Birdal said in a statement on April 26, Hurriyet Daily reports.
By Murdo Morrison on April 29, 2013 5:14 PM
The following article first appeared as a Comment in the 30 April issue of Flight International
Turkish Airlines’ grandiose plans to become the planet’s biggest airline are being matched by equally ostentatious government ambitions to build the world’s biggest hub airport in Istanbul, both in a manner that threatens to outpace rivals in the Arabian Gulf.
So just how realistic is Istanbul’s bid to become aviation’s next Dubai – or something even bigger? A larger home market, full of young, aspiring travellers getting more affluent is one significant advantage, and a geographical location allowing short-haul flights to destinations in Europe and parts of Africa to which Emirates must fly widebodies is another.
The 150 million passenger, $10 billion, six runway airport project should help Turkish Airlines reach its target of operating 2,000 flights per day while boosting the country’s other emerging carriers, which cannot currently expand in slot-constrained Ataturk.
Yet assuming the new airport goes to plan, and given the scale of the task that’s a very big assumption, will Turkey’s airlines be able to hold on to the reins while growing at such speed? Of course they say they can, but building scale efficiently and not letting costs run out of control will be a huge challenge.
Any number of imponderables may play a hand in shaping Istanbul’s destiny, but given everything Turkey has achieved so far and where it was 10 years ago, who would bet against the country pulling it off again?
via Who would bet against Turkey? – Flight International Editor’s Blog.
Adam Elktronik, based in GOSB Teknopark built by Israeli industrialist Stef Wertheimer, receives prize for innovative project from Turkish industry minister
Ofer Petersburg
Published: 04.26.13, 14:47 / Israel Business
Turkey’s industry minister has awarded an Israeli company with a prize for an innovative project during a technological parks convention in Istanbul.
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Full story
The company, Adam Elktronik, is based in the GOSB Teknopark – an industrial park built by Israeli businessman and philanthropist Stef Wertheimer in Turkey.
The Turkish minister even promised to send a team from his office to visit Wertheimer’s industrial parks in Israel.
The GOSB Teknopark was built at a total investment of $10 million according to the model of the Tefen industrial park in northern Israel, and includes an art gallery.
The Istanbul ceremony was attended by the director of Wertheimer’s industrial parks, Arieh Dahan.
via Turkey honors Israeli company – Israel Business, Ynetnews.
Turkey’s strategic geographical position, at the crossroads of eastern and western cultures, historically guaranteed its political importance on the Old World stage. Now, with its stable economical growth and a young, well-educated and highly skilled workforce, Turkey is once again rising up to become a major economic, political and financial force in the new global economy.
Turkey has been investing heavily in the development of its infrastructure, with several large projects currently underway. These include the $11bn construction of the Istanbul-Izmir motorway, the $25bn investment in the Akkuyu Nuclear Power Plant by Russia’s Rosatom and the $15bn investment in the new Istanbul Airport, which will be the world’s largest airport with an annual capacity of 150m passengers. Other major construction projects that have commenced include a high-speed rail link for Istanbul to Anmkara and a third bridge over the Bosphorus, all of which will coincide with Turkey’s bid for the 2020 Olympics.
While numerous US and European banks collapsed following the global financial and Eurozone crises, Turkey’s banking sector has been performing relatively robustly on the international stage. Turkish central bank data has revealed that portfolio inflows last year rose 60% to $35bn, with commentators describing Turkey as one of the most interesting emerging markets in the region with a diversified range of investment products. Last November, Fitch Ratings gave Turkey its first investment grade credit rating in almost 20 years, which endorses the country’s economic transformation and has been one of the main catalysts for the significant rise in demand for Turkish assets this year.
Outside interest
With its deepening capital markets and robust growth, Turkey has caught the interest of the international investment community, particularly from the Gulf region, with investors being drawn to Turkey’s widening range of investment products, from a debut sovereign Sukuk bond issue last September to foreign currency-denominated Eurobonds from both banks and corporates.
Inward and outward foreign direct investments of all sizes are flooding the market. At the larger end of the scale, the larger investments typically come from new or emerging jurisdictions. Russia is becoming one of the largest trading partners in Turkey, and good and improved relations between the two countries has resulted in Turkey becoming the largest foreign investor in Russia. While Russia’s Rosatom is building the Akkuyu nuclear power plant, Sberbank has acquired both the domestic Turkish Denizbank for over $4bn and the consumer banking division of Citibank in Turkey.
Outside the financial services sector, a significant proportion of the Turkish pharmaceutical manufacturing industry has been acquired by global drugmakers. These companies, mainly Swiss, German, Japanese and US based, continue to compete for larger shares of Turkey’s fast growing pharmaceutical market, which expanded from $3bn in 2003 to $13bn in 2012.
There have been similar trends in many other sectors, including insurance and healthcare, as the economy expands and a fast growing population increases purchasing power, consuming both domestic and imported production.
Turkey’s exports are on a continuous increase, with the government taking critical steps to control the economic growth and current account deficit. The government has committed to increase its exports, currently at $150bn, to over $500bn by Turkey’s centennial celebrations in 2023. Deputy Prime Minister Ali Babacan recently said that it would be possible to reach a GDP per capita of $25,000, provided that both judicial and educational reforms are carried out to liberalise the economy.
As part of its stated ambition to establish Istanbul as a major international financial centre appropriate to the country’s standing in the region, the government has set out its plans and construction for the premises of an international financial centre (IFC) have already commenced. The intention is for the IFC to improve the Turkish economy by attracting funds, allowing Turkish businesses to obtain easier finance and for the domestic insurance sector to become closer to international financial markets.
As part of its commitment to legislative reform and to improve the climate in which to do business in Turkey, the cabinet has sent legislation to parliament on the formation of the Istanbul Arbitration Center (IAC). Turkey is aiming for the IAC to become a major dispute resolution centre for investors particularly in the IFC and a prime centre for the resolution of commercial disputes in the region. At a conference on the proposed IAC, convened in November 2012, the various requirements for the development of a successful arbitration centre were discussed by a record number of 380 delegates.
As the organisers of the conference, Mehmet Gn & Partners believe that establishing the IAC alone is not enough – it must be supported by the creation of special courts and appeal chambers equipped with the state-of-the-art disclosure processes, so that the complex disputes that IFC participants may encounter can be swiftly and efficiently resolved. We will continue to work to facilitate the establishment and international recognition of the IAC, of specialised IFC courts and the adoption of full and frank disclosure in Turkish civil procedures.
The deputy prime minister believes that Istanbul can fill the gap between the financial centres of London, Frankfurt and Dubai, and become a regional powerhouse. There is no doubt that following the Arab Spring, Istanbul benefited from its position as a strong stable economy outside the EU and its “safe haven” status for investors in the East Mediterranean, North African and Central Asian region. In Egypt, Cairo has already lost its importance to Istanbul as was shown when the Nikkei Index of Japan relocated its Middle East offices to Istanbul. With an almost bankrupt Greece and Cyprus, and an unstable Egypt, Turkey is paving the way to become the region’s major financial and commercial centre.
bne/Mehmet Gn of Mehmet Gn & Partners
Turkey’s government Thursday submitted a new bill to parliament seeking to lure more than $100 billion of Turkish assets held abroad in the latest bid to shore up local funding sources and curb rising foreign-financing needs that’s widely seen as the economy’s Achilles’ heel.
By Yeliz CandemirIf approved by the national assembly in Ankara, the bill will cut taxes on Turkish citizens and firms declaring foreign-held assets from as high as 35% to just 2% with no questions asked about how the money was earned. The condition is that they declare all foreign assets — ranging from properties and cash to currencies, stocks, bonds and other capital market investments — by July 31. The proposed law would also protect businessmen from tax probes on newly declared assets, and exempt them from corporate and income levies if they chose to transfer their assets to Turkey by the end of the year.
With the proposed legislation, Prime Minister Recep Tayyip Erdogan seeks to tap Turkish wealth abroad to help underwrite the country’s economic growth with domestic funds instead of its current, heavy reliance on international cash. Turkish firms and individuals had as much as $138 billion of assets abroad at the end of last year, according to London-based research firm Wealth Insight. Previous government efforts to repatriate cash and bring to fore undeclared domestic wealth in 2008 and 2009 resulted in the declaration of 48 billion liras ($27 billion) of assets, just more than half of which was abroad.
Turkey’s current account deficit shrunk to 6% of its $786 billion gross domestic product last year after ballooning to 10% in 2011, which triggered a sharp drop in the lira that helped push inflation to double digits for the first time in three years. Most economists argue that Turkey can’t sustain short-term foreign-funding needs of more than 5% of GDP because it leaves the economy vulnerable to external shocks
“Even though there are no official forecasts on how much in foreign asses will be repatriated or how much that might generate in taxes, if this legislation passes, it would have a positive impact on both tax revenues and the financing of the current account deficit,” said Ozlem Derici, chief economist with Istanbul-based brokerage Ekspres Invest. “The government also aims to reduce the size of the unregistered economy. So, the fact that officials may provide an assurance that there won’t be tax investigations on newly declared assets is an appealing offer as well,” Ms. Derici said.
The previous wealth amnesty came in two rounds starting November 2008 and ending December 2009 as part of Turkey’s efforts to alleviate the spillover from the global financial crisis. After Lehman Brothers collapsed in September 2008, Turkey’s economy nearly ground to a halt and contracted by 4.8% in 2009. At the time, the government imposed a 5% tax for previously undeclared local assets and 2% levy for foreign assets that were repatriated.
Turkey’s current-account deficit is overwhelmingly financed by short-term portfolio flows, or so-called hot money that often leaves a country’s economy if investors get skittish because of either a global or local deterioration of risk appetite. Meanwhile, foreign direct investment in Turkey dropped 23% annually to $12.4 billion in 2012, according to the Economy Ministry, meaning that only a quarter of the current-account gap if financed by safer, long-term international money.
Officials in Ankara engineered an economic rebalancing last year, curbing credit-fueled consumer spending and relying on exports to expand Turkey’s economy. The country’s GDP grew by a respectable 2.2% in 2012, but missed initial government forecasts of as high as 4% and fell sharply to a quarter of the pace the previous year.
Analysts said that as Mr. Erdogan seeks to accelerate economic growth to 4% in 2013, attracting Turkish investments back home would help meet some of the country’s funding needs. They added that it would also reduce Ankara’s dependence on international investors as the prime minister seeks to triple Turkey’s GDP to $2 trillion and join the world’s top-10 economies in the next decade.
Israel has become bridge between Turkey, Jordan
Quietly, over past five months, Turkish shipping has been avoiding Syrian unrest, tense borders, by docking at Haifa Port, unloading trucks laden with cargo bound for Jordan
Lior El-Hai
Published: 04.25.13, 20:50 / Israel News
The relationship between Turkey and Israel had been in a downward spiral up until a few weeks ago; now it seems that at least where trade is concerned, Middle East realities trump politics.
Just recently, the opposition party in Turkey attempted to embarrass its country’s prime minister, Recep Tayyip Erdogan, by revealing that a Turkish shipping company owned by his son was moving its cargo via Israel, in spite of the tensions between the two countries.
Now it appears that Erdogan junior is not alone. For five months Israel has been serving as a continental bridge to Turkish loads making their way to Jordan on large trailers, as well as for Jordanian goods making their way via Israel to Turkey and to other nations.
What has made Israel such an ideal mid-point is the war-like situation that continues in Turkey, plus issues at the border crossings between Turkey and Syria, and between Jordan and Syria. Prior to the outbreak of war in Syria, cargo trucks moved via Syria, continuing onto Jordan, Saudi Arabia and other Gulf nations.
For the past year there has been a cut in communications between Turkey and Syria, thus trucks cannot cross between the two countries. Insurance companies have refused to insure their cargo, thus causing difficulties in the transfer of loads from Turkey to other countries.
The problems along the Syrian border led to the creation of a special project, whose logistics are run by Tiran Shipping, located in Haifa. Tiran serves as an agent for shipping companies, among which is the Turkish company Sisa Shiping Lines, whose ships anchor once a week in Haifa Port.
“This project began to provide a service to the Jordanian market,” said David Behrisch, Managing Partner of Tiran. The business connection currently serves only Jordanian imports and exports, due to the fact that Saudi Arabia refuses to accept trucks with cargo transferred via Israel.
Currently, Turkish ships dock at Haifa Port once a week, and the intention is to raise this to twice per week. On Saturday, a ship is expected to arrive at the Israeli port carrying 60 trucks loaded with Turkish goods. On its way back, the ship will return to Turkey carrying 60 trucks laden with Jordanian agricultural exports.
The Turkish trucks drive in a convoy from the Haifa Port, to the Sheikh Hussein Bridge, where they cross the border to Jordan. At times, this train of trucks can reach a half kilometer in length.
“We are happy to provide our services to every customer who docks at the Port of Haifa,” a port spokesperson said.
via Israel has become bridge between Turkey, Jordan – Israel News, Ynetnews.
