Companies exit Turkey’s mega-projects as economic prospects remain bleak

TURKEY’S ECONOMIC headaches will seemingly continue to hit the rough seas as more companies look set to withdraw from major projects.

One of the biggest construction projects to be completed recently was the Istanbul Grand Airport (IGA). Now, Kolin Construction, a company with a shareholding in the airport, is considering selling its share. The airport, one of the biggest in the world, was recently opened by President Recep Tayyip Erdogan.

Kerim Kemahlı, the financial affairs manager at Nurol Holding, said to Bloomberg that the big company is planning to sell its share in the recently completed Osmangazi Bridge. A report by Japon media said Mitsubishi wants to get out of the planned nuclear plant in Sinop.

The move by these companies displays how confidence is being lost that Turkey will ever recover economically.

The airport has also been Erdogan’s favourite argument to galvanize the crowds during his election campaigns.

The first phase of the airport was opened in October last year, a ceremony of bells and whistles, attended by some fifty world leaders.

“We would like to inform the public negotiations of the transfer of our shares in IGA are ongoing with our partners,” Kolin said in a statement.

Turkish online new portal, Patronlar Dunyasi reported that Kolin is considering selling its 20% shareholding in IGA to the Kalyon Group.  

Critical S&P report warns about increase in bad loans of Turkish banks

Another company exits a major project  

In an interview with Bloomberg, Kemanli said his company is planning to sell its entire shareholding in the Osmangazi Bridge. The company owns 27% of shares.

Kamanli explained that the Italian company Astaldi, with an 18% stake in the bridge, is reportedly in urgent need of cash. The Italians have now apparently communicated their intention to sell to international banks and financial institutions so that they can generate cash.

Makyol, Özaltın Construction and Nurol Holding each has a 27% shareholding in the Osmangazi Bridge consortium.

Turkish government that guarantees the consortium an income to the equivalent of tolls for forty thousand vehicles (in foreign currency equal) crossing the bridge. Osmangazi bridge tolls jumped from 71.75 Lira ($13.50) for automobiles last year to 103.05 lira ($19.35) this year. Many motorists use the long-distance highway to avoid paying the high toll price.

The nuclear project now in limbo as the Japanese make an exit

Besides mega airport and bridge projects, Turkey’s dream of building a nuclear power plant in the Black Sea city of Sinop is under risk as Mitsubishi is planning to leave Turkey, Japan’s Nikkei newspaper reported.

Japan and French consortiums have decided to quit the project as the cost of the nuclear project, which was undertaken by a consortium of public and private institutions led by a Japan firm, doubled the initial estimates of 5 trillion Yen ($ 44 billion).

IMF gives a bleak report on Turkey’s 2019 economic prospects

The post Companies exit Turkey’s mega-projects as economic prospects remain bleak appeared first on IPA NEWS.

from IPA NEWS https://ipa.news/2019/01/30/companies-exit-turkeys-mega-projects-as-economic-prospects-remain-bleak/