Turkey’s prospects bright, says survey
Posted by meb at February 19th, 2008
The value of commodities in Turkey has increased drastically since 2001, a survey by the Istanbul Chamber of Certified Public Accountants (İSMMMO) has revealed.
Since 2001, gold prices witnessed a three-and-a-half-fold rise, while inflation rose three times, according to the survey that is partially based on the data of international audit companies such as Deloitte and Colliers. Over that period house prices in many districts of Istanbul also gained value, increasing between seven to 20 times. To date, capital inflow was based on mergers and acquisitions, said İSMMMO Chairman Yahya Arıkan, who is also vice chairman of the Union of Chambers of Certified Accountants of Turkey (TÜRMOB). However, economic management should give particular emphasis to greenfield investments rather than providing incentives to all sectors. Such an approach will make Turkey one of the world’s largest production centers including training programs to support the qualified labor force, Arıkan added.
“Turkey, at the crossroad of Europe, Middle East and the Muslim world, may become a country where the business world competes for entry despite of the lack of oil. Turkey may profit from the crises [generated by United States mortgage woes] with some efforts and incentives,” said Arıkan.
Mergers and acquisitions
The survey emphasizes that the most important mergers and acquisitions have been observed in the finance sector. The banks that underwent mergers or acquisitions include Sitebank, Koç Financial Services, Demirbank, TEB, Dışbank, Yapı Kredi, Finansbank, C Bank, Denizbank, Tekfenbank, Garanti Bank, MNG, Şekerbank, Oyakbank, Adabank and Akbank. At the end of 2007, the mergers and acquisitions of the last five years reached $75 billion, while $71 billion out of that amount accounts for such activities that occurred within the last three years. Privatizations in the last five years provided a resource of $22 billion. Interest in Turkey’s private sector is increasing day by day, and capital inflow has reached $40-50 billion.
Privatizations and important mergers and acquisitions are ongoing also in the real sector, said Arıkan. “Besides mergers and acquisitions worth billions of dollars, there is also interest toward small scale companies with great potential. These companies draw the attention not only of foreign companies, but also of domestic ones.”
Besides the will of foreign companies to grow in Turkey, the increasing interest of private equity funds is also among the factors that increase the value of companies, said Arıkan. Medium sized companies attract foreign attention now, he said. As this trend increases and foreigners bring more direct capital to Turkey rather than hot money, there are more chances for protection from crises, he added.
Energy attractive
Energy is one of the most attractive sectors, the survey suggests. It is expected that the installed capacity, which at present is around 40,000 megawatts, will be up to 70,000 megawatts by 2015. Purchase guarantees to be given for electricity and natural gas distribution as well as nuclear power plants, Afşin Elbistan C and D, are attractive for domestic and foreign investors, as there is an investment demand worth $128 billion by 2020. Some $100 billion of that amount will be invested in the electricity sector.
Source: Turkish Daily News
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