28 Haziran 2011 Salı

Turkey might help Europe recover, foundation says

This file photo shows an automotive-making employee on the assembly line at a plant in the northwestern province of Kocaeli. Turkey may become a second Germany for the EU, a business group chief says.

This file photo shows an automotive-making employee on the assembly line at a plant in the northwestern province of Kocaeli. Turkey may become a second Germany for the EU, a business group chief says.
Hit by the financial crisis, the European Union might need Turkey more than ever to gear up the growth and sustain a resilient economy, said the chairman of Turkey’s Economic Development Foundation, or IKV, on Monday.

“Burden,” a word repeatedly used for Turkey’s possible membership in the EU, is no more valid thanks to strong growth in the country amid the global economic crisis, IKV Chairman Haluk Kabaalioðlu told the Hürriyet Daily News on the sidelines of the 49th General Assembly of IKV held in Istanbul on Monday.

The EU budget consists of contributions from all its members, rich or poor, with a certain portion from their gross domestic product, Kabaalioðlu said. “As a result of this, there are net contributors, which receive less than they contribute, and net receivers, which receive more than they contribute.”

This situation is subject to change according to member’s ongoing economic progress, according to him.
“Spain, for example, started out as a net receiver but was a net contributor until the recent financial crisis,” he said. “With its dynamic population and right policies, Turkey may well become a net contributor to the budget shortly after membership,” he said.

Recalling the support of Jose Manuel Barosso, current president of the European Commission, for Turkey’s EU bid, Kabaalioðlu said, “Turkey could be a second Germany for the union in order to create a sustainable and resilient economy.”

“The EU has started to lose its attractiveness as the financial crisis continues to sweep though the economy,” he said.

The chairman implied that the union would not be “eager to accept more members” after the membership of Croatia in 2013. “Still the EU remains a model for Turkey regarding social welfare, human rights and democratization,” he said.

“The EU membership bid should be Turkey’s top priority,” said Rifat Hisarcýklýoðlu, chairman of the Union of Chambers and Commodity Exchanges of Turkey, or TOBB, addressing to delegates of IKV at the meeting. “Turkey’s membership in the EU means sustainable development, high democratic standards, individual freedom and equality among genders and more for the country,” he said.

Talking about the social and legal reforms Turkey needs to go though, he said, “Turkey has also responsibility in the slowing down of the negotiations.”

Croatia, which started EU negotiations at the same time as Turkey, has already completed the process and will most likely be a full member by 2013, according to him. “We currently have just one negotiation chapter closed out of 35,” he said. “Turkey has not done its homework unfortunately.”

“Turkey should focus on India and China since in both countries some 400 million people, which equals the EU’s total population, are living in the same standard of life with the people in the union,” said Hisarcýklýoðu. “The financial crisis in the EU is likely to continue,” he said, adding that Turkey might need to look for other alternatives, such as focusing more on Mexico, the United States, China and India.

23 Haziran 2011 Perşembe

Press corps flee Brussels as EU power diminishes

Eurogroup president Jean-Claude Juncker walks past journalists as he arrives prior to a meeting on June 14 in Brussels. The EU’s passive stance has hit journalism, too.

Eurogroup president Jean-Claude Juncker walks past journalists as he arrives prior to a meeting on June 14 in Brussels. The EU’s passive stance has hit journalism, too.
Brussels, the heart of European diplomacy, is falling from grace in the eyes of the international press, as many publications see no harm in reducing or withdrawing staff there to cut costs.

Journalists at Your Service, or JYS, the main journalism organization based in Belgium’s capital, have observed that the number of foreign journalists in the city has declined by 25 percent in just one year.

Brussels hosts the headquarters of the European Commission and the European Parliament, whose activities attracted hundreds of journalists from around the globe until a few years ago.

Two interrelated reasons underlie the “escape from Brussels” - the diminishing role of the EU in international politics, as reflected in the recent Arab spring, and the debt crisis that continues to ravage the eurozone, forcing many European media companies to cut costs.

Reporters scrolling through the Commission and Parliament sharply decreased from approximately 1,200 to 900 in one year, Maria Laura Franciosi, head of the JYS, told the Hürriyet Daily News in a recent interview in Brussels.

“Most mainstream media organizations do not have foreign correspondents in Brussels anymore,” said Marc Gruger, the director of European Federation of Journalists, or EFJ, an organization representing 250,000 journalists across 30 countries. This new trend was first triggered by the global financial crisis and continued with the eurozone crisis, he told the Daily News in a phone interview. “Media institutions in Germany, France and the Netherlands have already cut the number of reporters in Brussels significantly,” Gruger said.

Keeping permanent reporters in Brussels bears a significant cost for media organizations. “Employers have to pay monthly nearly 4,000 euros per reporter, in addition to renting an apartment in central Brussels,” Gruger said.

A tax system that obliges companies based abroad to pay Belgium for their reporters does not help, either. This tax is around half of the 4,000 euros, Gruger said.

Still, he said he hoped the city would return to its good old days. “Despite mainstream organizations’ neglect of Brussels, I believe there will be more journalists coming from India, China and the Middle East,” he told the Daily News.

“Copy-paste journalism has paved the way” for press corps to leave the city, according to Demir Murat Seyrek, a managing partner of Brussels-based Global Communications. “Many foreign reporters rely on press releases from EU institutions, with not much added value in terms of journalism,” he told the Daily News.
TM News, a major Italian news agency, used to employ four journalists in Brussels. Today, it is only Lorenzo Consoli that represents the organization in Brussels.

According to Consoli, also a former president of the International Press Association, many editors think there is “no use in being in Brussels anymore.”

“The EU seems weak and slow in decision-making most of the time,” he said. Regarding the Libya crisis, Consoli said Brussels was “completely non-existent” except for humanitarian support.

“The journalists have given up [on Brussels] due to fruitless long discussions and meetings. The lack of leadership and hesitations … has resulted in a decline in interest toward the EU - not only among journalists, but for everyone,” Consoli said.

Jean Lemaitre, director of the Brussels-based Institut des Hautes Etudes des Communications Sociales, reminds that many reporters from Eastern Europe came to Brussels to cover what’s going on in the EU after 10 members were admitted in the union in 2004.

“People in those countries were full of hope after accession. Nowadays, after the economic crisis, a kind of disenchantment has replaced euphoria. This disenchantment was clearly visible when many Brussels-based journalists went back home,” the director said on his Social European Journalism Blog.

Turkey deserves rating upgrade, Top market professional says

Vedat Akgiray, the chief of the Capital Markets Board of Turkey. AA photo

Vedat Akgiray, the chief of the Capital Markets Board of Turkey. AA photo
Comparing Turkey’s economic outlook and performance throughout the global economic crisis, the nation’s economy has already deserved a rate increase from the international rating agencies, according to Vedat Akgiray, the chief of the Capital Markets Board of Turkey.

“As the countries around Turkey are seeing rate decreases by the international rating agencies, Turkey’s ratings remain the same, which is also a sign for the country’s bright future,” Akgiray told the Hürriyet Daily News on the sidelines of the Banking Business Forum 2011 organized by Banking Association for Central and Eastern Europe, or BACEE.

Speaking few days after Turkey’s general elections that brought 49.9 percent of the votes and a polished victory to the ruling Justice and Development Party, or AKP, Akgiray said, “there is not much excuse that the rating agencies could bring up now, it is time to increase the rates.”

Moody’s ranks Turkey at Ba2, two levels below investment grade, with a positive outlook. Standard & Poor’s rates the country an equivalent BB, also with a positive outlook, and Fitch Ratings has a BB+ ranking, one step below investment grade.

“The control over the credit growth has already helped Turkey to slow down the growth of the current account deficit,” said Akgiray noting that “we will see the benefits of curbing the loan growth in the markets, mainly in third quarter of the year.” Year to date total loan growth reached 13.9 percent as of June 3, implying a 33 percent growth rate for the year according to official data.

Current account gap

As Turkish Central Bank has raised reserve requirements for banks by 10 percent since December to curb the lending, nearly 50 billion Turkish Liras has been mopped up by the Central Bank, issuing no interest rate in return. Akgiray said, “The banks’ executives and chief economists have started to appreciate the measures taken against the loan growth to stabilize the economy.” Responding to the criticisms of “though measures”, he said that “there will be always some people complaining about the reserve rate requirement.”

Country’s chronic problem current-account deficit that widened to $7.7 billion in April from $4.4 billion a year earlier, according to Turkish Statistics Institute, or Turk STATS. It was the second- biggest gap since records began in 1984, after the revised $9.7 billion record that was posted for March.

22 Haziran 2011 Çarşamba

Turkey spending $96.8 million on tourism promotion abroad

Pictures of Turkey’s sandy beaches and ancient heritage are now appearing on billboards lining the popular streets of the world’s capitals, foreign TV channels and public buses as the Tourism Ministry spends $96.8 million to attract more visitors to the country
This June 4 photo shows Turkey posters on a building on a popular street in Los Angeles, US. The country plans to spend $98 million to promote itself as a tourism destination.

This June 4 photo shows Turkey posters on a building on a popular street in Los Angeles, US. The country plans to spend $98 million to promote itself as a tourism destination.
Turkey is spending nearly $96.8 million to promote the country as a tourism destination around the world as it seeks to attract a target of 31 million visitors by the end of 2011, according to officials.

Turkey’s 40 promotion offices across the world are working to increase the country’s tourism profile and bring more people in, Tayfun Şenerkul, head of the Asia Pacific and Middle East Department of Turkey’s General Directorate of Promotion told the Hürriyet Daily News in a phone interview Tuesday.

“Through various TV commercials, advertisements on billboards and Internet banners, we aim to gain a bigger share of the [world] tourist [market],” he said.
The million-dollar promotion campaign tenders generally begin in September and close by the end of November, he said.

Speaking about the political turmoil in parts of the Middle East and North Africa, Şenerkul said Turkey had halted commercials in Cairo and decreased the amount spent in some Middle Eastern countries.
The country has offices in Tel Aviv, Riyadh, Cairo, Damascus, Dubai and Tehran.

“Despite the cuts and slumps in budget for promotion in [parts of] the region, Turkey still draws tourists from the region as it is a safe holiday destination with an affordable price tag and not many competitors,” he said.
“Turkey will be promoted in 153 different fairs in 61 countries in this year,” said Başaran Ulusoy, chairman of Turkish Association of Travel Agents, or TURSAB, as he emphasized the need for promoting the country abroad.

“Turkey became one of the top destinations globally thanks to international promotion campaigns,” said Ulusoy, adding that Turkey’s economic positive outlook compared with crisis-hit southern European countries, such as Greece, Italy and Spain played a major role in Turkey’s position. “During the crisis, many Middle Eastern tourists chose Turkey as visas have been waived for Syria, Lebanon and Jordan.”
Besides activities abroad, the directorate hosted this year over 200 foreign opinion makers, primarily journalists, to experience the “Turkish way of holiday,” Şenerkul said.

In regards to the recent opening of promotion offices in Brunei, Malaysia, China and India, the official said the booming tourist flow to Turkey proved “the country’s strategy is on the right track.”
Turkey had increased its total number of tourist from 13.2 million in 2002 to 28.6 million by the end of last year, a total increase of 116 percent, according to official figures.

The country’s total spending on global promotion campaigns, advertisements and international fairs peaked at $98.6 million this year compared with $27.8 million in 2002, according to figures provided by Turkey’s Culture and Tourism Ministry.

The nation’s tourism revenues are also bearing the fruits of long-term investment, according to Şenerkul, as the total revenue of tourism had climbed from $7.6 billion to $20.8 billion by the end of last year.
Turkey’s tourism revenue might hit nearly $25 billion by the end of this year, said Ahmet Barut, head of Turkish Hoteliers Federation, or TUROFED. “Turkey could easily reach the targeted 31 million tourists by the end of this year,” he told the Daily News.

14 Haziran 2011 Salı

Iraq's $77 billion electricity project promising for Turks

Tuesday, June 14, 2011

Iraq's Electricity Minister says his government will flow some $77 billion into a long term project to improve electricity production and distribution. Iraq plans to finalize a $22 billion portion of the investment until 2015.
A general view from the Iraqi capital Baghdad is seen in this photo. The government is working on a big project to meet the rising electricity demand in both cities and rural areas. Bloomberg photo

A general view from the Iraqi capital Baghdad is seen in this photo. The government is working on a big project to meet the rising electricity demand in both cities and rural areas. Bloomberg photo
The Iraqi government is planning to invest $77 billion in country-wide projects to generate and distribute electricity in a bid to repair and develop its war-hit network and meet increasing power demands.

Several Turkish companies, including Çalık, which is currently running energy projects in the country, are interested in this new project, Al’a Disher Zamil, the Iraqi electricity minister told Hürriyet Daily News on the sidelines of a Monday meeting in Istanbul.

Economically reviving northern Iraq, which is desperately in need of power, is one of the regions being prioritized, Zamil said at the Iraq Power, Gas Projects conference held by the Foreign Economic Relations Board of Turkey, or DEİK, and Middle East Business Intelligence, or MEED.

“The ministry aims to generate and transfer the electricity that economically emerging regions, especially northern Iraq, desperately need,” said Zamil.

The Iraqi government plans to invest an initial $22 billion in the beginning phase of the project, which will last until 2015, he said.

Many Turkish firms are eyeing opportunities that lie in the fast-developing Middle East region, the minister said, adding that Turkey’s Çalık, a leading energy and construction, was also interested in the project.
Last month, Çalık laid the foundation for Iraq’s Karbala Al-Khariat power plant, which is expected to produce 2,000 megawatts of energy.

Demand in transmission

“Extra capacitors are required, mainly in Dohuk in the north, to achieve satisfactory voltages,” said Jeff Larkin, country manager of Parsons Brinkerhoff in Iraq.

“Currently, seven transmission lines are overloaded and Dohuk is deficient in generation, so more power transfers from Iraq via the Mosul Dam and Turkey were required to meet increased demand,” he told the Hürriyet Daily News. Turkey exports electricity to Dohuk.

Still, according to Larkin, the situation might change in the near future. “After the billion-dollar investments in the region, northern Iraq could also export electricity to Turkey,” Larkin said.

He also said Turkey was able to manufacture almost all the products needed at the electricity grids, including transformers. “Most of the investors in the region will purchase the products from Turkey as the logistics and manufacture costs are lower than many countries.”

Time to focus back on the economy, experts tell new Turkish lawmakers

Tuesday, June 14, 2011


ISTANBUL- Hürriyet Daily News
Along with a number of hot political issues, Turkey’s new lawmakers will face the basic economic challenges of the current account gap and inflation while trying to create jobs in the wake of parliamentary elections, according to economists speaking to the Hürriyet Daily News
The climbing current account deficit, inflation and high unemployment remain lingering problems that Turkey’s ruling party will have to tackle in its third term in power after an election victory Sunday, according to several economists.

“The general election results were expected by investors,” Banu Kıvcı Tokalı, the chief economist at Destek Securities, told the Hürriyet Daily News after the results of the election, won by the Justice and Development Party, or AKP, were made public. “Though the results will boost the power and respectability of the AKP, Turkey’s economic challenges will need to be tackled as soon as possible.”

Foreign investors will follow the trend of investing in emerging markets while Turkey keeps attracting a larger portion of these investments, due to “confidence in the market,” Tokalı added.

One of the major challenges facing the new government will be inflation, which has reared up in recent months. Consumer prices in the country rose by 2.4 percent in May from 4.3 percent on the year, according to figures from the Turkish Statistics Institute, or TurkStat.

As result of the inflation hike, the Turkish Central Bank might increase its benchmark interest rate by 50 basis points in June and 25 basis points in July according to Standard Chartered, a multinational financial services company headquartered in London.

Oil prices

“Markets will enjoy the political stability assured by the AKP for the third time,” said Nurhan Toğuç, the chief economist of Ata Invest, who added that the nation’s major economic challenges will remain a “heavy burden on the shoulders of the new government.”

She said the skyrocketing oil prices, caused mainly by the regional turmoil in the Middle East and North Africa, would also continue affecting Turkey, especially the country’s current account deficit and inflation rates. “Political stability will need to also bring economic stability,” Toğuç said. “The fight with the widening trade gap will be a real challenge for Turkey’s new government.”

The current account deficit ballooned to more than $60 billion, or about 8 percent of gross domestic product, in the 12 months through March, compared with a government forecast of $42 billion for the year, according to Bloomberg.

Toğuç said a possible increase in taxes and implementation of new taxes might be on the agenda of the new government, whose Deputy Prime Minister Ali Babacan stated previously that Turkey’s next medium-term economic program would look for “ways to use public finance to help manage the country’s widening current account deficit.”

Turkey’s current account deficit for this year will be $63.5 billion according to Turkish Central Bank forecasts.

Recent threats

“Despite the trust injected into the markets, current account deficit figures announced Monday might draw the attention of investors and financial actors to Turkey’s economic challenges,” said Kerem Alkin, director of Bloomberg HT. “The AKP’s winning close to 330 was the scenario expected by 47 percent of investors before the general elections.”

The Turkish lender Akbank also emphasized the country’s current account deficit problem in a note Monday to investors. Forecasting the gap would stand at 8 percent of gross domestic product by the end of the year, the bank said: “The AKP is now in a strong position to tackle Turkey’s more pressing issues; the large current account deficit and the strength of domestic demand.”

2 Haziran 2011 Perşembe

Turkey plans to open bank in China

The Turkish Central Bank and the Chinese Central Bank are negotiating to support trade in national currencies, says Turkish Deputy PM Ali Babacan (2nd L).

The Turkish Central Bank and the Chinese Central Bank are negotiating to support trade in national currencies, says Turkish Deputy PM Ali Babacan (2nd L).
Turkey plans to open a bank in China as a result of the developing trade and monetary relations between the two countries, according to a statement by Turkish Deputy Prime Minister and Economy Minister Ali Babacan.

The Bank of China, the Asian county’s third-largest lender by market value, has received a license to open a branch in Istanbul, Babacan said while speaking at the Turkey China business forum held Thursday in Istanbul.

The Turkish Central Bank and the Chinese Central Bank are negotiating to support trade in national currencies, the economy minister added. “We are pleased to see that the head of the branch has been assigned by the bank to operate in Istanbul,” he said.
“We are also trying to open a Turkish bank in China as soon as possible,” Babacan said, noting that the Turkish government hopes to develop a long-term and multidimensional strategic partnership with China.

The Industrial and Commercial Bank of China, or ICBC, has also been looking for opportunities to open branches in Turkey, Ning Zhang, the secretary-general of the standing committee of Shenyang Municipal People’s Congress, told the Hürriyet Daily News earlier. Chinese banks started to plan new branches in Turkey following a November meeting between Turkish Prime Minister Recep Tayyip Erdoğan and Chinese Premier Wen Jiabao in Ankara, agreeing to use local currencies, the Turkish Lira and the yuan, in bilateral trade.

More than 50 Chinese companies looking for investment and trade opportunities in the Turkish market joined Thursday’s event.Leading energy firms from the two countries agreed to invest nearly $120 million in a solar-energy business in Turkey, the top executive of Turkey’s Akfel Engineering told the Daily News during the forum.

CEEG Solar Science & Technology, the largest solar-cell manufacturing company in China, will directly invest nearly $100 million in a new solar plant in southern Turkey, said Fatih Baltacı of Akfel. He added that his firm will invest nearly $20 million in the project.

The total electricity-generation capacity of the solar plant will be nearly 50 megawatts, according to Baltacı. “Turkey plans to reach a total of 600 MW of energy generated through solar power plants within four years,” Baltacı said, adding that Chinese solar-energy companies, primarily CEEG, are looking for a bigger share of this market.

“I believe that more investment will come to Turkey,” he said.“The Bank of China may fund the Chinese firm for the solar investment in Turkey,” Baltacı said, noting that the location of the investment has not yet been decided, but the negotiations are continuing between the companies.

More firms eying Turkey

The DAQQ Group, which has 23 subsidiaries and joint venture companies cooperating with Germany’s Siemens and Moeller, the U.S. firm Eaton and the Swiss firm Secheron, is meanwhile eyeing investments in hydropower stations in Turkey, the Daily News has learned.

Huadong Electrical & Mechanical Engineering plans new investments in hydropower stations and renewable energy in Turkey, while Chinese manufacturers of construction equipment, including Jiangsu Jianhua Concrete Pile and Fuzhou Xia, aim to manufacture equipment in the Turkish market. The leading Chinese construction firms Shanghai Euro Sunshine Group and Zhongwei Real Estate are meanwhile among the companies looking for investment opportunities in Turkey’s rapidly growing property market.