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Presentation by : Leyla OZHAN Assistant Secretary General lozhan@tmb.tr

TURK I SH CONTRACTORS ASSOC I AT I ON. Presentation by : Leyla OZHAN Assistant Secretary General lozhan@tmb.org.tr. CONTENT. Turkish Contractors Association (TCA) Facts and Figures About C onstruction S ector International Activities of Turkish Contractors Why to invest in Turkey

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Presentation by : Leyla OZHAN Assistant Secretary General lozhan@tmb.tr

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  1. TURKISH CONTRACTORS ASSOCIATION Presentation by : Leyla OZHAN Assistant Secretary General lozhan@tmb.org.tr

  2. CONTENT • Turkish ContractorsAssociation (TCA) • Facts and Figures About Construction Sector • International Activities of Turkish Contractors • Why to invest in Turkey • Strengths of Turkish Contractors

  3. About TCA Status : Non-governmental, non-profit, independent professional organization established in 1952 Head Office : Ankara – TURKEY Number of Member Companies : 143 Members’ Profile : Construction–Contracting Companies Business Volume : 70% of all domestic and 90% of all international contracting works International Memberships : ICCF, UEPC, FIEC, EIC, WWC

  4. About TCA Our Vision is : to contribute to the development of a sustainable and knowledge-based Turkish construction sector, which is competitive, innovative, market driven, meets user and societal needs, by providing the best living and working conditions for all people whereever we do business.

  5. Major Activities of TCA • Information Management • R & D • Strategic Alliances • Training • Public Relations & Lobbying • Special Events • Social Responsibility Projects • Publications

  6. International memberships ICCF European Union of Developers and House Builders 1992 Full Member European Construction Industry Federation 2000 Full Member European International Contractors 2002 Full Member World Water Council 2004 Full Member Islamic Countries Contractor’s Federation 1991 Full Member TCA is full member to 5 international organisations

  7. Construction Industry - 1 Share of Construction in GNP % 8 6,91 7 6,40 6 5,25 5,03 5,02 4,79 5 4,59 4,03 3,76 4 2,95 3 2 1 0 2006 2007 1990 1995 2000 2001 2002 2003 2004 2005

  8. Construction GNP Construction Industry - 2 Construction and GNP : 1995-2007 Growth Rates (%) 60,0 50,0 40,0 30,0 21,5 19,4 20,0 9,9 8,3 11,5 7,1 7,9 10,0 8,0 7,6 6,0 6,3 5,8 5,9 4,6 5,0 4,4 3,9 4,0 0,7 0,0 2007 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 -4,7 -5,5 -5,6 -6,1 -10,0 -9,0 -9,5 -12,5 -20,0

  9. Construction Industry - 3 Employment Number of Employees (Million) 1,37 1,36 1,11 1,22 1,19 1,17 0,97 1,03 0,96 2006 2007* 1999 2000 2001 2002 2003 2004 2005 * 2007 3rd Q

  10. Construction Industry - 4 Ready - Mix Concrete : 70,7 Million m3 / year Prefabrike Beton : 1,6 Million m3 / year Cement : 47,6 Million ton / year Clinker : 38,2 Million ton / year Ceramic : 280,0 Million m2 / year Sheet Glass : 0,8 Million ton / year Iron – Steel Bar : 11,5 Million ton / year Brick : 4.700,0 Million unit / year Plastik Profil : 0,3 Million ton / year Consumption Indicators Source : The Building Information Centre – 2007

  11. Construction Industry 5 Shares of Housing, Non-residential Buildings and Infrastructure in Turkish Construction Industry (road, bridge, dam, tunnel, road, harbour-airport-pipeline, cable networks) infrastructure 25% housing non-residential 60% 15% (commercial, industrial, health, cultural, administrative, religious, other)

  12. International Activities - 1 More than 4300 Projects in 69 countries Total business volume of 105 Billion USD in 36 years EUROPE 18 countries, (9,07%) THE CIS 12 countries, (36,87%) THE MIDDLE EAST 13 countries, (22,88%) AMERICA 3 countries, (1,66%) NORTH AFRICA, 5 countries, (26,08%) SUB-SAHARAN AFRICA, 11 countries, (0,31%) SOUTH ASIA & FAR EAST 7 countries, (3,13%)

  13. International Activities - 2 International Market Development by Periods 1972-1979 1980-1989 COUNTRY (%) COUNTRY (%) LIBYA 72,54 LIBYA 55,23 S.ARABIA 15,44 S.ARABIA 23,41 IRAQ IRAQ 11,47 7,25 KUWAIT 4,71 THE RUSSIAN FED. 3,77 0,06 GREECE YEMEN 1,55 0,01 IRAN OTHERS (11 Countries) 4,57 1990-1999 2000-2007 COUNTRY (%) COUNTRY (%) THE RUSSIAN FED. 34,51 THE RUSSIAN FED. 14,89 LIBYA 13,75 LIBYA 9,66 KAZAKHSTAN 7,83 KAZAKHSTAN 9,41 TURKMENISTAN 6,67 S. ARABIA 8,01 PAKISTAN 6,59 QATAR 7,37 OTHERS (43 Countries) 30,65 OTHERS (46 Countries) 50,66

  14. International Activities - 3 1972 -2007 4300 projects in 69 countries Total volume :105 Billion US Dollars 19,5 15,9 International Contracting Services 9,8 6,5 3,5 1,7 2002 2003 2004 2005 2006 2007 Turkish International Contracting Services (USD Billion)

  15. International Activities - 4 • Major Factors Encouraging International Contracting • Location of Turkey on the crossroads of 3 continents • Rich experience gained in the international market • Internal factors such as “slow-down” in public investments • Increasing investments in the oil exporting countries • Familiarity with the local business environments in North African, Eurasian and Middle Eastern countries

  16. International Activities - 5 Distribution of International Works By Regions - 2007 CIS 38,3% Europe 6,6% Africa 29,7% Middle East Asia 24,3% Other 0,8% 0,3%

  17. International Activities - 6 Nature of International Work by Periods 1980-1989 1972-1979 (%) FIELDS OF ACTIVITY % FIELDS OF ACTIVITY 36,69 HOUSING 32,14 HOUSING 17,21 SEAPORT 18,11 URBAN INFRASTR. 6,96 INDUSTRIAL PLANT 15,59 ROAD/BRIDGE/TUNNEL 5,37 ROAD/BRIDGE/TUNNEL 11,67 IRRIGATION 4,12 URBAN INFRASTR. 8,19 HEALTH FACILITIES OTHER 29,65 OTHER 14,30 2000-2007 1990-1999 (%) FIELDS OF ACTIVITY (%) FIELDS OF ACTIVITY 14,24 HOUSING 24,89 ROAD/BRIDGE/TUNNEL 12,12 ROAD/BRIDGE/TUNNEL 12,66 AIRPORT COMMERCIAL CENTER 10,83 INDUSTRIAL PLANT 8,96 PIPE LINE 8,32 COMMERCIAL CENTER 8,05 8,31 HOUSING TOURISM FACILITIES 5,90 46,17 OTHER OTHER 39,53

  18. LIBYA 19,3% OTHERS (57 Countries) 25,0% ROMANIA 2,3% UAE 3,3% IRAQ 3,5% THE RUSSIAN FEDERATION S. ARABIA AZERBAIJAN 18,1% QATAR KAZAKSTAN 9,3% 3,6% TURKMENISTAN 4,1% 7,4% 4,2% International Activities - 7 Distribution of Activities by Country (1972 - 2007) OTHER: PAKISTAN, OMAN, ALGERIA, BULGARIA, AFGHANISTAN, MOROCCO, UZBEKISTAN, IRELAND, JORDAN, UKRAINE, KUWAIT, USA, TUNISIA, EGYPT, GEORGIA, CROATIA, GERMANY, YEMEN, BELARUS, LATVIA, TRNC, ALBANIA, IRAN, POLAND, SUDAN, ISRAEL, TAJIKISTAN, KYRGYZSTAN, BAHRAIN, MACEDONIA, INDIA, MOLDOVA, SYRIA, CHILE, ETHIOPIA, NEPAL, LEBANON, GUINEA, BOSNIA-HER., CAMEROON, MALI, SIERRA LEONE, MALAYSIA, MOZAMBIQUE, ARMENIA, THE PHILIPPINES, GHANA, ITALY, MEXICO, KOSOVO, ARGENTINA, GREECE, MALAWI, THAILAND, INDONESIA, LITHUANIA

  19. HOUSING OTHERS 17,7% 19,2% HEALTH FACILITIES 3,4% ROAD/BRIDGE/TUNNEL 12,6% PETROCHEMICAL PLANT 4,2% POWER PLANT 4,5% SOC. CULT. FACILITIES COMMERCIAL CENTER 4,6% 8,4% URBAN INF. INDUSTRIAL PLANT PIPE LINE 4,7% AIRPORT 7,4% 5,7% 7,4% International Activities - 8 International Activities by Nature of Work (1972-2007) OTHER : ADMINISTARTIVE BUILDING, TOURISM FACILITIES, IRRIGATION, SEAPPORT, DAM, RAILWAY, TREATMENT PLANT, MILITARY FACILITIES, DEPOTS, ENERGY TRANSMISSION LINES, TELECOMMUNICATION

  20. International Activities - 9 Top 10 International Markets (2006 – 2007) (USD)

  21. East Europe North East North Africa Middle East Why to invest in Turkey-1 Turkey’s strategic location on the crossroads of 3 continents • East Europe • Albania • Bosnia - H. • Bulgaria • Croatia • Greece • Kosovo • Macedonia • Moldavia • Poland • Romania • Serbia • Slovenia • Ukraine • Africa • Algeria • Egypt • Libya • Morocco • Sudan • Tunisia • North East • Armenia • Azerbaijan • Georgia • Kazakhstan • The Russian Fed. • Tajikistan • Turkmenistan • Uzbekistan • Middle East • Afghanistan • Bahrain • Iran • Iraq • Israel • Jordan • Oman • Pakistan • Qatar • Saudi Arabia • Syria • UAE • Yemen

  22. Why to invest in Turkey-2 • 93%of population is 65 and younger • 65% of population is 35 and younger (20 % 17-25 years old) • population growth rate 1.72%. • decreasing household size (to less than 5) is a significant factor in the increase of house demand. • 65 % urbanization (growing need for health, education andtransportation facilities) • 85 % highway-based transportation

  23. Why to Invest in Turkey - 3 • Rapid growth in demand for housing, infrastructure and modernisation • Turkey’s being in the accession process to the EU • Increasing economic stability • Increasing EU funding • Increasing private investment and public-private partnerships

  24. Why to invest in Turkey - 4 • Outlook for growth in infrastructure investments : • IMF Program and budget restrictions limited public infrastructure investments. • Government policy is to increase the share of private sector in infrastructure • New opportunities created by privatization • (such as major highways and bridges) • Legal framework for PPP, • Direct private sector investments. • Turkey’s membership negotiations with the EU which started in 2005 introduced: • New legislations, • New infrastructure requirements in several areas where there is a big lack • New funds

  25. Why to invest in Turkey -5 Government policy to transfer the infrastructure investments to private sector Privatization and wider use of PPP GROWTH IN DEMAND FOR INFRASTRUCTURE ! EU Accession period: new legistation, infrastructure requirements and EU funding Internal reasons: population increase, urbanization additional housing demand

  26. INVESTMENT OPPORTUNITIES THAT WILL CREATE POSITIVE EFFECTS ON CONSTRUCTION INDUSTRY • Privatization of Bridges and Motorways • Bridge over Izmit Bay and Izmit-Bursa-Balıkesir- Izmir Motorway • Energy projects • Third Bridge over the Bosphorus • Railway Projects (new + uprgading of existing network) • Regional integrated development projects • (“SAP”, Konya Plain and Eastern Anatolia Projects) • Private sector investments (such as refineries and petrochemical plants)

  27. Strengths 1 Strengths of Turkish Contractors • Credibility in partnerships • Rich experience in diverse markets and project types • First hand knowledge of the business culture in the surrounding regions • Logistic advantages due to geographic location of Turkey • Cost effective service at international standards • Delivery of the final product prior to contract deadlines

  28. Strengths 2 Strengths of Turkish Contractors • A calculated risk-taker approach to business • Experience in international partnerships • Experience in working with Japanese contractors on large scale projects (e.g.Bosphorus Bridge, Marmaray Project, Dubai Metro) • Hardworking, qualified , relatively low-cost labor force available for works abroad

  29. TCA MEMBER COMPANIES ARE READY TO JOIN FORCES WITH THEIR JAPANESE COUNTERPARTSAND TAKE ADVANTAGE OF THE RICH BUSINESS OPPORTUNITIES BOTH IN TURKEY AND IN THE THIRD COUNTRIES

  30. Thank you … For more information please contact : Turkish Contractors Association www.tmb.org.tr tmb@tmb.org.tr

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