2017 will erase the negativities of the previous year

While 2016 was not very pleasant due to many developments that negatively affected the markets, expectations for 2017 are positive. The year 2016 was not a bright year for Turkey due to the coup attempt, terrorist attacks, the refugee problem, and the fluctuations in exchange rates. Nevertheless, due to continuing urban transformation at full speed, and the mega projects of the construction sector, Turkish climatization sector did not suffer significant losses. According to the Sector Report (January 2017), which is regularly published monthly by IMSAD Turkey, it is expected that the construction works will continue to increase in housing in 2017. The sector will have a growth rate that is above the general economy, but below the 2016 growth performance. The public will increase their investments in 2017 by 27 percent. The growth expectation in the European construction sector is high. According to the report, the construction sector grew 7.4 percent in the first nine months of 2016. Growth is expected to be between 5-6 percent throughout the year. Thus, the construction sector will be performing better than the general economy and many other industries. In 2017, public investments and urban transformation will continue to support the construction industry. EmlakKonut GYO, the largest real estate investment company in Turkey, closed 2016 with sales of 7.3 billion TL (+2 billion USD), and aims to increase its sales in 2017 to 8 billion TL (+2.2 billion USD). As of 2016, there are 9.1 million buildings in our country, of which 7.9 million are residential. More than 100,000 new buildings are added to Turkey’s building stock each year.

The exports of Turkey’s climatization sector in 2016 were 3.2 billion USD. Climatization has a 2.5% share in Turkey’s total exports. The sector, which has exports to 209 countries, is increasing its foreign initiatives to increase its momentum in 2017. In this direction, a Turkish Trade Center is being established in Dubai.

In Turkey, within the scope of “Climate Change Action Plan 2011-2023”, it is aimed to supply at least 20% of annual energy needs of new buildings from renewable energy sources starting from 2017. Within the scope of the “Energy Efficiency Strategy Document 2012-2023”, strategic objectives towards transforming at least one quarter (1/4) of the building stock of 2010 into sustainable structures until 2023, and dissemination of on-site production practices in mass housing were defined. Maximum energy requirement, and maximum emission limitation for buildings are expected to be introduced. The 2014-2018 Tenth Development Plan also aims to reduce energy consumption in public buildings. Turkey joined the COP 21 with a commitment to reduce greenhouse gas emissions by 21% by 2030, based on the reference scenario. In recent years, Turkey has accelerated projects in transportation, infrastructure, energy and defense fields, and the financial size of its mega projects has left behind the national income of 130 countries. The cost of 21 mega-projects that are on Turkey’s agenda exceeds 138 billion dollars.

The mega-projects, which will greatly influence the future and outlook of Turkey, captured great attention with their financial size, leaving behind the national incomes of countries such as Hungary, Luxembourg, Libya, Bulgaria, Uruguay and Slovenia.

President of TIM Mehmet Buyukeksi expressed Turkey’s 2017 expectations with his remarks, “We declared 2017 as the year of breakthrough. We predict that exports will increase to 155 billion dollars at the end of the year”.

Attraction centers in Turkey to entice USD 5.3 billion investment

At a launch event held in Ankara to mark the official inauguration of the Attraction Centers Program, which designates certain areas as priority for investments, Prime Minister Binali Yildirim announced that the government received initial applications from 1,200 investors, worth TRY 19.6 billion (USD 5.3 billion). These applications, made following the November 2016 announcement of the Attraction Centers Program in the Official Gazette, are for regional projects in 23 provinces that will benefit from government incentives. Yildirim said that the Attraction Centers Program would invigorate  lesserdeveloped locales by undertaking long overdue investments. It is hoped that the program will curb migration away from these areas and will remove disparities between different regions of the country. The demand for such projects is expected to create employment opportunities for more than 112,000 people in Turkey’s eastern and southeastern provinces, according to Yildirim.

Company representatives willing to benefit from the incentives scheme for their projects must apply to the Development Bank of Turkey or to regional investment support offices for evaluation of their projects. The applications and related projects should conform with the Council of Ministers’ Decree No. 2016/9596 dated 28.11.2016 on Principles and Procedures for the Implementation of the Attraction Centers Program. As per the program to be coordinated by the Ministry of Development, the government is committed to providing support in four areas: support for investment and manufacturing, support for relocation of manufacturing facilities, support for call centers, and support for investment and energy in data centers. Under the program, the government’s support will vary in a wide range of areas. Support may come in the form of consultancy services, construction, land allocation, interest-free investment loans, and reduced-rate operating loans.

Oya BAKIR Ph. D.
Editor
oyabakir@dogayayin.com