Arab Spring Hits Turkish Construction Business

The uprising in Arab countries keep on hitting Turkish construction businesses there. Some 370 projects in Libya are under risk, latest figures say

Nearly $100 million of cash owned by Turkish businesses are being held in Libya banks.The ongoing “Arab Spring” in the Middle East and North Africa means a winter-like summer for the Turkish construction businesses in the region, recent figures have shown.

The turmoil in Libya, which has already evolved in to a civil war, is threatening some $18.4 billion worth of projects by Turkish builders in the country, according to a recent “Construction Sector Analysis” by the Turkish Contractors Association, or TMB.

The amount of allowance payments these companies have been unable to deposit has already hit, $1.6 billion, the report said. Nearly $100 million of cash owned by Turkish businesses are being held in Libya banks. The machinery and equipment of companies that have already returned to Turkey adds to the current losses.

Noting that Turkish contractors undertook nearly 6,000 projects in 90 countries across the world, totaling a business volume of $190 billion between 1972 and 2010, Libya had a great share in this sum, the TMB report said. Within the given period, Turkish companies materialized 529 projects worth $27 billion in Libya.

The losses caused by the crisis in this crucial country are not likely to be compensated in the short run, contractors said, adding that the competition conditions in post-turmoil Libya would also not be similar to those before the uprising that started in early 2010.

All these elements have forced constructors to search for alternative markets and political risks insurance is a must for the sector, the analysis concluded.

Turk Eximbank and the TMB should coordinate in finding solutions to these problems, the report continued.

“In finding alternative markets, the inner regions of Africa look prominent. It would be quite effective if Eximbank re-launches country credits, a practice that generated good results in the past,” the TMB report added.

Arabs steam tourism gains

In a holiday season hit by European debt crisis, tourism in Turkey has been enjoying an increasing number of visitors from Arab countries with a 20 percent rise from last year according to figures.

With the number of Arab tourists to the county increased by 20 percent from last year according to official figures, sector representatives foresee the ratio to exceed 75 percent by the year end.

“The best promotion in tourism is the one that is a result of trust,” said Ahmet Emre Bilgili, the Istanbul tourism director, to Radikal newspaper.

“Turkey is very expensive,” said Zeynep Kadhim, an Iraqi visitor to the city. “But the sea is great in Turkey and the food is delicious. The only problem here is that not many people speak English.”

Neda Mansona from Iran told Radikal that she spent $2,000 only on shopping during her visit. “Everything is very nice here but the three star hotels are at a two-star level.”

Fattandz Tahem, again from Iran, said he bought souvenirs for relatives and friends worth $20,000 before going to Kemeraltı and Çeşme, the two tourism destinations in the Aegean province of İzmir.

Tourists from Arab countries visit Istanbul all year round, said Leyla Özdemir, the marketing manager at Cevahir shopping mall. “They usually buy goods from local brands.”

According to Fatma Çiçek, a tour operator, the removal of visas from many countries including Morocco, Jordan, Libya, Lebanon, Syria and Tunisia has been affective in increasing tourism from these countries.

July 31, 2011
SOURCE: HURRIYET DAILY NEWS