‘Kürt Bölgesi’ Var mı, Sınırları Nedir ?
Türkiye’nin özellikle son 30 yılına damgasını vuran Kürt sorununda da bir “kakofoni”, yani ahenksizlik, uyumsuzluk…
ARTICLE SUMMARYHaving borrowed 1 billion euros from foreign lenders, Turkey’s controversial sovereign wealth fund has turned to rescuing troubled construction companies. REUTERS/Murad Sezer/File PhotoSarphan Finans Park (L), a project as part of the Istanbul Finance Center in the city’s new business and residential district of Atasehir, is pictured from a helicopter in Istanbul, Turkey, March 29, 2016.
Turkey’s sovereign wealth fund has remained largely inactive in the three years since its creation, though it was launched with high expectations and handed over major public assets. Borrowing has been the fund’s only noteworthy activity thus far in what has amounted to an effort to rescue big construction companies amid the country’s economic crisis.
Last week, the fund announced it was taking over a stake worth nearly 1.7 billion Turkish liras (some $300 million) in the partially built Istanbul Finance Center, a sprawling project where construction has stalled amid financial snags. The move, which came shortly after the fund secured a treasury-guaranteed loan of 1 billion euros from foreign lenders, appears to justify predictions outlined in an Al-Monitor article more than two years ago.
The fund, called officially the Turkey Wealth Fund, was established with much fanfare in August 2016 as a body attached to the now-defunct prime minister’s office. Its main objectives were described as “contributing to economic growth by ensuring value increase of key public assets, supporting the development of assets suitable for participation financing, actively deepening capital markets by supporting introduction of a variety of products, attracting further investments to Turkey and providing capital for new investments and … further developing strategically important industries and participating in large-scale investments.”
President Recep Tayyip Erdogan said the creation of the fund was a “belated” move, but had high hopes over its future. “The assets to be generated there will increase our strength, both nationally and internationally,” he said in November 2016.
Soon, the shares of major public capital companies, including some slated for privatization, were transferred to the fund. Among them are giant entities such as Ziraat Bank, Halk Bank, Turk Telekom, the Turkish Airlines, the PTT postal service, the National Lottery, the Istanbul stock exchange, pipeline operator BOTAS, oil company TPAO, satellite communications company Turksat, tea company CAYKUR and the mining enterprise Eti Maden.
By September 2017, however, Erdogan grew disappointed, grumbling that the fund had failed to progress as desired. “We have decided that things cannot go on like this,” he said. “Reorganizing the wealth fund is a must.” As it turned out, what Erdogan meant by reorganization was to appoint himself chairman of the fund and name Treasury and Finance Minister Berat Albayrak, who is also his son-in-law, as his deputy. In an apparent bid to varnish the overhaul, the heads of the country’s Banks Association and Union of Chambers and Commodity Exchanges were also appointed to the executive board.
The fund’s most notable activity since then has been borrowing. In the middle of this year, the fund, which has a net value of about $30 billion, acquired a loan of 1 billion euros (some $1.1 billion), according to its director-general, Zafer Sonmez. The loan, which has a two-year maturity and is guaranteed by the treasury, was provided by a consortium of banks, led by Citibank NA/London and China’s ICBC.
It did not take long before it emerged what the money was intended for. The fund has decided to buy liabilities from the financially troubled contractors of the Istanbul Finance Center.
In a television interview Sept. 25, Sonmez said, “We’ll be taking over a section of about 465,000 square meters in the project, which has a usable area of 1.3 million square meters, in return for 1.67 million Turkish liras, including project design, earthworks, land prices and the cost of the construction completed thus far. We are now signing deals with the three contractor companies [which were building] those sections that contain offices and shopping areas.” The fund will shortly invite bids to complete the construction, Sonmez said, adding that “the cranes will start working in November at the latest.”
The builders that are being rescued through the fund’s takeover of their liabilities are Agaoglu Insaat — one of Turkey’s largest construction firms that saw its heyday under the Justice and Development Party (AKP) — and Intas and YDA.
The construction of the Istanbul Finance Center is a long-winded story. It was planned as a giant complex in 2008 as part of the AKP government’s ambitions to make Istanbul an international financial hub. Public banks and financial institutions, which have their headquarters in the capital Ankara, are expected to be relocated to the center, which is being erected on a land of 300,000 square meters in the district of Umraniye on Istanbul’s Asian side.
The strategy and action plan of the project was published in the Official Gazette in October 2009. Work on architectural design and other project preparations was launched by Emlak Konut, a subsidiary of state housing developer TOKI. The first tender was held in November 2012, but construction started only in 2014.
The inauguration of the center, set for 2016 originally, was first rescheduled to 2018 and then, under the impact of the economic crisis, was delayed further to 2020. Among the contractor companies, Agaoglu, Tahincioglu and Is GYO have completed the rough work in their sections, while other builders remain in the earlier stages of construction. The two-block building of the public VakifBank has been erected, while the foundation of Ziraat Bank’s building was laid only in the last quarter of 2018. The offices of Halk Bank, the Banking Regulation and Supervision Agency and the Capital Markets Board also remain under construction, while work on the central bank’s building, which will be the tallest structure in the complex, has yet to kick off.
Under its deals with Agaoglu, YDA and Intas, the wealth fund pays for the cost of all work the companies have done thus far as well as their stakes, relieving the financially exhausted contractors from the project or, in other words, rescuing them by taking over their liabilities. The talk in bureaucracy and real estate quarters is that the fund’s borrowing and rescue operations will continue.