Distinguished Participants,

Ladies and Gentlemen,

It is indeed a great pleasure for me to be here with you today and a privilege to be asked to deliver the opening address of the briefing on the prospects of Turkey’s energy and infrastructure sectors. I would like to extend my sincere thanks to the Middle East Association for its timely initiative to set up this event and to UK Trade and Investment as well as Petrofac for their support.

I am here to talk about business: to recommend British companies to invest in Turkey. There are many reasons for this. First, Turkey has achieved stable economic growth with an average annual GDP growth rate of 5.2 percent over the last 9 years. Strikingly, this has been accomplished in spite of the fact that economic crises have put the global economy under strain. When we look at the figures they speak for themselves: Turkey’s gross domestic product grew by 8.5 percent in 2011, making it the fastest growing economy in Europe. The Istanbul economy alone is larger than 12 EU countries combined. It is estimated that Turkey will be in the top 10 economies in terms of GDP by 2023. And, equally important, Turkey’s close links with both Europe and Middle Eastern economies situate the country as an important staging post for businesses entering into Asian markets. I presume such peculiarities of an emerging market cannot afford to be ignored by investors. 

Secondly, I am proud to state that our institutionalised economy fuelled by 110 billion dollars of foreign direct investment in the last nine years is ranked as the 13^th most attractive FDI destination in 2012. This is essentially the consequence of its liberal and reformist investment climate. Since 1997, Turkey has been the second biggest reformer among OECD countries in terms of removing restrictions on FDI. It is possible to set up a company in an average of 6 days in Turkey, while the average in OECD member countries is over 12 days.

Furthermore, young, dynamic, well-educated and motivated professionals of over 26 million have been contributing significantly to the increase in labour productivity. The longest working hours and the lowest sick day leaves per employee are observed in comparison with other European countries. Every year, approximately 500,000 students graduate from universities, vocational and technical high schools. These compelling factors, I believe, make Turkey a hugely attractive destination for UK and European trade and investment.

The visit of the Deputy Prime Minister H.E. Nick Clegg to Turkey last month has already confirmed the determination of British businessmen to enjoy the strengths that the Turkish economy offers. I am confident that the visit has brought us closer by serving the purpose to further develop our bilateral economic and trade relations. As stated by R.H. Clegg, we have an ambitious aim to double bilateral trade by 2015. It has increased by 40 percent since 2009 so we are making good progress towards the target. The UK is currently Turkey’s fourth biggest export partner and over 2,200 British companies have invested in Turkey, including high street names Marks & Spencer, TESCO, Vodafone, HSBC and Laura Ashley.

Nonetheless, the story does not end there. There are vast economic opportunities so as to flourish our economic relations. The Turkish energy and infrastructure sectors are widely regarded as the most promising and attractive fields of investment in this regard. Due to Turkey’s high growth rate, it is anticipated that its electricity demand will increase annually 6,5 percent in the low case scenario or 7,5 percent in the high case scenario until 2023. Therefore, we are working to achieve full utilisation of the economically and technically feasible hydraulic potential and indigenous coal reserves. Moreover, we aim to increase the share of renewables in the generation mix at least by 30 percent and the installed wind energy power up to 20.000 MW, to ensure that our geothermal potential reaches up to 600 MW, and to supply 5 percent of our electricity production through nuclear energy.

In parallel with the high increase in demand and the aspiration to attain these targets, the energy market experiences a transition into a competitive and liberalised structure in order to enlarge its capacity to attract investments. I have to admit that an important driving force behind market liberalisation efforts is the requirement of more than 100 billion US dollars investment for the next 15 years. So far, the share of the private sector has increased through the privatisation of the state-owned electric distribution and generation assets and the reorganisation of the natural gas market. In the years to come, the Turkish energy market will continue to offer a wide range of investment opportunities, ranging from crude oil exploration to oil and petrochemical products distribution and exports, from electricity generation to machinery and equipment manufacturing.

Let me say a few words on the infrastructure sector as well. The national and local authorities in Turkey have been implementing numerous infrastructure projects through Public and Private Partnership (PPP). At the end of 2011, the total worth of 134 PPP projects focusing mainly in the areas of transportation, energy, health, defence and other public services was about 35 billion US Dollars. Our ambition is to make Istanbul an international financial centre, which will provide jobs for 30,000 people, together with the construction of 6 km of underground for transportation. Further, Turkey’s bid to host 2020 Olympic Games will diversify the opportunities of investments in finance, construction and real estate sectors. We also want to build over 5000 km of new motorways as well as 10,000 km of new high speed rail lines through 29 cities, to privatize the ports and to speed up our projects on integrated health campuses.

Turkey is a country that has attracted considerable foreign direct investment (FDI) inflow in recent years. Indeed, just in the infrastructure sector this increased from 750 million in 2004 to nearly 4.000 million US dollars in 2011. Turkey’s advantages such as its proximity to major markets, its pivotal role in connecting Pan-European transport corridors to Central Asia and its logistics industry, which has developed significantly since its joining the EU Customs Union, places the country in a unique position.

I conclude my remarks with an appeal to you all that Turkey-UK economic and trade relations should be further developed; and your active participation and insightful contributions can play an extraordinary role in this regard.

I thank you all.