Turkish Expertise

Anchoring the economy

Turkish contracting firms have left an indelible mark of their expertise on a diverse range of projects worldwide and have boosted the economic growth of their country.

July 2018

Construction plays a crucial role in Turkey’s economic development, accounting for nearly eight to nine per cent of its GDP and employing almost two million people – hence contributing directly and indirected to as much as 30 per cent of the economy, says the latest report produced by the Turkish Contractors Association (TCA).

The association also points out that the growing global competitiveness of Turkish contractors and building materials producers contributes significantly to the balance of payments of Turkey.

In the period between 1972-2018/Q1, Turkish contractors undertook 9,300 projects in 120 countries, with a total value of $360 billion, while the country is also among the world’s leading producers of building materials.

According to the TCA, Turkey’s strength in the sector is thanks to its unique geographical location, cost-competitive services that meet international standards, credibility in partnerships, extensive knowledge and vast experience in a variety of projects, familiarity with the business environments in the neighbouring regions, qualified manpower and a calculated risk-based approach to business.

Based upon 2016 data, 46 Turkish contracting companies ranked on “The World’s Top 250 International Contractors” list, published in August 2017 by the leading international industry magazine ENR – Engineering News Record. With this number, Turkey ranked second in the world after China.

Turkish contracting companies successfully compete on five continents and in 120 countries, says the report. They are open to enhancing international partnerships not only in the field of contracting, but also in construction industry investments, ranging from the production of building materials to infrastructure, housing, industrial plants and tourism projects in the African, Eurasian and Middle Eastern countries, the TCA report says. 

Another development over the past five decades is that several Turkish companies began specialising in certain project types, such as international airports, railways and urban rail systems. Elaborating on this, the report points out that over the 1972-2018/Q1 period, the share of housing projects in terms of the country’s overall international business decreased while Turkish contractors gained ground on road/bridge/tunnel, commercial centres, airport industrial plant, power plant, railway, socio-cultural facility, tourism facility and petrochemical plant projects.

During the 2010-2013 period, the annual volume of international business undertaken by Turkish contractors grew by 29 per cent to reach its peak, increasing from $23.4 billion in 2010 to $30.1 billion in 2013. However, annual business volumes decreased by 10 per cent in 2014 to $27.1 billion and continued to drop, accounting for $23.2 billion in 2015, $13.8 billion in 2016, $14.8 billion in 2017 and $3.3 billion in the first quarter of 2018, according to the TCA.

Turkmenistan (16.6 per cent), the Russian Federation (16.5 per cent), Iraq (8.7 per cent) and Saudi Arabia (6.6 per cent) have been the leading markets for Turkish contractors in this period. The projects completed in these countries accounted for nearly half (48.4 per cent) of the total amount of international works while the major fields of activity were the construction of roads/bridges/tunnels (15.7 per cent), housing (12.2 per cent), airports (9.2 per cent), power plants (7.8 per cent) and commercial centres (7.5 per cent) respectively.

Turkish contracting firms undertook 190 projects in 56 countries, valued at $13.8 billion in 2016. With a total share of 41.9 per cent, Qatar, Saudi Arabia, the Russian Federation and Uzbekistan were the leading markets followed by Bahrain, UAE, Kuwait, Senegal, Pakistan and Ukraine.

In 2017, Turkish contracting companies undertook 266 projects in 56 countries, worth nearly $14.8 billion. In this period Tanzania, Saudi Arabia, the Russian Federation and UAE were the leading markets with a share of 54 per cent.

In the first quarter of 2018, Turkish contracting companies have undertaken 32 projects in 16 countries, amounting nearly $3.3 billion. In this period Sudan, Saudi Arabia, Kuwait and Kazakhstan were the leading markets with a share of 88.9 per cent.

According to the Turkish Ministry of Economy, Saudi Arabia was its second largest overseas market last year after Tanzania took the lead with a 17.3 per cent share and projects worth $2.531 billion. The kingdom accounted for 14.1 percent of business in foreign markets, Russia with 12.1 per cent, and the UAE with 9.1 percent, each amounting to $2.072 billion, $1.771 billion and $1.331 billion, respectively.

Sectorwise, residential construction topped the list last year earning the Turkish contractors $2.844 billion of projects and this was followed by railway construction with $2.681 billion and power plant construction worth $2.413 billion. Turkish contractors also worked on airport construction worth $1.686 billion and highways, tunnels, and bridges worth $1.605 billion.

According to the Ministry of Economy, the number of countries where Turkish contractors have penetrated has reached 119 with the addition of Liberia, Chad, Rwanda, Seychelles, Sri Lanka, Czech Republic, Estonia, Madagascar, Malawi, and Vietnam.  

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