This is a best prospect industry sector for this country. Includes a market overview and trade data.
Turkey’s transportation and logistics sector has been one of Turkey’s fastest growing industries, tripling in value since 2002, with an average 20% annual growth rate. This growth, combined with Turkey’s strategic location as a bridge between East and West, is creating new opportunities for U.S. exporters of transportation and intelligent technologies. Turkey is not only a major transit country, but also a key freight destination. Given Turkey’s increasing population – now over 80 million – and inward migration to larger cities from rural areas, traffic has become a crucial issue, compelling local municipalities to invest heavily in Intelligent Transportation Systems (ITS). As a result, Turkey has doubled its transportation industry investment budget from 20% to 40% and invested more than $60 billion over the last decade. This sector is dependent on critical foreign technologies such as ITS, thus providing opportunities for U.S. firms.
Turkey’s Customs Union with the EU and its frozen application for full EU membership is pushing the transportation industry to consider new investments in Turkey. Turkey’s current transportation network is below EU-27 standards. Even if EU accession does not occur in the near term, Turkey has an ambitious goal to comply with all EU rules and regulations, as most of its foreign trade is with Europe.
U.S. firms have a comparative advantage in high-tech products; therefore, they are encouraged to take advantage by forming supplier agreements for specialized technologies.
The transportation sector’s influence is expected to increase over time, as many highway, railway, and other transportation-related projects are either underway or expected in order to accommodate the needs of an increasingly industrialized country. “Combined transportation” may have a big share in the transportation industry and, due to an increase in public-private partnerships, marine and railway freightage may play a larger role in cargo transport. Turkey has committed to new investments in this sector to keep up with future demand, expected to reach the following targets in 2023, the centennial of the Turkish Republic:
- Foreign trade volume to reach $5.2 billion, with $227 billion in exports and $293 billion in imports.
- GDP to reach $2 trillion
- Transported cargo to reach 625 billion tons.
However, with Turkey’s current economic situation, these goals are too ambitious. The government has typically used the Build-Operate-Transfer (BOT) type of funding for earlier and ongoing transportation projects, and it seems that with the limited resources for foreign funding for the country, BOT is the only way to realize upcoming major transportation projects, including the following:
- Canakkale 1915 Bridge: to be completed by 2023 on a BOT basis with the budget of $2.8 billion, it will be the longest bridge in the world (3623m), exceeding the Japanese Akashio Bridge rail plus motorway.
- The Grand Istanbul Tunnel: tender expected to be announced in 2020; $3.5 billion; 110m (361 ft) below sea level; 6.5 km (3.7 miles) long and three floors; two roads and one metro line. The project is expected to be completed in 2022.
- Canal Istanbul: planned to connect the Marmara Sea with the Black Sea; an alternative route to the Bosphorus Strait to decrease traffic congestion; $15 billion; 45km (nearly 28 miles) long and 145-150m (492 ft) wide on the surface and 125m (410 ft) wide on the floor; 25m (82 ft) deep to allow large ships access to the sea. As a result, Istanbul will be two peninsulas and an island. The project is controversial and there is no clear timeline for when or if construction will start.
The Turkish Government has prioritized improvements in the rail sector as follows:
- Liberalization of the rail system with the state maintaining ownership, but transportation companies able to transport cargo in private wagons. Three private companies have begun operations in the rail system, and more are expected.
- Increased passenger railroad transportation to 10% and cargo railroad transportation to 15%.
- Total rail length expected to reach 25,208km in 2023, including additional 11,700km high-speed rail, 8,500km rapid rail and 1,000km conventional rail.
- 8,000km of existing rail to be restored and modernized with new signal systems.
- Electrification and signal systems along with renovation of existing lines.
- New metro lines/light rail systems/trams in larger cities.
Roads & Highways
- 26,642km of existing divided roads with plans to increase to 29,514 km
- 3,779km of highway construction to be completed by 2023
- 9,000 bridges/viaducts with total length of almost 600km to be completed
- “Three Big Ports along the Three Big Seas” project on the Aegean, Black Sea and Mediterranean aiming for three transfer ports in every sea surrounding the country:
- West on Aegean Sea - Candarli port
- North on Black Sea - Filyos port (expected to be completed in 2020)
- South on Mediterranean Sea - Mersin port expansion
- Container transportation capacity expected to reach 32 billion TEU
- Liquid cargo expected to reach a capacity of 350 billion tons and dry cargo, 500 billion tons
- Turkey is expected to rank among the top ten countries that receive revenue from maritime transportation
- Increased combined/multimodal/intermodal types of transportation
- Marina capacity expected to increase to 35,000 ships
- Planned construction of seven new cruise ports
- Increased emphasis on sustainability and efficiency through projects like “Green Port”
All high-technology systems, products, equipment in all modes of transportation, including those related to ITS are in great demand. Below are some examples:
- Traffic engineering, management, measurement, control and signal systems
- Electronic detection, and camera and security systems
- Variable message, communication and digital information systems
- Lighting systems
- Tunnel SCADA, vehicle tracking and fleet management, data management
- Marine technology: port superstructure, vessel tracking systems, oil spill detection and contingency preparedness, underwater mapping
- Ministry of Transport, Maritime Affairs and Communications: www.ubak.gov.tr
- Ministry of Transport Directorate General of Merchant Marine.
- General Directorate of Highways (KGM): www.kgm.gov.tr
- General Directorate of State Railways (TCDD): www.tcdd.gov.tr
- Turkish Statistical Institute: www.turkstat.gov.tr
- Eurasia Rail Turkey – Konya, April 03-05, 2021, www.eurasiarail.eu
- Intertraffic Istanbul, May 2022, www.intertraffic.com/en/istanbul
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