PPP in Turkey: Financing future infrastructure

The inaugural PPP in Turkey international forum took place to great applaud at the 5* Crowne Plaza Hotel Ankara. With over 150 registered delegates from more than 15 countries, including representatives from over 15 public institutions, our 2012 event provided a platform for discussing the future potential of Turkey’s PPP ambitions. The event was kindly supported by our sponsors DK Infrastructure and Corporate Finance, Ernst & Young, Hill International, DenizBank and Hitachi, in addition to a range of media and other partners.

The forum was opened by conference chairs Tom Popple (Project Manager, E.E.L. Events Limited) and Burak Sencer (Country Director, Mott MacDonald), whom provided a detailed review of the state of play regarding PPP in Turkey. This was followed by 4 keynote speeches from Hasan Murat Mercan (Deputy Minister of Energy and Natural Resources, Turkey), Emin Zararsiz (Undersecretary of State for Ministry of Education, Turkey), Isa Coskun (Deputy Undersecretary of State for Ministry of Finance, Turkey) and Cem Galip Ozenen (Head of PPP Department, Ministry of Development, Turkey). Each ministerial representative underlined the PPP pipeline in their respective sectors, including review of past and current projects in PPP formula. With an ambitious PPP pipeline and specific targets up to 2023, these opening speeches provided an excellent opportunity for delegates to learn about projects in Turkey. This was aptly followed by Necmettin Kaymaz (Chief Project Director, Prime Ministry Investment Support and Promotion Agency, Turkey) who outlined the investment climate, incentives and future outlook, including review of the 2023 goals. The final presentation in the opening session was provided by Thomas Barrett (Director and Head of Advisory Services, EIB and Chairman of EPEC – EIB), who discussed the “importance of capacity-building for PPP projects”, thus emphasising the need for public institutions to be “PPP-ready”.

After a well-deserved coffee and a chance to network with each other, the delegates once again took their seats for the next session on Risk Allocation. Following a brief introduction by Paul Clarke (Head of Business Development, Turkey and Central Asia, Hill International), the panel session led by Franco Vigliano (Managing Partner, Ashurst) commenced. Panellists included Cem Galip Ozenen, Thomas Barrett, Richard Dyton (Partner, Simmons & Simmons), Ayhan Sarisu (Head of Project Group, Privatization Administration, Turkey) and Ian Twinn (Head of Portfolio, Infrastructure and Natural Resources, ECAMENA, IFC). Franco focused questions on the role of public sector risk taking and understanding, the relationship between public and private stakeholders, the need for public sector capacity building and realism, and possible legal frameworks, including debate over the need for a PPP law.

Following a break for lunch, the afternoon session allowed more detailed discussions on financing PPPs and future project pipelines. The financing session was opened by Murat Dedeoglu (Founding Partner, DK Infrastructure and Corporate Finance) discussing the potential of PPPs for investors and financiers, with specific reference to the requirements of financiers and an analysis of the Turkish PPP market. This was followed by Ian Twinn who presented on the role of the IFC in PPP deals in Turkey, with specific focus on Energy and Transport infrastructure. These topics were continued into the panel discussion headed by Orcun Makal (Senior Manager, Ernst & Young), with panellists including Arda Akarsu (Senior Project Manager, TEB), Mike Davey (Director for Turkey, EBRD), Levent Kirazoglu (Garanti Bank), Murat Dedeoglu and Ian Twinn. Topics for debate included: the appetite of financiers for PPP projects in Turkey, difference between domestic and international financiers, requirements of international stakeholders, structure of deals (equity-debt share) and the need for accurate and effective due diligence. The session closed with another networking break and a chance to visit the exhibition areas of the Afghanistan Ministry of Health, Hill International and DK.

The final session of Day 1 looked at the potential project pipeline and was opened by K. Zafer Topuz (Head of Department – Research Planning and Coordination, State Airports Authority (DHMI)), who outlined the state of play in the Turkish airport sector, including a comment on the 3rd Istanbul Airport. Yalcin Eliguzeloglu (Head of Water and Environmental Infrastructure Investment, Koc Holding) provided a detailed analysis of waste, wastewater and water infrastructure needs in Turkey. M. Mustafa Murat (Head of Construction and Real Estate Group, Ministry of Education, Turkey) followed with an excellent overview of the intentions of the Ministry for delivering education campuses in PPP format. The session closed with a review of the elderly healthcare sector in Turkey and the need for considerable investment, by Kemal Aydin (Coordinator – General Directorate of Foreign and EU Relations International Health Policy Department, Ministry of Health, Turkey).

Day 1 closed with applause and was followed by an evening cocktail reception, with drinks and canapés provided by E.E.L. Events Limited, providing an additional opportunity for attendees to network and hand out business cards.

Day 2 provided more detailed analysis of two key PPP sectors – Healthcare and Transport Infrastructure. Miguel Tapia Gordon (Vice President, Hill International) opened the healthcare session with a best practice case study from Spain, with lessons learnt for Turkey. This was followed by Sule Kilic (Head of Financial Advisory, UniCredit Group) with an in-depth presentation on the current challenges facing the Turkish Healthcare sector, including a detailed review of the requirements of financiers, both domestic and international. Sule then chaired the proceeding panel discussion with panellists including Mustafa Kocar (Founding Partner, DK Infrastructure and Corporate Finance), Fatih Turkmen (Head of Health and Social Security, Ministry of Development, Tureky), Lemi Leba (Director, Project Finance and Credits, DIA Holding), Burak Sencer (Country Director, Mott MacDonald) and Miguel Tapia Gordon. Discussions focused on the potential and feasibility of new healthcare PPPs, review of current project challenges and opportunities for international stakeholders. The session proved particularly interesting for the delegation from the Afghanistan Ministry of Health, who posed questions on project planning and preparation, which was aptly answered by Fatih Turkmen.

Following a further networking break, session 2 opened on Transport Infrastructure with presentations from Fulvio Lino De Balsio (Consultant, Ernst & Young), Bill Halkias (CEO, Attica Tollway Operations (Attikes Diadromes S.A.)), Salih Gumgum (Head of Marinas and Ports Department, Ministry of Transport, Maritime Affairs and Communications) and Yesim Kurna (Head of Seaport Projects, Privatization Administration, Turkey). Using Italy as a case study for best practice, Fulvio discussed the importance of monitoring projects and effective application of the resultant data, in order to make projects more attractive for investment. Greece provided Bill with a useful and informative case study presentation, drawing examples from different PPP structures which have proved resilient to recession and some that have not. Salih and Yesim both provided detailed presentations on upcoming projects for our audience of investors and concessionaires.

The conference closed with a targeted panel discussion on the role of PPPs in delivering infrastructure projects, although transport was the topic under review, many of the comments were broadly applicable to all PPP sectors. This session was aptly led by Branko Bajatovic (Director, Avistum), Allain Terraillon (Head of Ankara Office, EIB), Franco Vigliano and Bill Hakias. All panellists provided excellent answered to Branko’s questions, with topics focusing on the requirement/non-requirement for a PPP law in Turkey, including the need for the public sector to communicate more widely with private sector stakeholders, especially international companies.

The conference was closed with a presentation from Tom Popple, who emphasised that despite Turkey’s supportive government and political will, there is an essential need for the private sector to be incorporated into consultations, including more stakeholder communication in pre-project feasibility discussions.

If you are interested in accessing the conference materials (presentations, videos and delegate list), then please complete and return the necessary order form.
E.E.L. Events Limited will be providing a series of PPP forums in 2013, including our 2nd Annual PPP in Turkey Forum. If you would like to be involved as a sponsor, speaker, panellist or delegate please contact one of you representatives.

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