BMI View : Factors which inform our long-term bullish view on Turkish infrastructure remain in play . P rivatisation of assets and the use of PPPs, a supportive government and a geographic and demographic potential . However, over 2016 and 2017, we expect investment to slow - particularly in the residential and non-residential sectors - as currency depreciation, tightening credit and political risk remain key drags on sentiment.
Latest Updates And Structural Trends
We have downgraded our construction industry value real growth forecasts for 2016 and 2017, now 2.1% and 3.7% y-o-y respectively. This is lower than last quarter, following our revised estimation the industry grew by just 1% y-o-y.
Rail and road projects continue to see our forecasts for transport infrastructure growth remain buoyant at 4.8% in 2016. However, energy and utilities infrastructure growth has been lowered for 2016 on the back of the breakdown in relations between Moscow and Ankara and its impact on Turkey's nuclear and pipeline projects.
Driven by the contracts awarded under the government's USD500bn regeneration programme and continued strong building in Istanbul, the residential sector will perform well. We forecast real annual average growth of 2.8% over our 10-year forecast period, with the non-residential sector dragging down that figure.
|e/f = BMI estimate/forecast. Source: National sources, BMI|
|Construction industry value, TRYbn||86.68||95.87||106.61||118.33||130.85||144.07||157.94|
|Construction Industry Value, Real Growth, % y-o-y||1.00||2.10||3.70||4.25||4.08||3.85||3.63|
|Construction Industry Value, % of GDP||4.5||4.4||4.4||4.5||4.5||4.6||4.6|
Turkey ranks in 10th place within the Central and Eastern Europe grouping of the RRI, with an overall score of 55.
The size and long-term growth potential of the Turkish infrastructure market is significant, but Turkey's banking sector remains reliant on expensive external financing. Turkey's Rewards score is 51.8.
Transparency in the tendering process remains a concern but more use of the public-private partnership model will begin to address this. Policy continuity under the AKP will help assure investments. Turkey's Risks score is 62.3.
|Risk/Reward Index||Rewards||Industry Rewards||Country Rewards||Risks||Industry Risks||Country Risks|
The Turkey Infrastructure Report features BMI Research's market assessment and forecasts covering public procurement and spending on all major infrastructure and construction projects, including transportation and logistics by land, sea and air; power plants and utilities, and commercial construction and property development. The report analyses the impact of regulatory changes and the macroeconomic outlook and features competitive intelligence on contractors and suppliers.
BMI's Turkey Infrastructure Report provides industry professionals and strategists, sector analysts, investors, trade associations and regulatory bodies with independent forecasts and competitive intelligence on the Turkish infrastructure and construction industry.
- Benchmark BMI's independent infrastructure industry forecasts for Turkey to test other views - a key input for successful budgetary and planning in the Turkish infrastructure market.
- Target business opportunities and risks in the Turkish infrastructure sector through our reviews of latest industry trends, regulatory changes and major deals, projects and investments in Turkey.
- Assess the activities, strategy and market position of your competitors, partners and clients via our Company Profiles (inc. SWOTs, KPIs and latest activity).
BMI Industry View
Summary of BMI’s key industry forecasts, views and trend analysis covering infrastructure and construction, regulatory changes, major investments and projects and significant national and multinational company developments. These are broken down into construction (social, commercial and residential), transport (roads, railways, ports, airports, etc), and energy & utilities (powerplants, pipelines and so on).
Industry SWOT Analysis
Analysis of the major strengths, weaknesses, opportunities and threats within the infrastructure and construction sectors and within the broader political, economic and business environment.
BMI Industry Forecasts
Historic data series (up to 2012) and forecasts to end-2024 for all key industry indicators, supported by explicit assumptions, plus analysis of key developments in the market and risks to the main forecasts. Indicators include:
Construction: Industry value (USDbn); contribution to GDP (%); total capital investment (USDbn); real growth (%).
Construction industry real growth forecasts (%) and industry value (USDbn) forecasts for industry sectors are split into Residential and Non-residential and Infrastructure sectors. Where the data is available for particular countries the infrastructure is further broken down into indicators for the transport subsectors of roads, railways, airports and ports and the energy and utilities sub-sectors of power plants and transmission grids, oil & gas pipelines and water infrastructure. This dataset is unique to the market.
The reports also include analysis of latest projects across the infrastructure sectors (transport, utilities, commercial construction).
BMI’s Infrastructure Risk Reward Index
BMI’s Risk Reward Index provides investors (construction companies, suppliers and partners) looking for opportunities in the region with a clear country-comparative assessment of a market’s risks and potential rewards. Each of the country markets are scored using a sophisticated model that includes more than 40 industry, economic and demographic data points. These provide indices of highest to lowest appeal to investors, with each position explained.
An assessment of the competitive landscape and key challenges to entering the market. Details of the largest companies active in the sector across the sub-segments of the industry, including the key financial figures from some of the largest players in the sector.
Examines the competitive positioning and short- to medium-term business strategies of key industry players. Strategy is examined within the context of BMI’s industry forecasts, our macroeconomic views and our understanding of the wider competitive landscape to generate company SWOT analyses. The latest financial and operating statistics and key company developments are also incorporated within the company profiles, enabling a full evaluation of recent company performance and future growth prospects.
The Infrastructure reports draw on an extensive network of primary sources, such as multilateral organisations, government departments, industry associations, chambers and company reports.
*Company profiles are not available for every country. Those reports instead contain information on the current activities of prominent companies operating in the market.