07 January 1994

The current account was in deficit by $4,827 million for the first nine months of 1993, compared with $456 million in January-September 1992. The increase is mostly due to a big expansion in the trade deficit, which increased by 83 per cent over the period to $10,770 million. Exports rose by only 2 per cent, to $10,900 million in fob terms, while imports surged by 30.8 per cent to $21,670 million. The deteriorating balance of payments situation is fuelling apprehension about lira depreciation on the foreign exchange markets (MEED 17:12:93, page 5).

Turkish companies are hoping to secure a 10 per cent share in Lebanon's $20,000 million-plus reconstruction programme, treasury head Osman Unsal said on 17 December, after briefing Lebanese Prime Minister Rafiq Hariri on Turkish capabilities. Turkish companies may seek the strength of joint ventures with Western partners rather than bidding alone, another official said. Hariri had arrived in Ankara the previous day for talks with Prime Minister Tansu Ciller and senior officials about economic co-operation. Unsal said that his officials had briefed the Lebanese premier on Turkey's privatisation efforts, free trade zones and construction sector, as well as possible regional projects and financing. He added that the Export Credit Bank of Turkey (Teximbank) will provide an undisclosed level of project credit for Lebanon. Detailed talks about this will take place in Lebanon in January. In the first nine months of 1993, exports to Lebanon were valued at $65.5 million, compared with imports of $3.9 million.

A contract to supply auto-transformers valued at $11.9 million, supported by the World Bank, has been awarded to a venture of the local associates of Germany's AEG and Zurich-based ABB Asea Brown Boveri. The client is the Turkish Electricity Board (TEK).

Turkish firms are the principal investors in Bulgaria and Romania, according to statistics from the two Balkan states. Turkish inflows represented half of total foreign investment of $23 million in Romania in November, according to the Romanian Development Agency. In Bulgaria, Turkish partners have taken an interest in 279 joint ventures, compared with 202 by Greeks, 151 by Russians and 114 by Arabs, according to the country's Deputy Prime Minister, Valentin Karabasev.

A $110 million trade finance loan for Is Bankasi was signed on 10 December. The deal is one of several short-term credits arranged towards the end of 1993 (MEED 10:12:93; 3:12:93). The arrangers were Sumitomo Bank, Dai- Ichi Kangyo, National Bank of Kuwait, RBC Europe and Societe Generale.

Ankara municipality is seeking a $10 million loan through Citibank to build the second stage of its natural gas distribution programme.

The local Bayinder is the low bidder for a road project valued at about $40 million. It will run between the second Bosporus bridge and the Istanbul suburb of Baykoz.

Tezcan Yaramanci has been appointed head of the Public Participation Administration (KOI). He was formerly director-general of national carrier Turk Hava Yollari (THY - Turkish Airlines).

Iran's First Vice-President, Hassan Habibi, started a three-day visit to Ankara on 20 December and was expected to seal an agreement reached in November on a mechanism for joint security co-operation on the Turco- Iranian border. According to Tehran radio on 20 December, the two countries had agreed to allow no activities on their soil against the internal security of the other, and to initiate military operations against any guerrilla bases that are detected. For Turkey, this would primarily mean the separatist Kurdish Workers Party (PKK) in Iran; and for Iran, the Iraq-based Mojaheddin- e Khalq led by Massoud Rajavi. After a surprise meeting with Iranian Foreign Affairs Minister Ali Akbar Velayati in Ankara on the previous day, Foreign Affairs Minister Hikmet Cetin claimed the November agreement reached by a joint security committee in the capital permitted Turkish observers to watch Iranian military operations against the PKK inside Iran. The two ministers said they hoped to hold a third tripartite discussion on regional security with Syrian Foreign Affairs Minister Farouq al-Shara in Turkey soon. Differences between Syria and Turkey over water resources reportedly stalled a meeting scheduled for 25 November.

The separatist Kurdish Workers Party (PKK) and Syrian officials have both denied reports that PKK leader Abdullah Ocalan was placed under house arrest in Syria on 15 December, the Arab press reports. According to Masoud Barzani, leader of the Iraqi Kurdish Democratic Party, the PKK leader was in northern Iraq as of 21 December. Turkish jets have repeatedly struck at alleged PKK bases in northern Iraq recently.

The government has accused Greece of building its foreign policy on what it called an imaginary Turkish threat, and of backing the Kurdish Workers Party (PKK). This follows declarations of support for the PKK from deputies of the ruling Panhellenic Socialist Movement Party led by Greek Premier Andreas Papandreou.

The US' Howard Johnson Franchise Systems plans to develop at least two hotels with 200 rooms each in a 25-year franchise agreement with the Netherlands' Oda International Management Corporation, as part of a regional business development programme.

Two ventures of local companies with foreign partners have both bid about $10 million for the Bafra plain project in the retender called after initial bids came in far above an offer of UK export credit support (MEED 10:12:93). They are Turkon and Pasiner with Germany's Strabag and Italy's Rosetti, and Sistem and Birlik with Italy's Astaldi. The client, Bafra municipality, has also requested credit financing offers with the tenders. The scheme includes a waste water treatment plant, rain water drainage, and sewerage schemes.

Plans to salvage and exhibit parts of the Breslau, a German-built cruiser which sank in the northeast Aegean Sea during the first world war, have been announced by the private-sector Rahmi Koc Industry Museum and Cultural Foundation. The 5,200-tonne vessel sank on 20 January 1918, after hitting mines. Germany donated the ship to the Ottoman government in 1914 to lure Turkey onto the German side in the war. The cruiser was subsequently renamed the Midilli.

A military judge released two television journalists on 20 December, but ordered them to appear in court on 25 January for trial on charges of broadcasting material that encouraged Turks to evade military service. The two, Erhan Akyildiz and Ali Tevfik Berber, work for the Istanbul-based HBB Television station, which broadcast a programme on draft dodgers and deserters from the army in early December.

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