Doing Construction In IRAQ DEİK Turkish- Japanese Business Counsel 05 July 2012, Istanbul

IRAQ

Scary Scenario for Iraq

Turkish Canractors Experience in Iraq The members of Turkish Contractors Association, executed 6500 projects in 93 countries with value of 205 billion USD since Turkish contractors are working in Iraq market since Starting from 1972, until the end of 2012, they executed 634 projects. The value of executed contracts is 12.6 billion USD. This figure does not include TCA non member companies. Iraq market is the 5th bigest market for TCA member companies after Russia (36.5 billion USD), Libya (26.5 billion USD), Turkmenistan (22.8 billion USD), and Kazakhistan (14.5 billion USD).

Yuksel is working abroad since 1983

Yuksel is working in Iraq since 2003 Yuksel executed military works in Mosul, Taji, Telafer and Baghdat between the years Main clients are KBR, Fluor, Corps of Engineers,US Airforce. The executed works are mainly infrastructure, sewage, power plants, building projects, and maintenace and operation of military facilities. Since 2010 we are constructing Kora-Shaklawa-Kandeel road in Northern Kurdish Iraq region. It is 51 km long 2X2 state highway. Yuksel is opening office in Basrah in the South.

Security and Visa conditions Currently Northern and Southern Iraq is safer. Baghdat is more risky. Actually there is no visa problem for going and coming to any region in Iraq. As Turkish citizens we can enter from North, South or via Baghdat by obtaining the visa at the border. The problem is travellig between the regions. If you go to North by plane or through border by car, you can enter the Kurdish region easily. It is the same from South and Baghdat. But, it is not allowed to travel to other regions, and exit from other regions with that visa. You can be jailed. There is not a single national visa regime. Working permit conditions are the same like visa system in Iraq.

Material Supply, Manpower and Transport Most of the construction material is imported. Turkey is one of the biggest and closest supplier. Iran, Jordan, Gulf countries and China are other suppliers. Turkish materials are preferred for quality, whereas the other country materials may be cheaper. In Irak you can obtain gravel and bitumen. Some of cement is manufactured locally. Enough manpower can be found locally. We are employing more than 60% local worker. There is no problem of transportation.

Construction Market There is a big difference between North and South. Northern Iraq is more developed. Nortern Iraq is getting 17% of oil revenue, it is acting autonomously and getting the privilige of western support. Many 5 star hotels, hospitals, luxury housing and infrastructure is built in Northern Iraq. Although most of the petrol revenue is created in South, there is less development in the South. Hospital, quality hotels, housing and inrastructure investments are needed in the region.

Construction Market In order to balance the development the Iraq government will pay premium for produced petrol to the states. The petro-dollar premium will 1 USD per barrel petrol. Today Iraq is extracting 2 million barrel per day. The target is 8 million barrel per day. Within the next 5 years more money will flow to Southern states. More investments is expected in the Southern part within the next 5 years.

How to Get Projects The projects are tendered through regional governments, or through central governmet. Central government is controling mostly international infrastructure and energy projects. Northern Iraq is acting more independently. Southern Iraq is following the North. The relations with local governments is important. It is very important to have local partners. While doing business in Iraq, the ethnical, religious secterial, even the tribal connections should be established delicately and carefully.

Conclusion for Japaneese Contractors Personally we had very successful experience with Japan Construction Companies. We worked with Kumagai Gumi ( Istanbul Çıragan Palace Hotel), Hazama Gumi( Istanbul Swiss Hotel), Kajima (Istanbul Hyatt Regency Hotel), and Shimizu (Uzbekistan 3 airport renovation). Having so much experience with Japaneese Contractors in Turkey and Abroad I can advise to cooperate with Turkish contractors. Turkish Engineers have experience to work together with Japan Engineers. Use Turkish Contractors strategic advantages and experience in Iraq.

Iraq is bordering contry with Turkey. We have very strong historical, cultural, religious and ethnical ties between Turkey and Iraq. I wish ther will not be any internal conflict within Iraq. THANK YOU