Istanbul Seeks Partners for Multi-Billion-Dollar Projects
Istanbul Seeks Partners for Multi-Billion-Dollar Projects
(Bloomberg) -- Istanbul Metropolitan Municipality is seeking partnerships with international investors for projects that will need billions of dollars of funds over the next five years.
Turkey’s commercial capital, which accounts for one-third of the country’s $734 billion economy, announced the establishment of an Istanbul Investment Agency on Monday. The agency’s objective is to attract strategic or financial investors to projects including land and sea transportation, waste treatment, wireless communication and technology hubs, Nihat Narin, chief executive of the agency, said in a meeting that marked its debut in Istanbul.
“The metro lines alone that we want to complete need about $1 billion to invest,” Narin said in an interview after the event. “We will make investment procedures easier.”
The metropolis of 15.5 million residents picked the main opposition Republican People’s Party’s Ekrem Imamoglu as its mayor in a landslide victory last year, a political watershed after 25 years of rule by President Recep Tayyip Erdogan, his party and its predecessors. Imamoglu pledged to make Istanbul a “center of democracy and liberal freedoms” in a speech he made at the event on Monday.
Istanbul’s new mayor took over an outstanding debt of 35 billion liras ($5.8 billion) from the previous administration, Imamoglu said in July after he took office. Istanbul’s credit rating is “constrained by its relatively high debt burden, which will remain elevated during 2020, and upward pressure on its debt-servicing costs, given the city’s significant exposure to foreign-currency debt,” said Moody’s Investor Service, which rates the city at B1, in a ratings review on Feb. 13.
The agency invited local and international investors and representatives of international banks including Goldman Sachs Group Inc. and Societe Generale SA. London & Partners, the U.K. capital’s international trade, investment and promotion agency, made a presentation about how it attracted companies including Twitter Inc., Alibaba Group Holdings Ltd., Tesla Inc. and Airbnb Inc. to the city during their scale-up periods.
The projects planned for the city by 2024 include extending underground metro service to 550 kilometers from 320 kilometers, increasing the share of sea transportation to 10% of the total transportation network from 4%, more than doubling car parking capacity to 195,000 units from 95,000 units, raising the ratio of recycled waste to 50% from 16% and boosting power produced from recycled waste to 250 megawatts from 72 megawatts, according to Narin.
The City of Istanbul has been seeking approval from Turkey’s central government for a plan to sell around $500 million of Eurobonds in international markets. Imamoglu said the city needed funds from the bond sale to finance projects as state banks “shut the doors” on the now opposition-run municipality.
To contact the reporter on this story: Ercan Ersoy in Istanbul at eersoy@bloomberg.net
To contact the editors responsible for this story: Stefania Bianchi at sbianchi10@bloomberg.net, ;Onur Ant at oant@bloomberg.net, Taylan Bilgic, Benjamin Harvey
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