Turkey’s $200 Billion Wealth Fund to Finance Transport Projects
(Bloomberg) -- Turkey’s proposed national wealth fund, which could total as much as $200 billion, will finance projects including airports, seaports, roads and railroads across the country, according to a government minister.
The fund, approved by parliament last weekend, will be used to carry out projects that don’t have a build-operate-finance model, Transport, Maritime and Communication Minister Ahmet Arslan said on Tuesday. Some sub-funds will provide finance for those infrastructure projects, he said in an interview at the work-site for the third bridge connecting Asia and Europe across the Bosporus waterway that will open Friday.
The government planned the wealth fund after a failed coup attempt to topple President Recep Tayyip Erdogan on July 15. It will include state-owned companies and lands, as well as proceeds from privatizations, Deputy Prime Minister Mehmet Simsek said July 20.
“Transport projects impact the lives of millions of people and hundreds of billions of dollars of local and international trade,” Arslan said. “That’s why it’s normal that transport-infrastructure projects benefit from a large part of the wealth fund.”
The third bridge on the Bosporus, called Yavuz Sultan Selim after the 16th century Ottoman sultan Selim I, was built by Astaldi SpA and local partner IC Ictas through a $3 billion investment. The group will operate the 1.4 kilometer (0.9 miles) suspension bridge, which also has a rail track, along with 95 kilometers of connecting roads for about 10 years. The project is part of a wider network of roads stretching from the east of Istanbul to its west, known as the North Marmara Highway project.
“All the road and bridge projects around Istanbul and around the Sea of Marmara will be completed by the end of 2019 and will cost around $20 billion, serving around 30 million people,” Arslan said.
The government is also planning to auction the rights next year to build a tunnel for a road and railway under the Bosporus to carry about 6.5 million passengers a day, Arslan said. The project will cost about $5 billion and will be integrated into existing metro lines and roads, he said.