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have finalised an agreement to restart direct passenger train services between Ankara and Tehran, News.am has reported.It is not clear why the service was cancelled in the first place, but it is likely that it was down to previous political tensions that occurred before the rapprochement seen between the two neighbours in more recent times. Iranians in western provinces of Iran reportedly used the Tabriz-Van route often, as it served to provide a quicker journey than taking a flight from Tehran and driving to the end-destination. In addition to the Tehran-Ankara link, a route will open up between eastern Turkey city Van to Tehran.
9.1.4 Construction & Real estate sector news
Turkish contractors’ revenues from projects abroad decline more than 60% y/y in Q1. Turkish contractors felt the pinch from the global economic slowdown as year on year they raised far fewer revenues from projects they undertook abroad in the first quarter of this year, business daily Dunya reported, citing a report by Turkey’s Trade Ministry. Data the ministry provided showed that Turkish contractors were awarded a total of 40 projects abroad in January-March, higher than the 32 a year ago. But the value of those projects was only $1.29bn versus $3.4bn in the same period of the previous year, marking a decline of more than 60%. Local contractors were typically carrying out 400 to 600 projects abroad annually while the global economy was strong. However, following the global crisis, oil-exporting countries, which provide Turkish construction firms’ with their main markets, allocated less money for infrastructure projects as their revenues declined. Turkish contractors were awarded 430 projects in 2013. But the corresponding figures were 345 in 2014, 196 in 2016 and 287 in 2018. The Trade Ministry forecasts that the global construction industry will grow 3.9% per annum until 2030 and that its size will reach a whopping $17.5trn.
Construction companies are facing a more challenging environment at home. The local construction sector, once hailed as the engine of economic growth, contracted 16% y/y in the first quarter of 2019, after shrinking 2.6% y/y in the third quarter of 2018 and 5.8% y/y in Q4 of last year.
Home sales are also collapsing. The latest available data shows that home sales declined by 18% y/y in April. In March, the decline was 5.3% on an annual basis. The industry saw an 18% y/y decline in February that followed the 25% y/y drop in home sales in the first month of the year.
The TUIK data showed that in May 3,900 properties were sold to foreigners in Turkey, up 62.5% y/y. Iraqi citizens purchased 594, Iranians 509 and Russians 285. In all, 82,200 units of real estate were sold in Turkey during May, a gain of 31.3% y/y, the official figures also showed. At total of 15,800 of those properties were sold in Istanbul, while 8,200 were sold in Ankara and 5,000 in Antalya.
9.1.5 Retail sector news
Visits to Turkish shopping centres fall 3% y/y in April. The number of people visiting shopping centres in Turkey declined by 3% y/y in April, the Council of Shopping Centres (AYD) announced on June 10. The association, however, did not say how many visitors Turkey’s some 420 shopping centres received in the month. The shopping centres’ turnover index showed a 14.2% increase on an annual basis in April, the AYD also noted. Hulusi Belgu, the then president of the association, said last year that there were a total of 412 shopping centres in 71 provinces in Turkey as of December and that 10 more malls would open their doors to shoppers in 2019. He also forecast that the combined turnover of Turkey’s shopping centres would reach TRY160bn in 2019. Istanbul, the country’s largest city, has some 120 shopping centres, followed by the capital Ankara which is home to around 40 such venues. Shopping centre investments in Turkey have surged over the past two
77 TURKEY Country Report July 2019 www.intellinews.com