Turkish-Chinese bonds stronger than ever as deals fill ‘27-year gap’

Turkish-Chinese bonds stronger than ever as deals fill ‘27-year gap’

President Hu guides PM Erdoğan to a meeting room for their talks at the Great Hall of the People in Beijing. (Photo: Reuters)

April 10, 2012, Tuesday/ 18:38:00/ TODAY'S ZAMAN WITH WIRES

Chinese media sources reported on Tuesday that Turkish-Chinese relations have entered a honeymoon phase, as several agreements that were signed during Prime Minister Recep Tayyip Erdoğan's official visit to China are expected to fill a "27-year gap."

Noting that Erdoğan is the first Turkish prime minister to visit China in 27 years, the China Daily newspaper wrote that nuclear power, energy sector and new investment deals demonstrate that both prime ministers are inclined towards serious economic cooperation. Erdoğan attended the Turkish-Chinese Economic and Commercial Cooperation Forum on the third day of his official visit to China. Speaking to participants at the forum, he noted that Turkey conducts 10 percent of its foreign trade with China and the responsibility of increasing this falls on the shoulders of businessmen.

During the forum, Turkish and Chinese business signed deals in the presence of Erdoğan, Turkish Energy and Natural Resources Minister Taner Yıldız and Minister of Economy Zafer Çağlayan, as well as many government officials.

Turkey’s Hattat Holding signed an agreement with Chinese China Avic International Holding to cooperate to engineer and build a 1,980-megawatt thermal power plant, to be built in the northern Turkish province of Bartın. The project is expected to cost about $2 billion and employ 11,000 workers. Under the agreement, which is expected to reduce the import of charcoal by $1 billion, the two companies aim to excavate 5 million tons of charcoal from pits in Bartın. But people in the region feel that coal-fired power plants are threat to the region as they are known to cause acid rain and release carbon dioxide. Though many people in the region have worked as miners, most oppose a coal-fired power plant because they are aware of the potential harm.

The Turkish Ağaoğlu Corporate Group, which is active in the fields of tourism and energy, as well as construction, signed a deal with Sinovel -- the largest wind power company in China -- to buy wind turbines from China and develop a 600-megawatt wind power plant in Turkey. The cost of the project will be about $1 billion and the group also called on Sinovel to invest in Turkey to produce turbine towers, panels and generators.

Turkey’s Akfel Group and the China Sun Energy company signed an agreement worth $350 million to produce solar panels in Turkey. Turkey’s Demkor Mining Industry & Trade Limited Company and the Beijing Shouugang International Engineering Technology initiated an agreement to share technology, project design and construction projects worth $500 million. Moreover, Turkey’s Sun Group and the China Railway Shanhaiguan Bridge Group Co. (CRSBG) are planning to collaborate to produce the raw products for bridge construction, as well as railway equipment, to be sold in Turkey and surrounding countries.

Expressing his confidence on the improvement of cooperation between both countries as a result of meetings during his visit, Erdoğan said, “The roots of contact between people from both countries go back hundreds of years. During ancient times, both cultures lived as neighbors. Even after the migration of Turks to the West, the communication and cooperation did not stop, due to the historic Silk Road, which began in China and carried goods to Turkey -- then named Asia Minor.” Erdoğan pointed out the similarities between both countries’ economies and highlighted the record high growth of the Chinese economy in 2010-2011 -- a time when the global economy was severely slowing -- similarly to the Turkish economy, which was ranked as the second-fastest growing economy after China in 2011, with growth of 8.5 percent.”

Despite their similar potential -- as a result of their young and dynamic populations, and for being attractive centers of production -- the foreign trade deficit between them is quite high. Prime Minister Erdoğan also commented on a 2010 visit to Turkey from his counterpart, Wen Jiabao. The purpose of the visit was to increase the trade volume between Turkey and China to $50 billion by 2015 and $100 billion by 2020. Erdoğan confirmed that bilateral trade is on target to reach those figures.

‘Turkey and China can create a unique synergy’

Prime Minister Erdoğan stated at the forum, “as countries who built empires in two different ends of the world, intense cooperation on fields of economy, international politics, social and cultural issues, Turkey and China can create a unique synergy.”

Noting the important investment opportunities in Turkey and highlighting the importance of Turkey’s location as it is an “open door to both Europe and Asia,” Erdoğan said it is disappointing to see only a fragment of China’s total of $320 billion in foreign investment in Turkey. “Our doors are wide open to Chinese investors,” he said. “We recently announced a very broad incentive package, not only for domestic investors but also to for attract international investors. The strategic investment category of the package strongly supports investments in technology, textiles, defense, aerospace and transportation, in addition to assisting companies find land for their business and helping with insurance premiums, taxes and interest rates.” He urged the Chinese businessmen to take advantage of these incentives and said that Turkey will make the process simple. Erdoğan concluded, “I hope Chinese businessmen will not miss out on the opportunities rising in western Asia, in Turkey, a country that is working towards becoming a European Union member, with increasing economic and political influence in the region.”

Erdoğan visited a satellite manufacturing facility in Beijing after attending the Turkish-Chinese Economic and Commercial Cooperation Forum.

Erdoğan met with Chinese President Hu Jintao in Beijing as part of his talks in China. Jintao gave Erdoğan a warm welcome to their meeting at the Chinese National Assembly and said that he was pleased to have the Turkish prime minister in China. “Prime Minister Erdoğan has a very busy agenda on his visit in our country. I believe that his visit will develop the cooperation between our two nations and further improve our strategic partnership,” Jintao told reporters before a gathering of Turkish and Chinese delegations. Erdoğan also extended an invitation from Turkish President Abdullah Gül to Jintao to visit Turkey in June.

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