Turkey enters into guaranteed-loss projects for the people of Turkey with foreign investors that are guaranteed-profits for the investors
Turkey enters into guaranteed-loss projects for the people of Turkey with foreign investors that are guaranteed-profits for the investors.
Many similar projects have been signed by the Turkish government that becomes a boondoggle for the government friendly contractors who profit handsomely and foreign investors who are given guaranteed profits. The only losers here are the people of Turkey who have to pay taxes so the investors can be guaranteed profits.
One project in question is the Osmangazi Bridge. Whether anyone crosses the bridge or not, the foreign investor corporation gets the agreed upon total amount from the Turkish government. This goes whether the bridge is in use, under or over utilized or even if it is closed down and not a single vehicle passes. No matter what the investor gets its pre-agreed profit.
In this particular bridge, the collection at the bridge amounts only to a quarter of what is needed to come even for the investor payments. The rest? That is, the three quarters? The government pays it from taxes collected from the people. The payments are to be done with US dollars, and when the Turkish Lira loses its value, as it mostly does, the cost of the guaranteed profits simply go through the roof.
“Dynamic nature of private sector”
Asked about the accounting on Osmangazi bridge, Turkish Transportation Minister Cahit Turhan explained that due to exchange rate explosion of the US dollar against the Turkish Lira, the bridge toll has reached $44.5. However, This amount is so expensive for Turkey that nearly nobody will cross if it was implemented. For this reason, the full cost is not reflected on the toll with the government paying the difference.
Transportation minister said these arrangements utilized, “The dynamic nature of private sector” for successful investments and management of enterprises. He also added, explaining the exorbitantly high toll charged as, “These bridges are only used to alleviate the very heavy traffic and answer the need to have an alternative during substantial traffic blockages.”
Everybody pays for every project
Answering how come the people who never use the bridge are forced to pay the cost, that is the whole society pays for the unused bridge, the minister said those who live in the East pay for bridges in the West and those who are in the West pay for those bridges in the East so it was a wash. He said, “This all is our country, every corner is ours and we are engaged in projects with a social cause. We built roads with divided lanes in parts where there was no service. Those regions gained momentum in economic development.”
The minister also said, “Those who do not want to use the bridges are not forced to use it. We should be charging $44.5 dollars to cross this bridge, but we are only charging $15.00 plus tax. The difference of around $30.00 for each car is being paid by our government.”
Sendika.Org News (M.B.)