Euronewsport Magazine reportage

Bora Can Yıldız, the Board Member of EID Construction

evaluated the market conditions in Middle East:

Turkey is in the big brother position

in the region.

Iraq is a growing market and Turkey gets significant shares from this market. Although it is a high-risk region, our proximity to the market and our cultural similarities determine the local people’s approach to us, our talented businessmen’ ability to solve problems ensure a sustainable and steady development which is free from political improvements.

Having been investing for many years in the market in which Koç Holding has entered recently, EID Construction is breaking grounds with the primary projects such as hospital projects deemed necessary by the Iraqi people. Highlighting that Iraq is the fastest growing markets of the world, Bora Can Yıldız, the Board Member of the company, shared his important experiences he gained in the region with our readers.

Your experiences on the market conditions of Iraq are really important for the businessmen who are interested in that region. Could you make a brief evaluation about the market?

There is a great need for infrastructure in Iraq. Considering that the war between Iran and Iraq started in 1979-1980, nothing has been done for the country’s sake for 8-9 years during the ongoing war. Thereafter, the country was completely destroyed at the end of the Gulf War. The southern Iraq was the region affected by the most. An embargo was imposed in the post-war era, which took approximately 10 years. Following the embargo, the Second Gulf War and American invasion as well as withdrawal of the military forces and abolishment of the national administration took place. Thereafter, the region suffered from the instability and sectarian tensions. The needs of the country were not met during this period of 30 years. Leaving the high level of needs in the market aside, we have to say that the market conditions are extremely challenging as well. When we started our operation in the region three years ago, ENKA was the only company there, beside us. There was only one plane to Basra in that period. However, THY has 7, Iraq Airlines has 3 planes flying to that direction now. Emirates has 7 flights as well. The number of flights was increased from 1 to 17 per week. We were there when both needs and risks were high. Especially safety was an important problem. However, we passed these hard phases.

Being a businessman carrying out operations in the southern region, how would you compare the Northern and Southern Iraq?
The northern Iraq is steadier than southern region. The northern region is way safer; however when we make a comparison between Baghdad and southern Iraq, I can say that southern region is safer.

The situation in Baghdad is very complicated; however, the southern population is completely shiite, there are no domestic turbulences. Yet, when we first got there, there were uncertainties as well. The reason why THY did not have any flights to that region was the safety problems. 

There is a general opinion stating that it has been in a better shape than the northern part for the last two years. 
It is not better than the northern region, however, better than Baghdad. For Turkey, the northern Iraq is way safer. There are local policemen and soldiers. You can easily go out there. When the ministers in Baghdad have me over, they do not let me go out after 10 o’clock even if they have their bodyguards escort me. Due to the risk of being kidnapped, you cannot hang out in suits. However, if you take the necessary precautions, it is an untouched and important market.

Did the political problems you have been going through recently affect the operations?
Yes, they slightly affected us. There is nothing official; however, I can say that there is a resistance against the Turkish companies.

Do you think this problem will be resolved?
Of course, it will. I think it will be resolved in the following years. The reason why we are loved there is that we have good relations with the people, because these people are our relatives in a way. I mean, the Turkish people, Iraqi people, Syrian people and Algerian people have lived together for many years. We have the same religion, same culture. We greet the same way while saying hello and good bye. The stand Turkey took during the wartime has created a great sympathy. For this reason, people love us so much. What I can say for the Southern Iraq is that I have witnessed the greatest hospitality there which I have never seen anywhere in the Arabia. Once the political tension is overcome, everything will be okay. Even if the politics change, the friendship remains. I think that the relationship between Turkey and Iraq will get worse, even if this situation continues for a few years. I cannot make any comments on politics; however the politicians change after a while. I am sure that the other politicians are not so hard on Turkey either. I think there is a tension between the present politicians. This will change one way or another. After all, the politicians have a limited period of office and political life according to the laws. I do not think these tensions will suddenly disappear right after the changes. There is an important question: Who is going to work there? There are some certain needs such as installation of a sewer system, construction of hospitals and schools. The electrical problems must be solved. People are dying because of high temperatures, lack of electricity. The Spanish, English, French or Italian people cannot carry out these operations. They cannot stand there. Chinese people cannot do it alone either. There is already a resistance against them as well. Even if it is a German or French company, it requires people to go out there, right to the site; and these people are Turkish people.
There are two ways to operate in the country. You can either take the project and do it yourself, or take it and have some other company do it; the latter applies to us. The local companies are not capable enough to carry out these operations. For this reason, one way or another, the Turkish people are needed on site. When I explain this situation to the people there, they acknowledge me to be right, because they are aware of the fact that we have been there for the last three years, we have provided bread for them, helped out the poor families, sent children to school, taken care of everything, done our job accurately, and therefore we have gained their sympathy despite of their formation in central units. We have always kept our promises. They see that we are right. They need job, and all these operations must be carried out. The businessmen must be exempted from politics no matter what has happened between the countries. You cannot tell a mother of a sick child that you could not build a hospital there because of the political tension. That hospital must be built. We are building four hospitals there now, and these constructions must be completed. Sometimes we experience some difficulties both geographically and in terms of safety. 

Are we politically in the right place to dominate in this region and to conduct business?

I cannot say anything about the governmental policies of Turkey. Politics and business are two different things. If you represent your country in the political arena, you have to make some sacrifices. They may not consider business at this point. I have nothing to say about it. The PM has a stand. They may not think like that there is a construction; it may have a negative influence on the customer. Turkey has leadership culture in the region. It is not a vision created only by our PM or minister of foreign affairs. It is the reality based on the historical grounds. When you are there, everyone says that they want to be in Istanbul, everyone watches Turkish TV shows, and everyone wants to be like Turkish people. Everyone asks why we have abandoned them, why we have not protected and supported them. It is the general idea in the country.  After Turkey had withdrawn from the region, there was only blood and tears as they say. After Turkey’s withdrawal from the regions including a considerable Turkish population, there has been nothing but tons of blood in Algeria, Syria, Iran, and Iraq. The geography we are talking about has 60% of the total petroleum reserves in the world, and has 40% of the total gas reserves as well. There are great mines under the ground. However, there is an unbelievable misery above the ground. There are so many interruptions. There are quite conflicts there. They say it is the heart of the Middle East. However, people are under fire there. What happens in the past should stay in the past. They may have stabbed us in the back, however we have to leave the past behind and be friends with those countries. Otherwise, we will be all alone. However, Turkey is really like a big brother for that region. Whoever I talk to and say that I am Turk, they ask me about the Turkish TV shows first, and then they say that they have Turkish relatives. When I attended to the World Economical Forum I said that luckily they did not admit us into the European Union. Thus, we got together with our relatives. We remember our own culture with them. We conduct business with them. Europe that did not let us in the Union is now trying to conduct business in those regions. How they are going to have the work done, even if they took the project? We were together with the CEO of a really important German company. The CEO of the Germany’s Central Bank had said: “Sirs, Turkey will be the financial center of the Europe for the next 10 years”. He told people to make their plans accordingly. The CEO of this company asked me what the source of Turkey’s power was. I told him that we were headed to Basra Desert then. You asked me that question with a young Turkish businessman next to you. We would go across Iraq and I could show you at least 100-200 more Turkish businessmen. You did not see any French or Italian businessman conducting such a business here. If you happened to visit Algeria, Libya, Turkmenistan and Kazakhstan, you would see Turkish businessmen all around. I explained him that the Turkish people are where the other people cannot go or walk in, and of course this bravery must be rewarded, as long as they do a decent job.

Do you have any other employees apart from those in Iraq?

We have projects in some other countries such as Kuwait and Qatar now. We signed an agreement with Libya. We established a joint company with the government. We worked with the government for a project worth $ 500 million. We made a deal, however, we could not finalize it because of the outbreak of war. However, we are negotiating again. We may revive the operations slowly.

Is it hard for you to conduct business in Northern Iraq?

We are focused on the southern region. 

Do you really have to make a choice between them?

Well, the current situation requires you to choose. I was together with the president of an important petroleum company. They said they had $ 3 billion worth investments in Northern Iraq, and they said that they wanted to invest in the southern region as well. They even proposed me to partner up. However, they stated that they were having hesitations since the laws were not steady yet. I mean, there is a possibility that we may be involved in the petroleum commitment business in the northern region; however, we are more focused on the southern Iraq for now.

What is your business volume there?
Our total volume is around $ 200 million. However, we aim at reaching $ 400 million in a few years.

Business News Magazine reportage / December 2013

BORA CAN YILDIZ, 
THE VICE CHAIRMAN OF THE BOARD OF EID
"OUR MISSION IN IRAQ MUST BE 
PROVIDING SERVICES"

Highlighting that the strong statements addressed both by the Turkish Government and Iraqi Government have an influence on the economic relations as well, Bora Can Yıldız, the Vice Chairman of the Board of EID, emphasizes that Turkey’s mission in Iraq is to provide services, and the discourses to damage such mission must be avoided.

We see that the Turkish companies have successfully run many projects in Northern Iraq recently. However, the Turkish companies operate not only in the northern, but also in the southern part of Iraq. EID Construction is a contracting company that has been engaged in the activities in Basra Region of Iraq for many years. We interviewed with Bora Can Yıldız, the Chairman of EID Construction on the difficulties of conducting business and activities of EID Construction in Iraq.

Could you inform us about the problems you encounter and the scale of the businesses you carry on in Iraq?

Following Germany, Iraq appears to be the second Export market of Turkey. When you visit Iraq and go to a grocery store, you can see a wide range of Turkish products from food to the cleaning materials. It is so nice that the trade volume has improved greatly. There have been some political tensions as well as some problems arising therefrom between two countries in recent years. However, all in all, the people living there and the Turkish people are so similar to each other. We have a lot in common in terms of our history, language, culture, geographical location and historical background. From this aspect, it is way easier for Turkish people than the foreign ones.

What do you think about other positive characteristics of the Turkish businessmen?

The Turks are known for their bravery and entrepreneurialism all around the world. They are the raiders descended from Ottomans; they have the imperial culture such as frontier principalities.

They are not like the Europeans; they do not dream a perfect life. They maintain the logic of a complete expatriate abroad. I know that the Turkish businessmen have run many successful projects in many countries such as Kazakhstan and Iraq with the construction culture they have gained from the British and American construction companies.

What did the other foreign companies do in Iraq?

The Americans arrived at Iraq after the war and conducted business; however, they charged 10, even 15 Lira for the works that worth 1 Lira. Hence, they carried out high-cost works. Although Iraq has the greatest oil reserves, there is not much that changed in the last decade. The Turks have a special place in the heart of Iraqi people thanks to the projects they run despite of all kinds of bureaucracy and security problems.

How did you, as EID, go to Iraq?

We went to Iraq in a period when everyone was terrified. At first, there is quite violence in Basra. It does not seem much now; however, a great number of bombs were exploding then. We contacted local businessmen thanks to our ambassador, and decided to commence with small-scale businesses. Progressing step by step, we gained experiences in the fields of logistics, strategy and security. We built a medium scale eye hospital, dwellings and workplaces there. Thereafter, the United States Air Forces sent us an invitation to tender on the airport construction for the USA Consulate, and we were awarded the contract. We successfully completed this project within a period of 11 months. Thus, it turned into an important international reference for us.

What are you doing in Iraq now?

Due to my international contacts, we started to work with international oil companies, as it has been our primary aim since the beginning. It is not easy to get a job from the oil companies. You have to be on site and close the deals. Many international companies compete with each other to get the job; however, most of them come up empty. We have a wide range of ongoing projects from oil pipelines to water pipelines, and even to industrial facilities right now. For example, we are building a pipeline of 81 km. We are building industrial facilities. Our turn-key hospital, hotel and various superstructure constructions for the private sector and state are in progress. We only operate in the southern part of Iraq.

Do you have any projects in Northern Iraq?

We occasionally place a bid for the projects in the northern side; however, we are not on any project at the moment. That part of the country does not suffer from terrorism much. There is a certain work organization and you have certain contacts. However, it is so different in Baghdad. You can expose to the explosions or traffic stops at any time. Some groups murder people that do not share the same religious sect with them. Even some businessmen were murdered. The southern part is slightly safer than Baghdad. We have overcome the security problem by thinking like a warrior. However, I still take 3-4 armed guards with me wherever I go, just in case.

Did the tension between the Turkish and Iraqi governments affect you in a negative way?
The geographical location of Turkey is very complicated. Hundreds of thousands of people took refuge in Turkey due to the civil war in Syria. I met Besar Resat as well. He seems reasonable; however, the people around him are not. There is the Ba’ath Party. There is the influence of the authoritarian regime. Thus, Esad rushed back to Syria from England, and took the lead upon his father’s death. After all, it could not be expected from him to settle the disputes in such an atmosphere, because it was the Ba’ath Party that put him in charge, and was the real driving force there. Regarding the tension between Turkey and Iraq, both leaders made strong statements. Of course, Iraq also has internal balance. For this reason, the Turkish Government could have expressed softer statements and the problems could have been overcome through reciprocal dialogues. I always side with the tolerance and communication between the countries.

How did the policy of our Minister of Foreign Affairs Davutoğlu that is considered to be ‘Neo-Ottomanism’ affect Iraq?

They used the Ottoman policy discourse along with the political tension, and tried to manipulate the ignorant people in Iraq. However, they cannot answer our questions. The Ottomans reign over Iraq for a period of 300-500 years. It is true; I ask them whether they failed to preserve their language, culture; whether they were oppressed or not. In Iraq, five million people in total died and became permanently disabled during both gulf wars. Today, thousands of people are dying due to the wars of religious sect. An Iraqi minister delivered strong messages to Turkey in his speech at a conference there. When I got the floor, I said the followings. The Turks and Iraqis are brothers; they have a long lasting relation. We have cultural relations, and we are related. When I asked them to separate business from the politics, they acknowledged me to be right. Mr. Davutoğlu is an academician. I admire his political vision. He already avoids discourses that may cause tension. I think the name ‘Ottoman’ or any other names do not matter; what really matter is that we need to make an effort to create a service leadership and Turkish Islamic Union under the guidance of Turkey.

How is the legal structure and financial system there; what changed in the last decade?

We are having major problems with the government tenders. As there is no established system, we have to get approval from three different authorities even for pouring cement. All governmental agencies were repealed after the war; there were neither governorate nor police and military institutions; now they are trying to establish a system from scratch after many years again. For this reason, there is no system that fully operates, particularly in the governorate. You cannot get your progress payments earlier than 5-6 months. The Iraqi Government is a multi-party coalition. There are so many parties constituting the coalitions in the governorates, regional assemblies. Therefore, the greatest hindrance is not the politics but bureaucratic organization. The Turkish Consulate and Embassy make great efforts and have good intentions to solve this problem.

They do the best they could. The Iraqi Government carries out restructuring operations to overcome such problems. They will have a better stand in the next decade.

How do you predict your future in Iraq as EID?
There are companies that can confront difficulties. There will be better terms in the future. We operate there under the name of EID. We want to stay there for many years. We made considerable investments in the equipment pool in this sense. We will be deliberate in the government tenders in the medium term until the bureaucratic procedures are in order. However, we are carrying on business with the oil companies substantially. I can say that the name ‘EID’ has become a brand in the Middle East and region.

Related Turkish Media Link:
http://www.businessnewstr.com/2013/12/15/eid-yonetim-kurulu-baskan-yardimcisi-bora-can-yildiz-iraktaki-misyonumuz-hizmet-uretmek-olmali/

Bora Can Yıldız represented Turkey at the United Nations

Bora Can Yıldız, the Chairman of the Board of EID Construction running petroleum pipeline and construction projects in the Middle Eastern countries, especially in Iraq, represented Turkey in the Conference ‘World Energy Day’ hosted by the United Nations (UN).

Participating in the World Energy Day Panel held in the headquarters of the United Nations located in New York as the leading speaker, Yıldız addressed a speech with the title of ‘the Use of the Energy Sources and Incomes for the Benefit of Human’. Stating in his speech that there is a crisis not in the field of economy and energy, but in the field of morality, Yıldız said: “It is a great contradiction that poverty and terrorism dominate in the Middle East although the most valuable reserves of the world are extracted in the Middle East. The reason of the crises and terrorism is greed and unfair distribution of income. Only if some part of the revenue obtained from petroleum in the region is spent on art, education and moral values in the relevant countries, then the world can find peace.” Expressing that Turkey is dependent on outside sources when it comes to energy despite of its successful economy, Yıldız said that it was a must to invest in the nuclear and renewable energy, and Turkey took steps in this direction.”

Being one of the founders of Istanbul Young Entrepreneurs’ Association, Yıldız is notable in the Middle East for energy infrastructure and his investments in the petroleum regions. Attracting attention in the UN Conference with the speech he addressed in the session on the evaluation of the energy and economic crisis in the world, Yıldız said that unless the money obtained from energy is distributed to the people in the Middle East fairly, the unrest and wars dominating in the world will not come to an end. Explaining that the occurrence of terrorism is inevitable in the uneducated and poor Middle East given up to the bigot mentality, Yıldız said: “We, as a company, carry out operations related to the energy infrastructure right in the middle of the energy sources in Iraq. We witness that the people in this region struggle for making a living in this huge poverty despite of the rich underground sources. Yet, these regions are pointed as the source of the terrorism in the world. In such countries left behind, especially with the wars and domestic turbulences, the level of education is too low. In order to prevent terrorism caused by bigotry and insufficient education, the money obtained here is invested in the guns and war industries. There is no economy to afford a police station in each street, and every single corner in the world. The money obtained from energy must be spent on the education and infrastructural needs of the people here.”

Drawing attention to the fact that the financial crisis of 2007 affected the entire world, however, the experts could not come up with a solution, Yıldız said: “The machines issued Dollars, Euros and bills of exchange. However, the crisis did not stop. There is a reason why it did not come to an end. It is because there is not an economic crisis; on the contrary, there is a moral crisis in the world. The reason of the crisis was not the securities or precious metals. The reason was the greed, selfishness, egoism and never-ending ambition to save up. Hence, we noticed that we could not achieve anything by investing in the machines, buildings, factories, concrete and iron. In this society where egoism dominates, the crises would not stop even if there were 7/24 monetizing activities. We can find temporary solutions today; however, in a few years greater crises will arise.”

Emphasizing that Turkey took significant steps to diversify the energy sources, Yıldız said: “Turkey has been the fastest growing country among the EU members and OECD countries in the last decade. Despite this, it imports 90% of the energy it needs. The energy need of Turkey will be doubled in 2023. For this reason, Turkey should invest in the clean nuclear and renewable sustainable energy solutions. If Turkey desires to increase its power in the global economy and achieve prosperity, it should accelerate its alternative energy investments.”

Related Turkish Media Links: 

http://yurthaber.mynet.com/istanbul-haberleri/genc-girisimci-yildiz-birlesmis-milletlerde-turkiyeyi-temsil-etti-1119869

http://www.haber3.com/genc-girisimci-yildiz-birlesmis-milletlerde-turkiyeyi-temsil-etti-haberi-2272500h.htm

http://www.haberler.com/genc-girisimci-yildiz-birlesmis-milletlerde-5223373-haberi/

http://www.sondakika.com/haber/haber-genc-girisimci-yildiz-birlesmis-milletlerde-5223373/

http://www.ogunhaber.com/haber/genc-girisimci-yildiz-birlesmis-milletlerde-turkiyeyi-temsil-etti-haberi-208589h.html

http://www.haberexen.com/genc-girisimci-yildiz-birlesmis-milletlerde-turkiyeyi-temsil-etti-435457h.htm

http://www.zaphaber.com/genc-girisimci-yildiz,-birlesmis-milletlerde-turkiyeyi-temsil-etti-67375h.htm 

http://www.medya73.com/genc-girisimci-yildiz-birlesmis-milletlerde-turkiyeyi-temsil-etti-haberi-1523813.html

http://www.stargundem.com/ajanslar/genc-girisimci-yildiz-birlesmis-milletlerde-turkiyeyi-temsil-etti-481872.html

http://beyazgazete.com/haber/2013/10/27/genc-girisimci-yildiz-birlesmis-milletlerde-turkiye-yi-temsil-etti-1995336.html

The Turkish business warned: “Iraq may be a scene from Black Thursday”

ISGID Member Bora Can Yıldız made a warning: “The logic of ‘Gold Rush’ may turn into “Black Thursday” for some companies in Iraq.”

Iraq’s energy future was discussed by the top executives at a 2 day-long meeting. Some matters such as use of the water resources, gas resources, infrastructure, petroleum pipelines, refineries, processing and transportation of the petroleum as well as the energy strategies of the country was handled by the speakers.

Having represented Turkey in the Middle East and Iraq Energy Conference, Bora Can Yıldız, the ISGID Member, discussed the country’s future together with the key players in the region.

The energy resources in Iraq and the projects relating to such resources were discussed in the meeting in which the directors of the world’s most important energy companies such as Shell, Chevron, Lukoil, Crescent, Kogas as well as leading politicians in the region, bureaucrats and businessmen participated.

The second richest oil reserves of the world as well as the tenth richest natural gas resources of the world are located in Iraq. However, being lack of security, logistics, human resources, transportation, bureaucracy and infrastructure can sometimes constitute a problem for the international players in terms of investing in the region.

Thamir Abbas Ghadbhan, the Chairman of the Committee in Iraqi Parliament and former Minister of Oil explained the Integrated National Energy Strategy INES in this meeting. He said that until 2017, they would reach 13 million barrels per day according to the high production scenario, and 9 million barrels according to the medium production scenario; and he stated the milestones relating to these two scenarios. Thamir said that they would produce 10 BSCFD (Billion Standard Cubic Feet per Day) gas in 2017 according to the high production scenario.

Adnan Al-Janabi, the Chairman of Energy and Oil Committee, said that the oil reserves in Iraq reached 200 billion barrels, and $ 1 trillion would be spent on the reconstruction of Iraq, provided that $ 500 billion of which would be spent on the oil and energy infrastructure. He explained that they aim for a capacity of 1.5 million barrels a day as the refinery capacity, and they aim for a capacity of 20 GW as the electricity generation; and that they were making short, medium and long term investment plans in this field, and that the majority of such investments would be made in association with the international energy giants. Bora Can Yıldız who has taken many projects in the region and one of the partners of EID Construction addressed a speech about the region’s future and the difficulties encountered in the region. Sharing his experiences about an airport project they run for the international sector, and two hospital projects they run both for the private and state sector, he explained that different projects had different dynamics in the region.

Stating that the monthly safety expenses of a single construction site may exceed $ 1 million for the international projects they run in the oil regions; however, it costs way less for the projects they run in the city among the people, and that the Iraqi people treat Turkish people so hospitably and closely, Yıldız added: “We are really hopeful about Iraq’s future; the bureaucratic difficulties are natural in a country going through reconstruction, that’s why, we should be understanding. However, the companies entering in the region must have a strong financial balance and be prepared for the unexpected.

It is companies’ duty to contribute to the development of the Iraqi people and Iraqi employees. They should also make a contribution with the social projects. However, they should not do it just for show; they should do because they want it from the heart.

Unfortunately, some international companies and professional personnel working in the region aim for high revenues in the short term. However, this causes a great damage both for the country and themselves in the long term. The companies aiming to serve Iraqi people must be long lasting, because these modest and humble people deserve it. Otherwise, the gold rush may turn into a black Thursday situation for such companies”.

Bora Can Yıldız, the Vice President of EID Construction running many construction projects in the region stated in his speech that it is possible to encounter difficulties while conducting business in Iraq due to the regional dynamics.  Yıldız said: “The amount of the processed gas production corresponds to 587 MMSCFD (million standard cubic feet per day) in Iraq today; however, more than twice this amount is burnt off just because there is not enough facility to process gases. While burning twice the production amount, they import one third of their gas need. With a $ 40 billion worth investment to be made in the field of gas in the next years, $ 500 billion revenue will be gained from the gas, and saving on the oil which is used for the energy generation and corresponds to $ 50 billion, the total revenue will be $ 550 billion. For the record, it is amount to be gained only from the gas.” He added: “If some companies in the region mistake these opportunities for gold rush and do not take the national dynamics into account, and focus on the short term operations, and especially do not respect the local culture there, the step they take with the intention of gold rush may turn into a ‘black Thursday’ for them.”

Related Turkish Media Link:
http://www.patronlardunyasi.com/haber/Turk-isadami-uyardi-Irak-Kara-Persembe-olabilir/142014