Finance giants from Luxembourg may fund Turkish firms
Encouraged by the booming economic growth of Turkey and promising market dynamics, financial giants of Europe headquartered in Luxembourg are eyeing opportunities with Turkish firms by granting funding for joint investments, according to a top executive. A trade mission from Luxembourg led by Crown Prince Guillaume, the heir to the Grand Duke of Luxembourg, visited Istanbul on Wednesday.
“Turkish firms in search of funding should consider partnering with our financial institutions to benefit from cross-border finance opportunities,” Fernand Grulms, chief executive of Luxembourg for Finance, a public-private partnership agency, told the Hürriyet Daily News & Economic Review on the sidelines of the meeting.
According to Grulms, financial institutions of Luxembourg could grant financial support for Turkish firms and entrepreneurs for making investment in Turkish, Asian and Middle Eastern markets.
“Europe has had only little growth and if European financial institutions would like to continue grow, they have do more business with countries like Turkey that bridge Asia and Europe and present opportunities in the neighboring emerging economies,” he said.
Leading European financial institutions including Alfi, Allen & Overy Luxembourg, Baloise Assueance, Banque de Luxembourg, Citi, Equity Trust, Ernst & Young, HSH Nordbank, Intertrust, European Private Bankers, Nordea Bank and United Trust came to Turkey as part of the trade mission.
Grulms said Luxembourg has decided to open an embassy in Ankara and there will be a trade attache to work for stronger economic cooperation between the two countries. Noting that Istanbul has already become an important regional financial center, Grulms said, “Despite its biggest competitor being Moscow, Turkey might turn into an international finance center.” According to him, “Turkey should consider attracting skilled workers from all over the world in order to turn Istanbul into an international finance center.”
More joint ventures
“Rising energy costs are making transportation more expensive globally,” said Jeannot Krecke, foreign trade minister of Luxembourg, at the meeting. “Even though many Western businesses are considering investment in the Far East, Turkey has great potential for manufacturing for European firms and more joint ventures shall be established” and European enterprises should move manufacturing facilities to Turkey as the cost of production remains affordable in addition to there being a young and educated population. “Together with Turkey, we could get Europe back to the forefront,” the minister added.
Noting that Luxembourg does not have many natural resources, the minister said the country is still a big player in the iron ore market. Talking about the steel and iron sector in Turkey, the minister said, “We would like to increase our existence in Erdemir.” Arcelor Mittal, headquartered in Luxembourg acquired 24.9 percent of Turkey’s biggest steel producer Erdemir in 2008 for $869.25 million. According to the minister, the shares of the firm might be increased.
Last year, the trade volume between Turkey and Luxembourg grew significantly, particularly due to Luxembourg’s exports to Turkey, which increased from 50.8 million euros in 2009 to 97.2 million euros in 2010. Turkey’s exports, which were at nearly 8.74 million euros in 2003 also rose to 17.86 million euros by the end of last year, according to the Luxembourg Statistics Office.
Article by Gökhan Kurtaran
Istanbul-Hürriyet Daily News
Wednesday, March 23, 2011