TURKEY: Sabanci Holding cement unit sees 2015 sales rising 10-15 pct

The cement business of Turkey's Sabanci Holding expects its sales to rise 10-15 percent this year and is looking for acquisition opportunities, its chief executive said.

Sabanci's cement group, consisting of cement companies Akcansa and Cimsa, posted a 16 percent increase in sales to 2.5 billion lira ($980 million) in 2014, the cement unit's Chief Executive Officer Hakan Gurdal told reporters late on Monday.

"We are chasing opportunities for growth abroad. Financial structures of Akcansa and Cimsa are getting stronger, creating serious potential. We currently have the ability to borrow up to $1.5 billion to fund an acquisition," Gurdal said.

Sabanci Holding was in a consortium that offered bids for some of the assets put up for sale by cement makers Lafarge and Holcim after their mega-merger. But Irish cement maker CRH agreed to buy the assets for 6.5 billion euros.

Sabanci has long been interested in acquisitions, but has not bought any companies. Gurdal explained this was due to geopolitical risks in Turkey's neighbouring region.

Gurdal also said the group had an investment target of 300-330 million lira, most of which would be invested in a factory in the Aegean province of Afyon. The factory is expected to start producing in May 2016.

TURKEY: CRH, Eren Said to Hire JPMorgan to Sell Turkey Cement Unit

CRH Plc (CRH), Ireland’s biggest cement company, and its Turkish partner Eren Holding AS have hired JPMorgan Chase & Co. (JPM) to help sell their cement joint venture in Turkey, people with knowledge of the matter said.

Companies including Haci Omer Sabanci Holding AS (SAHOL), Limak Holding AS and Oyak Cement Group are interested in the unit, in which CRH holds a 50 percent stake with Istanbul-based Eren owning the rest, said the people, who asked not to be named because the talks are confidential.

The three potential bidders are among those shortlisted and the sale process for the unit, known as Denizli Cimento Sanayii TAS, could be finalized by October, one of the people said.

About 20 domestic and international cement producers, including Italcementi SpA (IT), operate in Turkey, where cement makers have a total annual capacity of about 107 million tons, according to the local Cement Producers’ Association. The country, which has a gross domestic product of about $820 billion, is seeking to become one of the largest 10 economies in the world by 2023, and has planned $100 billion of infrastructure projects in the next four years, including a new bridge across the Bosphorus strait.

Representatives of Sabanci Holding and Eren Holding didn’t respond to e-mailed questions and calls seeking comment. Representatives of CRH, JPMorgan, Oyak, Denizli and Limak Holding declined to comment.

Denizli Output

Denizli, in which CRH bought a 50 percent stake from Eren Holding in 2007, produces about 3 percent of Turkey’s and 31 percent of western Turkey’s total clinker output, according to its website. The company is aiming to increase its sales to 250 million liras ($116 million) this year from 220 million liras in 2013, according to an e-mailed statement.

Oyak Group’s cement units include Mardin Cimento Sanayii & Ticaret AS, Unye Cimento Sanayii & Ticaret AS, Bolu Cimento Sanayii AS and Aslan Cimento AS.

Sabanci’s Cimsa Cimento agreed to buy Sancim Bilecik Cimento, a cement producer in western Turkey, from Sonmez Group for $220.7 million, it said in a public filing last month.

IVORY COAST: Limak Holding plans $50 mln Ivory Coast cement investment

Turkey's Limak Holding will enter the African cement market with a $50 million investment to build a plant in Ivory Coast with partner Afrikbat.

Limak will hold a 51 percent stake in the joint venture set up with Afrikbat and they aim to begin production in late 2015.

The plant will have a processing capacity of 1 million tonnes and will export to other African countries, Limak CEO Nihat Ozdemir said at a signing ceremony.

The ground-breaking for the plant is planned in December.

TURKEY: Çimsa Sancim Bilecik Çimento'yu 220,7 milyon dolara satın aldı

Sabancı Holding'e ait Çimsa, Sançim Bilecik Çimento'nun yüzde 100'nü 220,7 milyon dolara almak için mukavele imzaladığını Kamuoyunu Aydınlatma Platformu'na bildirdi

Sabancı Holding şirketlerinden Çimsa, Sançim Bilecik Çimento'nun sermayesinin % 100'ünü satın alınması hususunda pay alım satım mukavelesi imza altına aldı .Nominal değeri 87. beş milyon lira olan hisselerin devir ücreti düzeltmeler hariç 220.7 milyon dolar olarak belirlendi.KAP'ta dün akşam yayınlanan açıklamaya göre, hisselerin, Aunde Teknik Tekstil, E.N.A. Tekstil, Celal Sönmez, Ali Cem Sönmez, Osman Sönmez, Cemil Sönmez, Ali Hazır ve Mehmet Hazır'dan satın alınması hususunda 15 Temmuz 2014 tarihinde "Hisse Alım ve Satım Sözleşmesi" imzalandı.Hisselerin devri ve pay devir bedelinin ödenmesi, Rekabet Kurulu'nun izninin alınmasından ve pay devir sözleşmesinde öngörülen diğer işlemlerin yerine getirilmesinden akabinde kapanışta gerçekleştirilecek.Beyanatta bulunan bilgiye göre, satıcı şirketler ve kişiler ile Çimsa arasında denetim ve sermaye bakımından dolaylı ya da dolaysız bir ilişki bulunmuyor.Sabancı gelirlerde % 15 kârda İkili haneli büyüyecek.

TURKEY: Oyak eyes cement acquisitions in Europe, Africa

Turkey's Oyak army pension fund is looking into acquisition opportunities in the cement sector, focusing on Europe, Africa and Britain, its cement group chairman Celalettin Caglar said on Thursday.

Caglar said the group was also interested in acquisition opportunities that could arise from the merger of Holcim of Switzerland and France's Lafarge on Monday to create the world's biggest cement maker.

Lafarge has said two-thirds of divestments as a result of the deal with Holcim are expected to affect Western Europe, but there are also overlapping operations in India, China, Canada and Brazil.

LIBYA: Subsea Cranes, Cement Unloader Orders

Cargotec's MacGregor has secured a new IHC Merwede order for subsea cranes, and in Libya Cargotec is to supply a Turkish company with a mobile cement unloader to work ports along the coast.

Subsea crane order

MacGregor, part of Cargotec, has won an order worth around EUR 23 million for six active heave-compensated (AHC) subsea cranes from the Dutch IHC Merwede. The cranes will be installed on three pipe-laying ships destined for the UK headquartered global offshore specialist, Subsea 7. Delivery of the cranes is scheduled between June and December 2015. 


The new series builds on others under construction at the IHC Merwede yard for Subsea 7, including the 146m vessel, Seven Waves, which will also be fitted with a MacGregor subsea crane and is scheduled for delivery this year. 
 
The latest vessels, hulls 731, 733 and 735, will each be fitted with one 100-tonne SWL and one 25-tonne MacGregor AHC subsea cranes, designed to operate at depths of 3,500m and 3,000m respectively. 

Mobile cement unloader for Libya

A Turkish construction services company, Mussa Insaat Dis Ticaret Ltd of Istanbul, placed an order with Cargotec for a standard road-mobile Siwertell 10 000 S cement unloader. The trailer based, diesel powered unit will have a rated discharge capacity of 300t/h and is scheduled for delivery in mid-May 2014.

"While the unloader's primary location will be in the western part of Libya, our customer is planning to use it for cement unloading operations at several sites along the Libyan coast," said Jörgen Ojeda, Sales Director for Siwertell mobile unloaders. "This demonstrates the significant commercial and operational advantages of our road mobile systems. It is easy to move them from one port to another and, once at the new location, one man can have the unloader ready for operation within an hour."

The new unloader will be equipped with a double bellows system and dust filter, which deliver consistently high levels of efficiency and environmental protection.

TURKEY: IFC is providing a debt facility to Turkey’s major cement firms

IFC, a member of the World Bank Group, is providing a long-term financing package to Cimko, one of Turkey’s major cement firms and a joint venture between Sanko Group in Turkey and Italy’s Cementerie Aldo Barbetti SPA, to invest in the ready mix concrete (RMC) segment and in energy efficiency.´

 

The debt facility includes a $40 million loan for IFC’s own account and a syndicated loan of €18 million from BNP Paribas Fortis SA/NV mobilized by IFC. 

The project is expected to strengthen Cimko’s competitiveness and increase employment in the Southeast Anatolia region of Turkey, where Cimko is based. The deal will give the company sizeable energy savings and reduce its greenhouse gas emissions. 

Cimko will be able to supply more top-quality cement to the domestic market and export more to the MENA region, where cement demands are growing due to major infrastructure and housing investments. 

“Sanko Holding’s partnership with IFC goes back to 1989,” said Sanko Holding Chairman Abdulkadir Konukoglu. “We value our relationship with IFC and see IFC as a long term partner. In addition to financial support, IFC’s deep industry expertise contributed a lot to Cimko’s success.” 

IFC’s guidance on installation of energy-efficient, environmentally and socially friendly processes will also contribute to the company’s sustainable development programs. 

“Cement is critical for the construction sector, the world’s largest industry, and a shortage of supply could hinder the industry’s growth. This project will help Cimko increase its productivity efficiently,” said Guy Ellena, IFC Director for Manufacturing, Agribusiness, and Services in Europe, the Middle East, and North Africa. “We are looking forward to cooperate further with our long-term client Sanko.” IFC has been investing in Turkey’s private sector for nearly 50 years. In the 2013 fiscal year, IFC delivered a record $985 million in 20 projects supporting exports, smaller businesses, renewable energy, and the healthcare, education, and infrastructure sectors.

TURKEY: OYAK Group orders three vertical roller mills from Pfeiffer

Bolu Cimento Sanayii AS, a member of the OYAK Group, has ordered three vertical roller mills from Gebr Pfeiffer SE for the new production line at its cement grinding plant in Kazan near Ankara. Installation of the mill will expand the existing plant into an integrated cement plant. Delivery of the mills is scheduled for mid-2014 and will boost the total number of Pfeiffer mills installed at OYAK Group cement plants to eight.

An MPS 4500 B with a drive power of 3150kW will be used for cement raw material grinding. The mill is guaranteed to produce 320t/hr at a product fineness of 12% residue on the 0.090mm screen.

Pet-coke and lignite will be ground in an MPS 225 BK vertical roller mill with a drive power of 400kW. The throughput rate of this mill when grinding pet-coke will be 20t/hr at a fineness of 3% residue on the 0.09mm screen and 35t/hr when processing lignite.

Bolu Cimento has also ordered an MPS 4500 BC mill with a drive power of 3300kW, which will yield 130t/hr of CEM I at a specific surface of 3900cm²/g acc. to Blaine.

TURKEY: Sancim Cement to build new plant in Adana.

Sancim Cement is to build a new cement plant in Adana, southern  Turkey, according to daily Milliyet. The plant will be able to produce 1.7Mta of clinker and 2Mta cement and the investment period is expected to be around 20-22 months.

TURKEY: Akcansa, Cimsa Plan to Buy Cement Companies Outside Turkey

Akcansa Cimento Sanayi & Ticaret AS, and Cimsa Cimento Sanayi & Ticaret AS, Turkish cement makers, plan two separate acquisitions abroad this year, said Mehmet Gocmen, head of Haci Omer Sabanci Holding AS’s cement group.

Akcansa, owned by HeidelbergCement AG (HEI) and Sabanci Holding, and Cimsa, with a combined 20 percent share in Turkey’s cement production, are looking at companies in Turkey’s geographical region, Gocmen told a news conference in embargoed comments late yesterday. The targets could be based in central and southern Europe to the Caucasus andMiddle East, he said.

Akcansa and Cimsa each have sufficient equity to make the acquisitions without any borrowing, Gocmen said. “Should shareholders add some more financing, bigger acquisitions are also possible,” he said.

Cimsa is also waiting for the result of an auction in which its bidding to buy Turkish cement maker Afyon Cimento Sanayi TAS from İtalcementi SpA’s Ciments Francais SA, Gocmen said.

Turkish Market

Akcansa and Cimsa plan inorganic growth both in Turkey and abroad because regulations don’t allow a single company to control more than 25 percent of the domestic market, Gocmen said. About 20 international and local cement producers, including Italcementi and Cimpor Cimentos de Portugal SGPS SA, operate in Turkey. Akcansa and Cimsa are also interested in opportunities domestically, Gocmen said.

Cimsa rose 1.4 percent to 8.78 liras and Akcansa was unchanged at 7.40 liras at 4:34 p.m. in Istanbul. The main share index gained 0.2 percent.

Turkey, where cement makers run at almost full capacity, can produce 70 million metric tons annually and cement consumption is expected to grow 4.5 percent this year after growing an estimated 11 percent to 56.1 million tons in 2011, Gocmen said. The remaining output was exported last year, with exports dropping 4.5 million tons from 2010, he said. Cement exports, mostly to Russia, Argentina and Brazil, will probably decline further in 2012, Gocmen said.

Sabanci Holding’s cement division expects this year’s sales at 2 billion liras ($1.1 billion), after an estimated 20 percent growth last year, according to Gocmen. Akcansa will invest 125 million liras this year and Cimsa 100 million liras, excluding any possible acquisitions, he said.

TURKEY: Turkey’s Nuh Cimento Grew 20% in 2011, Chairman Tells Dunya

Nuh Cimento Sanayi AS (NUHCM), parent company of Turkey’s largest cement maker, grew 20 percent in 2011 after its best December ever,Dunya reported, citing Chairman Atalay Sahinoglu.

Revenue from energy and cement sales last year exceeded $1 billion, Dunya said.

The company invested $55.5 million in technology and energy efficiency and plans to expand clinker production by 50 percent, Sahinoglu also told the newspaper.

Nuh Cimento plans to focus on exports, including Brazil, Africa and Russia, and with its 50 percent partnership in the Russian port of Rostov, Dunya reported.

TURKEY: Exports decline due to civil unrest

The instability and social unrest in the Middle East and North African countries has a negative impact on Turkish exports.

Turkey’s southern province of Antalya is experiencing a significant decline in cement exports this year due to Middle Eastern and North African turmoil, the head of the Antalya Free Trade Zone, or ASBAŞ, said during a Sunday meeting.

“Cement exports fell by 35 per cent in the first half of this year compared with last year,” said Zeki Gürses, general manager of ASBAŞ, speaking to press in Antalya. The city’s total exports of cement and barite in the first half of last year was at around 515,000t and declined to 335,000t by the first half of this year, he said.

The total trade volume of the Antalya Free Trade Zone reached US$75.3m by the end of the first half of 2011 compared to last year’s US$71.6m, according to official figures. “Despite the five per cent increase in total trade volume in this year’s first half compared with last year, our city’s cement and barite export was hit by the Middle Eastern and North African turmoil especially in January and February,” said Gürses.

TURKEY: Turkish Equity Movers: Baticim, Batisoke, Dogan Yayin, Sinpas

Turkey’s benchmark ISE National 100 Index (XU100) fell for the third day, dropping 551.4806 or 0.8 percent, to 68,823.82 at 3:10 p.m. in Istanbul.

The following stocks were active. Symbols are in parentheses.

Baticim Bati Anadolu Cimento Sanayii AS (BTCIM) , a cement producer, rose for the seventh day to extend an all-time high, gaining 58 kurus, or 5.8 percent, to 10.7 liras. Turkey’s asset sales agency on May 4 invited Baticim Enerji, in which Baticim holds an 80 percent stake, to buy twopower plants by a July 4 deadline. The shares have gained 32 percent since April 29, when the original winner of the auction, Akfen Holding, asked to extend its May 2 deadline to buy the plants, a request that was denied.

Batisoke Soke Cimento Sanayii TAS (BSOKE) , which owns the remaining 20 percent of Baticim Enerji, gained for a seventh day to a more than three-year high, adding 11 kurus, or 5.2 percent, to 2.24 liras.

Dogan Yayin Holding AS (DYHOL) , a newspaper publisher, fell for the third day, dropping 3 kurus, or 1.7 percent, to 1.76 liras. The company got conditional approval from the market regulator to double its capital to 2 billion liras ($1.3 billion) via a rights issue.

Sinpas Gayrimenkul Yatirim Ortakligi AS (SNGYO) , a real- estate investment trust, dropped as much as 4 kurus, or 1.8 percent, after it reported 18.1 million liras of profit in a filing for tax purposes only to the Istanbul Stock Exchange. Sinpas fell 2 kurus, or 0.9 percent, to 2.17 liras.

TURKEY: Turkey's Sabanci cement group seeks acquisitions

Turkey's Sabanci (SAHOL.IS) cement group chairman Mehmet Gocmen said the group is seeking buyouts in the region and may spend between 1 and 1.5 billion lira ($660 million-$988 million) for takeovers this year.

The group is also interested in acquiring domestic cement makers and may buy Afyon Cimento (AFYON.IS), Gocmen told reporters late on Thursday.

TURKEY: Turkish cement group scans region for acquisition

The Sabancı Cement Group, which includes two leading cement producers in Turkey, is eyeing chances to acquire factories abroad. ‘Crazy growth’ before the global crisis and the shrinking that followed are today offering strong investors with opportunities to buy stagnant plants, says Mehmet Göçmen, the group’s chairman. The company is also looking for domestic acquisition chances, he says

The Sabancı Cement Group, a Sabancı Holding subsidiary, is searching for acquisitions in production facilities both in Turkey and abroad, Mehmet Göçmen, the group president said Thursday.

The world experienced “crazy growth” between 2003 and 2008, which increased capacity by 850 million tons annually. But the industry hit rock bottom during after the global recession, the president said.

The sector in Turkey did not grow in 2009 but expanded 17 percent last year, he said.

Significant global players fell into debt during the crisis and while they are reconfiguring their networks they are trying to sell cement plants, said the president.

"The international investment environment provides the companies that have strong balance sheets like ours with the chance to invest,” he said. “We hold the advantage of having a strong cash-inflow during a period when markets across the world are in bad shape.”

Sabancı Cement Group consists of two separate companies: Akçansa, a Sabancı Holding and Heidelberg Cement joint venture, and Çimsa, a Sabancı firm that has been in business since 1975.

"The annual activities of our two companies come to between 300 million and 400 million Turkish Liras. Sabancı has a borrowing capacity of up to 1.2 billion liras from the companies’ balance sheets, without adding any additional capital. This means we can invest between 1 billion and 1.2 billion liras without doing anything extra. We can raise our annual capacity of 15 million tons to 25 million tons depending on our internal dynamics.”

Göçmen said they would choose a country with low risk, suitable demographical structure and easy geographical access for their new investments.

Anti-trust regulations

Göçmen spoke about the anti-trust laws and regulations for the market in relation to many cement factories in bad financial condition. “Isn’t it a pity? Capacity is there but someone says: You cannot buy that firm. Some rules need flexibility for the sake of the country’s benefit,” he said, calling on economists and top business organizations to intervene in the issue.

World market

A total of 3 billion tons of cement is produced across the world, Göçmen said, adding that only a small portion, between 170 million and 200 million tons, is traded internationally. Generally, countries can produce the amount of cement they need to meet their domestic demands, said the president.

Growth in the cement industry is directly related to the development level of a country, said Göçmen. The amount of cement consumption in developing countries is much higher than developed countries. The highest consumption figures across the world stand between 800 and 1,000 kilograms per capita annually, he said.

TURKEY: Cement sales expected to hit nine-month peak

The first month of spring has brought good news for cement producers as sales for March are expected to reach a nine-month high, while prices have increased by four to six per cent.

Sales are expected to surge by 23 per cent to 3 million tons on a monthly basis, the highest in the last nine months, according to Topline Securities.

Cement sector stocks have rallied seven per cent in last 10 days, reflecting positive investor interest due to the rise and expected sales, said Topline Securities analyst Furqan Punjani in a research note.

Sales to cross 3m mark

Cement sales are expected to cross the three million mark in March 2011, up 23 per cent from February, with commendable improvement from the local side. From these, local sales are expected to increase by 25 per cent to 2.2 million tons while exports are expected to depict a growth of 23 per cent to 0.85 million tons.

Higher margin in local sales

Strong price discipline adopted by cement producers has increased prices by up to six per cent, to Rs375 per bag in a few days.

The new price hike comes on the back of an additional 1.5 per cent special excise duty on cement price imposed recently.

However, the impact of special excise duty was only Rs5-6 per bag, while prices have surged by Rs15-20 per bag, adds the research note.

The gap between local and export selling prices have further widened with this increase.

Local selling prices stand 36 per cent higher at Rs245 per bag, compared with export price of around Rs180 per bag ($42 per ton).

The price differential bodes well for producers having higher share of local dispatch is their sales mix, added Punjani. With domestic dispatches picking up, cement producers will continue to pass on cost pressures on to the final consumer; thus protecting their margins.

TURKEY: Turkish highway builder on the road to public offering

Limak, a Turkish construction and energy group, is preparing to apply to the Capital Markets Board in March to sell shares at Limak Investment through an initial public offering, according to the group’s chairman.

The holding plans to offer nearly 35 percent of the shares of Limak Investment, a branch active in energy production and construction businesses.

The branch has 17 firms operating in energy generation and distribution in Turkey and Georgia, construction projects in many countries including the main international airport in Pristine and highway contracts in Pakistan, Saudi Arabia, Syria and Macedonia, said Chairman Nihat Özdemir at a meeting in Istanbul on Thursday.

Based in Ankara, Limak hired Unicredit and İş Investment to manage the public offering process.

The company also holds 40 percent of shares at Istansbul’s Sabiha Gökçen International Airport along with nine hydroelectric plants in Turkey and four more in Georgia, which generate some 1,000 megawatts of electricity in total.

One geothermal plant in southwestern province of Denizli is also included in Limak Investment’s current portfolio.

The group holds licenses for operating the power grids in the central province of Yozgat and the northwestern province of Bursa and posted 2.2 billion Turkish Liras in revenue at the end of last year.

Limak plans to increase its energy investments, especially after the country’s general elections due June 12, Özdemir told journalists at the meeting. “We will invest more in the electricity distribution businesses to be privatized,” he said, forecasting that the government tends to boost privatizations after elections.

Nearly 80 percent of the shares will be allocated to international corporate investors, according Özdemir.

Limak also won a bid for the 36-year operational rights to the large international port in İskenderun, a Mediterranean district in the southern province of Hatay, last year, investing $372 million. “İskenderun [port] carries great importance for the group and we will make it bigger than the Mersin airport,” he said.

Limak is among the prominent cement companies in Turkey. “We have a cement firm investment for $100 million in southeast province of Şanlıurfa and increased its capacity by 120 percent as we target Middle Eastern countries such as Iraq and Syria”.

The group currently has five cement plants in Siirt, Bitlis, Şanlıurfa, Gaziantep and Diyarbakır, all southern provinces.

Commenting on the company’s future plans, the chairman said Limak is interested in opportunities in nearby emerging markets such as the Balkans, Caspian region and the Middle East.

North African retreat

Recent unrest in North African countries has affected the group’s plans for some investments, according to a board member.

“We were just about to participate in a tender for four highway contracts valued around $150 million in Libya and Cairo and airport construction and operation – valued at approximately $300 million – in Egypt, but we have postponed these plans for today,” Serdar Bacaksız, a board chairman at Limak Investment told the Hürriyet Daily News & Economic Review.

TURKEY: Ciments Français agrees to sell part of its activities in Turkey to Limak Holding

Ciments Francais has agreed to sell Set Group Holding and its subsidiaries for a total amount of 290 million euros (on a cash and debt-free basis) to Limak Holding, a diversified Turkish Group with investments in construction, infrastructure, cement, energy, transport and tourism.

Set Group Holding, which represents a significant part of the existing industrial network of Ciments Français in Turkey, operates three cement plants in Ankara, Balikesir and Trakya (for a total clinker capacity of 2.3 Mt/y), one grinding center in Ambarli (total cement capacity of 1.2 Mt/y) and 13 ready mix concrete facilities. As of 31 December 2010, Set Group Holding posted revenues of approximately 130 million euros and a net debt close to 17 million euros.

Afyon Çimento, a listed Turkish company majority-owned by Ciments Français is not included in the perimeter of the transaction. In the future, Ciments Français will examine the best industrial and financial opportunities for this asset.

The completion of the transaction with Limak Holding is subject to approval by the relevant Turkish authorities. The transaction is expected to be completed during the second quarter of 2011. 

Mediobanca acted as financial adviser to Ciments Français on this transaction.

TURKEY: Free trade agreement with Turkey

Jordan’s free trade agreement with Turkey will come into effect as of next month. The agreement recognised the fact that the two countries are not on the same footing, therefore the Jordanian products will be allowed to enter the Turkish market tax exempt, while the Turkish products imported by Jordan will enjoy the tax exemption on gradual basis and will not reach full exemption until 2018.

As a matter of principle, trade between any two countries is beneficial to both. It encourages industrial specialisation and large-scale production. Producers in both countries will not confine themselves to their local market. They will look further and try to reach external market as well.

The absence of equality between the two countries when it comes to labour wages, industries’ subsidies, exports incentives and difference on exchange render the graduation stipulated in the agreement hardly enough to secure balanced and fair exchange of products between the two countries.

Yes, Turkey will grant full exemption to the Jordanian products entering Turkey.

This is good. The problem is that there are no Jordanian products which are ready to take advantage of this. If such products exist, they will not be able to compete with the Turkish products’ prices and/or quality.

Under the circumstances, it is very likely that trade between Jordan and Turkey will be in one direction. Jordan will play the role of importer and Turkey will be the exporter.

It is only fair to say that this state of affairs does not apply only to Turkey; Jordan did not hesitate to enter into sweeping free trade agreements with Gulf countries, which either do not impose taxes on imports or charge a symbolic tax, but there is almost nothing to exempt.

On the contrary, customs taxes in Jordan form a major source of revenue for the budget. Tax exemption in this case is very costly indeed, and not reciprocal.

In this respect, one should take into account that the Saudi or Emiratie producer enjoys cheap fuel, electricity and water, while the Jordanian producer has to pay more than the world prices for such industrial inputs.

How can competition between the two sides be fair under such situation?

One of the results of this state of affairs is the establishment in Jordan of a Saudi cement company with no factories, which imports clinker from Saudi Arabia at less than 50 per cent of the cost of producing this commodity in Jordan.

No wonder the Saudi local company was able in no time to expel Jordan’s cement factories from the market that produce their own clinker using fuel and energy at high prices.

The government hesitated and finally failed to act to protect local cement companies from unfair competition.

The share price of the Jordan Cement Factories Company, for example, dropped from JD12 to JD4. This is only one example, but it applies, at various degrees, to most local industries.

Jordan dared enter into free trade agreements with some advanced and industrialised countries like the United States and the European Union, but the results were extremely bad. The value of European Union’s exports to Jordan is 15 times the value of Jordanian exports to the EU.

Had it not been for the Qualifying Industrial Zones, trade with America would have been similar to that with the EU, perhaps even worse.

I am a supporter of opening up the Jordanian market to the world, provided, of course, that the exchange of goods and services is fair. Trade between two countries should be balanced or near balanced. Subsidised products, on the other hand, should not be allowed to enter the Jordanian market unless they pay a big enough tax to absorb the subsidy.

TURKEY: Turkish cement production rises 12.2 percent

Turkey, as Europe’s largest cement producer and the fifth-largest in the world, continues to grow its industry, according to a report by the national Cement Manufacturers’ Association. The rising export figures reflect a revival in Turkey’s key construction sector as Turkish contractors improve business abroad.

Turkey posted a 12 percent increase in cement production in the first five months of this year, making nearly 24 million tons of the construction material, Anatolia news agency reported.

Turkey increased the total amount of cement produced by nearly 4 million tons in the first five months of the year compared to the same period last year, according to the Turkish Cement Manufacturers’ Association, or TCMA, the news agency reported. Seventy-two percent of the material was sold in the domestic cement market and the rest exported, said the association.

Sales in the domestic market reached nearly 17.4 million tons in the first five months of this year, up from 15.3 million tons when compared to last year’s figures, representing an increase of 14.2 percent.

The total amount of cement exported during this period reached nearly 6.8 million tons, up from last year’s approximately 6.4 millions tons, representing an increase of 6.2 percent.

The highest levels of cement production occurred mainly at factories located in the Marmara region, which produced nearly 6.2 million tons. The Mediterranean region ranked second, producing nearly 5.4 million tons. The Central Anatolian region produced nearly 3.5 million tons, while the Black Sea region produced nearly 2.9 tons. Smaller amounts were produced in other regions: the Southeast region produced nearly 2.6 million tons, the Aegean region produced nearly 2.4 million tons and the East region produced nearly 1.5 million tons.

Export target: 19 million tons

Turkey exported nearly 14 million tons of cement in 2009. Iraq, Syria, Italy, Libya, Egypt, Nigeria, Russia, Israel, Azerbaijan and Bulgaria were the top 10 export destinations respectively. Neighboring Iraq imported nearly 3.4 million tons and Syria nearly 2 million tons last year. Turkey exported nearly 1.3 million tons of cement to Italy and 1.3 million to Libya by the end of 2009. As Europe's largest cement exporter last year, Turkey is aiming to export nearly 19 million tons of cement during 2010, according to TCMA.