DR. FRANK QUANTE EVALUATES THE TURKISH ENERGY SECTOR
Quante believes that Turkey will grow as an energytrading hub. Turkey has a strategic role in ensuring energy security for European countries as a transit country for natural gas and oil transfers, he said. Turkey is crisscrossed by oil and gas pipelines, and several new projects are planned. New investment is also possible, especially in renewable energy, Qante noted. The establishment of the Energy Exchange Istanbul, (EPIAS) will allow for a more liquid market with a high number of players, if it operates efficiently, he said. More transparency, especially in pricing, will boost trust in the market. “In this context, EPIAS’ contribution to the market and the trust it provides are of great importance in terms of sustainable market structure,” he said.
A lack of predictability in the Turkish market is among the threats to investment, Qante said. “Foreign investors enter the Turkish market to invest in mechanisms that are supported by legislation. However, legislation changes over and over again to correct deficiencies in the market. This creates a serious uncertainty for companies,” he said. “Since the purchase price of natural-gas importers is still unclear, the price uncertainty that arises in the wholesale market makes companies hesitant to take risks.” Eliminating extraordinary threats, such as terrorist attacks, is one of the most important short-term steps Turkey can take to attract foreign investors. Keeping the promises made by regulations and an open market is also essential, he said. “Legal stability is keenly observed by foreign investors. With rising interest rates in the United States, and probably also in Europe soon, emerging markets are in fiercer competition to attract foreign investment. Moreover, for electricity generation investments the markets must be predictable,” he underlined.