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Turkey's billion-dollar mega project that will cut the country in half

Written by Roberta Souza
Published 14/06/2024 às 10:06
Istanbul, canal, Türkiye
PHOTO: CANVA

Turkey is building a new canal in Istanbul to relieve the congested Bosphorus Strait and capitalize on its strategic position

Istanbul, the largest city in Türkiye, stands out not only for its rich history, but also because of its strategic location that connects Europe and Asia. With a population that represents around 20% of the entire country, the city is home to the vital Bosphorus Strait, a crucial corridor for global maritime trade. However, Turkey now aims build a new channel which promises to change the dynamics of international trade, according to the Construction Time website.

Geopolitical importance of the Bosphorus Strait in Türkiye

The Bosphorus Strait is one of the most important sea passages in the world, connecting the Black Sea to the Mediterranean Sea. It allows ships from countries such as Russia, Bulgaria, Romania, Georgia and Ukraine access the Mediterranean and, consequently, the Atlantic Ocean. This strait is the only maritime outlet for these countries during winter, making it essential for your savings.

Furthermore, the Bosphorus is a key route for transporting natural gas from Russia for Europe, crucial for heating and energy generation on the continent. The connection between the ports of Shanghai and Rotterdam also depends on this strait, underlining its importance for trade between Asia and Europe.

Discover the billion-dollar mega project of the new Istanbul Canal

Istanbul's new channel

The Turkish government, led by President Recep Tayyip Erdogan, announced the construction of the Istanbul CanalTo project valued at approximately 15 billion dollars. This new canal, around 40 km long, will be located 30 km west of the Bosphorus. The construction aims to relieve the congested strait, through which around 40 ships transit annually, causing long waits and delays in deliveries.

Istanbul's new canal will allow up to 160 ships to pass per day, significantly reducing congestion and risks associated with the transport of dangerous cargo, such as oil. Currently, the Bosphorus cuts through the commercial center of Istanbul, exposing the city to the risk of accidents.

Economic and strategic benefits of the Turkey project

One of the main objectives of the new channel is to allow Turkey to charge passage fees, which is not possible on the Bosphorus due to the Montreux Convention, signed in 1936. This convention exempts ships from Black Sea countries from tariffs for passing through the Bosphorus, depriving Turkey of a significant source of revenue. The new channel, as it is not covered by this convention, will allow the country to monetize its strategic location.

The expectation is that the new Istanbul channel generates around 8 billion dollars a year in revenue, recovering the initial investment in less than two years. In addition to the direct economic benefit, the canal also promises to alleviate pressure on the Bosphorus, improving the safety and efficiency of maritime trade.

Controversies and challenges

Despite the promised benefits, the project faces strong internal and external opposition. Research indicates that 80% of the Turkish population is against the construction of the new canal, concerned about the destruction of residential areas and significant environmental impacts. Furthermore, the opposition points to a possible conflict of interest, as land along the canal's route belongs to President Erdogan's son-in-law, who is also the economy minister.

Externally, Russia expressed concern about the project, as it could reduce its influence in controlling maritime traffic in the region. However, the Turkish government remains firm, stating that the benefits outweigh the challenges and that the project will bring greater security and prosperity to the country.

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Roberta Souza

Petroleum Engineer, postgraduate in Commissioning of Industrial Units, specialist in Industrial Corrosion. Get in touch to suggest an agenda, advertise job vacancies or advertise on our portal. We do not receive resumes

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