How UK Companies Benefitted from Turkey’s Flawed Construction Industry

The earthquake that shook Turkey on February 6, 2022, claimed over 70 lives, including Aysel Kaya’s, who lost her life in the SSK hospital in Iskenderun. Although the city is classified as a disaster zone due to its proximity to the East Anatolian Fault, buildings there failed to meet basic safety standards, causing several modern buildings to collapse, while older ones remained standing. These defects, which led to the loss of many lives, can be traced back to the rot in the Turkish construction industry.

In the past, the Kaya family had lived in a house that was illegally built and in bad condition. They had always feared that an earthquake would collapse the house, and they were right. They eventually sold the house and bought a new one, which survived the recent earthquake. Unfortunately, Aysel Kaya, who was in the hospital for treatment on her back, was not as lucky. The wing where she was staying collapsed, killing her and others.

According to Murat Guney, an urban development researcher, Turkish zoning decisions are based on profit rather than public safety. The 1999 Izmit earthquake in Istanbul damaged many poorer parts of the city, but these areas have been left out of zoning plans. Meanwhile, older and undamaged areas of Istanbul, which are built on rock and have views of the Bosphorus, have been seized and handed over to loyal constructors for “urban transformation” projects.

Turkish construction firms, particularly the “gang of five” biggest companies, have close links with President Erdogan and are often awarded premium land and state tenders. Ronesans, one of the “gang of five”, was responsible for the construction of a luxury 12-story residence in Antakya that collapsed during the earthquake. Kalyon, another company, is owned by the president’s in-laws. These companies, in return for their lucrative contracts, purchase newspapers and TV channels, turning them into propaganda outlets for Erdogan.

The government's building of new hospitals in Turkey has also benefited these large construction firms. The £14 billion contracts for 18 mega-hospitals in the country’s major cities were awarded mainly to these firms. The government financed these contracts through public-private partnerships (PPPs), a funding model promoted by the UK government abroad, where private companies build public assets and lease them back to the state. Ankara opened tenders for its PPP hospitals a decade ago, marking it as a “high-value opportunity” for British businesses, with the potential for British companies to win more than £1.25 billion.

Although the PPP model was popular in the UK from the late 1990s until the 2008 economic crisis, the City of London and UK consulates continued to promote it abroad. Officials from Turkey’s health ministry visited the UK in 2014, where they were shown two PFI hospitals and introduced to UK contractors and consultants. Similarly, in a trip organised by the UK department of trade and industry, 22 British healthcare companies visited Turkey.

It is clear that the Turkish construction industry is flawed, and the earthquake in Iskenderun revealed the devastating effects of poor building regulations. While British companies benefited from Ankara’s PPP contracts, the Turkish people have paid a high price for their government's preferential treatment of large construction companies with close ties to the president.