Head of the Department of Economics, Başkent University. Dr. Uğur Emek stated that the 15-year operating period of Osmangazi Bridge started in March and calculated that the operator earned 2 billion 148 million dollars between the date the bridge was put into service and the official contract was put into operation.
SAYISTAY CALLED UNAUTHORIZED GAIN
The auditors of the Court of Audit found that the firm started the construction works in violation of the contract early and emphasized that this situation caused great unfair profit.
According to the contract, the processing time of bridges and highways is 22 years and 4 months. 7 years of this period was defined as the “production process”. When the operating company completed the construction before 7 years, the increased time required by the contract would be added to 22 years and 4 months, which is the operating period. The company, which started the construction works before the contract, started the construction before the site was delivered. Thus, it was highlighted in the report that the operating company will get an unfair gain by completing the construction as soon as possible and gaining extra bridge operating time. The auditors of the Court of Accounts stated that it was not possible to determine when the company actually started the construction works and therefore the unfair gain could not be calculated clearly. In other words, it could not be precisely calculated how long the operating company gained the right to operate.
Here is the relevant part of Uğur Emek’s article:
Osmangazi Bridge is a component of Gebze-İzmir highway. According to the contract, the total cost of the highway is $ 6.5 billion * at the exchange rate on the date of the contract, and the cost of the Osmangazi Bridge is $ 1.2 billion (19% of the total cost of the project).
According to the contract, the construction period is 7 years and the operation period is 15 years and 4 months. Within the scope of the contract, transition guarantees vary according to the segments. In the table below, the transition guarantees given according to the contract are given on the basis of quantity and amount. According to the contract, the operator was guaranteed an income of 10.4 billion dollars for 15 years and 4 months.
The share of Osmangazi Bridge, which has a share of 19% in construction cost, is 76% within the guarantees given to the operator. So why? Let’s call the answer to this question.
According to the contract, we stated that the investment period is 7 years. If the investment is completed before this time, the difference will be added to the operating time. Even though the investment is delayed, the difference will be reduced from the operating time (I have not heard of a project where the second option is implemented).
According to the contract, it is possible to make partial acceptance in Gebze-İzmir project. For the segment that is completed before the investment period ends, the operator’s income collection will be opened and this period will be added to the total operation period.
The contract of the Gebze-İzmir highway entered into force on 15/03/2013 and the construction works were completed on 15/03/2020. The operating period started on this date and the contract will expire on 15/07/2035.
RATIONAL OPPORTUNITY AT WORK
As every rational operator can do, the contractor of the project firstly completed the Osmangazi bridge, whose share in cost is 19% and its share in income is 76%.
The bridge was put into operation on 01/07/2016 and 1,351 days a day until 15/03/2020, when the operation period of the main project will start; the operator collected over 40,000 vehicles and wages updated according to inflation in the USA. The total of these revenues, some of which are covered by users and most of them from the budget, is 2 billion 148 million USD.
This amount is close to one third of the income that the operator will collect during the operation period. According to the contract, the amount of equity that an enterprise should have is approximately 1.3 billion dollars. In other words, front-loading income collection is 70% more than the equity that should be put in accordance with the contract.
* In his speech, President Erdoğan points out the partial acceptance by stating that “they have put many stages of the project into service as they are completed”. He also explains the cost of the project as $ 11 billion in his same speech. According to this information, the construction cost seems to have increased by approximately 70% compared to the contract. However, the official page of the Gebze-İzmir highway shows the amount that is still included in the contract and the amount I use in my calculations as an investment cost.
