The Role of the Private Sector in Railway and Metro Systems (Liberalisation, Opportunities and Suggestions)

On Thursday 27 September, Bezen & Partners and IPFA jointly organised an event on “The Role of the Private Sector in Railway and Metro Systems (Liberalisation, Opportunities and Suggestions)”. The event was hosted by Bezen & Partners and took place at the Hyatt Centric Levent Hotel in Istanbul. The session consisted of two parts: i) an opening speech and a brief presentation on the liberalisation of railways; and ii) a panel discussion.

The opening speech held by Mr. Aykut Bakırcı, Senior Partner at Bezen & Partners, included notes on the background of the liberalisation efforts and the current situation of the Turkish railway sector.

Following the opening speech, Anıl Özgün, the Manager of the Competition Branch Office of the Directorate General of Railway Regulation from the Ministry of Transport and Infrastructure (the “Ministry”), gave a brief presentation on the current legal framework and the end of the monopoly of the Turkish State Railways. She further explained relevant licensing procedures and the requirements to be met by investors in order to be authorised as a railway operator.

The panel discussion at the end of Anıl Özgün’s presentation was moderated by Aykut Bakırcı. The panel members included representatives from the Ministry and the Istanbul Metropolitan Municipality (the “IBB”). During the first round of such panel discussion, Aykut Bakırcı asked several questions to the panellists to understand their views on the liberalisation efforts and to encourage the audience to interact with the panellists.

The first panellist Serdar Ünsal, Head of Department of the Department of Urban Rail Systems from the Ministry, provided a brief explanation on the railway investments that have been realised by the Ministry in recent years. In particular, he gave information on large-scale metro investments in Istanbul and Ankara which were initiated by the IBB and the Ankara Metropolitan Municipality and later taken over by the Ministry.

The second panellist Turgay Gökdemir, Head of the Department of Rail Systems from the IBB provided information on the IBB’s ongoing projects and described main financial challenges faced during the implementation of metro projects.

The second round of the panel began with Aykut Bakırcı’s question directed at Anıl Ozgun on the current investment potential in the liberalised railways sector. Anıl Özgun stated that the private sector is highly interested in entering the railway market and that such interest is felt most among private construction companies. Turgay Gökdemir and Serdar Ünsal presented further information on the construction and operation of metro systems under current legislation and on the public procurement as well as the build-operate-transfer model. They also discussed the potential of a public-private-partnership model and assessed whether such model would be suitable for the construction, operation, maintenance and/or repair of metro systems.

During the reception after the panel sessions, the delegates used the opportunity to network, to ask further questions and to have direct conversations with the speakers and panellists.