Babacan: Turkey's crazy project has begun

Official planning work on a new shipping canal to connect the Black Sea to the Aegean -- a project dubbed by critics and advocates alike as Turkey's "crazy project" -- is officially under way, Turkish Deputy Prime Minister Ali Babacan said on Thursday. Speaking to reporters in Ankara, Babacan said that the construction and operating rights to 30-mile canal, which will be built on the western fringes of Istanbul, will be auctioned off in a government tender resembling last week's $22 billion state sale of the contract for Istanbul's third airport. "It's going to be a build-operate-transfer [BOT] contract and will be done in public-private partnership," Babacan said in comments carried by the Anatolia news agency. Those plans have so far remained remarkably hazy, even by Ankara's standards. The government confirmed in mid-April that it had "pressed the button" on the plan but has yet to publically attach a price tag to the project or announce the exact path of the future waterway. Babacan acknowledged on Thursday that financing might be one of the project's most difficult challenges and chose to liken the steps needed to secure funding to tailoring a suit. "For every project different measures are necessary in the same way that a tailor sews a custom-made suit," he said. Last week Ankara inked a $22 billion nuclear power plant deal with Japan in the province of Sinop and a secured staggering $29 billion deal for a third Istanbul airport. It is also preparing to start construction of a third Bosporus bridge and highway network, which the government has estimated will cost around $6 billion. Because of the size and scale of the project, Babacan indicated that the state may have to heavily finance the effort, suggesting that it would likely dwarf private financing efforts. "This project is a mega project. It is going to go on past the completion date of the third airport," Babacan said. The third airport is scheduled to be completed in 2017. Babacan also announced that Turkey concluded its last debt payment to the International Monetary Fund (IMF) on Wednesday night with a final payment of $421 million. Babacan said that Turkey's voting power in the IMF had doubled since 2002. In the past, Babacan has been a strong critic of the bank's voting system, which gives disproportionate voting power to Western European and North American economies. The minister also weighed in on Ankara's dual efforts to help women enter the workforce while having more children. Earlier this year, Turkey's state statistics agency reported that average national fertility rates had fallen to just above the rate needed to sustain Turkey's present population. Ankara has spoken about creating a free national day care system as one way to make it easier for working women to have children and stay in the workforce. The government is "continuing its efforts on designing policies to encourage families to have more children," Babacan said without elaborating on a specific policy. "We'll be completing these efforts in a few weeks," he pledged.