Türkiye İMSAD: The cost of reconstruction of the earthquake zone is 46 billion dollars
The “February 2023 Industry Report” has been announced, produced by the Turkish Building Materials Manufacturers Association (Turkey IMSAD), the umbrella organization of the building materials industry. According to the report, industrial production of building materials fell 3.4 percent in the latest quarter compared with the last quarter of last year.
In the report, which also includes the effects of the earthquakes, whose epicenter was Kahramanmaraş on February 6, 2023, and which caused great destruction in 11 provinces; He specified that the reconstruction activities to be carried out in the region will cost 46 billion dollars, a figure that may increase with the clarification of the damage.
Despite this, the industrial production of construction materials increased by 0.2% in the year as a whole compared to the previous year. The construction sector, for its part, grew 2.0 percent in the fourth quarter of 2022 compared to the same period of the previous year, ending the fall experienced in the last 5 quarters.
Despite weakness in other sectors, growth in the construction sector was mainly driven by the base effect. However, it was stated that the fragilities in the dynamics of the limited recovery continued.
EARTHQUAKE COST
Consequently, it was expected to spend $28.9 billion for the reconstruction of the 550,000 homes, which were destroyed in the first place and could not be used due to severe damage, and $5.6 billion for the infrastructure of these buildings.
While $2.6 billion is expected to be spent for the repair and modernization of lightly and moderately damaged residences, $3.4 billion is estimated for the construction and repair of commercial buildings and $2.5 billion for the construction and repair of public buildings.
While spending 3 billion US dollars is required for infrastructure repair and renovation, total reconstruction costs calculated based on current damage in 11 provinces are expected to reach 46 billion US dollars.
‘BUILDING MATERIALS CREATED ADDITIONAL DEMAND’
According to the report, targeted development activities in 11 provinces created a large additional demand for construction materials. In this context, it was stated that the use of construction materials in the domestic market can cause a slowdown in exports.
A large part of the total population of 13.5 million in 11 provinces in the earthquake region was directly affected by the earthquake. Although a part of the affected population migrated to other cities, there were increases in housing prices and in housing rents in the provinces that received this migration.
On the other hand, according to the report prepared using data from the period 2015-2022; It was indicated that the size of construction licenses obtained in 11 provinces in 2022 is 12,049 buildings, 22.54 million square meters of floor space, 100,565 apartments, and 87.20 billion TL of construction cost.
The size of building permits obtained in 11 provinces in 2022 was determined to be 10,962 buildings, 19.95 million square meters of floor space, 81,616 apartments, and 62.46 billion TL of construction cost.