China's growing appetite for Turkish marble

(MENAFN- Asia Times)

Burdur is a small, peaceful town in inland southern Turkey, which, despite its hidden gems, such as the picturesque lake and nearby Graeco-Roman ruins, is off the beaten track for tourists. Inhabitants of Burdur are not accustomed to seeing foreigners around, but this is now changing, owing, not to a sudden tourism boom, but to an influx of Chinese people. Around 1,000 Chinese citizens are calling Burdur home today, their numbers are likely to increase, and they come to this relatively remote part of the country for a reason: Turkish marble.

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Turkey is a world leader in marble production. The country's marble reserves are estimated to amount to 5 billion cubic meters, which corresponds to one-third of the world total. Around 800 marble quarries are actively producing at the moment, and a majority of them are located in Burdur and the surrounding provinces. Turkish marble comes in 120 different colors and patterns and includes some of the most sought-after kinds in the world, such as cherry, beige, white, black, tiger stripes, maroon and lilac. Turkish suppliers have provided marble for construction projects around the globe, from the White House to Disneyland, from Burj Khalifa to St Pierre in the Vatican and the Bundestag in Berlin.

These days, however, it is mainly the Chinese who are buying the marble. As China's construction industry continues to grow rapidly, with a 17% increase in value in 2016, there is an increasing demand for all kinds of materials, including marble, which is needed for top-tier residential and commercial projects. In 2016, China imported US$1.23 billion worth of marble from the entire world, corresponding to 61% of all the marble traded internationally, and 59.5% of all the marble bought by China came from Turkey. In the same period, 85% of all the marble exported by Turkey was destined for China. Some types, such as the Turkish cherry marble, which has replaced the now-extinct Italian rosso levanto, are in especially high demand by the Chinese due to customer preferences.

Trade figures clearly reveal why Burdur, and its marble-rich neighbors, such as Isparta, Afyon, Denizli, and Muğla, are hosting fast-increasing numbers of Chinese businessmen, engineers, workers and their families. Once merely buyers of marble from Turkish-owned companies, the Chinese are now becoming investors, operators and producers themselves, and around 100 marble quarries in the region are now Chinese-owned. These quarries are extracting the marble in raw form, cutting it into rectangular blocks and shipping them to China. From the Chinese perspective, it makes sense to own the quarries, as it provides security of supply, enables lower costs through the shipment of the marble in unprocessed form, and gives them an advantage against competing buyers, especially those from India.

For the Turks, however, the picture is more complicated. Having a stable long-term customer is surely welcome; however, the fact that Turkey sells its marble in raw form at lower prices, and buys back – perhaps from China but also from others – processed marble at higher prices remains a major concern. Turkish industry representatives argue that if the processing can be done in Turkey instead of China, there will be more local value added on the final product, and the Turkish economy could gain more from the whole process. There is, however, a counter-argument too, stating that if processing were done in Turkey, prices would rise and Turkey would lose its competitive advantage in the world markets. In 2016, 42% of all of the marble traded globally was exported from Turkey, and the Turks want this number to increase, not to decrease. In the meantime, while the economic merits of hosting Chinese-owned marble quarries are fiercely debated in Turkey, more important issues attract less attention, despite being frequently raised by local NGOs. What is the ecological impact of such aggressive marble quarrying? Who will be responsible for reforestation and environmental recovery once the Chinese-owned quarries run out of marble?

The Chinese know very well that they need Turkey's marble for their gargantuan construction sector, and for the Turks, the marble trade is the strongest and most concrete pillar of their relationship with the world's economic giant

The Chinese know very well that they need Turkey's marble for their gargantuan construction sector, and for the Turks, the marble trade is the strongest and most concrete pillar of their relationship with the world's economic giant. Questions over ownership, processing, environment and so on are likely to be solved by the two sides through mutual understanding as necessitated by mutual benefits. However, the marble trade between Turkey and China is also likely to have significant repercussions in the near future that will spill over the boundaries of Turkey.

Turkey and China combined have the highest number of construction companies operating globally. In the list of the top 250 international contractors published by Engineering News Record, China ranks first with 65 entries, and Turkey comes second with 40 companies. Unlike their Western counterparts, Chinese and Turkish contractors can and do operate in the most unstable parts of the world. When the chaos that the Middle East is currently engulfed in is over, there will be profound demand for reconstruction and rebuilding in this region, particularly in Syria and Iraq. It is not difficult to foresee that as strong global players, Chinese construction companies, with their capital and technology as well as the advantage of carrying no historical baggage in the region and the push of the One Belt, One Road initiative, and their Turkish counterparts, with their geographical proximity, local knowledge and know-how, will be the ones who are best positioned to undertake infrastructure projects in the region. For powerful Chinese players, the logical choice will be to partner with Turkish companies, not only because the latter know the region and its people, but also because they can bring in the construction materials that will be needed. In other words, while the marble trade between Turkey and China largely serves the Chinese domestic market today, it can be considered as a precursor of larger-scale collaboration between the two countries' companies in construction and supply chain management within the framework of post-conflict reconstruction efforts in the Middle East.

It was around the same time that the first Chinese restaurant in Burdur opened its doors to clients, and a local business association proudly announced that Burdur's quarries exported around $70 million worth of marbles in the first half of 2017. Expect more Chinese restaurants to open and exports figures to go up in Turkey's marble region, and expect the Turks and Chinese to do more construction-related work together.

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