Nuclear Power in Türkiye: A Catalyst for Economic Growth and Diversification?
Türkiye's journey towards harnessing nuclear energy through the construction of Nuclear Power Plants presents a myriad of opportunities for the nation's economy. Beyond the immediate advantages of job creation and reduced reliance on imported energy, this strategic move offers the potential for long-term economic growth and diversification. In this article, we explore how the development of NPPs in Türkiye is not only a step towards cleaner and more secure energy but also a driving force behind various sectors that can contribute to the nation's prosperity.
Economic Growth Stimulated by the Construction of Nuclear Power Plants (NPP)
The construction of NPPs involves significant capital investment and creates numerous job opportunities, both of which can stimulate economic growth. The construction of nuclear power plants demands a highly skilled workforce, offering employment prospects and promoting the development of specialized engineering and technical expertise The Akkuyu Nuclear Power Plant in Türkiye is expected to employ around 15,000 people during its peak construction period and once the power plant is operational, it will employ about 4,000 people, These jobs span a range of sectors, including construction, engineering, and operations, contributing to a reduction in unemployment and an increase in household income. Furthermore, the development of these facilities can lead to the growth of ancillary industries that supply materials and services for the construction and operation of the plants. This can create a ripple effect throughout the economy, leading to broad-based economic growth.
Reduction of Reliance on Imported Energy
Currently, Türkiye relies heavily on imported energy. The volume of electricity imports into the country recorded a significant jump in 2022 with 6.4 terawatt hours, indicating over 175 percent growth compared to the previous year. The development of nuclear energy could reduce this dependence, leading to a more balanced trade deficit and greater energy security. This could also lead to a reduction in energy costs for consumers and businesses, as domestic energy sources are typically cheaper than imported ones. Furthermore, reducing reliance on imported energy could also enhance Türkiye’s geopolitical standing by making it less dependent on foreign countries for its energy needs.
Diversification of the Energy Mix
Nuclear energy would diversify Türkiye’s energy mix, reducing reliance on any single source and making the country’s energy supply more resilient. This diversification could also stimulate innovation and development in other sectors of the economy. For example, it could lead to advancements in energy storage technologies or the development of new industries related to nuclear energy. Furthermore, Türkiye has experienced significant fluctuations in energy prices. For instance, electricity costs rose by 50% for households and 125% for businesses in 2022. A diversified energy mix, including nuclear power, could make Türkiye’s economy more resilient to such fluctuations.
Opportunities in Infrastructure and Construction Sectors
The construction of NPPs requires significant infrastructure development, providing opportunities for growth in the construction sector. This includes not only the construction of the plants themselves but also the infrastructure needed to support them, such as roads and power lines. Furthermore, the development of this infrastructure can lead to improvements in other areas as well. For example, improved road networks can facilitate trade and commerce, while enhanced power infrastructure can lead to more reliable electricity supply for homes and businesses. In addition to the direct benefits to the construction sector, the development of NPPs also stimulates growth in other industries. For instance, the manufacturing sector can experience a boost due to the increased demand for materials and equipment necessary for the construction and operation of these plants. It provides an impetus for the growth of local industries, such as steel, cement, and equipment manufacturing, which will witness increased demand for their products and services. Additionally, the long-term nature of nuclear power plant projects ensures a sustained pipeline of work, fostering stability and sustainability in the construction sector.
Attracting More Foreign Investments to Türkiye
The catalytic effect on the economy extends beyond the energy sector, touching various industries, such as manufacturing, services, and logistics, creating a virtuous cycle of growth. In essence, the advent of new nuclear power plants in Türkiye not only transforms the nation's energy landscape but also paves the way for increased foreign investments, ushering in an era of prosperity and collaboration across all sectors. According to UNCTAD's World Investment Report 2022, FDI inflows to Türkiye increased by 60.2% to USD 12.5 billion in 2021. The development of nuclear energy could make Türkiye more attractive to foreign investors. This could bring additional capital into the country, stimulating economic growth and creating jobs. Furthermore, foreign investment can lead to technology transfer and skill development, enhancing Türkiye’s competitiveness in the global economy. It could also lead to increased trade ties with other countries, opening up new markets for Türkiye’s goods and services.
Development of the Automotive Industry
The Turkish automotive industry might benefit from nuclear energy development, as it would increase the availability of electricity and contribute to the production of electric vehicles, which is a crucial sector. Sales of electric vehicles in Türkiye exceeded 7,000 in 2022, and the Ministry of Energy and Natural Resources predicts that the number of electric vehicles on the country's roads will reach over 1 million by 2030. These projections are in line with the plans of Türkiye'nin Otomobili Girişim Grubu (TOGG), a Turkish electric car manufacturer, to expand their electric vehicle production. Furthermore, the development of electric vehicles could encourage advancements in related fields, including battery technology and charging infrastructure, leading to new employment opportunities and further strengthening economic growth.
Growth of the Tourism Sector
The forecast from the World Travel & Tourism Council (WTTC) shows by 2032, the sector’s contribution to the nation's GDP could reach nearly TRY 1,036 billion (US$117 billion), representing 11% of the total economy. The development of nuclear energy could create indirect benefits for Türkiye’s tourism sector. The construction of NPPs and related infrastructure could lead to the development of new tourist destinations, contributing to the growth of this important sector. For example, visitors may be attracted by the opportunity to learn about nuclear technology or visit facilities such as visitor centers or observation decks at NPPs. Furthermore, the development of these facilities could lead to improvements in local amenities and infrastructure that benefit both tourists and local residents.
In conclusion, the development of nuclear energy in Türkiye holds significant potential for enhancing the country’s economic condition. From stimulating economic growth through job creation to attracting foreign investments and boosting local economies, the benefits are manifold. It is also crucial to approach this transition with careful planning and regulation to ensure safety and sustainability. With a strategic approach, nuclear energy could indeed play a pivotal role in shaping Türkiye’s economic future.
Download the Report
Opportunities in the Turkish nuclear market will be discussed during the Türkiye NBP 2023 conference and exhibition which will take place 6-8 November in Antalya. This industry meeting is hosted by Nükleer Teknik Destek Anonim Şirketi (NÜTED A.Ş.). An exclusive technical site-visit to the Akkuyu nuclear plant site is also scheduled as part of Türkiye NBP 2023
For more information and to download the detailed meeting agenda visit - www.nuclearbusiness-platform.com/turkiye/tnbp-2023
