Kanal Istanbul: A Ponzi scheme with an AKP touch

There is still so much we don’t know about Kanal Istanbul. But one can assume that it is a huge real estate project through which allies of Erdoğan will get richer while the rest of Istanbul will suffer — permanently. 

Ignoring more than a hundred thousand pleas, the Minister of City Planning and Environment hastily accepted the Environmental Impact Assessment (ÇED) report for Kanal Istanbul. Some changes have been made on the report, according to Medyascope. President Erdoğan had said “only housing for 500,000” will be allowed, but the figure has already been changed to 1 million.   

On Monday, Cumhuriyet newspaper led with the headline, “The son-in-law knows the drill.” In a move that was supposed to be confidential, Finance Minister and President Erdoğan’s son-in-law, Berat Albayrak, had purchased 13 acres of land in 2012 along the Kanal Istanbul route.

His lawyers claimed that Berat Albayrak’s father started to buy land in 2003 and the minister bought some as well, since “he didn’t want the land to end up in foreign hands.” 

Which foreigners could this be referring to? Independent media outlets have reported on several land investments that Saudi, UAE and Kuwaiti businessmen have purchased along the Kanal Istanbul route.

Çiğdem Toker from Sözcü newspaper recently wrote that Arab investors have purchased 300 acres of land so far. Journalists are not allowed to view land registrations, and Toker could obtain this information from a secret source. Whilst Erdoğan proudly defended the purchase of land by the mother of a Qatari prince, there has been no word on other foreign investments.  

Meanwhile, well-known economists have questioned how Kanal Istanbul will be financed, but they haven’t yet received any answers. Prof. Dr. Haluk Levent from Bilgi University believes that Kanal Istanbul is a Ponzi scheme, but with a difference: in a Ponzi Scheme, everything must be on the record, but this is not the case for Kanal Istanbul. The scheme is changing the town planning and zoning. 

“There is no feasibility study for this project. The cost of the Kanal is unclear, changing between 8.5 billion and 20 billion dollars. However, our colleagues have calculated that a minimum of 35 billion dollars is needed only for the excavation. One hundred and fifty thousand acres of land is to be expropriated. Some obviously knew and positioned themselves along the Kanal’s route. In my view, Kanal Istanbul is a huge dispossession project,” says Prof. Levent.  

Prof. Levent believes that the Kanal cannot be finished, because it cannot be financed. He thinks that after the first excavations, investors will give up their land and leave. 

Kanal Istanbul will be an ecological disaster for Istanbul and for the whole region. But it will have an enormous impact on local people as well. “Istanbul will get much poorer,” says associate professor of sociology, Ayfer Bartu Candan of Boğaziçi University, who analyzed the social impact section of the ÇED report.  

“Kanal Istanbul will affect a huge area, where hundreds of thousands of people are living. As the report states, 52 percent of them are farmers, and this the only way for them to make a living. The canal project will destroy their land and the means to survive.”

The ÇED report actually states that the impact of the canal on the local population will be “highly negative” and “permanent” on many accounts. The only positive social aspect noted in the report was the “employment during construction.” 

Professor Candan believes that this assessment is not true, since the construction period will not last, and not everyone can become a construction worker. 

Both professors believe that financially and socially, Kanal Istanbul is a total waste. Istanbul — actually, Turkey — has a tremendous problem of wasting its resources. Instead of solving its problems and talking about climate crisis, the government is creating new problems such as this canal project.