Privatization of Turkey’s Bridges and Highways: Economic, Social, and Policy Implications
- The Istanbul Chronicle Team
- Sep 21
- 5 min read
In late August 2025, a development that hit the Turkish agenda reignited the debate over the privatization of major transport arteries. The Privatization Administration officially invited investment banks to bid for the operating rights of Istanbul's two iconic bridges, the 15 July Martyrs Bridge and the Fatih Sultan Mehmet Bridge, along with nine highways. Although no binding agreement has been signed, the announcement has already sparked debate about Turkey’s economy and the future of its most critical transport infrastructure.
The debate over privatization centers not only on revenues but also on broader issues of access, fairness, and politics. This article provides an in-depth examination of the privatization debate in Turkey and globally, considering its historical development, economic motivations, social consequences, and possible alternative policies.
Historical Background
Privatization efforts in Turkey date back to the 1980s and cover many sectors. These initiatives encompass sectors such as telecommunications, energy, port management, mining, and sugar production. The primary aim was not only to generate revenue but also to reduce the state’s operational role and enhance efficiency through private-sector involvement. However, privatization has constantly led to debate and controversy due to both political and economic dynamics. Although these steps provided short-term fiscal gains, over time the sale of strategic assets and gaps in maintenance provoked social backlash.
There are important milestones, particularly for bridges and highways. In 2012, the Koç Holding consortium offered $5.7 billion for the operating rights of the 15 July Martyrs Bridge, the Fatih Sultan Mehmet Bridge and several highways, but the political will of the time deemed this amount insufficient and canceled the tender. Prime Minister Erdoğan's statement that “anything less than $7 billion is treason to the nation” caused a huge public outcry and showed that privatization was not just an economic issue. During the 2018-2019 economic crisis, officials discussed redirecting bridge revenues to the state budget as a short-term fiscal measure, which was not a full privatization step but still signaled an attempt to monetize these assets. However, public reaction slowed these plans.. The privatization effort, revived in 2025, builds on the state’s earlier unsuccessful attempt and is gaining urgency as economic pressures mount.
From an international outlook, the issues around the privatization of critical infrastructure demand particular caution. For example, highway privatizations in France provided short-term revenue for the state, but over time, significant increases in tolls led to public discontent. Another example, the Morandi Bridge disaster in Italy clearly demonstrated the risks of this process: the negligence of the privatized bridge operators raised concerns on profit-oriented management and showed that financial incentives alone cannot guarantee infrastructure safety. By contrast, in Chile, highway privatizations initially boosted state revenue; however, the accompanying rise in toll fees and subsequent social protests raised serious questions about balancing public interest with private sector objectives. Therefore, Turkey's past privatization experiences and international examples are crucial for understanding the potential risks of the current process.
Economic Justifications and Financial Analysis
By 2025, the Turkish economy offers important clues for understanding the short-term appeal of privatization steps. The budget deficit has reached approximately 3.6% of GDP, the inflation rate is hovering above 50%, and Central Bank reserves are under pressure. Borrowing costs are also high, increasing the government's short-term liquidity needs. This fragile outlook creates strong tendency for the government to seek quick liquid revenue through the transfer of bridge and highway operating rights. In the short run, privatization could generate billions of Turkish lira and narrow the budget deficit. However, in the long term, the state will have foregone annual operating revenues, and discussions about sustainability in public finance will resurface.
One of the issues of greatest public concern is high toll rates and consumer costs. Assuming that the operator will want to recoup its investments and make a profit after privatization, toll increases are expected. This increase raises transportation costs, directly affecting logistics prices and daily living expenses. While demand remains inelastic in the short term, some flexibility may be gained in the long term through alternative routes and public transportation options. Therefore, the accurate analysis of toll fees and demand dynamics is crucial for both the public and private sectors.
Net Present Value (NPV) and Internal Rate of Return (IRR) calculations can be performed for financial analysis. These calculations enable the comparison of returns from the public and private sectors using different discount rates. For example, while the government may obtain $7 billion in cash in the short term, the private sector may aim for high returns by securing operating income in the long term.
Social Impact and Access Equity
The privatization of public infrastructure such as bridges and highways, originally designed to support national growth, creates various problems regarding public access. When public services are treated like commercial ventures, that is, when they begin to pursue profit, all segments of the public are affected. In a society where income gaps are deep, bridge tolls become a serious burden for low-income families but hardly affect wealthier users. This imbalance challenges the principle of fairness in access to public infrastructure.
Countries' investments in development also have symbolic importance. Istanbul's bridges are valued not only as basic transportation links but also as historical and cultural symbols. Therefore, discussions about privatization should be evaluated not only financially but also socially. Social responses, ranging from online campaigns to union protests and opposition criticism, can heighten the political risks of a pure financial approach. It is crucial to manage public perception and social reactions to ensure that privatization efforts proceed without eroding public confidence.
International Comparisons
Experiences from other countries highlight both the opportunities and the risks of privatizing transport infrastructure. In France, highway concessions initially boosted state revenue, but rising tolls over time triggered widespread public dissatisfaction. In Italy, the collapse of the Morandi Bridge in 2018 became a tragic reminder of how insufficient oversight under private operators can undermine public safety. In Chile, privatization triggered social unrest, illustrating how profit-driven approaches can generate instability. For Turkey, the key takeaway is that any future strategy should go beyond short-term revenues and focus on ensuring fairness, stability, and strict oversight.
Alternative Policies and Management Models
Privatization is not the only option, and the current process can be supported by alternative models. Infrastructure bonds offer the public small-scale investment opportunities while maintaining state control and increasing public oversight. Performance-based contracts focus on maintenance and service quality rather than revenue guarantees; this ensures a balance between the operator's profit target and the quality of public services.
Graduated pricing and revenue support offer subsidy and support mechanisms for low-income users, while the involvement of local governments in the process increases oversight capacity and enhances civic credibility. Transparent tendering and contract clauses, along with the addition of rights to reassess, monitor, and revise, protect both investor confidence and the public interest. Supporting these policies with detailed financial scenarios minimizes the potential risks of privatization.
Conclusion
The privatization of bridges and highways could yield significant revenue for the government in the near future, yet over time it risks eroding public income, issues of social access equity, and political costs. Any decision must weigh fiscal benefits against the need for public oversight, social equity, and the protection of strategic infrastructure. In making this decision, Turkey must consider not only today's budget deficit but also the transportation and quality of life of future generations.
Written by: Onat Uzkan
Edited by: Defne Taykurt