We talked to Bilgün Gürkan, Turkey Director at Bahrain and Kuwait (BBK), about the goals and activities of BBK.
Bank of Bahrain and Kuwait (BBK) is operating in Kuwait, India, Mumbai, Hyderabad, Aluva, New Delhi, United Arab Emirates (UAE), and Dubai, as well as the Kingdom of Bahrain where it was founded in 1971. And it provides services before the international banking division in countries where it doesn’t operate physically. With its representative office in Turkey, BBK aims to be a trade bridge between Turkey and the region and develop business opportunities. We talked to Bilgün Gürkan, Director at BBK Turkey, about the goals of the bank and their activities in Turkey.
Could you tell us about the course of Turkey-Bahrain economic relations throughout history?
Bahrain has a population of 1.5 million people and extends over a 778-kilometre surface area. With that, it harbours attractive opportunities with its proximity to Saudi Arabia, the biggest economy in the Gulf Region, its free business environment, and zero customs tax with the countries of the region, and so on.
Turkey and Bahrain increase their trade volume day by day. Even though our trade, which went from $28 million to $300 million in 2003, decreased in 2020 due to the pandemic, the general speed of our trade relations is remarkable, nonetheless. The infrastructure and contracting works conducted in this period affected our exports greatly.
The fact that the peoples of both countries share the same cultural values is quite important in this regard. Bahraini businesspeople love Turkey and want to do business here. And the number of Bahraini tourists in our country has been increasing rapidly in recent years. Food, clothing, and furniture sectors attract attention in Bahrain. Technological products with high added value have also found a place in the Bahraini market, especially in the last couple of years.
However, Turkey is not fulfilling its export potential to the country. Even though our country has a highly competitive power in many products that Bahrain imports, our exports to the country are still below the desired level, constituting 3-4% of Turkey’s exports. This rate is similar to Turkey’s rate of the total import figures made to the Gulf countries. One of the main reasons for this is that Turkey didn’t give due importance to Gulf countries in terms of exports because of their low population. And these countries import their products mostly from China, the USA, the UK, and Europe instead of Turkey. Bahrain has a liberal trade regime and low customs taxes. And this is a great advantage for businesspeople who want to export to Bahrain.
Besides, I believe that the more Turkish investors know Bahrain the bigger the mutual trade volume we will achieve. The national income per capita in Bahrain is $50.4 thousand. This income also increases purchasing power.
Bahrain has a well-functioning legal system and a free economic environment. And the new bankruptcy law, open data law, and cybersecurity laws improve the business environment. Bahrain is among the top 10 countries preferred by foreign workers.
As the Chairperson of Turkey-Bahrain Business Council of DEIK, which activities do you carry out to improve the trade volume between the countries?
As the DEIK/Turkey-Bahrain Business Council, our main goal for the 2020-2022 period is to increase the export and import figures between the two countries. It is also important for us to attract investment from Bahrain’s direct and indirect financial institutions to Turkey and increase foreign investment accordingly. For this purpose, we also plan to increase the number of companies and people coming to Turkey from Bahrain in the tourism, healthcare, and education sectors and their expenses. Mutual and personal acquaintances are very effective in developing trade relations with Bahrain. We are working towards reaching the top 100 import companies of Bahrain one by one and introduce them to Turkish companies in their sector. Even though it takes time, it will yield great results in the long term.
And we also signed an agreement with our shareholder in Bahrain, the Bahraini Businessmen’s Association. In this way, we aim to introduce our DEIK member companies to big companies in Bahrain. We held online meetings with the Bahrain Chamber of Commerce due to the pandemic this year, initiating the first B2B meetings between Gulf countries as DEIK.
Do Turkish businesspeople know about the investment opportunities in Bahrain?
Together with the Bahrain Economic Development Board (EDB), we tell DEIK members the opportunities of investing in Bahrain. Bahrain’s close relations with India, its Free Trade Agreement with the USA, and cheaper living conditions than Dubai are some of the opportunities for Turkish companies.
What can you say about the promising sectors of Bahrain?
Bahrain will make up to $32 billion worth of investments in the energy sector in the upcoming years. This will lay the ground for other developments in information technologies, healthcare, medical devices, construction, engineering, ports, professional services, and renewable energy areas.
What are the activities of the Bank of Bahrain Kuwait in Turkey?
Bank of Bahrain Kuwait (BBK) is the largest personal bank of Bahrain and has been operating in Turkey with public and private sector syndication and bonds since 2010. Since 2017, it shares our country’s market information and possible syndication and financing opportunities with other countries. We also help people follow issues regarding our overseas centre and country branches in order to introduce the Turkish companies in the Gulf and India to our overseas centre office and to provide for the possible financing needs of Turkish companies.
Our BBK Turkey Office helps other countries to finance the right businesses in Turkey. The Turkish team promotes the rapid spread of correct information and an increase in foreign financing with the country limit set for Turkey for four years. I am also the chairperson of the TÜSİAD Gulf Network Working Group. As BBK, we support the promotion of Turkey in the Gulf region as well as increasing its trade volume with the countries of the region.
What Is the Bank of Bahrain and Kuwait’s Goal with an Office in Turkey? Could you tell us about the activities of the office?
As BBK Turkey representative office, we especially aim to introduce Arab-invested banks in the Gulf that don’t operate in Turkey to Turkish companies and banks. In addition, we explain to banks that have a limit for our country but trade in the secondary market the importance of doing business in the first market and getting to know Turkish banks in first market transactions.
Turkey is a dynamic country and is very far ahead of the Gulf banking system, especially in terms of banking and technology. The fact that international investors open offices in our country provides investment and trade opportunities not only in Turkey but in the neighbouring countries as well.
Our representation of BBK at DEIK and TÜSİAD helps to increase the recognition level of BBK. In addition, we include photos and information about our activities and meetings in our bank’s magazine every month. And we continue to promote BBK Turkey in Bahrain as well. Our desire is to become a licensed bank. Although it takes a long time, the most important thing for BBK both at home and abroad is trust.
Bahrain is a highly developed country in terms of the Islamic finance ecosystem. And Turkey has been proving itself in the sector with increasing success in recent years. What would you like to say about the contribution of the Islamic finance system to the national economies?
The financial sector and especially Islamic finance in Bahrain are highly developed. The country is not only one of the important financial centres of the Gulf Region but also stands out as the country with the highest number of Islamic financial institutions in the Middle East. Most of the regulatory bodies of the Islamic finance sector are also in Bahrain. Since most conventional banks in the country have Islamic finance divisions, both financing products can proceed simultaneously.
There are also banks operating only with an Islamic finance license. Many institutions in the Gulf and Bahrain are in need of new countries and different portfolios. As the DEIK/Turkey-Bahrain Business Council, we are working towards attracting Islamic finance institutions and banks in our country. Just like BBK, we focus on the questions, “Why do they need to go out of the Gulf region?” and “Why is Turkey important?”
In this regard, as TKBB and DEIK/Turkey-Bahrain Business Council, we organised a workshop to take a closer look at this issue together. We invited the related department managers of the Investment Office of the Presidency of Turkey to this workshop. Our priority now is to inform our potential shareholders about our activities, to share our knowledge, and closely follow this subject from different channels.
Our goal is to answer the question “Why Turkey?” with TKBB one by one in the banks that we selected. Because Turkey is ready and has done quite a lot of work to be a regional centre in terms of Islamic finance. For this reason, we want to explain the criteria I have listed together and to bring new Islamic banks to our country, as in the case of the BBK. I believe that soon we will talk about new banks that have invested in Turkey and the financings that have taken place.
Interview: Fatma Çınar