presentation niatr inpps 2016 v4

THE 5 FOREIGN THREATS IN THE TURKISH NUCLEAR MARKET

– Strategies on how to swim with the sharks in the nuclear industry–

Research conducted by :

Nuclear Industry Association of Turkey

Areas covered

•  The nuclear power market in Middle East and Africa confirms the limits of the supply chain and and the opportunities for new entrants

•  The 5 foreign threats to the Turkish

industry

•  3 Steps to build a solid lobbying group

What’s the business size?

“Construction of nuclear plants creates a range of export opportunities. Depending on the design, a single new reactor requires approximately: •  500 to 3,000 nuclear grade valves, •  125 to 250 pumps, •  70 kilometer of piping, •  483 kilometers of electric wiring, •  and 90,000 electrical components.”

Source: Nuclear Energy Institute

What’s the nuclear power energy market size?

0 100 200 300 400 500 600 700 800 900 1000

back end fuel cycle

front end fuel cycle

service

nuclear power plant construction

radiation management

nuclear generation

2030 2011

Estimated size of the global nuclear energy market in 2011 and 2030 (Billion TRY)

The nuclear power market in Middle East and Africa confirms the limits of the supply chain and the

opportunities for new entrants

... BUT Turkish companies are way behind their foreign

competitors

•  In 2003, the Science and Technology Upper Council of the Scientific and Technological Research Council of Turkey (TÜBITAK) listed electricity generation through nuclear power plants as the third highest priority of the country.

•  In 2016, Turkey will host the world energy congress. The event will bring together more than 10.000 top world leaders in the field of energy, coming from industry, governments, and international organizations

They do not focus on the priority

World Energy Congress, Daegu, South Korea 2013

World Nuclear Exhibition 2014

Power Gen Europe 2015

Atomexpo 2015

Istanbul •  SITERM •  TEKSAN GENERATOR

Ankara

Bursa •  ÇIMTAŞ BORU İMALATLARI VE TİC

Adana

Izmir •  ENKO ELECTRONIC CONTROL SYSTEMS

Kocaeli

Gaziantep •  ÇİLTUĞ ISISAN.VE TİC.A.Ş

Six years without branding their business

Since the signature of Akkuyu project in 2010, no Turkish Exhibitors were involved in the major exhibitions such as Power Gen International, Nuclear Power Industry China, and World Nuclear Exhibition

Source: Reedexpo,Pennwell, Atomexpo

They do not manage their online reputation

Source Mavinci A.S., Dynatom International

66%

39%

26%

12%

0% 10% 20% 30% 40% 50% 60% 70%

US

France

Russia

Japan

Website reference on Google On 188 Turkish companies willing to get involved in the clusters: •  76% have an English website •  64% are on Facebook •  52% have a LinkedIn account •  37% have a Newsletter •  34% communicate via Twitter

There are three areas under the umbrella of social tech: social relevancy, social media, and social networking. You need to understand the difference among these.

Source: Manager’s Guide to Social Media

“Social Tech isn’t a fad: it’s a powerful trend. Don’t wait a moment longer to get in Front of it. The desire to have new ways to communicate and less expensive ways to transmit information globally are driving adoption.” Scott Klososky

They do not expand overseas

Source: Mavinci, Dynatom International

Website reference on Google

There is no significant representation in the following markets: Armenia, Australia, Belarus, Belgium, Brazil, Canada, Czech Republic, Denmark, Japan, Kyrgyzstan, Lithuania Mongolia, Namibia, Slovakia and Slovenia.

Africa 4%

Latin America 4%

North America

6% Central Asia 7%

Asia 13%

Russia 14%

Middle East 17%

Europe 35%

The 188 candidates to the clusters are represented in 30 Key markets related to nuclear. But the reality shows a ratio of 1.25% of overseas presence (through agent, office, factory).

They do not invest in nuclear standards

Source: Mavinci, Dynatom International

Most of companies follow ISO 9001, but a few invest in the certification for nuclear safety equipment. There is no evidence of companies certified RCC-M, RCC-E, JSME and IEEE

0 20 40 60 80 100 120

ASME N

ASME S

ASME U

GOST R

ISO14001

ISO 9001

And yet…

•  58 new reactors forecasted in the Middle East and Africa Continent until 2030 and more until 2040

Sources: IAEA, World Nuclear, IEA, OCDE,

Middle East and Africa are the new markets

The continent is a magnet for Nuclear Tech countries

The industry must comprehend the complexity of its domestic nuclear power market

These eight forces in the Turkish market represent barriers and opportunities, depending how the nuclear cluster is prepared to face the (domestic and foreign) competition and market needs. Each force must be matched, for example by an adjustment from the cluster, or a focal point on one segment of the market, such as the GOST standard for Akkuyu project, focus in safety level 3 equipment, regional domination with an international partner, or lobbying inside the government. These forces represents the needs that Turkey will have to fulfill with partners from Europe (including Russia), China, Japan, USA and Canada.

The Five Foreign Threats to the Turkish Industry

1.  Lack of Skills

2.  Structured foreign supply chain and expertise

3.  Foreign investment = NO control

4.  Strong willpower from foreign government

5.  Uncontrolled (foreign) service suppliers

The lack of an experienced human resources

Akkuyu project in Turkey includes 4 units AES-2006 for an investment between 54-58 Billion TRY. When the Turkish parliament voted the construction of nuclear power plants, any investor had the duty to localize 60% of the project. Grigory Kazakov, CEO of Akkuyu Nuclear indicated during his presentation at Atomexpo 2015 that 90% of the plant equipment will be manufactured in Russia and equipment account for half of all outlays.

COMPANY UNIVERSITY

BAŞOĞLU KABLO VE PROFİL SANAYİ VE TİC. AŞ Yıldız Teknik Üniversitesi

GEDIK DÖKÜM Gedik University

BOMAK Cukurova University

ASELSAN Gazi Universiy, Uludağ University

STC METU, Bilkent University, Yıldırım Beyazıt University, International Antakya University

MAVİNCİ Hacettepe University, Gebze University

MATRIKS ENERJI İstanbul Teknik Üniversitesi

STM Bilkent University

SFS İstanbul Teknik Üniversitesi

“The main challenge in developing nuclear power in the Middle East will be in setting up the needed nuclear infrastructure and training, as well as the education of a highly skilled nuclear work force”. Source: IEA “Regional perspectives for nuclear energy” 2015

The foreign expertise is structured and over confident

0 500 1000 1500 2000 2500 3000 3500 4000

SNGC (Spain)

BNF (Belgium)

Airto (UK)

OEKTG (Austria)

ENEN (Europe)

Bulatom (Bulgaria)

ENS (Europe)

PFCE (France)

CNA (Canada)

BNS (Belgium)

NIAUK (UK)

GIIN (France)

JAIF (Japan)

SNF (Switzerland)

FNS (Finland)

EPRI (USA)

The Nuclear Institute (UK)

ANS (USA)

PNS (Pakistan)

KTG (Germany)

SFEN (France)

The lack of investment means no certainty

Rosatom’s appealing business model may have long-term impacts on the energy security of Turkey. Relying upon Rosatom officials to own and operate nuclear power plants could ultimately Turkey’s capacity to ensure and enforce the highest standards of nuclear safety. While countries with little expertise in nuclear power may be drawn to outsourcing the plant’s operation under the BOO model, the model can also leave local partners reliant on the personnel and expertise of the Russian company. In Turkey, the BOO model cannot be safely implemented unless local partners are trained as well, something that is not built into the “one-stop-shop” model. As such, Rosatom’s BOO model, while convenient, risks leaving Turkey ill-equipped to provide effective and appropriate oversight.

Source: Emma Lecavalier, Bulletin of the Atomic Scientist, 16 October 2015

A strong willpower from foreign governments

Chinese leaders base future economic growth on innovation to become a global supplier of high-tech commodities “created in China.” The objective is to seize strategic industries and their global markets. The “One Belt, One Road” strategy is intended to shape global economic integration and trade by Chinese terms, advancing nuclear technology as one of China’s new high-tech export brands, as railways before.

Source: Jost Wübbeke and Guan Ting, The Diplomat, 11 February 2016

Too many foreign service suppliers

Source: American Nuclear Society Buyer Guide 2015

ALREADY 230 MULTINATIONALS OFFER 57 VARIOUS TRAINING SERVICE AT Air Treatment AC Auditing, Codes & Standards AE Auditing, Environmental CH Chemistry C Communications CP Computer Users/Computer Personnel CM Construction Management Personnel CS Crane & Rigging Safety EP Emergency Planning & Response EM Engineering Management EE Engineers, Electrical ME Engineers, Mechanical ES Engineers, Structural EL Environmental Laws & Regulation EQ Equipment Qualification FP Fire Protection FD Fitness-for-Duty,

Behavioral Observation FC Fuel Cycle/Performance Analysis FT Fuel Transport/Storage HV HVAC Maintenance I Instructors, Classroom & Simulator LD Leadership Development L Licensing M Maintenance MN Management NT Nondestructive Testing NO Nuclear Power Plant Operations Personnel OE Organizational Effectiveness OS OSHA Compliance P Plant Commissioning PC Process Control Statistical PM Project Management QA Quality Assurance/Quality Control RM Radiation Management (ALARA) RP Radiation Protection

RC Radiochemistry RA Reliability Analysis RR Research Reactor Utilization & Maintenance RS Respiratory Protection RT Root Cause Analysis SE Safety Evaluation S Scaffolding SP Security Personnel SQ Seismic Qualification SI Simulator, Power Plant & Reactor SR Simulators, Radiation SM Snubber Maintenance & Overhaul TB Team Building TE Technicians, Electrical TI Technicians, Instrumentation and Control TL Technicians, Laboratory TM Technicians, Mechanical TS Technicians, Security WM Waste Management WC Water Chemistry

What is the real cost of nuclear?

China Statistical Yearbook, 2013 Complied by National Bureau of Statistics of China

What would you pay to: •  Determine the right strategy •  Find trusted partners and suppliers •  Hire the local stars •  Invest in all training required •  Understand codes and standards •  Create a dedicated marketing team •  Exchange information with your peers •  Monitor the competition •  Promote your company overseas •  Brand your business •  Lobby your government

The 3 Steps to build a solid lobbying group

1.  Commit to the global strategy of Turkey

2.  Create your nuclear cluster

3.  Join the Nuclear Industry Association of Turkey

Commit to the Global Strategy of Turkey

In February 2016, The Government started a prospection in Africa to increase Turkey’s “strategic partnership with Africa and developing relations with members of the Economic Community of West African States (ECOWAS). This trip followed the visit of Ethiopia, Djibouti and Somalia in 2015. Turkey has more than tripled the number of embassies it has in Africa since 2009, while national flag carrier Turkish Airlines has dozens of destinations on the continent. Bilateral trade between Turkey and all of Africa was worth $23.4 billion in 2014, while bilateral trade with sub-Saharan countries has increased tenfold since 2000, according to the Foreign Ministry.

Source: Hurryet Daily News, February 2015

0

5

10

15

20

25

30

Turkish Airlines Emirates Qatar Airways Etihad

Africa Middle East

TurkishAirlines32%

Emirates26%

QatarAirways22%

Etihad20%

Presence of the main regional Airlines in Middles East and Africa

Market presence between the four main airlines in Middle East and Africa

Create the nuclear cluster in your city

•  Ankara Chamber of Industry created its cluster in 2015

•  Istanbul Chamber of Industry followed in 2016

•  Adana and Tekirdağ just started to expand their network

•  Most of the industry is located in the following cities: Bursa, Corum, Eskişehir, Gaziantep, İzmir , Kahramanmaraş, Kayseri, Kocaeli, Konya, Malatya, Mersin, Sakarya, Samsun, Sanliurfa and Sinop.

Since its creation, the PNB gathers 160 entities. More than 3 000 jobs were created in Burgundy and investments of above 700 Million Euros. Nuclear represents 12,000 jobs in the region. Pole Nucléaire Bourgogne

SNGC is a consortium of ENSA, ENUSA, RINGO and TECNATOM in order to coordinate, increase and promote these companies operations in the marketing sector of goods and services. http://www.sngc.es/en/about-us/

Join the Turkish Nuclear Industry Association (NIATR)

Created in 2015, supported by the government and the industry

•  Set up by business owners, with a dynamic international mindset

•  Focused in the foundation of a solid workforce for domestic and regional nuclear projects.

•  Open to any company and individuals Represented in Europe, North America and Asia

•  International business development in Switzerland, a traditional ally of Turkey.

•  Representative in Chicago, the cradle of the nuclear industry.

•  Delegate in Beijing to supervise the relations with the Chinese SOE.

Most ambitious commercial program

•  To become the industrial think tank of the government for nuclear.

•  Expansion plans in Africa and ME •  Open to foreign partners


Source: NIAUK, Bulatom

Hire Local Stars

•  Agreement with local universities to start early training of talents

•  Cooperation with foreign universities and technical school for easy transfer of know how

•  National HR listing

Introduction to Trusted Partners


•  Our B2B matchmaking program monitors 1400 of foreign companies, met face to face

•  Quick check out for our members of the reliability and references of their partner

•  Strategic advice on market

and partnership

Training and Workshops


•  We select the trainings for all members and selected segments

•  We advise you on which training you can, you should, or must follow

•  We list the local and foreign

suppliers that are recognized for their cost-savvy service and results

Dedicated Marketing Team


•  Our marketing team based in 4 continents monitors business news.

•  Mobile application with news in Turkish and English (Android and IOS)

•  Digital magazine sent every

two months with technical and marketing information.

We Brand your Business


•  Use our marketing platform to promote your company

•  Participation to INPPS in Turkey

•  Involvement in overseas

exhibitions under NIATR pavilion

Factory visit


•  Other way to promote your achievements

•  Benchmark your capabilities and visit local and foreign competitors

•  Assess the feedback from

the buyers

Meetings with the Authorities


•  Regular meetings with regional and national stakeholders of the projects

•  Meeting with the Ministry, Safety Authority, to get and provide feedback of the market and needs

•  Strategic meeting with the Ministry of Energy ( see membership type)

Prospect in foreign markets with experts


•  Explore sensitive markets at low risk

•  Use foreign members •  Avoid costly business

prospection

•  Optimize your existing commercial network

Participate to domestic tenders


•  NIATR participates to UR-GE tenders

•  Consolidation of talents •  Increase your market share

in nuclear business

•  Involve in international tenders

Visit of Nuclear Power Projects and Plants


•  Visits of Turkish projects

•  Visits of operating nuclear power plants

Ongoing Business

In 2015, the NIATR signed cooperation agreement with:

•  GIIN (France) •  NIAUK (United Kingdom)

In the first quarter of 2016, the NIATR increased its development with new cooperation agreements:

•  OCI (Canada) •  Bulatom (Bulgaria) •  CNS (Czech Republic) •  Agoria (Belgium) •  US NIC (USA)

Still during the first quarter of 2016, the NIATR will sign more cooperation agreements:

•  SGNC (Spain) •  AREN (Romania) •  NSS (Slovenia)

2016 is the year of global expansion with planned meetings in Jordan, Egypt and Ghana

Next Step

Any industrialized country that uses nuclear power controls 90% of the supply chain. China, India, the Middle East, Asia Minor, Africa and Latin America are no exceptions to this rule, it is just a question of timing. Your role is to act in the global market and to anticipate new challenges rather than wait for orders and control the damage from your competitors.

Join the NIATR Sağlık Sokak No:21 Yenişehir

Ankara Ph: +90 (312) 219 75 46

http://www.niatr.org

presentation niatr inpps 2016 v4

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