Relocation In The World Economy TAGI in The

Relocation In The World Economy TAGI in The Turkish Republic and Beyond İdris Can Koç TAGI - Karınca Exclusive Cooperation General Manager Beirut, Lebanon – December 2009

From 1997, Karınca Group have been the home to two of the most influential and reputable local Sworn Financial Advisory and Certified Public Accountancy firms in The Turkish Republic. • Karınca YMM and Karınca SMMM have given services to more than 300 local and international clients. • It’s founder, Mr. Mustafa Koç, is an ex-accounting expert of the Turkish Ministry of Finance, a former Team Coordinator of The Turkish Tax Council and a Sworn Certified Public Accountant for 18 years. • To whom did TAGI give its license?

Other members of The Forum of Firms. TM are already operating in The Turkish Republic by giving their licenses to Turkish Accounting and Auditing firms. Some are operating for decades. Karınca Group however, didn’t choose to join forces with Western Auditing Firms for the reasons of: ◦ High Competition Among Western Firms in The Market, ◦ Lack of Original Methodology and Thoughts, ◦ Low level of connection with The Middle-East, Gulf Area, Arabic Peninsula and North Africa and ◦ Lack of familiar business cultures and character. Why did Karınca request especially TAGI’s license?

TAGI belongs to one of the biggest groups of corporate services, TAGORG houses very important companies like TAG-Capital, AGIP, TAGLegal, TAGITI and signs under important projects as an agent with AGPRO. TAGORG is a leader and an idol of trust in The Arab World, with regards to all aspects of business life within this region. Why did Karınca request especially TAGI’s license?

The Turkish Republic has long been having connections with The Western World, in almost all business sectors. After years of business, The Western World established strong bonds with the country and the “blood flow” of Turkey’s arm which is open to this part of the world, is healthy. However, Turkey’s other arm is not open to the Arab World and is almost, “gangrene”. Although there are fortunate developments, The current economic and corporate connections of The Turkish Republic with the Arab World is still very weak and the key reason to this weakness is the lack of trust. Why did Karınca request especially TAGI’s license?

In spite of all the centuries lived together and decades of modern business life, no trustworthy professional relationship was ever established between The Turkish Republic and The Arab World. Ready-to Wear Clothing, Construction and Food sectors struggled and still struggle to hold on, with the overwhelming efforts of individual firms and people. However, when compared to the Western World, The Arab World is almost unknown to Turkey. So is Turkey to The Arab World. This had to be stopped. Why did Karınca request especially TAGI’s license?

Karınca Group believed that only TAGORG could help disperse these clouds of uncertainty and mistrust between The Turkish Republic and The Arab World. As its primary field of work and reason of reputation is ◦ ◦ ◦ Auditing, Accounting, Business consultancy, Financial Consultancy and Investment Consultancy, Karınca Group wanted to have TAGI’s license and thus bring TAGORG’s trustworthiness to The Turkish Republic with one of its key firms. Why did Karınca request especially TAGI’s license?

The Turkish Trade Code will change radically, in 2010. With its change, more than 150. 000 companies will be gradually obliged to be audited, by law. Currently, this number is around 15. 000. Why now? Technical Reasons

Currently, there are more than 3. 500 Middle-East, North African, Arabic and Gulf Area based firms established in The Turkish Republic. Almost every one of them are either inactive observers and/or getting their auditing and accounting services from Western auditing firms. Why now? Technical Reasons

Currently, there is a foreign trade of USD 37 Billion (realized - 2008) between The Turkish Republic and The Arab World. Not only this number is very low when compared to the possible, but also this trade volume is audited and consulted by others. Why now? Technical Reasons

There is a developing participation (islamic) banking sector in The Turkish Republic which is also audited by Western Auditing Firms. The biggest industrial companies in The Turkish Republic are trying to do business or more business with The Arab World and they are asking their Western auditing firms to be their agents and presenters here. Why now? Technical Reasons

It is most possible to make The Turkish companies see and understand that: ◦ TAGI is the only auditing firm in the world which can truly and professionally give them the services they need with its international permits and privileges together with its special knowledge of the Arab World, and ◦ Introduce them to TAGORG, which will make them fully benefit from and give benefit to; while safely connecting to and from, this region. Why now? Technical Reasons

The Connection of TRUST Why now? Global Reasons

The Global Economic and Financial Crisis is the biggest catastrophe ever experienced by any sense. The Crisis started in 2007 and it did not end. And the end is not near. To have the least damage from The Crisis, one must not act alone; be it companies or countries. Why now? Global Reasons

Facts about Turkey: as of 2008 ◦ Population: 73. 910. 000 (Worldbank) ◦ GDP: USD 794 Billion (Worldbank) ◦ Currency: Turkish Lira – 1, 5. -TL = 1. -USD (2009) ◦ Borders to: Central Asia, Europe and Middle East ◦ Religion: Islam – 98. 9% of population ◦ Capital: Ankara ◦ Biggest City: Istanbul Population: 14. 000 (State Statistical Inst. ) GDP: USD 193 Billion (State Statistical Institute) Why now? Global Reasons

News about Turkey: December 2009 ◦ Merrill Lynch East Europe, Middle East and Africa (EEMEA): Turkey’s Growth will be 4. 3% in 2010 and will increase. ◦ OECD: Turkey will be the fastest growing country in OECD between 2011 -2017 with an average growth of 6. 7% in GDP. ◦ IMF: The Strong Growth in Turkey will start in 2010. ◦ Citigroup: Turkey will grow 4. 2% in 2010, 5. 5% in 2011, 5. 8% in 2012 and 6% in 2013. ◦ Fitch Ratings: Credit Note of Turkey, raised from BB- to BB+, Country Cap: BBB- GDP per capita above BBB (investment threshold) level. Why now? Global Reasons

News about Turkey: December 2009 ◦ Sukuks: Although The Turkish Treasury says that there are no preparations of Islamic Finance Bonds for 2010 “for now”, both Istanbul Stock Exchange and the Ministry of Finance are making progress in the development of Sukuks and Sukuk based “Income Sharing Bonds” or “Gulf Bonds” market. The work about Sukuks have started in 2003. ◦ Gold: After the latest rise in Gold Prices, the price of 5000 tons of gold, thought to be “under the mattress” savings of Turkey has become USD 192 Billion. (Istanbul Gold Exchange Data - 2009) The weak thoughts for Gold prices to rise further can transfer this volume to Sukuks or other alternative financial instruments. Why now? Global Reasons

Turkish Government’s Thoughts for Middle East, Gulf Area Countries, Arabic Peninsula and North Africa: ◦ Prime Minister Mr. Recep Tayyip Erdogan: “With its young population, rich natural resources, mosaic of cultures and vast experience, The Middle East has given great benefits to The History of Mankind. The Middle East should once again become a place of culture, science, art, peace and prosperity. We will try to do our best whenever a duty is given to us. ” ◦ Middle East Consultant of President of The Turkish Republic Mr. Abdullah Gul, Mr. Ersad Hurmuzlu: “Turkey believes that no country or region must be supported because of another country or region. Turkey’s policy is not to emphasize its political views to any country. Turkey wants the Middle East to be peaceful and consistent. ” Why now? Global Reasons

News about Istanbul: 2009 Q 3 -Q 4 ◦ Istanbul housed, both the IMF Annual Meeting on October 2009 and COMCEC Business Forum on November 2009, in Istanbul Congress Center, 500 metres from our office. ◦ Istanbul is chosen as The European Capital of Culture for the year 2010. A marketing budget of USD 100 Million will be used for this specialty. ◦ One day after our licensing signature ceremony on 30 th September, 2009, The Official Gazette of Turkey published an Action Plan for making Istanbul the Region’s, and then the World’s Finance Center, until the year 2012. Why now? Global Reasons

The Chairman of The Standing Committee For Economic and Commercial Cooperation Of The Organization of The Islamic Conference (COMCEC) is permanently, The President Of The Turkish Republic, currently, Mr. Abdullah Gul. COMCEC is celebrating its 25 th anniversary, with its 57 member states. The Elected General Secretary of The Organization of The Islamic Conference (OIC) is Mr. Prof. Ekmeleddin Ihsanoglu, from Turkey. OIC is celebrating its 40 th year with its 57 member states in 4 continents. The Vice President of Eurochambers is also The President of The Union of Chambers and Commodity Exchanges in Turkey, Mr. Rifat Hisarciklioglu, from October 2009. Chairman of The World Chambers Federation is Mr. Rona Yircali, from Turkey, who is re-elected on December 2009. World Chambers Federation works under ICC (International Chamber of Commerce) As Mr. Talal Abu -Ghazaleh is an executive board member of ICC, Mr. Rona is also an exofficio executive board member of ICC. Why now? Global Reasons

What will The Turkish Government Need to maintain and develop these positive forecasts and global standing? ◦ JCR (Japan Credit Ratings): Turkey needs external financing. ◦ Citigroup: Global Demand for Turkey has to increase, and planned privatizations have to be realized. ◦ Merrill Lynch: Low Current Account Deficit, Low Interest Rates and Low Inflation have to be maintained, unemployment has to be decreased. ◦ Fitch: Turkey needs a Gross External Financial Requirement of USD 66 bn in 2010. ◦ OECD: The ongoing investor trust improvements have to be maintained. Why now? Global Reasons

Therefore, economically, ◦ Turkey needs and plans to attract Foreign Direct Investments (FDIs), especially from our region to plan, organize and realize important projects, which would help not only Turkey, but all. ◦ Also, Turkey needs to implement Sukuks and other alternative financial instruments rapidly to deserve the place of at least a regional finance center, gain adequate external finance and “under the mattress” savings. Why now? Global Reasons

This can only happen when The Connection of Trust is established between countries, companies and business people; between Europe, Central Asia and Our Region. Why now? Global Reasons

As seen from all above, Turkey can act as a bridge and a gate with double doors opening both to Europe and Central Asia, and Middle East. Never before has our region gathered this much Realizable Economic Possibility (REP). Why now? Global Reasons

Trust in Economy and Commerce in Our Region can only be gained by a Corporate Services Group with: ◦ Strong Professionalism, ◦ Strong Corporate Relations, ◦ Strong Knowledge of The Region’s Business Culture ◦ Strong Reputation and ◦ Strong Experience, which is: Why now? Global Reasons

TAGORG Why now? Global Reasons

Act One Boosting TAGI with TAGORG, in Turkey What now?

FACTS § The TAGI-Karinca Cooperation can give any kind of auditing, accounting and consulting services to any and every company and project in Turkey. § However, auditing and accounting has systems with almost similar documentation and methodology. § Therefore the competition in the market, is high. What now?

FACTS § The difference, § Being chosen from within the competition, § Comes from, CONSULTANCY What now?

FACTS § The TAGI-Karinca Cooperation will be using the combination of: § TAGI’s origins from and experience in The Middle-East, § It’s 35 -year corporate history and placement in The Forum of Firms and § Karınca Team’s experience, prestige and knowledge in Turkey to gain local and international clients. What now?

FACTS § But also, no auditing and accountancy firm in Turkey, other than TAGI-Karinca Cooperation is under a corporate services group, let alone such like TAGORG. What now?

FACTS § If TAGORG’s services, reputation, connections and activities are seen and understood by (cleverly promoted to) the Turkish Government, companies, associations, institutions and authorities, What now?

FACTS § And if TAGI-Karinca Cooperation canalize its clients to TAGORG when they need § investment consultancy, § investors for their projects or assets, § entrepreneurial aid, § legal aid, § professional training, § intellectual property services, § IT services or web design services, What now?

FACTS § Then TAGI-Karinca Cooperation, both with, § its origins and § its possibilities to get them in close connection with The Arab World via TAGORG, Will have a special and almost competition-free place in the Turkish auditing, accounting and consultancy market. What now?

FACTS With this system, both TAGI will be boosted in Turkey with TAGORG’s existence and TAGORG will gain additional income and business to its other companies. What now?

FACTS Karınca is currently doing the marketing of TAGI and indirectly TAGORG, in this sense. By this way, not only the brandrecognition of TAGI but also that of TAGORG will increase rapidly and simultaneously, in Turkey. What now?

FACTS Until now, The TAGI-Karınca Cooperation has been published in 12 national newspapers including Hürriyet (The biggest selling newspaper of Turkey) and Dünya (The biggest financial newspaper in Turkey) What now?

FACTS Including Business. Week Turkey, our cooperation has been featured in 3 financial magazines. There has been a one-hour TV program on one of the national TV channels (Kanal 24) featuring Mr. Mustafa Koç and myself only, as the cooperators of TAGI. The program created a big success. What now?

FACTS Almost all of the Turkish Economy Media wants to do interviews with Mr. Talal Abu-Ghazaleh and wants to know more of TAG-Org and TAGI. What now?

FACTS And this is just the beginning…

Act Two TAGI-Karınca and TAGORG as creators and agents of region-wide investments What now?

On Turkey’s side, there are many investments, with which all the region can benefit from. The sectors are: ◦ Energy, (Hydro-Electric Power Plants, Dams, Natural Gas Distribution) USD 10 Billion ◦ Infrastructure, (3 rd Bosphorus Bridge, Highways, Railroads, Airports etc. ) USD 5 Billion ◦ Education Cities for Student Exchange, (Erasmus of Middle-East) USD 2 Billion ◦ Health Tourism, (Thermal, Spa Cities) USD 3 Billion What now?

◦ Family Entertainment, (Disney Antalya) USD 4. 5 Billion ◦ Port - Shipyard Management and Construction, (The Filyos Port) USD 4 Billion ◦ Agricultural Technologies, (The South-East Anatolia Project – SEAP (GAP)) USD 20 Billion ◦ Information Technologies, (e-commerce, nationwide networks) USD 1 Billion ◦ Fair and Exhibition Cities Management and Construction (Istanbul and Antalya) USD 8 Billion What now?

The total cost of investments in those sectors is close to USD 60 Billion. All these investments are either planned with their locations ready or waiting to be developed. Many of those investments do not only require business plans, capital and necessary permits, but also cooperation of associations, chambers and institutions. If The TAGI-Karınca Cooperation and TAGORG act as an agent to get countries, companies, associations and institutions together by recreating trust in all aspects with its professionality, reputation, connections and experience, then, investors to those investments can be found and joint -ventures of (even) countries can be formed by us. What now?

Being the capital providing agents of these projects would almost automatically give their auditing and consultancy business. If The TAGI-Karinca Cooperation and TAGORG act as the financial consultants, auditors and capital providing agents of these projects respectively, TAGI and TAGORG would surely and greatly improve their international standing in a few years’ time. What now?

The Global Economic Crisis will end after a serious period of time. The Realizable Economic Potential in our region has never been this much. The Turkish Republic, politically and economically has never been this close to our region before. The World Economy is looking towards our region for one of the few “exits” out of The Crisis Conclusion: Relocation In The Future Of World Economy

At the same time, The Arab World is looking for a safe and secure way to connect to Central Asia and Europe. There is no better way to use Turkey as a gate with double doors from Europe and Central Asia to The Arab World and vice versa then to implement The Karınca/TAGI - TAG-Org system in the connection. Conclusion: Relocation In The Future Of World Economy

It is the only way to establish a “Connection of Trust” between countries and regions. Accounting, Auditing and Consultancy are the idols of trust and professionality to form the foundations of this connection. The Karınca-TAGI Cooperation would create the trust mechanism and do the marketing of the system to safely send the projects and customers to TAG-Org. Conclusion: Relocation In The Future Of World Economy

And the services of TAG-Org would seal the deals. This way, TAG-Org would be the group to promote our region to relocate itself in a better place, in the future of World Economy. The Karınca Group would do anything in means of professional connections, corporate trust and ethics to accomplish this important mission. Conclusion: Relocation In The Future Of World Economy

May Allah be with us all… Thank you