Turkish Eximbank signs credit agreement worth billion

By News Centre

Turkish Eximbank has signed a credit agreement for the Turkiye Green Export Project, totaling 1 billion euros.

According to the statement made by Turkish Eximbank, the bank has added another financing opportunity to support the investments exporters will make in green transformation.

Under the guarantee structure of the Treasury and Ministry of Finance and the initial loss compensation structure of the International Bank for Reconstruction and Development (IBRD), a member of the World Bank Group, in the amount of 600 million euros, Turkish Eximbank has signed a credit agreement totaling 1 billion euros for the "Turkiye Green Export Project."

The 10-year term loan, realized with the participation of Deutsche Bank, Standard Chartered Bank, BNP Paribas, and ING Bank, is the largest borrowing transaction of Turkish Eximbank to date, and it is also the first guarantee transaction of IBRD supporting the green transformation of exporters.

This financing transaction aims to help Turkish exporters overcome the difficulties that may arise as a result of the European Union's Border Carbon Adjustment Mechanism (CBAM) through cooperation between IBRD, creditors, and Turkish Eximbank under the Turkiye Green Export Project.

While the Border Carbon Adjustment Mechanism of the European Union initially targets carbon-intensive sectors as of 2026, it will be implemented in other carbon-intensive sectors and carbon taxes in other export markets in the future.

In addition to focusing on the mentioned green transformation, the loan also aims to support social goals such as financing companies supporting women's participation in the workforce and SME financing.

"I believe it will support our country's goal of achieving net zero emissions by 2053."

Kerem Dönmez, General Director of External Economic Relations at the Ministry of Treasury and Finance, stated in the statement that they attach great importance to providing exporters, the driving force of the economy, with access to appropriate conditional financing and supporting their adaptation to the European Union's Border Carbon Adjustment Mechanism to increase the international competitiveness of exporters, and he added:

"I believe that the Turkiye Green Export Project, developed for this purpose, will lead the green transformation of our country's exporters, create new employment opportunities, and support our country's goal of achieving net zero emissions by 2053. We will continue to work with the World Bank and other development partners to support productivity-based and export-oriented qualified growth in the coming period."

Humberto Lopez, World Bank Country Director for Turkiye, stated that the ongoing success of the export sector is vital for the Turkish economy and the transition towards sustainability remains a high priority for the government.

Lopez said, "The World Bank is pleased to support initiatives that will not only contribute to the transition to a low-carbon future worldwide but also enhance both the competitiveness of firms and the country."

"We will be pleased to support green exports through long-term financing."

Ali Güney, General Manager of Turkish Eximbank, stated that they will be pleased to support green exports through the 10-year financing of 1 billion euros secured with the IBRD guarantee, accompanying Turkiye's efforts to adapt to climate change, and supporting Turkish exporters' green transformations and green exports through affordable long-term financing.

Güney expressed that the Border Carbon Adjustment Mechanism (CBAM) set by the European Union, which will subject Turkish-made goods to import tariffs in the form of "carbon taxes," will disadvantage our exporters in terms of competitiveness compared to companies using low-carbon production processes and potentially affect the marketability of their products in the European Union and other export markets. He made the following assessment:

"This situation is expected to expand CBAM to include all sectors in the relatively near future, by 2030. Therefore, it is expected that our exporters will adapt and decarbonize their productions as much as possible to protect their export potentials. With the resources we provide, we will also do our part in drawing up a strategic roadmap for transitioning to low-carbon exports and preserving the competitiveness of exporters in sectors affected by CBAM."

Orhan Özalp, Country Director of Turkiye and General Manager of Deutsche Bank A?, stated that the 1 billion euro agreement provided to Turkish Eximbank is a landmark agreement demonstrating Deutsche Bank's commitment to Turkiye and the bank.

Özalp said, "Deutsche Bank's commitment to Turkiye will continue to grow with the improvement in the country's macro outlook."

Ka?if Atun, General Manager of Standard Chartered, highlighted that this agreement assists Turkish Eximbank in providing long-term financing at very competitive rates, stating, "Supporting our clients and the communities we operate in on their journey towards energy transition and decarbonization is at the heart of our bank's strategy. We are grateful to be part of this transaction, which is very important for the country."

Ümit Leblebici, General Manager of Türk Ekonomi Bankas? (TEB), emphasized that TEB actively participates in providing financing for its customers' sustainability-focused investments and supporting their projects in this field, stating:

"We provide consultancy support in the green transformation processes to our corporate customers, including exporters, and offer them the financing products they may need. We also benefit from the knowledge and experience of our global partner, BNP Paribas Group, in the fields of ESG and sustainable finance."

Alper Gökgöz, CEO of ING Turkiye, stated that they position sustainability among their strategic priorities and believe that green transformation requires collective effort and action.

Gökgöz expressed their belief that the green transformations of exporters in Turkiye are crucial for preserving their export capacities and gaining competitive advantage.