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

According to a statement from Turk Eximbank, the bank has added another financing opportunity to support exporters’ investments related to green transformation.

Under the guarantee of the Treasury and Finance Ministry and the International Bank for Reconstruction and Development (IBRD), a member of the World Bank Group, with an initial loss compensation structure of 600 million euros, Turk Eximbank has signed the “Turkey Green Export Project” credit agreement totaling 1 billion euros.

The 10-year loan, participated by Deutsche Bank, Standard Chartered Bank, BNP Paribas, and ING Bank, is Turk Eximbank’s largest borrowing transaction to date and also marks IBRD’s first guarantee transaction supporting exporters’ green transformation.

This financing transaction aims to assist Turkish exporters in overcoming challenges that may arise as a result of the European Union’s Carbon Border Adjustment Mechanism (CBAM) within the scope of the Turkey Green Export Project through cooperation between IBRD, creditors, and Turk Eximbank.

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

To support exporters producing green products in increasing their exports by preventing potential negative impacts on exporters operating in affected sectors, renewable energy production, energy efficiency investments, and working capital needs of exporters making these investments will be financed.

In addition to the aforementioned focus on green transformation, the credit also includes social objectives such as financing companies supporting female workforce participation and SME financing.

“I believe it will contribute to achieving our country’s 2053 net zero emissions target” Kerem Dönmez, Director General of Foreign Economic Relations at the Ministry of Treasury and Finance, stated in the announcement that they attach great importance to ensuring access to appropriate conditional financing for exporters, supporting their adaptation to the European Union’s Carbon Border Adjustment Mechanism, and increasing the international competitiveness of exporters. He added:

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

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

Lopez stated, “The World Bank not only supports the transition to a low-carbon future globally but also is pleased to assist in initiatives that will increase both firms’ and the country’s competitiveness.”

“We will be pleased to support green exports through long-term financing” Ali Güney, General Manager of Turk Eximbank, stated that they will be pleased to support Turkey’s efforts to adapt to climate change with the 1 billion euro source provided with the IBRD guarantee for a period of 10 years and to support green exports through cost-effective long-term financing.

Güney noted that the Carbon Border Adjustment Mechanism (CBAM) organized by the European Union to achieve its greenhouse gas emission reduction target will subject Turkish-made goods to import tariffs in the form of “carbon taxes,” and he made the following evaluation:

“This situation will disadvantage our exporters compared to companies using low-carbon production processes and potentially affect the marketability of their products in the European Union and other export markets. It is expected that CBAM will expand further and cover all sectors relatively soon, by 2030. Therefore, our exporters are expected to adapt and decarbonize their production as much as possible to protect their export potentials. We will also do our part in the strategic roadmap to be drawn to support the transition to low-carbon exports and maintain the competitiveness of exporters in sectors affected by CBAM.”

Orhan Özalp, Turkey Country Director and General Manager of Deutsche Bank AŞ, stated that the 1 billion euro agreement provided to Turk Eximbank is a landmark agreement demonstrating Deutsche Bank’s commitment to Turkey and the bank.

Özalp said, “With the improvement in the country’s macro outlook, Deutsche Bank’s commitment to Turkey will continue to increase.”

Kaşif Atun, General Manager of Standard Chartered Bank, highlighted that this agreement helps Turk Eximbank provide long-term financing at highly competitive rates and stated, “We are grateful to be part of this important transaction for the country.”

Ümit Leblebici, General Manager of Türk Ekonomi Bankası (TEB), emphasized their active role in providing financing for their customers’ sustainability-focused investments and supporting their projects in this field.

“We provide consultancy support to our corporate customers, especially our exporters, in their green transformation processes 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 ESG and sustainable financing,” Leblebici said.

Alper Gökgöz, CEO of ING Turkey, positioned sustainability among their strategic priorities and emphasized their belief that green transformation requires collective effort and action.

Gökgöz stated that they believe the green transformations of exporters in Turkey are crucial for maintaining their export capacities and gaining a competitive advantage.

source: prepared by Melisa Beğiç

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