Ankara, July 15, 2021 – As Turkey continued to tackle the health, economic and social impacts of COVID-19, the World Bank provided funding of $ 1.5 billion for five critical development projects, in fiscal year 2021, which ended on June 30.
Financial support, along with technical and policy advice and analytical work, contributes to the implementation of the 11e National development plan, as defined in the framework of the partnership with the countries of the World Bank Group (FY17-23). With the new loan approvals in 2021, Turkey’s active loan portfolio reached just over $ 7 billion covering 23 projects.
“Given the current challenges of the COVID-19 crisis, the World Bank is helping Turkey limit the damage caused by the pandemic, while advancing long-term development needs. Our programs, in the fiscal year just ended, are helping to preserve jobs, maintain the private sector, improve resilience to climate change and other development priorities, ”said Auguste Kouame, World Bank Country Director for Turkey.
The highlights of financial support in FY21 are:
Supporting Turkey’s Response to COVID-19 Response
After executing two pandemic response projects in FY20 for health, education and access to finance for exporting companies, the Bank executed in FY21 two additional essential projects to help preserve jobs and viable small and medium-sized businesses:
- the $ 500 million Emergency Business Support Project in Turkey aimed at ensuring access to finance for small and medium-sized enterprises (SMEs) affected by – or adapting to – the economic impacts of COVID-19. The project is implemented through sub-loans managed by VakifBank and the Development Bank of Turkey (TKYB).
- the $ 300 million Rapid support for micro and small businesses during the COVID-19 crisis project, implemented by KOSGEB, aims to prevent the closure of viable micro and small enterprises (MSEs) affected by the pandemic and to maintain their employment levels. The project supports individuals and businesses by providing repayable funding to manufacturing companies and other innovative start-ups focused on manufacturing, scientific research and development, and computer programming.
Stay focused on the long-term development agenda
The Bank’s COVID-19 emergency operations did not derail its focus on long-term development challenges or its strategy to support Turkey’s mitigation, adaptation and resilience efforts in the face of to climate change. In accordance with the Country Partnership Framework (CPP), the Bank’s regular support program continued to focus on inclusive and sustainable growth with a renewed focus on the climate change agenda:
- A $ 300 million Organized Industrial Zones (ZIO) Project for Turkey, implemented by the Ministry of Industry and Technology (MoIT), with the aim of supporting investments in basic infrastructure – such as new roads, water and gas pipes, power lines and logistics facilities – as well as in “green” infrastructure – including improved energy and water efficient facilities, advanced wastewater treatment plants and energy efficient buildings in industrial areas.
- A $ 135 million Resilient Landscape Integration Project in Turkey (TULIP) aimed at improving livelihoods and resilient infrastructure services for rural communities in the Bolaman River Basin, located in the Eastern Black Sea Region, and the Cekerek River Basin in the Central Anatolia region . The project will support investments in resilient landscape integration in targeted areas, restore and maintain green infrastructure and promote sustainable livelihoods.
- A $ 265 million ready to Seismic Resilience and Energy Efficiency Project in Turkish Public Buildings strengthen the safety of public buildings against the dangers of earthquakes while improving energy efficiency to reduce energy bills and harmful carbon emissions. The project aims to better isolate, strengthen or rebuild more than 140 schools, dormitories, hospitals and public buildings, directly benefiting approximately 26,000 people who live, work or use these buildings, including school children and employees. More generally, the benefits will accrue to more than 6 million citizens dependent on the public services provided by the targeted buildings.
Development challenges related to the Syrian refugee crisis
The Bank has also contributed to the government’s efforts to manage the refugee crisis which has been exacerbated by the COVID-19 pandemic and requires increased efforts to protect those most at risk, including women. Within the framework of the support program for regions and municipalities hosting refugees, the Bank has continued to implement and prepare new projects which benefit from the financing of the EU Facility for Refugees in Turkey (FRIT).
Building on the success of projects managed by the World Bank under FRIT-1, the Bank signed administrative agreements for five new Recipient Executed Trust Funds (RETF) of the second batch of FRIT funds also known as FRIT-2. The five projects, worth 392 million euros, are:
- Project to improve municipal services in areas affected by refugees;
- Creation of formal jobs for refugees and Turkish citizens;
- Support for employment and activation of people able to work under protection and Turkish citizens’ project;
- Support for agricultural employment for refugees and Turkish citizens through strengthened links with the market;
- Social entrepreneurship, empowerment and cohesion in refugee and host communities.
Sharing knowledge for better policies
The World Bank has carried out policy-oriented research and analysis that has informed government policy and programs, facilitated the preparation of many WBG-funded projects, and supported investments from other development partners. In FY21, areas of focus for the World Bank’s Advisory and Analytical Services (ASA) included Turkey’s Semi-Annual Economic Monitoring Reports (TEM); Political dialogue on the digital economy in Turkey; women’s access to economic opportunities in Turkey; Leveraging global value chains for growth in Turkey; Resilience of buildings in Turkey; Improved equity and social services; Impact of the Syrian refugee crisis; Business environment in Turkey; Consultancy for Turkey on smart grid options, production planning and trade finance; Improve the impact of the Turkish Court of Auditors on good public governance; Review of national planning, policy formulation and public finance management institutions and performance; Institutional capacity building for risk informed decision making and urban resilience in Turkey.
“We are very happy to have had a productive 2021 fiscal year working closely with the government as well as with many stakeholders and development partners in Turkey to support the Turkish people in the face of COVID-19 and the crisis of refugees while contributing to its long-term development ambitions and strong climate change agenda in the long run. We look forward to building on this success as we begin a new fiscal year, added Mr. Kouamé.
Projects in preparation for the new fiscal year include: additional financing of the geothermal development project; Urban resilience project; Integrated water conservation project; Climate smart and competitive growth in agrifood value chains; Scaling of photovoltaic solar panels distributed in Turkey; and the emergency green, resilient and inclusive Izmir post-earthquake reconstruction project. For these projects, no loan agreement has yet been signed. The finalization of the preparation of these projects and their submission for internal approval are subject to confirmation of the continued interest of all pre-identified borrowing and executing institutions involved.
Ongoing analytical work includes: the Climate Change and Development Report (CCDR); Analysis and advisory program for sustainable recovery and green growth, including a document on low carbon options; Technical assistance for the Emissions Trading System (ETS); Impact of the proposed carbon frontier adjustment mechanism; Public spending and fiscal tools to support green transformation; Private investment for climate adaptation; Regional disparities and development; Review of human capital and quality of education; Social development; Energy Transition and E-Mobility; Preparing for pandemics; Institutional development for high income status; Options to activate long-term financing in Turkey.