IFC invests $20B+ in Türkiye’s private sector over decade

By Gokhan Yildiz

ISTANBUL (AA) – Türkiye is one of the International Finance Corporation's (IFC) largest markets, with more than $20 billion in investments in Türkiye's private sector made in a decade, the ICF official said.

Wiebke Schloemer, the IFC regional director for Türkiye and Central Asia, told Anadolu that they have increased investments in Türkiye in the last two years to support the private sector amid macroeconomic volatility.

She stated that the $3 billion of the total investment was made between July 2022 and June 2023.

Schloemer noted that they have been working to improve the access of underserved segments, such as women entrepreneurs and small businesses, for the last two years.

She added that they aim to scale sustainable and critical infrastructure investments in order to support the manufacturing sector through export-oriented companies and projects.

- World Bank to give $18B loan for private sector in 3 years

Schloemer mentioned that the World Bank Group will provide $18 billion in direct loans to Türkiye's private sector in the coming three years, in addition to the $17 billion in programs, saying:

"This implies a tentative financial package of around $35 billion. This package represents a big expansion in our Türkiye program and responds to the strong commitment shown by the administration to restore macroeconomic stability."

"We also plan to deepen our involvement in some other areas, such as the export sector," she added.

Schloemer noted that the International Bank for Reconstruction and Development (IBRD) approved a $1 billion loan in June 2023 to help the people in the areas affected by the earthquakes of Feb. 6, 2023.

She underlined that the loan would be used for repairing rural homes and providing basic public services, and she highlighted that 11 provinces were hit the most in the wake of the earthquakes, which house 14 million people.

"In parallel, IFC has worked tirelessly on securing private sector funding for both early relief and long-term reconstruction efforts. In the aftermath of the earthquakes, we committed to deploying approximately $1 billion over the next two years to support relief and reconstruction efforts, channeling funding through our longstanding private partners in the financial, manufacturing, and infrastructure sectors," she added.

- ⁠IFC prioritizes redeveloping destroyed areas, supporting affected households via Turkish banks

Schloemer underlined that the IFC's priorities include not only helping the reconstruction of earthquake-stricken areas but also supporting the affected households via Turkish banks, saying:

"Many people in these areas are unable to pay back their loans. We are also working with local banks to mitigate the impact on the financial sector by addressing their short-term liquidity needs and are examining the feasibility of leveraging capital market instruments to support long-term reconstruction efforts."

She mentioned the financing package amounting to about $680 million they provided for medium and small enterprises in the region and a leading manufacturing company, saying:

"The funding, which builds on IFC's extensive experience in responding to global natural disasters, aims to support the participating banks by providing liquidity to help them continue lending in the quake-affected provinces. The five banks include Akbank, which will receive $71 million; DenizBank - $119.5 million; QNB Finansbank - $109.5 million; Türkiyeİş Bankası - $150 million; and Yapı Kredi - $80 million."

"The funds include up to $220 million mobilized from international financial and development institutions. The second component is our $150 million green loan to Sanko Holding to bolster the manufacturing sector in the region and help create jobs and drive sustainable growth," she added.

*Writing by Emir Yildirim