International Finance Corporation provides major investment package for Türkiye

​​​​​​​By Gokhan Ergocun and Dilara Zengin Okay

ISTANBUL / WASHINGTON (AA) - The International Finance Corporation (IFC), the private sector arm of the World Bank Group, mobilized a $3.6 billion investment package for Türkiye, in the fiscal year from July 2023 to June 2024.

This is according to Hela Cheikhrouhou, the corporation's vice president for the Middle East, Central Asia, Türkiye, Afghanistan and Pakistan.

The package confirms Türkiye's position as the third largest country of activity of the IFC with the private sector following only India and Brazil, she told Anadolu.

On the margins of the UN General Assembly in New York in September, the Turkish American Business Association organized with high-level Turkish officials, excellent meetings to showcase the evolution of the economic and fiscal policy in Türkiye and opportunities for foreign direct investments and trade relationships to be grown for greater prosperity and results for American companies and the Turkish people and the Turkish companies, said Cheikhrouhou.

During the Annual Meetings of the World Bank Group and the International Monetary Fund, unanimity about the positive steps towards macro-fiscal stabilization that started since middle 2023, improvements in the sovereign ratings of the country, and enhanced foreign private sector appetite to see the opportunities to invest and bring about new job creation was reached, she said.

She said as part of the macro-fiscal stabilization, the World Bank Group is committed to implementing $35 billion, $17 billion of which are portfolio activities and $18 billion in new activities.

Half of the new activities would be with the IFC, In the fiscal year from July 1, 2023, to June 30, 2024, the IFC has achieved a record in its activities in Türkiye, she underlined.

She said: "We approved and mobilized $3.6 billion for Türkiye, which confirms its position as the third largest country of activity of IFC with the private sector only coming after India and Brazil; so, this is a testimony to the vibrancy of the private sector and to the opportunities that it offers across the sectors."

- Türkiye very much open to Europe

IFC's priorities are to enable the vision of the Turkish people as articulated in their medium-term plan, she highlighted.

"And we want to ensure, you know, prosperity comes through jobs, preserving jobs, creating jobs. So, we will be all things equal, looking at all the activities we can undertake that will ensure the preservation of jobs and the creation of jobs," she stressed.

IFC has issued the first green bonds, the first blue bonds in Türkiye as well as, sustainability or gender loans in the manufacturing, agribusiness and services, including to support the higher tech push in the country, she added.

There is an ambition to localize some of the global supply chains that are looking to be closer to the markets, and Türkiye is very much open to Europe, Cheikhrouhou said, expressing the need to create higher value-added manufacturing activities.

The IFC also looks to support logistics, energy and cleaner energy to prepare Türkiye for the carbon border adjustment mechanism of Europe that will take effect very soon, she noted.

- Economic outlook increasingly positive

Noting the devastating twin earthquakes in Türkiye in February 2023, which hit 11 provinces and caused thousands of deaths, she said the IFC provided $530 million for micro, small- and medium-sized enterprises, including priority for women and agribusinesses for the provinces that were affected by the quakes through five banks that are systemic and active in the region and those provinces that were affected.

"We also are very active in the manufacturing, agribusiness and services industry, particularly those export-oriented," she added.

She said: "I and my institution are very much admirative of the resilience of the Turkish private sector. It is truly the engine, a key engine to the Turkish economy."

The wish of the Turkish private sector and the Turkish government is to provide its people, 85 million, with an economy that is prosperous and creates job opportunities on an ongoing basis, she stressed.

She said: "Therefore, there is competition to attract investment. We have seen over the last several years, international investors retrenching into the OECD (Organisation for Economic Co-operation and Development). We want to attract a significant share of that into Türkiye."

Cheikhrouhou said the outlook for the economy will be increasingly positive as enabling policies and institutional setup offer stability, certainty and positive enabling that the private sector, local and international and regional would require.

"So, as you know, everybody is looking for opportunities where they can have greater stability for their outcomes as a result of their investment. And so, Türkiye can be that, especially now that it is adopting a more orthodox macro-fiscal policy.

"Just to say that the Turkish economy is very well diversified and that's very important nowadays. So, we want to be there across as you see the industries, because that's the name of the game, not to be too dependent on one industry, but also increase the value add that it brings, so that you can elevate the quality and number of the jobs," she added.​​​​​​​