Turk Eximbank, MIGA Trade Finance Guarantee (MIGA-15266)

Regions
  • Europe and Central Asia
Geographic location where the impacts of the investment may be experienced.
Countries
  • Turkiye
Geographic location where the impacts of the investment may be experienced.
Financial Institutions
  • Multilateral Investment Guarantee Agency (MIGA)
International, regional and national development finance institutions. Many of these banks have a public interest mission, such as poverty reduction.
Project Status
Proposed
Stage of the project cycle. Stages vary by development bank and can include: pending, approval, implementation, and closed or completed.
Bank Risk Rating
C
Environmental and social categorization assessed by the development bank as a measure of the planned project’s environmental and social impacts. A higher risk rating may require more due diligence to limit or avoid harm to people and the environment. For example, "A" or "B" are risk categories where "A" represents the highest amount of risk. Results will include projects that specifically recorded a rating, all other projects are marked ‘U’ for "Undisclosed."
Voting Date
Apr 6, 2024
Date when project documentation and funding is reviewed by the Board for consideration and approval. Some development banks will state a "board date" or "decision date." When funding approval is obtained, the legal documents are accepted and signed, the implementation phase begins.
Borrower
Lender not identified at the time of disclosure.
A public entity (government or state-owned) provided with funds or financial support to manage and/or implement a project.
Sectors
  • Finance
  • Industry and Trade
The service or industry focus of the investment. A project can have several sectors.
Investment Type(s)
Guarantee
The categories of the bank investment: loan, grant, guarantee, technical assistance, advisory services, equity and fund.
Investment Amount (USD)
$ 331.34 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Currency conversion note:
Bank reported 304
Converted using 2024-03-06 exchange rate.
Project Cost (USD)
$ 331.34 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Currency conversion note:
Bank reported 304
Converted using 2024-03-06 exchange rate.
Other Related Projects
Primary Source

Original disclosure @ MIGA website

Updated in EWS Apr 13, 2024

Disclosed by Bank Mar 6, 2024

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Project Description
If provided by the financial institution, the Early Warning System Team writes a short summary describing the purported development objective of the project and project components. Review the complete project documentation for a detailed description.

As stated by the MIGA, this summary describes a proposed investment by financial institutions yet to be identified (the Guarantee Holders) which intend to provide short-term, revolving trade loans to Turk Eximbank, a Turkish export credit agency solely owned by the Ministry of Treasury and Finance, to help the state-owned bank extend export credits to local companies to facilitate their exports. The MIGA Trade Finance Guarantee (TFG) is requested for up to EUR 304 million of trade loan principal, future interest, and potentially MIGA premium, against the risk of non-payment by Turk Eximbank of its financial obligations relating to the trade finance transaction with a framework period of 3 years, within which underlying transactions will have a maximum tenor of 1 year.

The proceeds of the trade loan will be used to fill the time gap between orders, shipments, and payments, which is equivalent to providing a short-term liquidity that covers front-end expenditures for production of export goods.

The Project is expected to support the government development strategy by seeking to reduce the country's external imbalances, through the provision of favorable trade finance loans to export oriented firms. Turk Eximbank is the sole export credit agency of Turkiye and a major player in support of exporters' access to finance. The national development strategy highlights that Turkiye's international competitive position will be strengthened through sustainable, low-emission, high-technology-based production techniques and exports will be improved with a focus on green and digital transformation. In alignment with the strategy, the proceeds of the facility will focus on servicing export-oriented small and medium enterprises (SMEs), women-inclusive companies, green export companies, and medium to high technology companies. Such loans will mostly be utilized to finance raw material and inputs expenditures for production and to provide liquidity to manage time mismatches between the order, shipment, and payment from the buyers.

The Project aims to promote private sector-led growth by supporting the exporters in Turkiye through increased access to trade finance.

Early Warning System Project Analysis
For a project with severe or irreversible impacts to local community and natural resources, the Early Warning System Team may conduct a thorough analysis regarding its potential impacts to human and environmental rights.

As stated on the project disclosure page, the MIGA TFG facility will support short-term trade loans. Trade-related transactions typically pose minimal Environmental and Social (E&S) risks and impacts. The Project has thus been categorized as ‘FI-3’.

Investment Description
Here you can find a list of individual development financial institutions that finance the project.
Financial Intermediary
A financial intermediary is a bank or financial institution that receives funds from a development bank. A financial intermediary then lends these funds to their clients (private actors) in the form of loans, bonds, guarantees and equity shares. Financial intermediaries include insurance, pension and equity funds. The direct financial relationship is between the development bank and the financial intermediary.
Private Actors Description
A Private Actor is a non-governmental body or entity that is the borrower or client of a development project, which can include corporations, private equity and banks. This describes the private actors and their roles in relation to the project, when private actor information is disclosed or has been further researched.

As stated o the company's website, in the early 1980s, traditional import substitution policies began being replaced by foreign oriented policies and thereafter exportation gained a high degree of importance to the Turkish economy. The task of supporting exports within this reorganization process was undertaken by Turk Eximbank, established in 1987 as Turkey's official export credit agency.

As a means of aiding export development, Turk Eximbank offers specialized financial services to exporters, export-oriented manufacturers, and overseas investors and contractors through a variety of short, medium, and long-term cash and non-cash credit, insurance, and guarantee programs.


Contact Information
This section aims to support the local communities and local CSO to get to know which stakeholders are involved in a project with their roles and responsibilities. If available, there may be a complaint office for the respective bank which operates independently to receive and determine violations in policy and practice. Independent Accountability Mechanisms receive and respond to complaints. Most Independent Accountability Mechanisms offer two functions for addressing complaints: dispute resolution and compliance review.

No project contacts provided at the time of disclosure.

Financial Intermediary - Turkiye Ihracat Kredi Bankasi (Turk Eximbank) A.S.:

Phone: +90 (216) 666 55 00
Fax: +90 (216) 666 55 99
Email: info@eximbank.gov.tr
Address: Inkilap Mah. Dr. Adnan, Buyukdeniz Cad. No:7B, 34768, Umraniye, Istanbul
Website: https://eximbank.gov.tr/en/

ACCESS TO INFORMATION

You can submit a request for information disclosure at: https://www.miga.org/contact/access_to_information

You can also request general information about MIGA and for information on guarantees by emailing: migainquiry@worldbank.org

ACCOUNTABILITY MECHANISM OF IFC/MIGA

The Compliance Advisor Ombudsman (CAO) is the independent complaint mechanism and fact-finding body for people who believe they are likely to be, or have been, adversely affected by an IFC or MIGA- financed project. If you submit a complaint to the CAO, they may assist you in resolving a dispute with the company and/or investigate to assess whether the IFC is following its own policies and procedures for preventing harm to people or the environment. If you want to submit a complaint electronically, you can email the CAO at CAO@worldbankgroup.org. You can learn more about the CAO and how to file a complaint at http://www.cao-ombudsman.org

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How it works