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Tuesday, January 23, 2018

World Bank approves first of two development loans for Turkey

A $500 million sustaining shared growth development policy loan was approved for Turkey by the World Bank's board of executive directors last week.

The loan is the first of two development policy loans and is grounded in the development of goals for Turkey, according to a bank press release.

The goal of the loans are to support Turkey's goal of continued socially and environmentally sustainable growth that it sees as key to fostering shared prosperity.

"Turkey's growth record over the past decade has been inclusive," World Bank Country Director for Turkey Martin Raiser said in the release. "[H]owever, these gains are at risk in a less accommodating international environment. With this DPL, the World Bank supports structural reforms that aim to ensure Turkey's success in raising incomes, creating jobs, and building sustainable infrastructure continues."

Reforms supported by the loans include those for enhancing competitiveness and improving transparency; sustaining job creation and boosting female employment; increasing financial inclusion; and creating a regulatory framework to attract long-term, quality investment in Turkey's infrastructure.

The loan is an IBRD flexible loan with an interest rate equal to six months EURIBOR term, plus a variable spread. It has a final maturity of 15.5 years, including an 8.5-year grace period.