AN agreement that will see a total of €1.2bn provided to finance the construction of a 140km high-speed line between Kayseri and Yerköy in the Central Anatolia region of Turkey was signed at the British Consulate General in Istanbul on January 5.
The signing took place during an official visit to Turkey by Britain’s secretary of state for business and trade, Ms Kemi Badenoch.
The financing package includes a €1bn loan for which MUFG has been appointed as sole mandated lead arranger, coordinator, structurer and agent bank by the Turkish Ministry of Treasury and Finance.
The loan has been guaranteed by UK Export Finance (UKEF) and other European export credit agencies (ECA), which have provided significant reinsurance. Sace of Italy has reinsured €249m, Kuke of Poland €205m and OeKB of Austria €176m.
The financing package also includes a separate €220m commercial loan facility, supported in part by the Islamic Corporation for the Insurance of Investment and Export Credit (ICIEC).
The funding will enable Turkey’s Ministry of Transport and Infrastructure, acting through the General Directorate of Infrastructural Investment (AYGM), to build the new line which is expected to reduce road congestion and cut net CO2 emissions between Yerköy and Kayseri by over 6500 tonnes a year.
Connecting with the Ankara - Sivas high-speed line, which opened in April 2023, the new line, which is one of several high-speed projects currently underway in Turkey, is also expected to support economic growth by increasing capacity for regional passenger and freight services around the country’s capital region.
The project will be delivered by a joint of venture (JV) of Turkish contractors Doğuş İnşaat, Çelikler and Özkar.
Mr Tolga Akkaş, chairman of the Doguş Çelikler Özkar JV comments: “This project features not only a significant stride in Turkey’s railway network but also connecting communities, driving economic prosperity, and fostering sustainable development.”
“The UKEF guarantee offers a huge boost to UK exporters looking to increase, or start, their export portfolio under a secure umbrella,” says Mr Marcus Dolman, vice-president of the British Exporters Association (BExA).
“Deals of this type are essential to increase the UK supply chains of large overseas contractors.”
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