The EBRD is continuing to support the development of small and medium-sized enterprises (SMEs) involved in agribusiness in Turkey’s developing regions with a US$ 65 million loan to Türk Ekonomi Bankası (TEB) that will help increase the availability of credit to those businesses.
Controlled by BNP Paribas and Çolakoğlu Group, TEB is the sixth largest private bank in Turkey. The EBRD loan is part of the Bank’s €400 million Agribusiness SME Financing Facility (TurAFF), launched in November 2011 to support the growth of agribusinesses, operating predominantly in Turkey’s rural areas.
The small business sector is a key driver of the Turkish economy, providing around 80 per cent of the country’s employment, while agriculture accounts for around 10 per cent of the GDP. Although corporate and consumer lending is picking up in Turkey, access to financing remains limited for small companies in the agribusiness sector.
The proceeds of the EBRD loan will be used to finance the investment needs of agribusiness enterprises, underpinning the development of the sector, and will support TEB’s drive to expand its SME lending activities.
“Increasing the availability of longer-term funding to the small and medium-sized enterprises sector, particularly in the remote areas and for small agriculture, is one of the EBRD’s strategic priorities in Turkey. We are delighted to launch our cooperation with TEB in order to support the growth of Turkey’s real economy sector,” said Mr. Mike Davey, EBRD Country Director for Turkey.
“Farmers have strategic importance for the Turkish economy and for the welfare of Turkish society. With this in mind, we have signed an important agreement with the EBRD to continue our support to the industry. Together, we will provide loans worth US$ 65 million to small and medium-sized agricultural businesses to promote their further growth and development,” said Mr Turgut Boz, Assistant General Manager, TEB.
Previously the EBRD signed loan agreements for €130 million under TurAFF with DenizBank, Garanti Bank and TSKB. The implementation of TurAFF is supported by technical assistance funds provided by the US government.
Since the beginning of the EBRD’s operations in Turkey, the Bank has invested over €1.7 billion in various sectors of the country’s economy, mobilising additional investment in excess of €3 billion.