Long Term Export Finance Guarantee

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The objective of Long Term Export Finance Guarantee Project for Turkey is to improve access to longer-term finance for Export Oriented Small and Medium Enterprises (EOSMEs) and Export Oriented Mid-Cap Enterprises (EOMCEs). The project has a single component that will utilize the market finance raised by Eximbank with the support of IBRD Guarantee to extend sub-loans to eligible SME and Mid-Cap exporters. With the target of 50 percent principal cover, the Project would assist Eximbank in mobilizing resources well above the notional amount of the IBRD guarantee, while also achieving significantly longer maturity and lower all-in cost for Eximbank than are currently achievable on a standalone loan basis. Ultimately, the larger amount achieved by the Project’s mobilizing longer-term private sector funding will help Eximbank to support more exporters at an appropriate maturity and at attractive rates, while keeping the all-in funding cost at a level that does not adversely affect Eximbank’s cost recovery over time. Eximbank will utilize the entire amount of raised funds to directly extend sub-loans to private export-oriented SMEs and Mid-Cap Enterprises. For the purpose of this Project, in line with the Government policy and Eximbank’s existing practice, EOSMEs will be defined as firms employing fewer than 250 people, while EOMCEs will be defined as firms employing from 250 to 1,500 workers.