Announcement of Turkey Boosts Manufacturing Industry on May 25, 1989

FOR IMMEDIATE RELEASE World Bank 1818 H Street, N.W., Washington, D.C. 20433, U.S.A.* Telephone: (202) 477-1234 BANK NEWS RELEASE NO. 89/ 75 Contact: Fawzi Rihane (202) 473-2675 TURKEY BOOSTS MANUFACTURING INDUSTRY WASHINGTON, May 25, 1989 -- Turkey will develop small- and medium-sized industries (SMIs) through a project that is expected to boost exports and generate jobs. The World Bank is supporting the project with a $204.5 million loan. Turkey has targeted SMIs, which constitute 89 percent of all private manufacturers, for growth. The $506 million project aims at expanding and modernizing SMIs by promoting efficient investments and operations and increasing the number of financial institutions that offer credit to these industries. Support will be provided by making credit available at market prices, expanding markets, and enhancing policymaking through reliable statistics. Growth of SMIs, which are labor intensive, will also reduce regional income disparities. Some 26,000 full-time jobs are expected to be created. The World Bank loan will provide lines of credit to participating lending institutions which will in turn finance investments to small- and medium-scale manufacturers. Manufacturers will receive technical and marketing-support services to help them upgrade product quality and expand marketing links with export trading companies. Additional financing for the project will be provided by the government ($500,000), participating credit institutions ($100.5 million) and other private-sector sources ($200.5 million). The World Bank loan is for 17 years, including five years of grace, with a variable interest rate, currently 7.65 percent, linked to the cost of the Bank's borrowings. It also carries an annual commitment charge of 0.75 percent on the undisbursed balance. Note: Money figures are expressed in U.S. dollar equivalents.