Standard Chartered Bank announces the signing of a landmark EUR 1.24 billion green financing for the Ministry of Treasury and Finance of Turkey to fund the development of a new high-speed railway line. The 200km long railway track being developed by the Ministry of Transport and Infrastructure of...show more
Standard Chartered Bank announces the signing of a landmark EUR 1.24 billion green financing for the Ministry of Treasury and Finance of Turkey to fund the development of a new high-speed railway line. The 200km long railway track being developed by the Ministry of Transport and Infrastructure of Turkey, acting through the General Directorate of the Infrastructural Investment (AYGM), is part of Turkey’s strategic vision to improve national transport infrastructure and connect businesses and local communities. The signing ceremony of the financing took place on 8 November 2021.
The railway line will link the cities of Bandirma and Osmaneli in the North West of the country (passing through Bursa and Yenisehir). Bursa is one of Turkey’s most industrialized cities and is not connected to the country’s railway network. Therefore, this project is crucial for economic integration of the inland industry and of the population of the Osmaneli region with the Ankara – Istanbul high-speed railway line.
This historic transaction marks the first green ECA-supported financing undertaken by the Ministry of Treasury and Finance. The transaction entails 100% financing of AYGM’s commercial contract for the project’s development with Kalyon5, a market-leading Turkish engineering, procurement, and construction (EPC) contractor.
As the Green Loan Coordinator, Standard Chartered supported the Ministry of Treasury and Finance to identify and confirm the project’s eligibility, as a clean transportation project, for green loan financing and to meet the Green Loan Principles6. The Bank also structured the financing to meet internationally recognized sustainability standards, including the Equator Principles7, International Finance Corporation Performance Standards8 and the Bank’s own Green and Sustainable Product Framework 2021. The project provides clear environmental benefits given the lower greenhouse gas emissions associated with rail transport vis-à-vis road transportation.
Furthermore, the project will help reduce the pressure on a developing road infrastructure, whilst bringing better mobility for workers, and greater employment opportunities, and an increased flow of business, goods and trade. It will also contribute towards the Turkish government’s alignment with the United Nations’ Sustainable Development Goal9 9 concerning industry, innovation and infrastructure.show less