Green transition remains key priority in the country

By Dilara Sarı

The European Bank for Reconstruction and Development (EBRD) has unveiled its investment strategy for Türkiye for the next five years, until the end of 2029.

The Bank has defined four key areas of investment priorities in the country: intensifying green transition, boosting the development of human capital, increasing Türkiye’s global competitiveness and strengthening the country’s infrastructure and regional integration.

In the last five years, the Bank has delivered nearly €10 billion(US$10.6  billion) for its investment goals under the previous country strategy, helping to drive significant progress in Türkiye’s private sector with regard to green investments, digital transformation and inclusive policies. In 2023 alone, the EBRD invested a record €2.5 billion(US$2.64billion) in the country, boosted by the Bank’s €1.5 billion support package for the earthquake-affected region.

Building on a strong track record, the EBRD will channel investments and policy dialogue within the strategic framework, with a strong emphasis on green transition and climate resilience.

Priority areas to guide investment                                  

The key area of investment for the EBRD remains the green transition and climate mitigation, with the Bank committed to providing support for increased renewable energy integration, resource efficiency, decarbonisation, the sustainability of municipal services, and boosting climate resilience.

The second EBRD priority is defined as Türkiye’s human capital development, with investments seeking to foster greater gender equality and economic and regional inclusion. The Bank hopes to achieve this in its projects by focusing on access to skills development, gender equality and inclusive economic participation and addressing regional disparities.

The third investment priority for the Bank is boosting Türkiye’s competitiveness through investments that will lead to increased productivity, innovation and stronger governance.

Lastly, EBRD projects will work towards strengthening Türkiye’s infrastructure and regional integration by investing in greater connectivity between transport networks and trade infrastructure, enhancing the quality of digital infrastructure and services, and increasing resilience to natural disasters. EBRD will work with donors and partners to re-integrate the earthquake affected regions into the broader Turkish economy with a focus on building back better and providing advisory to affected businesses.

Commenting on the new strategy, EBRD Managing Director for Türkiye, Elisabetta Falcetti, said: “Over the past15 years, the EBRD has invested over €20 billion in Türkiye’s economy – testament to the country’s importance as one of our primary markets. By fostering robust partnerships with the private sector and engaging in comprehensive policy dialogue, we will continue to support Türkiye’s evolution as a global economic player.”

In a recent report, the EBRD shared its growth forecast for Türkiye, expecting growth of 2.7 per cent in 2024 and 3.0 per cent in 2025. The report also highlighted some vulnerabilities in the economy, including high inflation, geopolitical tensions and external financing needs.

The EBRD is among Türkiye’s key investors, with more than €20.3 billion committed through 455 projects and trade finance limits since 2009, most of it in the private sector.