Beijing, December 14, 2021
AIIB Approves EUR300 million for Ispartakule-Cerkezkoy Railway Project
Loan to support construction of rail transport corridor and strengthen Turkey-EU connectivity
The Asian Infrastructure Investment Bank (AIIB) is helping the Government of Turkey finance Infrastructure for Tomorrow (i4t) through a connectivity project that aims to increase rail transport safety, passenger and freight capacity and speed between Turkey and the European Union.
AIIB’s Board of Directors approved a EUR300 million loan for the Ispartakule-Cerkezkoy Railway Project that involves the construction of a new double-track, electrified high-speed railway between Ispartakule and Cerkezkoy. The European Bank for Reconstruction and Development (EBRD) is cofinancing the project with a EUR150 million loan.
The railway project is part of the Halkali – Kapikule Railway Line (HKRL), a strategic transport project that itself is part of the Transport Corridor for Europe-Caucasus-Asia (TRACECA), which aims to strengthen economic relations, trade and transport in the regions of the Black Sea basin, South Caucasus and Central Asia. Once the project is finished, the people in these regions will have access to an inter-operable national rail transport corridor in line with EU standards with appropriate Trans-European Transport Network (TEN-T) connections.
In addition, the project will contribute to the reduction of greenhouse gas emissions, as the project design includes measures to minimize energy use and reduce fuel usage during both construction and operation phases. Low carbon benefits are also expected to result with the shifting of passenger and freight traffic from road to rail. Considering the diversity and volume of Turkey’s main export commodities—automotive parts, construction materials and dry goods—much of these are in fact especially suitable for transport by rail.
“AIIB’s investment in the project is considered 100-percent climate mitigation financing and falls under the Bank’s transport sector strategy. It is also aligned with AIIB’s thematic priorities of connectivity, regional cooperation and green infrastructure”, said Supee Teravaninthorn, Director General, Infrastructure Investment Department (Region 2), during a signing ceremony for the project that took place last week. “We look forward to working with the Government of Turkey and EBRD in support of developing high-quality and sustainable infrastructure across the region in order to further promote trade and economic growth and improve connectivity between Europe and Asia.”
Mr. Serhat Köksal, Ph.D. Acting Director General of Foreign Economic Relations, Ministry of Treasury and Finance of Turkey, said: “We appreciate AIIB's support and contribution in this project, which will provide Turkey's high standard railway connection with European countries with safe, high-speed and clean connection for both freight and passengers. It is also very important in terms of being the first public project financed by the AIIB and EBRD in the field of transportation. When the project is completed, it will be a major step that strengthens our country's position as a bridge between East and West.”
Mr. Yalçın Eyigün, Ph.D, Director General of Infrastructure Investments, Ministry of Transport and Infrastructure of Turkey, said: “We thank AIIB’s contribution to the Ispartakule-Çerkezköy Railway Line Project. The line is part of the EU Trans-European Transport Network (TEN-T) and Beijing to London “Silk Railway”. The project will provide safe, sustainable and low-carbon passenger and freight. The project will also promote the climate resilience of Turkey’s transport infrastructure by supporting the preparation and execution of engineering designs and construction approaches to develop infrastructure, thereby contribute to climate change adaptation goals regarding Turkey’s ratification of the Paris Agreement.”
The primary beneficiaries of the project will be the rail users, including passengers and freight transport operators, who will benefit from shorter travel times and a safer and more reliable rail system. Furthermore, the communities along the corridor, which extends through the provinces of Edirne, Istanbul, Kırklareli and Tekirdağ in Turkey with a combined population over 17.5 million, will benefit from access to jobs during the construction phase.
AIIB and the Government of Turkey have been working closely together since 2018 on other projects to help it address its climate commitments and support the development of energy-efficient transport systems. To date, AIIB has approved over USD3.1 billion through 14 projects in various sectors across the Turkish market.
The Asian Infrastructure Investment Bank (AIIB) is a multilateral development bank whose mission is financing the Infrastructure for Tomorrow—infrastructure with sustainability at its core. We began operations in Beijing in January 2016 and have since grown to 104 approved members worldwide. We are capitalized at USD100 billion and Triple-A-rated by the major international credit rating agencies. Working with partners, AIIB meets clients’ needs by unlocking new capital and investing in infrastructure that is green, technology-enabled and promotes regional connectivity.
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