* IFC’s Post-Financial Crisis Support for Turkey Tops $350 Million
Washington D.C., June 12, 2002
—The International Finance Corporation (IFC), the private sector lending arm of the World Bank Group, has extended a US$7.5 million loan to a leading Turkish glass tableware manufacturer, Pasabahce-Eskisehir, to help the company reduce its short-term debt, boost exports, and overcome shrinking domestic demand precipitated by the country’s recent financial crisis.
IFC’s support is critical at a time when the crisis in the economy, especially the manufacturing sector, and has brought about severe economic problems for the country. IFC’s loan will help the company avoid a potential liquidity crunch.
“This loan to Pasabahce-Eskisehir, a key employer and well-regarded corporate citizen, reflects our continued commitment to supporting Turkey’s private sector as it recovers from financial crisis,” said Khosrow Zamani, IFC’s Director for Southern Europe and Central Asia. “Key manufacturing companies like Pasabahce-Eskisehir that provide much-needed foreign exchange and stable jobs need to remain financially viable for Turkey’s economy to grow. Our investment will help Pasabahce-Eskisehir position itself as a stronger and more competitive company on international markets” he added.
The loan marks IFC’s 11th investment in Turkey since April 2001. Since then, IFC has invested more than $350 million in a wide range of companies and financial institutions to help weather the current economic difficulties. The investments have been aimed at boosting export revenues, improving efficiency, expanding production, and replenishing working capital. As the only source of competitive long-term financing currently available to the private sector, IFC has played a critical role in the growing resilience of the Turkish private sector.
Pasabahce-Eskisehir is a competitive glass tableware manufacturer that currently exports about 70 percent of its aggregate glass production, with a projected foreign exchange revenue of approximately $25 million in 2001. The company employs a workforce of 525 people.
The company is owned by Turkiye Sise ve Cam Fabrikalari A.S, which is the holding company of the Sisecam Group. Sisecam is the industry leader in Turkey and one of the largest glass producers in Europe with 29 affiliate/subsidiary companies, including Pasabahce-Eskisehir. The group employs cutting-edge technology in its production facilities, and uses sophisticated systems and up-to-date marketing methods to sell its products. It employs a workforce of over 12,500 people.
The investment marks IFC’s second in Pasabahce-Eskisehir. When the company started its operations in 1999 IFC had supported this greenfield investment from its own sources as well as mobilizing commercial banks to invest in the company.
The facilities are located near Eskisehir, a high growth potential province in the Anatolian Region of Turkey, with easy access to raw materials, power and energy resources, transportation facilities and customers.
IFC’s mission is to promote sustainable private sector investment in developing countries, helping to reduce poverty and improve people’s lives. IFC finances private sector investments in the developing world, mobilizes capital in the international financial markets, and provides technical assistance and advice to governments and businesses. Since its founding in 1956 through the close of the last fiscal year on June 30, 2001, IFC committed more than $31 billion of its own funds and arranged $20 billion in syndications for 2,636 companies in 140 developing countries. IFC’s committed portfolio at the end of FY01 was $14.3 billion
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