IFC invests in Turkish construction firm in bid to back Africa projects
IFC, a member of the World Bank Group, has said it is providing a $100 million financing package to Yapı Merkezi Holding, the parent company of Turkish construction company Yapı Merkezi Insaat ve Sanayi (YMI), to support the company’s expansion and boost the construction of transport infrastructure in challenging markets.
In a statement late on July 11, IFC said that the three-year term package comprises a $75 million euro and USD equivalent loan from IFC’s own account, and a $25 million euro equivalent syndicated loan from Akbank AG under IFC’s B-loan structure.
“The financing will provide YMI with working capital to allow the completion of transport infrastructure projects in Sub-Saharan Africa, the Middle East and North Africa, and Turkey, and support the company’s expansion in these markets,” IFC said.
Annual infrastructure investment needs in Africa are estimated at $93 billion, but actual investments average only less than half of that amount, according to the statement.
Yapı Merkezi is building a total of 950 kilometers of railway in Sub-Saharan Africa, which will be instrumental in increasing exports for commodities such as gold and coffee. The company is also building railways, tramways and metro systems in the Middle East and North Africa region, including the world’s longest span suspension bridge in Turkey.
“One of our priorities in Turkey is to support the global expansion of strong, competitive Turkish companies,” said Carsten Mueller, IFC’s Regional Industry Head for Manufacturing, Agribusiness and Services in Europe, Middle East and North Africa.
“YMI has a proven track-record in investing in challenging construction markets in Africa and MENA, as well as in Turkey, which will help pave the way for increased private sector investments and close the infrastructure investment gap,” Mueller added.
Over the past decade, IFC has invested more than $12 billion in 350 projects supporting urban development, in more than 60 countries.