The Ministry of Treasury and Finance extended the authorization of the Izmir Metropolitan Municipality to use “unsecured foreign credit from the Treasury” for one year, while continuing negotiations to finance the Buca metro project.
Izmir Metropolitan Municipality continues negotiations to provide foreign unsecured loans from the Treasury for the Üçyol-Buca metro line project, which will be the largest investment in Izmir history with a budget of 1 billion 70 million euros. After receiving the prior approval of 490 million euros in funding from various international organizations, the Metropolis also filed an application with the Ministry of Treasury and Finance and requested the extension of “the authorization to use the foreign credit without Treasury guarantee “. A letter of approval from the General Directorate of External Economic Relations of the Ministry of Treasury and Finance, indicating that the period has been extended by one year, has reached the metropolitan municipality.
Acknowledgments from President Soyer
Izmir Metropolitan Mayor Tunç Soyer recalled that he passed the matter on to President Recep Tayyip Erdoğan during his recent visit to Izmir. Stressing that the authorization was given at the end of this meeting, President Soyer said: “I thank our dear President for their interest.
The call for tenders has been announced
The tender for the construction of the Üçyol-Buca metro line, which will be built by the Izmir Metropolitan Municipality with its own resources, was announced to the world by being published on the Bank’s procurement portal. European Union for Reconstruction and Development and on the official website of the French Development Agency from February 13. With the announcement of the tender, the process of tendering and evaluation of tenders began. Construction of the project, which will give Buca a boost, should start no later than November.
Loan on favorable terms
The Izmir Metropolitan Municipality and the EBRD signed a loan agreement of 2019 million euros without a guarantee from the Treasury in December 1980. Later, this amount was increased to 125 million euros. The Asian Infrastructure Investment Bank (AIIB) has committed up to 125 million euros, the French Development Agency (AFD) 125 million euros and the Bank of Commerce and Development of the Sea Noire (BSTDB) 115 million euros for the project. He is about to sign letters of authorization with these organizations. Thus, the total of foreign loans granted without Treasury guarantee reached 490 million euros. Under the terms of the EBRD letter of authorization, the interest rate for the financing of the project is EURIBOR + 3.20% for six months; the deadline was set at 12 years, including a grace period of four years. Negotiations with other financing institutions should match the interest rate and maturity to EBRD indicators.