As Turkey continued to battle the health, economic and social impacts of COVID-19, the World Bank extended financing worth $1.5 billion for five critical development projects, during Fiscal Year 2021, which ended on June 30.
The financial support, together with technical and policy advice and analytical work, contribute to the implementation of Turkey’s 11th National Development Plan, as laid out in the World Bank Group’s Country Partnership Framework (FY17-23). With the new lending approvals in 2021, the active lending portfolio in Turkey has reached just over $7 billion covering 23 projects.
“Given the ongoing challenges from the COVID-19 crisis, the World Bank is supporting Turkey to limit the harm from the pandemic, while advancing progress on long-term development needs. Our programs, during the fiscal year that just ended, help to preserve jobs, maintain the private sector, improve resilience to climate change and other development priorities,” said Auguste Kouame, World Bank Country Director for Turkey.
Highlights of financing support during FY21 are:
Supporting Turkey’s Response to the COVID-19 Response
After delivering two pandemic response projects in FY20 for health, education and access to finance for export firms, the Bank delivered in FY21 two additional critical projects to help preserve jobs and viable small and medium size firms:
- The $500 million Turkey Emergency Firm Support Project aimed at ensuring access to finance for small and medium enterprises (SMEs) affected by – or adapting to – the economic impacts of COVID-19. The project is being implemented through sub-loans managed by VakifBank and the Development Bank of Turkey (TKYB).
- The $300 million Rapid Support for Micro and Small Enterprises during the COVID-19 Crisis Project, implemented by KOSGEB, aims at averting the closure of viable micro and small enterprises (MSEs) affected by the pandemic and maintain their employment levels. The project supports people and firms by providing reimbursable financing for manufacturing firms and other innovative young firms focusing on manufacturing, scientific research and development, and computer programming.
Maintaining a Focus on the Long-term Development Agenda
The Bank’s emergency COVID-19 operations did not derail the focus on long-term development challenges or its strategy to support Turkey’s climate change mitigation, adaptation and resilience efforts. In line with the Country Partnership Framework (CPF), the Bank’s regular program of support continued to focus on inclusive and sustainable growth with a renewed focus on the climate change agenda:
- A $300 million Organized Industrial Zones (OIZ) Project for Turkey, implemented by the Ministry of Industry and Technology (MoIT), with the objective to support investments in basic infrastructure – such as new roads, water and gas pipelines, power lines, and logistics facilities – as well as in “green” infrastructure – including improved energy and water efficiency facilities, advanced wastewater treatment plants, and energy-efficient buildings in industrial zones.
- A $135 million Turkey Resilient Landscape Integration Project (TULIP) aimed at improving livelihoods and resilient infrastructure services for rural communities in the Bolaman River Basin, located in the eastern Black Sea Region, and Cekerek River Basin in central Anatolia Region. The project will support investments in resilient landscape integration in targeted areas and restore and maintain green infrastructure and promote sustainable livelihoods.
- A $265 million loan to Turkey’s Seismic Resilience and Energy Efficiency in Public Buildings Project to strengthen the safety of public buildings against the dangers of earthquakes while also improving energy efficiency to reduce energy bills and harmful carbon emissions. The project aims at better insulating, strengthening or reconstructing more than 140 schools, dormitories, hospitals, and government buildings, directly benefiting about 26,000 people who live, work or use these buildings, including school children and employees. More broadly, the benefits will accrue to more than 6 million citizens reliant on the public services provided by the targeted buildings.
Development Challenges Related to the Syrian Refugee Crisis
The Bank also contributed to Government efforts in managing the refugee crisis which has been exacerbated by the COVID-19 pandemic and requires stronger efforts to protect those most at risk, including women. As part of the program of support to regions and municipalities hosting refugees, the Bank continued to implement and prepare new projects that benefit from the EU Facility for Refugees in Turkey (FRIT) financing.
Building on the success of projects managed by the World Bank under FRIT-1, the Bank signed Administrative Agreements for five new Recipient Executed Trust Funds (RETFs) from the second batch of FRIT Funds also known as FRIT-2. The five projects, worth € 392 million, are:
- Municipal Services Improvement Project in Refugee Affected Areas;
- Formal Employment Creation for Refugees and Turkish Citizens;
- Employment Support and Activation of Work-Able People under Protection and Turkish Citizens Project;
- Agricultural Employment Support for Refugees and Turkish Citizens through Enhanced Market Linkages;
- Social Entrepreneurship, Empowerment and Cohesion in Refugee and Host Communities.
Sharing Knowledge for Better Policies
The World Bank delivered policy-oriented research and analytical work that has informed Government policy and programs, facilitated the preparation of many WBG-funded projects, and underpinned investments from other development partners. In FY21, areas of focus for the World Bank’s Advisory Services and Analytics (ASA) included the bi-annual Turkey Economic Monitoring (TEM) reports; Policy dialogue on the digital economy in Turkey; Women’s Access to Economic Opportunities in Turkey; Leveraging Global Value Chains for Growth in Turkey; Buildings Resilience in Turkey; Improved Equity and Social Services; Impact of Syrian Refugee Crisis; Turkey Business Environment; Advisory Support for Turkey on Smart Grid Options, Generation Planning and Commercial Financing; Enhancing the Impact of the Turkish Court of Accounts on Good Public Governance; Review of National Planning, Policy Formulation and Public Financial Management Institutions and Performance; Building Institutional Capacity for Risk Informed Decision Making and Urban Resilience in Turkey.
“We are very pleased to have had a productive fiscal year 2021 working closely with the Government as well as many stakeholders and development partners in Turkey to support the people of Turkey in the face of COVID-19 and the refugee crisis while contributing to Turkey’s long-term development ambitions and its strong climate change agenda. We look forward to building on this success as we start a new fiscal year yea,” added Mr. Kouame.
Projects under preparation for the new Fiscal Year include: Geothermal Development Project Additional Financing; Urban Resilience Project; Integrated Water Conservation Project; Climate Smart and Competitive Growth in Agrifood Value Chains; Scaling-up Distributed Solar PVs in Turkey; and Izmir Post-Earthquake Green, Resilient and Inclusive Emergency Reconstruction Project. For these projects, no lending agreement has been signed yet. Finalization of the preparation of these projects and their submission for internal approval are subject to the confirmation of continued interest from all involved borrowing and pre-identified implementing institutions.
Analytical work underway includes: Climate Change and Development Report (CCDR); Sustainable Recovery and Green Growth Analytical and Advisory Program including a Low-Carbon Options Paper; Emissions Trading Scheme (ETS) Technical Assistance; Impact of the proposed Carbon Border Adjustment Mechanism; Public Expenditures and Fiscal tools to support green transformation; Private Investment for Climate Adaptation; Regional Disparities and Development; Human Capital Review and Education Quality; Social Development; Energy Transition and E-Mobility; Pandemics Preparedness; Institutional Development for High Income Status; Options for Enabling Long Term Financein Turkey.
Economic Recovery Plans Essential to Delivering Inclusive and Green Growth
EU member states must ensure careful and efficient implementation of economic recovery plans that support inclusion and growth to bounce back from the worst impacts of the COVID-19 pandemic, says a new World Bank report.
The World Bank’s latest EU Regular Economic Report – entitledInclusive Growth at a Crossroads – finds that the unprecedented and exceptional policy response of governments and EU institutions has cushioned the worst impacts on employment and income. However, the pandemic has exposed and exacerbated deep-seated inequalities, halting progress in multiple areas including gender equality and income convergence across the EU member states. A further three to five million people in the EU today are estimated to be ‘at risk of poverty,’ based on national thresholds benchmarked before the crisis.
The report highlights that effective recovery programs can reinforce progress on the green and digital transitions underway across the region. With the crisis continuing to unfold, government support schemes and the rollout of vaccines in a timely manner will remain essential to bolstering the resilience of firms, workers, and households. Given the longevity of the crisis and the impact on the most vulnerable, many governments have opted to extend the duration of support throughout 2021.
“A green, digital and inclusive transition is possible if economic policy is increasingly geared towards reforms and investment in education, health and sustainable infrastructure,” said Gallina A. Vincelette, Director for the European Union Countries at the World Bank.
With an output contraction of 6.1 percent in 2020, the COVID-19 pandemic has triggered the sharpest peacetime recession in the EU. Governments will need to ensure targeted and active labor market policies are in place to support an inclusive recovery. The report highlights that special attention should be given to already vulnerable workers such as youth, the self-employed, and those in informal employment. These groups are more likely to face employment adjustments during the crisis and may face longer spells of unemployment or periods outside the labor force.
Women have been disproportionately impacted by work disruptions during the pandemic, particularly in the sectors facing the worst effects of the crisis. This was also highlighted in the 2020 Regular Economic Report produced by the World Bank, which found that at least one in five women will face difficulty returning to work compared to one in ten men. It has been harder for women to resume work due to the sectors and occupations that they are working in and because of the additional care burdens that have fallen disproportionately on their shoulders – a manifestation of increasing inequities in home environments.
“As recovery takes hold, it will be important for carefully targeted and coordinated policy support to continue to mitigate the impact of the crisis, with measures increasingly targeted towards vulnerable households and viable firms. Policy makers will also need to strike a balance between helping those that need it most, while enhancing the productivity of the economy and keeping debt at manageable levels,” added Vincelette.
World Bank’s Regional Action in Europe and Central Asia
To date, the World Bank has committed more than $1.7 billion to help emerging economies in Europe and Central Asia mitigate the impacts of COVID-19. Since April 2020, around $866 million has been approved through new emergency response (MPA/Vaccines) projects. In addition, up to $904 million is being reallocated, used, or made available from existing projects and lending, including additional financing, to help countries with their COVID-19 response.
The World Bank’s Global Economic Prospects suggests that growth will be strong but uneven in 2021. The global economy is set to expand 5.6 percent—its strongest post-recession pace in 80 years. The recovery largely reflects sharp rebounds in some major economies.
ADB Calls for Just, Equitable Transition Toward Net Zero in Asia and Pacific
Asian Development Bank (ADB) President Masatsugu Asakawa today called for countries in Asia and the Pacific to take bold action to address climate change while ensuring fair and equitable economic growth amid the coronavirus disease (COVID-19) pandemic.
“The task of addressing climate change is not only urgent, but also inextricably linked to an inclusive and lasting recovery from the pandemic,” said Mr. Asakawa at the Indonesian Ministry of Finance–ADB 2021 International Climate Conference. “With shared commitment and international cooperation, we can make the transition to net zero and achieve climate resilience, so that our region emerges stronger than before.”
The one-day virtual conference attracted about 800 people from the public and private sectors, development partners, think tanks, and academia to discuss international good practices that can help ADB developing member countries transition to low-carbon, resilient economies and pursue a green, resilient, and inclusive recovery from the COVID-19 pandemic.
The event highlighted Indonesia’s commitment to meeting its nationally determined contributions (NDCs) under the Paris Agreement, as well as steps it has taken to support the development of a low-carbon, resilient economy.
“Indonesia has mainstreamed climate change into our National Medium-Term Development Plan 2020–2024 and established a national Action Plan, both on mitigation and adaptation,” said Indonesian Vice Minister of Finance Suahasil Nazara. “In the near future, we will use this recovery phase post-COVID-19 pandemic to pursue our climate and sustainability agenda.” Indonesia will chair the G20 in 2022.
Asia and the Pacific is responsible for more than half of global greenhouse gas emissions. Recent analysis predicts that global energy-related CO2 emissions will grow by nearly 5% in 2021, as demand for coal, oil, and gas rebounds. About 80% of the growth in coal demand is expected to come from Asia.
The Paris Agreement aims to keep the rise in global temperatures to well below 2°C, preferably to 1.5°C, compared to pre-industrial levels. ADB’s sovereign operations will be fully aligned with the goals of the Paris Agreement by 1 July 2023 and its nonsovereign operations by 1 July 2025. ADB will scale up investments in adaptation and resilience to at least $9 billion from 2019 to 2024 to support Asia and the Pacific’s recovery from the COVID-19 pandemic. The measures will contribute to ADB’s commitment to deliver $80 billion in climate finance between 2019 and 2030.
Mr. Asakawa said ADB will support Indonesia’s transition toward a low-carbon, resilient economy and help the country meet its NDC targets. Strengthening resilience is one of the three focus areas in ADB’s country partnership strategy for Indonesia. That includes climate change mitigation and adaptation and green recovery, as well as disaster risk management and finance.
10 new cities chosen for World Economic Forum circular economy initiative
The World Economic Forum’s Scale360° initiative announced today the 10 city-based hubs joining its Circular Shapers programme.
Scale360° leverages innovation hubs in cities, countries and regions worldwide, bringing together leaders in science, policy and business to trigger circular change. Circular Shapers engage with local public, private, and civil society stakeholders to design, organise, and deliver circular economy projects tailored to local needs.
Circular Shapers are competitively selected from the Global Shapers Community, a network of committed and energized young volunteers in 448 city-based hubs around the world. These changemakers have the energy, skill, networks and commitment needed to transform their cities into centres of circular economy innovation.
The latest Circular Shaper cohort hails from four continents and includes: Ankara, Asuncion, Auckland, Beijing, Bucharest, Lahore, Manama, Milan, Morelia, and Thimphu.
The cities selected to the latest cohort will apply Scale360°’s tested methodology – the Scale360° Circular Innovation Playbook – to fast-track Fourth Industrial Revolution impact to keep more goods in use. Their initiatives will explore ways to apply circular design principles, improve reuse, and to eliminate waste, all while strengthening economies and boosting job growth.
These join the successful pilot cohort which included four Global Shapers hubs in Mexico City, Brussels, Turin and Bangkok and ran from February to July 2021.
In just a few months, those pilot cities built critical relationships with leaders in government, the private sector, and NGOs, making critical early steps towards driving circular innovation. Specific achievements include:
Bangkok: Mobilized a range of partners from researchers to advertising agencies to popularize solutions to air pollution and plastics. Solutions included: assembling a catalogue to help businesses choose alternatives to single-use plastics in food packaging and a social media campaign to build momentum for clean air regulation.
Brussels: Partnered with local NGOs on its “Eat, Play, Live Circular” initiatives to create bottom-up solutions for more circular lifestyles. Initiatives included an ‘Idea-thon’ for food and packaging waste solutions and a series of experiments with the public to make one Brussels public space more circular.
Mexico City: Trained public, private and government stakeholders in Scale360° methodology to bridge circular economy knowledge gaps and drive the circular transition through focusing early conversations.
Turin: Built critical relationships with stakeholders from 14 organizations including regional policy makers, members of the private sector, academia, and existing networks to help foster and support much-needed discussions and collaboration on circular needs and priorities.
The Circular Shapers tap into World Economic Forum networks of experts and leaders in civil society, government, industry global organizations, including the Platform for Accelerating Circular Economy (PACE).
“It’s powerful to see how Scale360° methodology has spread so rapidly and empowered Global Shapers to become leaders driving circular innovation in their cities. Now in 14 hubs around the world, Circular Shapers is one of the largest cross-hub collaborations in the Global Shapers Community,” said Katie Hoeflinger, Specialist, Climate and Environment, Global Shapers Community.
The United Arab Emirates, a key supporter of Scale360°’s approaches, agrees that these new hubs will play an important role in building circular innovation. “The UAE supports Scale360° in driving the transition to circular economy locally and globally,” said his Excellency Dr. Abdullah Belhaif Al Nuaimi, Minister of Climate Change and Environment. “This program will go a long way in fostering innovations that have the potential to fast-track the implementation of the circular economy principles around the world.”
These efforts can also fuel a just transition, noted Head of Global Opportunities for Sustainable Development Goals (GO4SDGs), United Nations Environment Programme (UNEP), Adriana Zacarias Farah. “Jobs and skills are central to getting the political buy-in for the transformation from linear to circular. UNEP through the initiative Global Opportunities for SDGS (GO4SDGS) is happy to collaborate with the Forum and Scale360° on circular cities and the just transition narrative.”
Building circular capabilities can help meet critical climate goals. “Scaling up circular business models and solutions is vital for environmental reasons and needs to happen fast,” said Carsten Gerhardt, Partner at Kearney and Founder at Circular Valley (leading partners of Scale360° Germany).
With new Circular Shaper hubs in place, momentum for circular innovation can build further. Added Scale360°’s Global Lead, Helen Burdett: “This latest cohort is another example of local action for global impact on the circular economy transition.”
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