After recent turmoil in Iraq, the government of Turkey is preparing to ease loan procedures in an effort to relieve losses suffered by Turkish exporters.
According to a written statement released by Economy Minister Nihat Zeybekçi on Thursday, the government will extend the terms of repayment for loans Turkish exporters in Iraq had taken from Turkey's Eximbank. He also declared that Turkish contractors operating in Iraq will benefit from a loan incentive by Eximbank.
“There was a 3.4 percent decline in Turkish exports to Iraq in the January-August period of 2014 compared with the same period in 2013. We are trying hard to compensate the loss in trade with Iraq due to an ongoing conflict there,” the statement read, also revealing some incentives to help Turkish contractors in Iraqi markets as well.
The statement said contractors in Iraq will be able to receive as high as $25 million each in loans from Eximbank. The bank will provide one year non-refundable loans to contractors in Iraq, meaning these companies will be able to start repaying their loan debts to Eximbank after 12 months.
Zeybekçi explained the details further, saying that, being limited to 24 months, loan terms will be extended at a minimum of six-month periods, with new interest rates for each period. He also stated that the effects of the crisis in Iraq on Turkish companies have been worked on. Damage assessment studies have been completed and a new roadmap has been determined for exporters and the construction sector.
Iraq is the fourth busiest country for Turkish construction companies. Besides, Iraq is the second largest export route from Turkey, with $11.9 billion a year. During the uprisings in Libya and Syria, most Turkish construction companies operating in the areas suffered losses. After the fall of Muammar Gaddafi in Libya, Turkish companies failed to receive the money for the projects they had completed before the problems arose. After long discussions with the newly elected Ali Zeidan government of Libya, Turkish officials recovered nearly half of the money and negotiated the payment of the rest at a later date.