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EUR 200 Million EIB Support for Bosphorus Railway Tunnel

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EUR 200 Million EIB Support for Bosphorus Railway Tunnel BEI/04/86 Luxembourg/Ankara, 20 September 2004 EUR 200 million EIB support for Bosphorus railway tunnel The European Investment Bank (EIB), the European Union’s financing institution, is providing EUR 200 million to the Republic of Turkey for the first fixed rail connection of the European and Asian networks across the Bosphorus Straits. Mr Wolfgang Roth, EIB Vice-President whose special responsibilities include Turkey, signed the relevant agreement today in Ankara, where he met with State Minister for the Economy, Mr Ali Babacan and Minister of Transport, Mr Binali Yildirim. This is the first loan of a larger facility of up to EUR 650 million approved by the EIB for the tunnel. Financing under this facility will be phased over the period of the project's construction. EIB Vice-President Wolfgang Roth said: "This is a milestone signature. The Bosphorus tunnel is of crucial importance for the integration of Turkey with the European Union and the development of the Union's transport network. It is not just the largest and most important infrastructure project to be undertaken so far in Turkey, it will also be a stimulus to the Turkish and European economies. It is a good example of the catalytic role the EIB can play in helping to co-finance major infrastructure projects". In the context of EU’s South Eastern Neighbours policy, the tunnel gives to the trans-european rail networks (TENS) access to Asia. It will also reduce air and noise pollution by enabling a major shift from road to rail and alleviating congestion on the road network. Efficient transport networks are particularly important for countries such as Turkey, whose peripheral location is a challenge for European integration. The Bank's support for this TEN project will stimulate economic activity and underlines the key role the EIB is playing in the Union's growth initiative. Located in metropolitan Istanbul, the rail link also provides for a long-sought mass transport system for the city’s 11 million inhabitants, overcoming a natural barrier cutting the city in two. The project consists in connecting the two railway lines on the Pan-European Transport Corridor IV, presently terminating on either side of the Bosphorus, through a tunnel. With a total length of 76.53 km, the project includes the construction of 13.56 km of double track tunnel (of which 1.35 km under the sea and 12.21 km of approach tunnels), improvements to the two existing radial lines with an addition of a third track on a length of 62.97 km, 40 stations, connections with other transport networks and rolling stock. The EIB's loan finance will be complemented by funding from the Japanese Bank for International Cooperation (JBIC) and funds of the Republic of Turkey. Along with the two bridges over the Bosphorus, which provide for road connections across the Straits, and of which the first one has benefited from an EIB loan back in 1969, the tunnel will be a gateway for international links of European importance. Background information As a candidate country for European Union membership, as well as Mediterranean Partner Country under FEMIP (Facility for EuroMediterranean Investment Partnership), Turkey benefits from the EuroMediterranan Partnership Mandate, as well as from the “Pre-accession Facility”. To date, the EIB has supported in Turkey, under both, the Mandates as well as the Pre-Accession Facility, projects of key importance for the country’s economy with a total of more than EUR 2.5 billion of loans. Financing was mainly for infrastructure, environment, earthquake reconstruction, foreign direct investment, and the local private sector through global loans. Among the projects supported in Turkey are: the Bursa light rail, the wastewater and effluent treatment systems in Bursa, Adana, Mersin, Diyarbakir, Izmit and Tarsus; the Urban Development Project for the city of Eskisehir; the desulphurisation equipment at the Yeniköy power station on the Aegean coast and the construction of more environment-friendly power and heating plants. In the private sector the EIB has supported flagship FDI projects for Toyota’s car manufacturing plant in Adapazari and the Automotive Investment Turkey project. Contacts : Information and Communications Department (Mr Helena Kavvadia, principal press officer for FEMIP: tel. : +352 4379 6756, fax: +352 4379 3188, Email: [email protected], website: http://www.eib.org/lending/med/en/index.htm ) .
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