The World Bank's Board of Executive Directors approved a $91.54 million loan on Friday for the Sustainable Cities II Project in Turkey, the bank said in a statement.
This is the second project in a series of projects under the Program for Sustainable Cities to improve the economic, financial, environmental and social sustainability of Turkish cities by enabling interested municipalities to access financing for their investments and provide improved services to their residents. The first Sustainable Cities Project, valued at $132.7 million, was approved on Dec. 20, 2016.
Johannes Zutt, the World Bank country director for Turkey, said that today more than 75 percent of the population of Turkey lives in cities, which have become strong drivers of economic growth.
"Although urban access to services has expanded significantly in the past few decades to meet the needs of this population, it remains challenging both to ensure the quality of services and their long-term financial and environmental sustainability," he added.
He further said that the World Bank Group has a long-standing engagement in Turkey's urban sector, indicating that they are happy to continue helping Turkey's cities expand and improve their service delivery through this second Sustainable Cities Project.
The bank also said İller Bank will implement the project and will assist the cities of Antalya and Muğla through financing investments in infrastructure needed to meet service delivery requirements, particularly under the Metropolitan Municipalities (MM) Law of December 2012, to expand territorial service coverage and improve service quality.The expected investments focus on the improvement of water and sanitation services in the areas included in the service area of each municipality and its water and wastewater utility as required by the MM Law, it added.
The bank also said that both cities will receive support in preparing urban and financial investment plans through the first Sustainable Cities Project's Institutional Strengthening component, which is co-financed by the European Commission.
The project supports the Turkey Country Partnership Framework of the World Bank Group for 2018 to 2021, which includes the strategic objective of improving the sustainability and resilience of cities through investments and technical assistance interventions that coalesce around a public-private investment coordination platform in coordination with the International Finance Corporation (IFC), which is the private sector arm of the World Bank Group. The project supports the World Bank's objective under the maximizing finance for development (MFD) approach through this public-private investment coordination platform.
The statement said that the project is also consistent with the Turkish Government's 10th Development Plan (2014-2018), particularly its Livable Spaces/Sustainable Environment" pillar, which recognizes the challenges of rapid urbanization and maximizing its benefits for people and the economy.
The lending instrument for the project is an International Bank for Reconstruction and Development (IBRD) flexible loan with a fixed spread and 30-year maturity, including a five-year grace period, level principal repayments and a commitment-linked repayment schedule, the World Bank said.