State guarantee for giant projects: Build-operate-transfer projects with a minimum investment amount of over 1 billion liras and a Treasury guarantee for project debts of more than 500 million dollars executed by the Ministry of Health and Education
Objective To facilitate the financing of giant budget projects with Treasury support. 3 is now called Yavuz Selim. Bridge and 3. If the projects such as the airport are in trouble, the state will immediately catch up
Treasury guarantee for Turkey's giant project has been formulated. According to the Regulation on the Debt to be performed by the Undersecretariat of Treasury in the Official Gazette, the minimum investment amount of 1 billion pounds is made by the Ministry of Health and Education with the minimum amount of projects carried out by the Ministries of Health and National Education in the construction-lease-transfer projects with the amount of 500 million pounds If the facility is taken over by the relevant administrations before the term of the contract is terminated, the Treasury will be able to give 'debt undertaking commitment'.
SUPPORT UP TO 100 PERCENT WILL BE PROVIDED
Treasury guarantee total upper limit of this method is applied for the first time in Turkey will be $ 3 billion. However, it has been stated that the projects that have been announced so far will be exempted from this limit. This means that in case projects such as the 3rd bridge and 3rd airport experience financial difficulties, the Treasury will come to the rescue. The Treasury guarantee system, which was restricted after the 2001 economic crisis, will now be implemented within the framework of providing debt guarantee support to the relevant companies and public institutions in order to complete giant projects.
In the event of termination of the contract, the Treasury will partially or fully undertake any financial liability for the project. The project in question will be transferred to the relevant public institution. Treasury will assume 85 percent of the debt if the contract is terminated due to the company's fault. However, the debt undertaking ratio will reach 100 percent in cases other than the company's fault. Loans to be used for financing the equity that the company has committed to use in the project, cost increases arising due to its fault or loans to be obtained for cash needs will not be included in this scope.
WHAT IS THE DIFFERENCE FROM HISTORY WARRANTIES?
The prior ones included guarantees such as purchase or toll or public projects. In the new case, the Treasury will pay the debt directly if large projects are not completed.
WILL NOT KNOW THAT THE WARRANTY IS GIVEN TO WHICH PROJECTS
Public institutions requesting financial support for their projects will make a written application to the Treasury and this request will be submitted to the Council of Ministers with the proposal of the minister requesting finance. If the Council of Ministers approves according to the Treasury's decision, the relevant debt undertaking agreement will be signed. However, the signed debt assumption agreements will not be published in the Official Gazette. The public will not learn which projects will be provided with Treasury guarantees.
LOADED AMOUNT IT WILL BE SEEN AS A EXTERNAL DEBT
There will also be loans obtained from abroad within the scope of the application. If the Treasury is requested to undertake debt, the amount payable by the relevant creditor will be reported to the undersecretariat. The Treasury will create a "state foreign debt record" over this amount. The regulation in question will cover billion dollar projects such as the 3rd airport, 3rd bridge, Gebze-İzmit Highway project and Kanal Istanbul. Education campuses to be built in 8 provinces and city hospitals to be built in 15 provinces will also be included in the new regulation.
THAT TURKEY'S GIANT 5
- AIRPORT PROJECT
Tender price: 22.1 billion euros
GEBZE-IZMIT HIGHWAY PROJECT
Tender price: 6 billion dollars
- BRIDGE PROJECT
Tender price: 2.5 billion dollars
15 CITY HOSPITAL PROJECT
20 will cost $ 1 billion
8 will be held in the province