Minister of Treasury and Finance Mehmet Şimşek spoke at the opening of the panel titled "From Target to Implementation: Strategic Partnerships to Mobilize Climate Finance" organized by the International Development Finance Club (IDFC) and Turkey Industrial Development Bank (TSKB) within the scope of the 31st Conference of the Parties (COP31) to the United Nations (UN) Framework Convention on Climate Change held in Antalya.
Stating that they built COP31 around the idea of "implementation", Şimşek pointed out that developing countries need approximately 4 trillion dollars every year to finance their sustainable development goals, and 1.8 trillion dollars of this is for climate finance needs.
Stating that the financing gap continues to grow despite the efforts of multilateral development banks in this field, Şimşek noted that national development banks can play a greater role in closing this gap by mobilizing their own resources.
"I see development banks as catalysts"
Şimşek stated that multilateral development banks provide long-term financing and global expertise, while national development banks provide local knowledge, and said, "When we join forces, we make projects financeable, we introduce better standards and more effective tools." he said.
Underlining that national development banks adopt higher standards in project preparation when working with multilateral development banks, Şimşek continued his words as follows:
"Governance, environmental and social safeguards and risk management are of critical importance. National development banks obtain these standards from multilateral banks and transfer them to their own customers. This is where the real value emerges. Most of the time, we focus only on numbers, whereas the contribution offered by this partnership is much greater. Over time, the quality of investments in the entire economy increases and our capital markets deepen. Therefore, I see our development banks not only as intermediaries, but as catalysts that trigger change towards better governance and higher standards."
Drawing attention to the uncertainty environment in the world, Şimşek said, "Predictability is key. Investors want to be able to see 10 years ahead. If the goals and rules are not clear and there is no convincing road map for transformation, no financing tool can mobilize investment." he said.
Emphasizing that they aim for strong, sustainable and inclusive growth, Şimşek said, "We will achieve this goal by increasing efficiency, competitiveness and durability. In this process, the private sector and green and digital transformation will be at the center." made his assessment.
Şimşek reminded that they came together with the presidents of the Asian Development Bank (ADB), Asian Infrastructure Investment Bank (AIIB), World Bank and Islamic Development Bank (IsDB) and signed 10 new agreements worth a total of 5.1 billion dollars.
Stating that signing agreements is the easy part of the job and that the real challenge is to implement these agreements, Şimşek stated that three priorities stand out in the next process and said:
"The first is project preparation. In my opinion, a large part of the climate finance gap stems from the lack of financeable projects. The main issue is that governments and their partners can put forward projects that are ready for investment. Second, we need to use public resources rationally. The needs of each sector are different. Some need guarantees, some need risk sharing, some need capital support. Therefore, we must choose the right tool for each situation. Third, capacity building. Of course, credit is important in the relationship established with multilateral development banks, but what is permanent is the standards and technical know-how. Türkiye's special needs today "Our 75-year partnership with the World Bank Group has an important share in attracting capital."
"Türkiye is IBRD's largest financing user"
Paschal Donohoe, World Bank Group General Manager and Senior Manager Responsible for Information Management, also stated that Türkiye is the largest financing user of the International Bank for Reconstruction and Development (IBRD) worldwide, with a financing portfolio exceeding 20 billion dollars, and said, "70 percent of the loans provided to Türkiye support studies to reduce the effects of climate change or adapt to these effects. This rate constitutes the highest share among all IBRD's country programs." he said.
Donohoe stated that climate finance also means development finance, and that this financing is important in supporting companies, creating and protecting employment, strengthening cities and developing climate-resistant infrastructure.
Emphasizing that the World Bank Group is among the world's largest climate finance providers, Donohoe said, "In the last 5 years, we have provided more than 210 billion dollars of financing worldwide to development activities that have positive climate impacts. Thanks to our current portfolio, we have contributed to increasing the resilience of approximately 424 million people against the effects of climate change and reducing annual carbon emissions by 345 million tons of carbon dioxide equivalent." he said.
Noting that Türkiye is at the center of these studies, Donohoe said:
"Turkey ranks second among the countries to which the World Bank Group provides guarantees, and third globally among the countries in which our private sector organization, the International Finance Corporation (IFC), invests. This reflects the strength, quality and goals of Turkish companies in this field. However, what is important is not only the size of the financing, but also its quality."
Donohoe stated that they aim to move from a project-based financing approach to more comprehensive investment and financing models in order to realize these investments faster, and said that they are cooperating with the government and other stakeholders within the scope of the Turkish Industry Decarbonization Investment Platform (TIDIP).
Following the opening speeches, a panel titled "From Target to Implementation: Strategic Partnerships to Mobilize Climate Finance" was held.
