Turkey and World Bank Group Reinforce Cooperation on Improving Islamic Finance and the Country’s Investment Climate
October 30, 2013
World Bank Group President Jim Yong Kim’s First Official Visit to Turkey
ISTANBUL, October 30, 2013—World Bank Group President Jim Yong Kim today opened the Global Center for Islamic Finance, together with Turkish Deputy Prime Minister Ali Babacan, as part of a two-day visit to Turkey that focused on enhancing the partnership between the Bank Group and Turkey – the second largest World Bank Group client and a growing key regional player.
The Global Center is envisaged as a knowledge hub for developing Islamic finance globally, conducting research and training, and providing technical assistance and advisory services to World Bank Group client countries interested in developing Islamic financial institutions and markets.
On the occasion of the opening, Kim stated that the Center is a symbol of the Bank Group’s shared objectives of developing Islamic finance and maximizing its contribution to poverty alleviation and shared prosperity in client countries.
“It is my hope that this Center will become the cornerstone for these efforts, serving as a knowledge hub,” emphasized World Bank Group President Jim Yong Kim, “with Turkey taking a leading role in designing and delivering cutting-edge technical assistance, advisory services, as well as generating and disseminating practical knowledge on how to make Islamic finance more relevant for growth and development.”
Earlier in his trip, Kim attended the 5th Izmir Economic Congress, a national economic forum that helps shape the economic policy agenda of the country for the coming years. In his opening remarks, Kim underlined the twin goals of the World Bank Group to end extreme poverty by 2030 and boost shared prosperity for the bottom 40 percent in developing countries.
“Turkey’s economic achievements are an inspiration for many other developing countries,” said Kim. He added “We look forward to continuing our productive partnership with Turkey to help sustain your impressive achievements, to overcome your remaining challenges, and to share your remarkable experience with countries around the globe.”
Subsequently, Kim took part in a moderated panel discussion on current global economic developments with Deputy Prime Minister Ali Babacan.
In earlier meetings with Turkish President Abdullah Gül, Kim informed the Turkish leader of the new World Bank Group Strategy, how the Bank can share its global experience and knowledge, and the scope for increasing the Bank Group’s financial capacity and, hence, its relevance in middle-income countries. The two leaders also exchanged views on Turkey’s growing regional and global role.
Kim met with Turkish Prime Minister Recep Tayyip Erdoğan. Their discussion covered a range of issues, including Turkey’s broader development agenda, developments in the neighboring region, and how to evolve the Bank’s longstanding partnership with Turkey to cover cooperation and knowledge sharing in other countries. “Turkey has the history, capacity, and accumulated knowledge from experience to play a large and responsible role as a development partner and emerging donor,” stressed Kim.
Prior to concluding his visit to Turkey, President Kim will attend the 8th Investment Advisory Council (IAC) of Turkey at the invitation of Prime Minister Erdoğan. The IAC is an annual gathering of top national and international private sector representatives to share their views on Turkey's competitive position in the world economy and advise on how to improve the flow of foreign investment. The IAC gathering came two days after the release of the 2014 Doing Business rankings, which saw Turkey marginally improve its position to 69th place among 189 countries.
Turkey joined the World Bank in 1947. Today, the Bank’s portfolio is concentrated and strategically focused, with 11 investment projects and US$4.6 billion net commitments. Over the last decade, the Bank has worked with Turkey on maintaining prudent macroeconomic policies, restructuring the country’s banking system, making public administration more efficient, restructuring the health sector, reforming the energy sector, and supporting disaster risk management. The International Finance Corporation’s (IFC) strategy in Turkey is to support private sector development. Currently, the outstanding portfolio for IFC’s own account is US$2.4 billion. Fiscal year 2013 was a record year for the IFC in Turkey with US$985 million of investments in 20 projects. Turkey is MIGA’s 8th largest country by gross exposure, representing about 4.2 percent of MIGA’s gross portfolio. MIGA’s portfolio consists of 6 projects with a gross exposure of US$454 million.
About the World Bank Group
The World Bank Group is comprised of five institutions: the World Bank, which is made up of the International Bank for Reconstruction and Development (IBRD), which provides financing, risk management products, and other financial services to middle-income countries; the International Development Association (IDA), which provides interest-free loans and grants to the poorest countries; the International Finance Corporation (IFC), which makes equity investments, and provides loans, guarantees, and advisory services to private-sector business in developing countries; the Bank Group’s political risk insurance agency, the Multilateral Investment Guarantee Agency (MIGA); and the International Centre for Settlement of Investment Disputes (ICSID), which provides international facilities for conciliation and arbitration of investment disputes.