Other ADB Members
Sum of Measures 1—5 (Total Package)
|Measure||Amount (Local)||Amount (USD)||Details||Update||Source|
|01 - Liquidity Support info_outline||TRY40,000,000,000||USD6,610,730,013|
|01A - Short-term lending info_outline||TRY40,000,000,000||USD6,610,730,013||
(i) No amount/estimate: 17 March 2020, In addition to one-week repo auctions, the main policy instrument, the Central Bank of Turkey (CBRT) may inject liquidity to the market through repo auctions with maturities up to 91 days with an interest rate 150 basis points lower than the one-week repo rate, i.e. the CBRT’s policy rate, and with quantity auction method; (ii) No amount/estimate: To further support the Primary Dealership system considering its contributions to the deepening of financial markets and to the effectiveness of the monetary policy transmission mechanism, the facility offered to Primary Dealer (PD) banks to sell GDDS to the CBRT has been revised. Accordingly the CBRT has decided that: (a) The limits offered to PD banks for outright sales of GDDS to the CBRT will be applied independent of the repo transaction limits and that PD banks will be offered a GDDS selling limit that is equal to the repo transaction limits, (b) The related purchases will also be carried out within the total maximum limit of 10% set for the OMO portfolio, (c) The GDDS to be purchased and the amount of purchases will be determined by the CBRT, and (d) Purchases will be conducted via the quantity auction method; (iii) 31 March 2020, To facilitate goods and services exporting firms’ access to finance and support sustainability of employment, Turkish lira-denominated rediscount credits for export and foreign exchange earning services will be extended. A total limit of TRY60 billion has been defined for the credits. Of this limit, TRY20 billion has been allocated for credit utilization via Türk Eximbank, TRY30 billion for credit utilization via public banks, and TRY10 billion for credit utilization via other banks. The credits will have a maximum maturity of 360 days. 5 June 2020, CBRT decided to reallocate TRY20 billion out of the TRY60 billion as advanced loans against investment commitment (see Measure 3A).
|01B - Support policies for short-term lending info_outline||
No amount/estimate: (i) 31 March 2020, Outright purchase operations under the Open Market Operations (OMO) portfolio, which are conducted within the limits identified at the Monetary and Exchange Rate Policy for 2020 text, can be carried out in a front-loaded manner and these limits may be revised depending on the market conditions; (ii) 31 March 2020, For a temporary period, the Primary Dealer banks, will be able to sell the Government Domestic Debt Securities (GDDS) that they have bought from the Unemployment Insurance Fund to the CBRT under the terms and limits set by the CBRT, or will be able to increase at certain ratios the liquidity facility offered under OMO in the scope of the Primary Dealership system; (iii) 31 March 2020, Under the Turkish lira and foreign exchange operations conducted at the CBRT, asset-backed securities and mortgage-backed securities have been included in the collateral pool; (iv) April 2020, Liquidity facilities were augmented, including with longer-term instruments and at discounted rates. The reserve requirements on foreign currency deposits were reduced by 500 basis points for banks meeting lending growth targets. 18 July 2020, FX reserve requirement ratios have been increased by 300 basis points in all liability types and maturity brackets for all banks. The move was introduced as part of the normalization process, in order to support financial stability; (v) 17 April 2020, The maximum limit for the ratio of the OMO portfolio nominal size to the CBRT analytical balance sheet total assets, set at 5% for 2020 in the Monetary and Exchange Rate Policy for 2020 text, has been revised to 10%; (vi) No amount/estimate: 17 April 2020, Law No. 7244 on Commuting the Effects of New Coronavirus (COVID-19) Outbreak on Economic and Social Life and Amending Certain Laws Law temporarily restricts the distribution of corporate dividends until 30 September 2020. According to the law, companies may distribute only 25% of the net profit gained in the fiscal year 2019, cannot distribute previous years’ profits, and cannot grant boards of directors the right to distribute advance dividends. General assemblies shall also not give the board of directors the authority to distribute advance dividends. On 18 September 2020, three-month extension of the provisions (Commercial Code No. 6102). As of 29 December 2020, this measure has been extended until February 2021 [update]; (vii) 20 June 2020, the CBRT has decided to temporarily (until the year-end) suspend the enforcement of the rule of having adjusted real loan growth rate below 15% for the banks with a real annual loan growth rate above 15% in order to be able to benefit from reserve requirement incentive.
|01C - Forex operations info_outline||
17 March 2020, Conventional (multi-price) swap auctions with maturities of one, three and six months, which are currently available against US dollars, may also be held against euros and gold.
|02 - Credit creation info_outline||TRY25,000,000,000||USD4,131,706,258|
|02A - Financial sector lending/funding info_outline|
|02B - Support policies for long-term lending info_outline|
|02B1 - Interest rate reductions||
(i) No amount/estimate: As of 23 July 2020, The Central Bank of the Republic of Turkey (CRBT) has lowered the policy rate by a cumulative 250 basis points from 10.75% to 8.25%. On 25 September 2020, the CRBT increased the policy rate to 10.25%; (ii) 24 December 2020, The Monetary Policy Committee (MPC) has decided to increase the policy rate (one-week repo auction rate) from 15% to 17%. [update]
|02B2 - Other policies to support long-term lending||
(i) No amount/estimate: 31 March 2020, The limits for the targeted additional liquidity facilities offered to secure uninterrupted credit flow to the corporate sector will be increased; (ii) No amount/estimate: 1 April 2020, Joint-stock companies' dividend distributions (decided in shareholders' meetings) are capped to 25% of their 2019 profits; (iii) No amount/estimate: 6 May 2020, banks are required to maintain a new consolidated and individual asset ratio of at least 100% starting at the beginning of June; otherwise, they will have to pay an administration fee; (iv) No amount/estimate: 8 December 2020, The Banking Regulation and Supervision Agency (BDDK) extended an existing measure to mid-2021 that lengthened the grace period for reclassifying troubled loans as non-performing (NPL) to 180 days. [update]
|02C - Loan guarantees||TRY25,000,000,000||USD4,131,706,258||
TRY25 billion for doubling the credit guarantee fund.
|03 - Direct long-term lending info_outline||TRY118,000,000,000||USD19,501,653,537|
|03A - Long-term lending info_outline||TRY20,000,000,000||USD3,305,365,006||
5 June 2020, CBRT has decided to reallocate TRY20 billion out of the TRY60 billion limit of Turkish lira rediscount credit facility (see Measure 1A) as advance loans against investment commitment for more effective utilization in order to support investments in selected sectors that are critical to our country. Advance loans against investment commitment will be extended through development and investment banks to firms that hold Investment Incentive Certificates and that will make investment in selected sectors. Loans will have maximum maturity of 10 years.
|03B - Forbearance||TRY98,000,000,000||USD16,196,288,531||
No amount/estimate: (i) Local firms affected by the crisis were granted a 3-month moratorium on bank loan repayments (principal and interest); (ii) Exporters’ inventory financing is being supported by extending maturities for existing and new export rediscount credits; (iii) Debt enforcement and bankruptcy proceedings (except in alimony cases) have been suspended; (iv) 20 May 2020, TRY98 billion estimated deferred loans and interest payments.
|04 - Equity support info_outline||TRY21,000,000,000||USD3,470,633,257||
10 May 2020, Turkey’s sovereign wealth fund injected TRY21 billion into three state lenders (TC Ziraat Bankasi AS, Turkiye Halk Bankasi AS and Turkiye Vakiflar Bankasi TAO) to strengthen their capital positions and minimize the impact of the coronavirus pandemic.
|05 - Health and income support||TRY75,000,000,000||USD12,395,118,774|
|05A - Health support|
|05B - Income support||TRY75,000,000,000||USD12,395,118,774|
|05B1 - Tax and contribution deferrals and policy changes||
No amount/estimate: postponed taxes for affected industries (particularly tourism), and extension of personal and corporate income tax filing deadlines.
|05B2 - Tax and contribution rates reduction||
(i) No amount/estimate: 1 December 2020, Tax reduction application applied for employees employed within the scope of Temporary Article 21 of Law No. 4447 has been extended to 31 December 2022 [update]; (ii) No amount/estimate: 22 December 2020, The VAT rate in the import and delivery of COVID-19 vaccines approved by the Ministry of Health has been reduced to 1% until 31 December 2021. [update]; (iii) No amount/estimate: 22 December 2020, The validity period of the temporary reduced withholding rates has been extended for 5 months starting from 1 January 2021 until 31 May 2021 [update]; (iv) 23 December 2020, Entertainment tax rates applied for domestic and foreign films have been reduced to 0% until 31 May 2021. [update]
|05B3 - Wage support and subsidies to individuals and households||
(i) No amount/estimate: raising minimum pension and cash assistance to families in need; (ii) No amount/estimate: 5 June 2020, The government announced that it is working on a comprehensive "employment shield" package through the Family, Labor and Social Services Ministry; (iii) No amount/estimate: 30 October 2020, During COVID-19, a Community Benefit Program for the chauffeur profession may be organized to support the public services (due to COVID) of the Ministry of Health, its affiliated and related organizations and their provincial organizations.
|05B4 - Subsidies to business||
(i) No amount/estimate: direct support to Turkish Airlines and other affected entities; (ii) 7 June 2020, The total short-term employment allowance the country provided has reached TRY5.1 billion, benefiting 3 million workers. 26 October 2020, Extension for short-time work allowance from end-October through end-December 2020. This amount is already part of the TRY75 billion fiscal package; (iii) No amount/estimate: 1 December 2020, The Social Security Premium Incentive period has been extended to 30 June 2021 and can also be valid for up to 6 months. For private sector employers, this will be three months from the month following the end of short-term/cash wage support until 30 June 2021. [update]
|05B5 - Indirect income support|
|05B6 - No breakdown (income support)||TRY75,000,000,000||USD12,395,118,774||
(i) TRY75 billion in fiscal measures, broken down into Measure 5B1, items (i) and(ii) of Measure 5B4, and item (i) of Measure 5B3.
|05C - No breakdown (health and income support)|
|06 - Budget reallocation info_outline|
|07 - Central bank financing government||
No amount/estimate: 19 June 2020, A new law raised the upper limit of the Treasury's special-purpose domestic government bond issuance to 5% of the 2020 budget revenue forecast (previously the limit was 3%).
|07A - Direct lending & reserve drawdown|
|07B - Secondary purchase: government securities|
|08 - International Assistance Received||TRY100,058,275,407||USD16,536,456,106|
|08A - Swaps info_outline||TRY90,761,534,483||USD15,000,000,000||
20 May 2020, The Central Bank of Turkey tripled its currency swap agreement with Qatar from the original limit of USD5 billion to USD15 billion equivalent of Turkish lira and Qatari riyal.The core objectives of the agreement are to facilitate bilateral trade in respective local currencies and to support financial stability of the two countries.
|08B - International loans/grants||TRY9,296,740,924||USD1,536,456,106|
|08B1 - Asian Development Bank|
|08B2 - Other||TRY9,296,740,924||USD1,536,456,106||
(i) 24 April 2020, The World Bank approved a USD100 million loan to the Republic of Turkey for an Emergency COVID-19 Health Operation to support the actions Turkey is taking to respond to the health impact of COVID-19 pandemic; (ii) 6 May 2020, USD100 million Murabaha financing agreement is signed between the Islamic Development Bank (IsDB) and Turk Eximbank to support Turkish exporters; (iii) 21 May 2020, The IsDB approved a financing facility of up to EUR92 million to help Turkish SMEs sustain their operations in these difficult times. The facility will be utilised through Ziraat Katılım Bank to finance working capital goods of SMEs under the guarantee of the Ministry of Treasury and Finance of Turkey; (iv) 12 June 2020, The World Bank approved a partial credit guarantee in the amount of USD273.58 million to Turkey Export Credit Bank for the Turkey Long Term Export Finance Guarantee Project; (v) 25 June 2020, The World Bank approved a EUR143.8 million (USD160 million equivalent) Safe Schooling And Distance Education Project loan to enhance the capacity of the education system to provide e-learning equitably to school-age children during and following the COVID-19 pandemic and future shocks; (vi) 30 June 2020, USD500 million COVID-19 Credit Line Project of the Asian Infrastructure Investment Bank, processed under the COVID-19 Recovery Facility (CRF); (vii) 18 December 2020, USD300 million from the World Bank under its Rapid Support for Micro and Small Enterprises Proejct providing reimbursable support financing for manufacturing firms and other, innovative young firms focusing on manufacturing, scientific research and development, and computer programming. This will help avert the closure of viable MSEs affected by the health and economic shocks of the COVID-19 pandemic and maintain employment levels during the crisis [update]; (viii) 30 December 2020, EUR1 million working capital loan from the European Bank for Reconstruction and Development (EBRD) to one of Turkey’s fastest-growing medical equipment producers, Asset Medikal Tasarim AS. The working capital loan is to help the company expand its production, following burgeoning demand triggered by the coronavirus outbreak. [update]
|09 - International Assistance Provided|
|09A - Swaps info_outline|
|09B - International loans/grants|
|10 - No breakdown||TRY71,000,000,000||USD11,734,045,772||
20 May 2020, The government announced that the total support has exceeded TRY252 billion. Including deferred loans and interest payments, the total amount exceeds TRY350 billion.The breakdown of the remaining TRY71 billion cannot be ascertained (TRY350 billion less TRY100 billion (the earlier package), TRY98 billion (deferred loans and interest payments), TRY40 billion (the refinancing facility), TRY20 billion (loan guarantees), and TRY21 billion (equity infusions)).
|11 - Other Economic Measures||
(i) 15 April 2020, Customs tariffs for certain steel products were increased by 5 percentage points for 3 months, to protect output and employment in the domestic industry; (ii) From 18 April 2020, a customs surcharge of 50% is applied to imports of game consoles. From October this surcharge will be reduced to 20%; (iii) 27 April 2020, measures tightening the processing of imported goods in customs under 'red line' rules involving individual examination were implemented; (iv) 2 May 2020, export restrictions on health products and equipment implemented since March are waived. Exports of protective masks and suits remain restricted; (v) 12 May 2020, To support domestic industries affected by the COVID-19 crisis, customs tariffs were augmented by between 1.9-30% for 750 product groups (including textile products, various consumer durables, construction materials etc.); (vi) 20 May 2020, Customs tariff increases were introduced for around 800 additional product lines (including construction equipment, agricultural machinery and food processing and packaging equipment). These surcharges do not apply to imports from EU Customs Union partner countries; (vii) 5 November 2020, Document applications on paper during the COVID-19 epidemic increased the risk of contact. The warranty documents and the delivery documents given when the product is delivered to the service station and the prepared service vouchers can now be given to consumers electronically with a permanent data storage.
|12 - Non-Economic Measures|
|12A - Measures affecting travel and transport (local and international)||
(i) All travellers entering Turkey from virus-affected countries are taken under quarantine for 14 days, irrespective of nationality. Returning pilgrims will be kept under quarantine for one additional week. As of 4 April 2020, 15,756 persons were under quarantine in 78 converted student dormitories. From 22 March 2020, a curfew was applied to all citizens above 65 and for people with chronic illnesses. From 4 April 2020, this is extended to youth below 20 (with an exception for young workers between 18 and 20). From 31 March 2020, 41 towns, villages, and neighborhoods in 18 provinces have been taken under quarantine. From 4 April 2020, 30 metropolitan areas, including Istanbul, Ankara and Izmir, and the town of Zonguldak are also under quarantine. All exits from and entries to these zones are banned (under administrative authorization for special cases); (ii) Air traffic is stopped with all countries. Land borders with Iran, Azerbaijan and Georgia are closed. Public employees’ travels to foreign countries are subject to prior approval by their superiors; (iii) Turkish citizens are advised to postpone their travel plans abroad. Public transportation vehicles are required to accept 50% of their capacity to allow social distancing; (iv) On 28 March 2020, additional measures were announced: intercity travel was prohibited, subject only to individual permissions by state governors; Turkish Airlines suspended its domestic and international flights. Starting from 4 April 2020 all domestic flights are suspended until 28 April; suspension extended until 28 May; (v) Persons above 65 (23 March 2020) and those below 20 (4 April 2020) are locked down in their living places (with the exception of young workers between 18 and 20); (vi) Sport and cultural facilities, mosques (during high attendance periods), domestic and international trade fairs, cafes, museums, and libraries are closed; (vii) From 28 March 2020, outside physical exercises and picnics are banned in town centers on the weekends. Local authorities can extend these bans to weekdays. Grocery stores and supermarkets' opening hours are restricted, with a maximum of one customer for every 10 square metres of space; (viii) Turkey is starting to reduce coronavirus containment measures, lifting inter-city travel restrictions in seven provinces and easing a curfew imposed on the elderly and people less than 20 years old; (ix) 28 May 2020, intercity train services resume after a two-month gap; (x) 1 June 2020, Travel bans between regions are waived and domestic flights restart; (xi) 4 June 2020, the country plans to resume flights in 40 countries within the month; (xii) 1 December 2020, A weekday curfew and a full lockdown during weekends will be imposed. Citizens will not be allowed to leave home between 9 p.m. and 5 a.m. during weekdays, and at all during weekends. [update]
|12B - Measures affecting business and workplace||
(i) All educational institutions are closed. Online education started for primary and secondary classes on National TV and internet on 23 March 2020. Universities shifted to full online education via their distance education centers and Higher Education Council’s courses platform; (ii) Shopping malls, barber shops and some stores will be allowed to open on 11 May 2020 provided they abide by so-called normalisation rules, and universities would return to their academic calendar on June; (iii) 1 June 2020, Museums, libraries, and public parks will be open with distancing rules; (iv) 19 June 2020, all schools are formally re-opened; (v) 28 June 2020, The country ended the 2nd day of limited lockown in 81 provinces as 2.5 million students take university exams. Further easing is set for 1 July, with wedding halls, theaters and cinemas set to reopen; (vi) 12 August 2020, The country is scheduled to reopen schools on 31 August with distance learning. A gradual return to classrooms is scheduled for 21 September; (vii) 18 August, The government is awarding certificates to businesses that fully comply with measures against COVID-19; (viii) 26 August 2020, All state institutions may implement flexible working methods. Engagement ceremonies are banned in 14 provinces to fight COVID-19, and weddings will be limited to one hour; (ix) 31 August 2020, New school year opens, using distance education classes; (x) 18 September 2020, The Istanbul government announced alternate working hours for public servants. All municipality workers would work between 8:30 a.m. to 4:30 p.m., instead of the usual 8 a.m. to 5 p.m., starting 24 September 2020; (xi) 5 October 2020, The government announced a relaunch of face-to-face education for all elementary school students.
|12C - Others||
(i) 24 June 2020, 62 provinces among 81 were subject to obligatory mask wearing; (ii) 5 August 2020, New measures are imposed (e.g., inspection of isolation of patients, contract tracing, etc.) and nationwide inspection of the observation of rules is undertaken (https://bit.ly/3iaZLyE); (iii) 7 September 2020, Wearing masks is made made mandatory; (iv) 11 November 2020, The government announced a smoking ban in outdoor spaces across all provinces in an effort to halt increasing COVID-19 cases.