Turkey announces 10 billion-lira rescue package for tourism industry

Turkey’s government will underwrite as much as 10 billion liras ($1.25 billion) in preferential loans for the tourism industry to help it cope with the impact of the COVID-19 pandemic.

The four-year loans of as much as 40 million liras will carry a 12-month waiver on repayments, according to a statement on Friday by the Banks Association of Turkey (TBB), which has arranged the credit guarantees with the Treasury and Finance Ministry.

Visitors to Turkey have slumped by an annual 74 percent to 9.27 million in the first eight months of the year after countries around the world announced population lockdowns and travel warnings. Arrivals fell by an annual 69 percent to 2.16 million in the month of August, usually the peak of Turkey’s holiday season.

Turkey earned about $35 billion from tourism last year, a record amount.

Tourism firms may either choose to borrow at a fixed rate of interest of 14.5 percent or a variable rate equal to 2.5 percentage points over the Turkish lira reference interest rate (TLREF), the TTB said.

The amount of each individual loan will depend on a company’s size, varying between 100,000 liras for firms with an annual turnover of up to 3 million liras and 20 million liras for those with a turnover exceeding 125 million liras. The TBB said special loans of as much as 40 million liras will be available to hoteliers.