A period of revival in project finance transactions in Türkiye: 7.3 billion USD investment volume with 15 transactions in 2024
In 2024, global project finance transaction volume will grow by 17% annually, reaching $784 billion, while in Türkiye it will grow by 185% annually, reaching $7.3 billion.
At a time when global economic uncertainty is increasing, interest rates remain at prolonged high levels, and geopolitical risks are being redefined, project finance continues to stand out as one of the most powerful and indispensable tools for investments focused on infrastructure, energy transformation, and digitalization. Project finance has ceased to be a mere investment tool on a global scale; it has become a fundamental driver of economic transformation. Energy transformation, digital infrastructure investments, and sustainability priorities are reshaping financing dynamics worldwide. The twin transformations of green and digital transformation, in particular, are shaping the direction of global capital flows and creating strategic priorities for investors. In this context, project finance plays a critical role in the implementation of sustainable development goals in both developed economies and emerging markets.
While 2024 was recorded as a year of cautious growth in project finance activities globally, Türkiye experienced an upward trend driven by strategic infrastructure investments, renewable energy projects, and digital transformation initiatives. Branchout Türkiye's Project Finance Transactions Outlook Report, published for the first time this year, covers the following:
The project finance transaction volume increased by 185% year-over-year to $7.3 billion in 2024. The number of transactions that reached financial closure reached 15, a 36% increase.
Türkiye Perspective – Normalization and Repositioning
The project finance market in Türkiye has entered a period of rebalancing following recent volatility. This process is reflected not only in the increase in transaction volumes but also in the diversity of projects. Renewable energy, transportation, and industrial investments are central to Türkiye's development vision, and the interest of international funds reinforces the strategic importance of these areas. According to the Branchout Turkey Project Finance Transactions Outlook 2015-2024 report, the renewable energy sector stood out in terms of transaction volume in 2024 with nine projects, while the transportation sector maintained its leadership in this field with a total transaction volume of US$3.7 billion.
The Role of External Resources in Project Financing is Strong
Branchout Türkiye's report shows that international financial institutions were involved in 13 of the 15 transactions during the period. Total foreign financing inflows reached $5.8 billion, a significant increase compared to the previous period.
Prominent institutions on the financing front included the European Bank for Reconstruction and Development (EBRD), KfW, Proparco, DEG, US International Development Finance Corporation (DFC), and UK Export Finance (UKEF). On the domestic front, the Turkish Industrial Development Bank (TSKB) maintained its active position, particularly in projects focused on renewable energy and sustainability.
Future Prospects: International Partnerships and Capital Flows
In the coming period, project finance will take on a new dimension not only with the increase in investment sizes but also with the diversification of financing models. Collaborations between private equity funds, infrastructure funds, and development banks will continue to be decisive, particularly in projects requiring substantial capital. From Turkey's perspective, maintaining strong partnerships with international financing institutions and developing local financing capacity are crucial. This dual structure will be critical for both the sustainability of capital inflows and the deepening of the local market.
Project Finance as a Strategic Tool
The overall picture demonstrates that project finance is a strategic tool in Türkiye, as well as globally. This mechanism facilitates not only large-scale infrastructure investments but also sustainable energy, digitalization, and industrial projects.
It creates a leverage effect in the implementation of international capital flows. In the coming period, project finance is expected to continue to serve as a bridge between economic growth and sustainable development goals. For Turkey, this means positioning itself in line with global trends and enabling it to benefit more effectively from international capital flows.
