Turk Eximbank has secured a €1bn commercial loan, guaranteed by the World Bank, to help Turkish exporters adapt to the EU’s incoming carbon import tariff.

The 10-year loan, signed on May 7, is provided by Deutsche Bank, Standard Chartered, BNP Paribas and ING. Turk Eximbank, a government-backed lender, says the deal is its largest-ever borrowing transaction.

The International Bank of Reconstruction and Development (IBRD), a member of the World Bank Group, is providing a €600mn first loss guarantee to the lenders, Turk Eximbank says in a statement. The deal is the first time the IBRD has supported a loan dedicated to green exports.

A counter-guarantee has also been provided by Turkey’s ministry of treasury and finance.

The proceeds will be used to provide financing to exporters affected by the EU’s carbon border adjustment mechanism (CBAM), under which EU companies will be taxed on the carbon intensity of their imports from 2026 onwards.

Turkey, one of the EU’s top trading partners, has scrambled to adapt to the new rules. Last year the government said that a national emissions trading scheme it is developing will help cushion the impact of CBAM on the Turkish economy.

Turk Eximbank says the financing enabled by the loan will help exporters produce green products and support renewable energy use, energy efficiency investments and working capital needs.

“Our exporters are expected to adapt and decarbonise their production as much as possible to maintain their export potential,” Turk Eximbank’s general manager Ali Güney says. “With this resource, we will do our part in the strategic roadmap that will be drawn for the transition to low-carbon exports and preserving the competitiveness of exporters in the sectors that will be affected by CBAM.”

The loan will also be partly dedicated to lending to SMEs and companies that support women’s participation in the workforce, Turk Eximbank says.