WASHINGTON, April 1, 2025 - The World Bank Board has approved $500 million in funding to create inclusive jobs and revitalize the economy in areas that were devastated by the February 2023 earthquakes in Türkiye.
Long-standing structural challenges in the labor market were exacerbated by the 2023 earthquakes in the affected provinces. The Formal Employment Creation 2 Project aims at supporting Small and Medium Enterprises (SMEs) and at creating about 17,000 new or better jobs, of which more than one-third are expected to be for women and youth.
Constrained access to finance among firms is a key factor limiting employment generation. To address this challenge, the project is designed to provide long term financing to firms operating in earthquake-affected provinces with a focus on SMEs. This is expected to enhance conditions for formal employment creation by enabling firms to hire or retain employees, increase productivity, and boost labor demand.
"The World Bank has been accompanying Türkiye since the day of the earthquakes, sharing our international experience in disaster risk management and reconstruction. This project is a crucial step towards rebuilding local economies and providing much-needed employment opportunities in the formal sector," said Humberto Lopez, World Bank Country Director for Türkiye.
The February 2023 earthquakes killed more than 50,000 people, displaced more than 3.3 million, damaged or destroyed housing units and infrastructure, and inflicted severe damage to businesses and economies of the 18 affected provinces.
In addition to providing long-term financing for businesses, to ease credit constraints, the operation will also extend capacity-building support to firms in areas such as financial management and intermediation, environmental and social issues, gender, climate resilience, and market analysis to help strengthen their business operations.
The project is part of a comprehensive World Bank package to support Türkiye's earthquake-affected region, complementing broader efforts to strengthen the labor market and foster economic recovery. The support encompasses reconstruction of infrastructure and rural housing; provision of public services; and economic recovery through fast-tracked new projects, existing initiatives, analytical work, and technical assistance.
The World Bank is an important and reliable partner for Türkiye in disaster risk management, municipal infrastructure, housing, and health. Other World Bank-financed projects currently underway include the Türkiye Earthquake, Floods and Wildfires Emergency Reconstruction Project supporting green and resilient reconstruction in municipalities affected by disasters in 2020 and 2021; the Climate and Disaster Resilient Cities Project supporting resilient housing and municipal infrastructure in hazard-prone cities; the Disaster Risk Management in Schools Project and the Seismic Resilience and Energy Efficiency Project that strengthen the resilience of schools and public buildings, respectively, and Türkiye Preparedness for Public Health Emergencies Project' supporting the expansion of vaccine production and strengthening country's capacity to detect and initiate a rapid response to public health emergencies.
