2.2.4. Export Rediscount Credits

Export rediscount credits are extended in Turkish lira through the Export Credit Bank of Turkey, Inc. (Türk Eximbank) by the acceptance of foreign exchange bills with a maturity of 120 days for rediscount and repaid to the CBRT in foreign exchange.

In view of the contribution of export rediscount credits in reducing the current account deficit and bolstering the CBRT's foreign exchange reserves, credit limits were raised by

i) USD 1.5 billion to reach USD 4.5 billion on 2 January 2012,

ii) USD 1 billion to reach USD 5.5 billion on 9 May 2012,

iii) USD 500 million to reach USD 6 billion on 4 December 2012.

Furthermore, conditions for the use of credits were partly eased in 2012.

The annual amount of export rediscount credits, which was USD 3.1 billion in 2011, climbed to USD 10.5 billion as of 31 December 2012 with an outstanding debt of USD 3.8 billion.

As a result, export rediscount credits added USD 8.3 billion to the net FX reserves of the CBRT in 2012.

The CBRT will continue to extend export rediscount credits in 2013. Given the supportive role of export rediscount credits to FX reserves, if the monthly utilization level of export rediscount credits, which is achieved due to the raised limits and eased conditions, is sustained, rediscount credits are expected to contribute around USD 12 billion to FX reserves in 2013.