ECONOMY

Turkey’s new tunnel loan

ANKARA (AFP) – The European Investment Bank (EIB) yesterday granted Turkey a fresh loan of 400 million euros to build an underwater rail tunnel linking Europe and Asia, the Treasury said. The fresh loan brings EIB support for the project to link the two shores of the Bosporus that bisects Istanbul, Turkey’s biggest city with chronic traffic problems, to 1.05 billion euros, a Treasury statement said. The project’s other sponsor is the Japan Bank for International Cooperation, which has provided loans of about $1 billion (839 billion euros). Despite fears of powerful tremors in quake-prone Istanbul, construction of the 1.6-kilometer-long tunnel 60 meters below sea level began in May 2004, led by a Turkish-Japanese consortium. Pressure The government is under pressure to alleviate traffic problems in Istanbul, a city of more than 10 million whose European and Asian shores are now connected by two heavily congested bridges. Officials say the tunnel, which will link surface railways on the city’s European and Asian sides, will resist quakes measuring up to nine on the Richter scale because it is being built into 2 meters of rock. The project, scheduled to become operational at the end of 2009, is expected to cost $2.8 billion (2.3 billion euros), excluding expropriation payments.