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                                                    CONFORMED COPY
                                             LOAN NUMBER 2901-0 TU
                                                         2901-1 TU
              (Industrial Export Development Project)
                              between
                        REPUBLIC OF TURKEY
                                and
               INTERNATIONAL BANK FOR RECONSTRUCTION
                          AND DEVELOPMENT
                      Dated January 25, 1988
                                             LOAN NUMBER 2901-0 TU
                                                         2901-1 TU
                        GUARANTEE AGREEMENT
     AGREEMENT, dated January 25, 1988, between REPUBLIC OF TURKEY
(the Guarantor)  and  INTERNATIONAL  BANK  FOR  RECONSTRUCTION AND
DEVELOPMENT (the Bank).
     WHEREAS (A) the Guarantor  and Turkiye Sinai Kalkinma Bankasi
(TSKB) and Sinai Yatirim Ve  Kredi Bankasi (SYKB) of the Guarantor
(the Borrowers), having been  satisfied  as to the feasibility and
priority of the  Project  for  industrial  export development have
requested the Bank to assist in the financing of said Project;
     (B)  by the Loan Agreement (the Government Loan Agreement) of
even date herewith between  the  Guarantor  and the Bank, the Bank
agreed to extend to  the  Guarantor  a  loan in various currencies
equivalent to one hundred million dollars;
     (C)  by the Loan Agreements of even date herewith between the
Bank and the Borrowers, the Bank  has agreed to extend (i) to TSKB
a loan  in  various  currencies  equivalent  to  one hundred fifty
million dollars ($150,000,000); and (ii) to SYKB a loan in various
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currencies  equivalent  to  fifty  million  dollars ($50,000,000),
(these agreements being  hereinafter  referred  to individually as
the TSKB Loan Agreement and the SYKB Loan Agreement, respectively,
and, collectively,  as  the  Loan  Agreements),  on  the terms and
conditions set forth in the Loan Agreements, but only on condition
that the Guarantor agree  to  guarantee the respective obligations
of the Borrowers in  respect  of  such  loans  as provided in this
Agreement; and
     WHEREAS the Guarantor, in  consideration of the Bank's enter-
ing into the Loan Agreements with  the Borrowers, has agreed so to
guarantee such obligations of the Borrowers;
     NOW THEREFORE the parties hereto hereby agree as follows:
                             ARTICLE I
                  General Conditions; Definitions
     Section 1.01. The "General  Conditions Applicable to Loan and
Guarantee Agreements" of the Bank, dated January 1, 1985, with the
last sentence of Section  3.02  deleted and with the modifications
set forth in Schedule 3 to each of the TSKB Loan Agreement and the
SYKB  Loan  Agreement  (the   General  Conditions)  constitute  an
integral part of this Agreement.
     Section 1.02.  Unless  the  context  otherwise  requires, the
several terms defined in  the  General Conditions, in the Preamble
to this Agreement and in  the  Loan Agreements have the respective
meanings therein set forth.
                            ARTICLE II
                             Guarantee
     Section 2.01. The  Guarantor  declares  its commitment to the
objectives of the Project as  set  forth  in Schedule 1 to each of
the TSKB Loan Agreement and the  SYKB Loan Agreement, and, to this
end, the Guarantor  hereby  unconditionally guarantees, as primary
obligor and not as surety merely,  the due and punctual payment of
the principal of, and  interest  and  other charges on, the Loans,
and the premium, if any,  on  the  prepayment of the Loans, all as
set forth in the Loan Agreements.
                            ARTICLE III
            Representative of the Guarantor; Addresses
     Section 3.01. The Undersecretary  of the Treasury and Foreign
Trade of the  Guarantor  is  designated  as  representative of the
Guarantor  for  the  purposes  of  Section  11.03  of  the General
Conditions.
     Section 3.02. The following  addresses  are specified for the
purposes of Section 11.01 of the General Conditions:
     For the Guarantor:
          Basbakanlik
          Hazine Ve Dis Ticaret Mustesarligi
          Yenisehir - Ankara
          Cable address:                    Telex:
               HAZINE ANKARA                   821-42285 (MLYE-TR) 02
     For the Bank
          International Bank for
            Reconstruction and Development
          1818 H Street, N.W.
          Washington, D.C. 20433
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          United States of America
          Cable address:                    Telex:
               INTBAFRAD                       440098 (ITT),
               Washington, D.C.                248423 (RCA) or
                                                64145 (WUI)
     IN WITNESS WHEREOF, the  parties hereto, acting through their
duly authorized representatives, have  caused this Agreement to be
signed in their  respective  names  in  the  District of Columbia,
United States of  America,  as  of  the  day  and year first above
written.
                     REPUBLIC OF TURKEY
                     By /s/ Hikmet Ulugbay
                                         Authorized Representative
                     INTERNATIONAL BANK FOR
                        RECONSTRUCTION AND DEVELOPMENT
                     By /s/ Hans-Eberhard Kopp
                                    Acting Regional Vice President
                              Europe, Middle East and North Africa