Turkey halts $19.5 billion in military procurement due to fiscal crisis

ANKARA — Turkey's military, under Western pressure to cut Ankara's defense budget, has halted major procurement programs.

On the eve of the government's submittal of a request for billions of dollars in international loans, Turkey's chief of staff said the military would delay 32 projects to modernize the military. The cost of these projects amount to $19.5 billion.

The military did not list the projects that would be delayed. But they are believed to include projects to coproduce a main battle tank as well as an attack helicopter. Over the last few weeks, these projects have been severely criticized in the Turkish media and parliament.

Critics argued that despite two major earthquakes and a fall of the lira, the defense budget rose in proportion to the gross national product over the last year — from 3 percent to 3.3. percent. Turkey's Defense Industries Undersecretariat, responsible for procurement, has a budget of $1.5 billion. This is bolstered by revenues from taxes on cigarettes and other items.

The Turkish statement cited Ankara's fiscal crisis for the military decision. The Turkish lira has dropped by about 40 percent, which has struck hard Turkey's defense procurement plans from Western contractors.

The military statement said the delay would affect short-term, medium-term and long-term projects. But the military said Turkey's defense would not be fundamentally affected.

"These delays will not at all affect the deterrent capability of the armed forces," the military said.

The decision by the military comes amid riots in several cities over the fiscal crisis in Turkey. Police fired into the air to stop violent anti-government demonstrations by merchants.

The International Monetary Fund and the World Bank are negotiating with Turkey over a loan of between $10-12 billion. But the two agencies want Ankara to cut the defense budget and implement economic reforms. Turkey is scheduled to submit a letter of intentions to the IMF on Thursday.