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IMF in Turkey for bailout talks

Special to World Tribune.com
MIDDLE EAST NEWSLINE
Wednesday, April 4, 2001

WASHINGTON — The International Monetary Fund returns to Turkey to complete an agreement for economic reform and $12 billion in loans to bail Ankara out of its fiscal crisis.

Officials said a delegation from both the IMF and World Bank arrives in Ankara over the next week. By April 15, they said, an agreement will be signed for economic reform and loans.

The agreement, officials said, will affect Turkey's military procurement plans. Both the IMF and the World Bank have urged Ankara to cut defense spending. World Bank Vice President Jonannes Linn precedes the IMF delegation and arrives in Ankara on Wednesday.

On Tuesday, the Ankara-based Milliyet daily reported that the Turkish military plans to accelerate a project to coproduce Western attack helicopters. The newspaper reported that Ankara has opened a competition to provide electronic warfare systems for the U.S. King Cobra helicopter.

At the same time, the military will delay procurement of new tanks and naval vessels.

Turkish State Minister Kemal Dervis said the agreement with the IMF will ensure economic reform. He said the IMF executive board is expected to decide whether to approve the program by the end of April.

"The next two weeks are extremely critical for us," Dervis said after a series of meetings in Washington with IMF and World Bank officials. "Taking this decision is an important step. It can take three to six weeks to add the foreign support to our budget. But the decision should be taken in April the latest."

Dervis said he will return to Washington this month to conclude talks with the IMF and World Bank. He said Turkey seeks up to $12 billion in loans, an effort that is being supported by the United States.

The minister warned that Ankara must complete the loan deal by April 15. "If this is not achieved until April 15, we will accept there is a problem," he said.

Later, Prime Minister Bulent Ecevit dismissed Dervis's forecast and said the minister was demonstrating his political inexperience.

IMF officials said Turkey and the organization have reached what they termed a compromise formula to allow for the multi-billion dollar loans. They would not provide details.

Turkey's parliament is also expected to begin discussions this week on a series of economic reform measures. Officials said the bills submitted by the government could be passed by the end of the month.

Wednesday, April 4, 2001


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