IMF urges Turkey to be vigilant on inflation, speed up privatization

Published November 16th, 2000 - 02:00 GMT

The International Monetary Fund (IMF) called on the Turkish government Wednesday, November 15, to keep up its vigilance against chronic inflation and speed up privatization next year. 

 

IMF Turkey desk chief Carlo Cottarelli told a press conference in Ankara that Turkey had achieved significant success in pulling down inflation to its lowest level since 1986. 

 

But "while inflation has declined, it has remained above the target for 2000," Cottarelli said, adding that the situation "needed to be closely monitored". 

 

In October, Turkey's year-on-year inflation stood at 44.4 percent in consumer prices and 41.4 percent in wholesale prices. 

 

Turkey says it is now difficult to reach its year-end target of 20 and 25 percent envisaged under a stand-by deal signed with the IMF  

 

But, Ankara is not going to revise its 2001 inflation targets of 12 percent in consumer prices and 10 percent in wholesale prices, Turkish treasury undersecretary Selcul Demiralp told the same news conference. 

 

Cottarelli also noted "delays" in structural reforms, especially in the sale of state assets, and underlined an increase in the current accounts deficit linked to rising oil prices in the world. 

 

"The government is reacting promptly to these developments. There will be a strengthening of policies in 2001," he said. 

 

Nonetheless, the IMF official praised Turkey for a strong economic growth rate, which is expected to reach seven percent at the end of 2000, and improving primary surplus, which is projected to be three percent of gross national product in 2000 compared to minus 1.8 percent of GNP last year. 

 

Last December Turkey and the IMF hammered out a three-year, four-billion-dollar economic package of austerity measures aimed at reducing Turkey's chronic inflation and putting the country's economic house in order. — (AFP)  

 

© Agence France Presse 2000  

© 2000 Mena Report (www.menareport.com)

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