Turkey announced a series of measures Friday to help speed a recovery in the country's industrial and commercial sectors, badly hit by a severe economic crisis that has plagued the country since February. The package, agreed on after lengthy talks between the government and the Union of Chambers of Commerce, Industry and Commodity Exchanges (TOBB), aimed primarily to facilitate loan repayments for troubled companies, ease tax burdens and make investment incentives more efficient.
TOBB has long complained that the government was neglecting its problems while focusing its efforts and funds on healing the ailing banking sector, which was at the core of the February turmoil.
Speaking at a press conference with Economy Minister Kemal Dervis and Finance Minister Sumer Oral, TOBB chairman Rifat Hisarciklioglu said a draft bill aimed at restructuring the debts of crisis-hit companies would be submitted to parliament as soon as possible. The government also pledged to increase the amount of public bank loans for small and medium-sized enterprises and to speed up incentives for uncompleted investments, he added.
The government in addition agreed to revise a new tax law, due to come in force in January 2003, that will introduce tight measures against tax evasion. Oral said the revision would not damage the law's objective but would address "certain concerns" of the private sector. The government agreed to decrease the ratio of unemployment tax for 2002 in a bid to encourage the recruitment of new employees. Other measures aimed to encourage exports, allow more foreign capital and private sector activity in the energy sector and keep energy prices at a level that would not harm the competitiveness of industrial companies.
Earlier in the day, officials announced that the economic crisis, one of the worst in Turkey's modern history, has caused the economy to shrink by 8.3 percent in the first nine months of the year 2001 from the equivalent figure in 2000. Turkey expects the economy to shrink by 7.5 to 8.0 percent this year and then to achieve four-percent growth in 2002.
To put the battered economy on track, Ankara is implementing a tough program of reforms with multi-billion-dollar support from the International Monetary Fund (IMF) and the World Bank. Turkey's banking watchdog meanwhile bailed out a troubled private bank on Friday as part of further efforts to revitalize economic activity.
Toprakbank, owned by a prominent business group, failed to take measures to improve its financial structure and accumulated losses that threatened the interests of account holders as well as the stability of the banking sector, said a statement by the banking regulation and supervision board. The decision would not affect the interests of Toprakbank's account holders and creditors, it added.
The institution became the 19th bank that Turkish authorities have taken over. The government aims to either sell or close down the seized banks by the end of the year as part of its agreement with the IMF. The Fund has said it would negotiate a new deal with Turkey next month to close a financial gap of $10 billion that emerged in the aftermath of the September 11 terrorist attacks in the United States.
Separately, the US rating agency Standard and Poor's on Friday raised its outlook on Turkey to stable from negative and affirmed the country's credit ratings. Turkey's main credit rating was kept at single-B-minus, the rating that was given when the agency lowered its outlook in April for the country. The outlook revision "reflects Standard and Poor's view that the risk of events leading to a downgrade is now balanced by improved prospects for the continued implementation in 2002 of appropriate financial policies and structural reforms, in the context of a new three-year IMF standby arrangement," the agency said. — (AFP, Ankara)
© Agence France Presse 2001
© 2001 Mena Report (www.menareport.com)
