Turkey says no going back on economic reform plan

Published April 16th, 2001 - 02:00 GMT

Turkey's Economy Minister Kemal Dervis said in the Turkish press on Monday, April 16, there was no going back on a new package of reforms to overcome the country's economic crisis. 


"The program that we have unveiled demonstrates that Turkey has entered into a new phase and that there is no question of going back," he said in the editorials of leading Turkish newspapers. He said he was confident that Turkey would now receive billions of dollars of foreign aid it needs to overcome its economic crisis.  


The main aims of the program announced on Saturday were cutting public spending by nine percent, decreasing the state's debt burden, restructuring its weak banking system and accelerating privatization, including the long-delayed sale of Turkish Telekom. 


As Dervis announced the program on Saturday, thousands of people took to the streets across Turkey to protest the government's handling of the crisis that led to increasing prices and layoffs in the latest of a series of occasionally violent demonstrations. 


The reforms also came under heavy fire from leading trade unions for failing to address more urgent problems faced by the public such as falling purchasing power, unemployment and income distribution. The reforms were welcomed by Turkey's main ally the United States and International Monetary Fund. 


Dervis told daily Milliyet that what was at stake was a "structural overhaul", which would take time to bear fruit. "Transformation does not happen overnight. Nobody should expect miracles. Once the changes have taken place Turkey will become one of the most powerful countries in the region," he said. 


Ankara was forced to abandon a currency peg and float the lira on February 22 to contain a serious liquidity squeeze, triggered by fears of political instability after a fierce row at the top echelons of the state. 


The move, which broke the backbone of an ambitious IMF-backed disinflation program, has resulted in the lira falling some 47 percent against the dollar, price hikes on basic goods and rising inflation. 


Dervis told Radikal newspaper he expected Turkey to reach an agreement with the International Monetary Fund on a new funding package at the beginning of May. "I am very confident that we will get substantial foreign aid," he said. — (AFP, Ankara) 


© Agence France Presse 2001

© 2001 Mena Report (www.menareport.com)

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