Turkey seeks urgent legal reforms to steady shaky economy

Published March 29th, 2001 - 02:00 GMT

Turkish Prime Minister Bulent Ecevit asked lawmakers Wednesday, March 28, to rapidly pass economic reform laws as the country pleaded for $10-$12 billion in foreign aid. Members of parliament should launch "speedy and harmonious legislative work," Ecevit said. The legislation was "a must for an economic recovery," he added. "Both the ruling and opposition parties have great duties and responsibilities." 


Experts said the outside world was watching Turkey to see how fast it would implement economic reform, before extending further financial aid to steady the shaky economy. Economy Minister Kemal Dervis was in meetings with US and International Monetary Fund officials in Washington, where he said Turkey needed $10-$12 billion (€11-€13.5 billion) in financial aid. 


Turkey must pass 15 priority bills, aimed mainly at reforming Turkey's ailing banking sector and speeding up privatization, Dervis told Turkish journalists there. The press joined the call for quick legislative action. "The government should display determination and submit the required bills to parliament quickly," columnist Bilal Cetin wrote in the Sabah daily. "This will mark a significant stage in the search for foreign aid." 


The legislation is at the heart of an economic recovery program that Turkey is outlining after financial turmoil forced the government last month to float the Turkish lira. The decision to float the lira disrupted an IMF-backed anti-inflation program in place since December 1999 and pushed inflation up, making the revision of macro-economic targets inevitable. 


Last week, Turkey and the IMF agreed on the framework of a revised plan, which is expected to be finalized by mid-April and submitted to the Fund for a final approval in late April. But "before approving the program, the IMF wants to see that laws are being passed," Cetin said. 


Last year Ankara dragged its feet on several economic reforms, envisaged in the original IMF-backed program, triggering a massive flight of foreign capital in November and an ensuing liquidity crunch, which was alleviated with rescue aid from the Fund. 


The government's subsequent failure to come to grips with the problems and an unprecedented public row between Ecevit and President Ahmet Necdet Sezer over corruption led to a complete breakdown of confidence. 


Haluk Burumcekci, chief economist at Disbank, said fast legislative work would help boost the damaged credibility of the three-way ruling coalition both at home and abroad. "I am not pessimistic about foreign aid. But I still believe that the officials should press the deputies and get them working," the economist told AFP


A leading lawmaker from the coalition's Motherland Party (ANAP), Zeki Cakan, told AFP parliament would re-arrange its agenda and give priority to the economic bills as soon as they were submitted to parliament. "If necessary we will work day and night," Cakan said. 


Two of the drafts had already been taken up in parliamentary commissions and the government would send the rest "as soon as possible," deputy Parliament Speaker Murat Sokmenoglu said after a meeting with Ecevit. 


Observers agreed parliament faced a tough job but said the MPs could still pass the laws within a few weeks if they worked intensively, as they had last year when general assembly sessions often lasted into the small hours. Action was now essential, experts said. "Confidence is at the lowest level. Everybody is waiting for concrete steps," said one Istanbul-based foreign analyst. — (AFP, Ankara) 


by Sibel Utku  


© Agence France Presse 2001

© 2001 Mena Report (www.menareport.com)

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