Turkey changed the composition of the Turkish Telekom management board Tuesday, July 10, in a bid to end a dispute with the IMF that has delayed the release of $1.5 billion (€1.75 billion) for the cash-strapped economy.
Government officials responsible for the state-owned company held an extraordinary meeting and amended its charter to allow the appointment of two more members to the seven-seat board, a treasury statement said.
The officials also introduced a new rule barring the same person from holding both the post of director-general and head of the management board, it said.
The move is seen as a face-saving formula under which two additional directors with professional experience would be appointed without any of the existing members being removed, thus preserving fragile balances in the three-party coalition government of Prime Minister Bulent Ecevit.
The International Monetary Fund last week cancelled a meeting for the disbursement of the $1.5-billion tranche, allocated under a May stand-by deal to help Ankara battle financial turmoil. The World Bank followed suit by delaying the extension of $1.7 billion in credit.
The IMF says that key board members, who will run Turkish Telekom until it is privatized, have been appointed on the basis of political affiliation rather than professional capabilities and private sector experience.
The board composition is significant with respect to Turkey's pledges to eradicate political cronyism in the economy, seen as being at the core of many financial woes. Even though reluctantly and only after criticism against the Fund, the government announced Monday it would make the necessary changes "in order to prevent artificial snags from casting shadows on our ties".
The coalition's far-right Nationalist Movement Party (MHP), which holds the transport and communication portfolio, is at the center of the Telekom dispute. The party had appointed four of the seven board members.
The MHP has criticized the IMF for interfering with Turkey's domestic affairs. It has also criticized Economy Minister Kemal Dervis, who is pushing for a strict implementation of the IMF reforms, raising doubts over government harmony in the recovery drive.
The new appointments were to be announced late on Tuesday or Wednesday, the treasury said. It was not clear when the IMF executive board would meet to give the go-ahead for the delayed loan.
The Telekom amendments followed a government move to reform Turkey's ailing banking sector, widely blamed for fuelling a financial crisis that erupted in February. Turkey's banking watchdog placed five struggling private banks under state control Tuesday as part of efforts to remedy the financial system, another key pledge to the IMF. ― (AFP, Ankara)
© Agence France Presse 2001
© 2001 Mena Report (www.menareport.com)
