The Turkish parliament began Monday to debate the government's 2001 budget planned at 48.3 thousand trillion liras ($71 billion, €80.67 billion). The draft budget, based on a projected growth rate of 4.5 percent, foresees revenues totaling 43.1 thousand trillion liras, including 3.7 thousand trillion liras from privatizations. The budget deficit was forecast at 5.2 thousand trillion liras.
The 2000 budget allowed for the expenditure of 46.7 thousand trillion Turkish lira, revenues of 32.5 thousand trillion lira and a deficit of 14.1 thousand trillion lira.
Turkey's Finance Minister Sumer Oral said in his opening speech at parliament that the draft budget would help Turkey to get closer to its targets under a vigorous economic program backed by a three-year, four-billion-dollar stand-by deal with the International Monetary Fund. "In 2001, we will continue our determination to pull down inflation and narrow the public finance deficit," he added.
The Turkish government has not revised its end-2001 inflation targets of 12 percent in consumer prices and 10 percent in wholesale prices despite a near-certainty that it will fail to meet its end-2000 targets.
In November, inflation stood at 43.8 percent in consumer prices and 39.1 percent in wholesale prices, well above the year-end targets of 25 percent in consumer prices and 20 percent in wholesale prices.
Oral admitted Monday that the end-2000 inflation targets would be achieved with a "few months' delay" due to a massive increase in international oil prices and an increase in demand caused by falling interest rates.
The draft budget also foresees a pay rise of 10 percent for public sector employees for the first half of 2001, which has been widely opposed by trade unions as "insufficient". The government maintains that it will not let its employees suffer and will make extra funds available if inflation in the second half of next year falls by more than forecast.
Under the IMF stand-by deal sealed last December, Turkey pledged to introduce structural reforms to slash chronic inflation and overhaul its troubled economy.
Last week, Turkey turned to the IMF yet again and secured a $10-billion aid package after a severe liquidity squeeze rocked its money markets and threatened to throw the economic program off track. — (AFP, Ankara)
© Agence France Presse 2000
© 2000 Mena Report (www.menareport.com)