The government has proposed a new economic stabilisation programme to the IMF, according to State Minister Ufuk Soylemez. The minister, who is heading the Turkish team at the annual IMF-World Bank meetings in Washington, refused to use the term ‘standby’ for the medium-term assistance being sought from the fund.
The programme presented to the IMF had four crucial goals, said Soylemez. These were: lowering inflation, eliminating a budget deficit which stood at TL 588 million million ($6,900 million) at the end of August, reducing public debt and carrying out structural reforms such as privatisation. Without the burden of domestic debt servicing, the primary budget would be in surplus.
The last IMF economic programme had a standby facility of around $700 million attached to it. The programme lapsed last year amid the economic and political uncertainty which preceded the general elections of December 1995.
Reports prior to the annual meetings suggested that the IMF would now prefer a programme which gives priority to fiscal and budgetary adjustments, then leads into fundamental structural reforms such as selling off state enterprises and streamlining the social security system.