The World Bank will lend $62 million towards a public financial management project which is estimated to cost a total of $94.2 million. The project is intended to reform the tax and customs administration and improve the management of expenditure and personnel.

In modernising the tax administration, the project intends to increase revenues by broadening the tax base while ensuring a more equitable distribution of the tax burden. Both the IMF and the World Bank have urged the government to reduce perennial budget deficits by raising more revenues through taxation.

The customs modernisation will support changes in the national customs administration required for Turkey’s successful entry into an EU customs union in 1996. It also seeks to provide more support for business by making customs administration more efficient.

Additional World Bank support is planned for a second phase of the government’s overall financial management reform programme, following the satisfactory completion of studies and pilot investments in this first project.