Press Release No. 03/05

Press Release: IMF First Deputy Managing Director Anne Krueger Concludes Visit to Turkey

January 16, 2003

Anne Krueger, First Deputy Managing Director of the International Monetary Fund, met today government representatives in Ankara. The visit took place at the invitation of Economy Minister Ali Babacan. Ms. Krueger also met Prime Minister Abdullah Gül, Deputy Prime Minister Abdüllatif Şener, Finance Minister Kemal Unakitan, and senior economic officials. Their discussions focused on the status of Turkey's IMF-supported economic program and the actions the government needs to take to ensure a positive momentum in economic recovery and financial stabilization.

Following her meetings, Ms. Krueger said:

"I have had fruitful meetings with Prime Minister Gül and members of his government.

"The government has reaffirmed its commitment to disinflation, debt reduction, and rapid sustained growth. To this end, it has stated its commitment to a public sector primary surplus target of 6.5 percent of GNP in 2003. The government's targets for 2003 of 5 percent growth and 20 percent inflation remain feasible but require strict adherence to the program.

"Prime Minister Gül, his team, and I agree that the task for the government now is to translate its good intentions into actions. The recent announcements of budgetary measures and the 2003 privatization plan are helpful initial steps. In the coming weeks, the government needs to take further steps toward ensuring a viable fiscal position, a sound banking system, and an improved business environment. Swift formulation and implementation of strong economic policies will allow the Turkish economy to realize its vast growth potential, and lay the basis for raising the living standards of all Turkish citizens, including the economically disadvantaged.

"As soon as the government has clarified its concrete policy plans further, we stand ready to send an IMF mission to Ankara to discuss the 2003 budget and other issues key to the program."