Babacan: There Has Never Been Tension In Relations With The I.M.F.

ANKARA - State Minister Ali Babacan said on Sunday that there had never been tension in relations with the International Monetary Fund (IMF), stating that uniting 5th and 6th reviews was not in question. He said they would set a moderate timetable for the 6th review by taking into consideration the tempo of the legal arrangements in May and June.
Speaking at a tv program in CNN Turk channel, Babacan mentioned the developments carried out with the IMF, and pointed out that studies of the 4th review were very important as the economic program of their government was for the first time revealed in details, and that international institutions were agreed on it.
Babacan said 4th Review should be kept separate from the 5th and 6th Review, stating that serious disagreements had happened in the 4th Review, and that very difficult periods were experienced. ''However,'' he noted they wrote in the Letter of Intent what they thought were right for Turkey, and that an agreement could be reached afterwards.
''Uniting 5th and 6th reviews with the IMF is out of question,'' Babacan said, stating that they had talks with the IMF to change the date of the 6th Review.
Babacan said, ''an IMF delegation, under the leadership of Reza Moghadam, will visit Turkey on July 9 to reach a conclusion about the 5th Review and to set a timetable for the 6th Review. Preliminary studies of the 6th Review will be made during the talks, and a final point will be put on the 5th Review.''
Responding to a question which said, ''it appeared in the newspapers that there was a serious tension regarded with the 5th Review. It had also been stated that IMF was tense as legal arrangements had not been made. Is there any softening in relations with the IMF, Babacan said there had never been tension in relations with the IMF.
Stressing that some delay in legal arrangements should not create concerns, Babacan said such kind of concerns are unnecessary.
Babacan said it was not normal to be obliged to use loan from the IMF, and to make a stand-by agreement, Babacan said, ''what is normal is to make borrowing from markets through normal ways under moderate conditions. I mean using loan from the IMF is abnormal. This is a serious indication. We wish not to have a loan relation with the IMF after 2004 and after completion of the program. We wish not to have an obligation to use loan in stand by or through another way.''
Recalling that Turkey was one of the 29 countries that founded IMF, Babacan said IMF examined economies of all world countries and prepared reports. Babacan said, ''we want to bring relations with the IMF into normal level.''
When asked whether or not there were new arrangements and additional measures on the 5th Review, Babacan said the budgets were comprised of plan, program, and estimations, adding that it is not possible to say that ''there will not be deviation.''
Babacan stressed that they attributed great importance to primary surplus while putting budget targets, adding that their target was to reach 6.5 percent primary surplus. ''We will take additional measures if necessary,'' Babacan pointed out.
Stressing that this was the first year of the government, and that they wanted to create confidence in reaching budget targets, Babacan reiterated that they were determined in this respect.
Responding to a question about increase in salaries of civil servants and workers, Babacan said there has not been any deviation on salaries of civil servants and workers who work in state sector.
When asked, ''what happened to the decision to turn one billion U.S. dollars support figure in the U.S. Congress that would be given to Turkey to 8.5 billion U.S. dollars,'' Babacan said, ''talks started with the U.S. administration 3-4 weeks ago, and that talks continued.''
Underlining that Turkey's 2003 targets were not determined according to this loan, Babacan said, ''there are political and economic conditions related with the loan. There is not any obstacle in front of this loan as long as any problem is not experienced in Turkish-U.S. relations on Iraq. There is no difference of opinion with the U.S. administration so far on Iraq issue. As to the economic conditions, the decision issued by the Congress was the completion of the 4th Review and Turkey's attitude in continuing strong economy policies. 4th Review had been completed long before. There is no problem about it at the time being.''
Babacan said, ''it will be seen in the accounts when the money enters to the accounts of Turkish Treasury.''
(AY-BRC) 29.06.2003