Babacan: All Loans Will Be Used To Repay Other Debts

ANKARA - State Minister Ali Babacan stressed on Thursday that every loan that Turkey provided would be used to repay other debts.
Replying to questions of private CNN Turk channel, Babacan said that the total debt rolling over rate for 2004 decreased by 5 points after the debt repayment plan with the International Monetary Fund (IMF) had become definite.
When asked how 11.3 billion U.S. dollars of source provided at the end of last talks with the IMF would be used, Babacan said that every loan would be used to repay other debts.
Babacan said that they did not have a concrete work on how many tranches 8.5 billion U.S. dollars would be released, when the tranches would be released, and what the amount of tranches would be in their talks with the U.S. treasury.
If the cash inflow of Treasury was appropriate, they could make early repayment or wait for the date of repayment, Babacan noted.
Babacan stated that what was important was to start repayment of the loans which were obligatorily used in the times of crisis as soon as possible.
They were repaying 2.6 billion U.S. dollars that year although they had the opportunity to pay back 1.6 billion U.S. dollars, Babacan said.
Babacan pointed out that Turkey's debt to IMF was 21.4 billion U.S. dollars in principal money and the interest of that principal money also continued.
Total debt of Turkey was 185 billion U.S. dollars according to the recent rate of exchange, Babacan said.
Babacan noted that the total debt rolling ratio of 2003 was calculated as 89 percent but that rate was around 96 percent in January-July period.
They predicted that rate to be around 77 percent in the following five months, Babacan stated.
Babacan pointed out that they plan to issue eurobond to both European markets and the U.S. market starting as of September.
Referring to rating organizations, Babacan said that they had started a different kind of initiative regarding those institutions and they included those organizations in their roadshow programs to make presentations.
Stating that the rating changing systems of those organizations were very different from each other, Babacan said that the ratings would be positive as long as they carried out the economic program without any concessions.
Babacan added, ''what is important is to concentrate on what we are doing and doing a good job.''
6.5 PERCENT PRIMARY SURPLUS FIRST TARGET OF GOVERNMENT
Babacan said that if they deviated from that target at great extent in their first year, nobody would rely on the targets they would set in coming years.
Therefore, Babacan noted, they would achieve that target.
Babacan stated that they predicted 2.3 quadrillion Turkish liras (TL) of deficit starting from June till the end of the year.
They did not predict any deviation in the end of the year after measures had been taken, Babacan said.
Babacan said that they would revise everything during the sixth review with the International Monetary Fund (IMF) and take measures if there was a deficit which could not be estimated before.
There were many important things to be made in direct taxation, Babacan pointed out.
Babacan noted that taxation would be the most important issue on which they would focus before the sixth review.
They had invited most experienced IMF experts on taxation, Babacan stated.
Babacan said that experts from countries successful in registration would come to Turkey and organize workshops.
The Investment Environment Rehabilitation Coordination Council would meet on August 27, Babacan noted.
Babacan pointed out that high-level administrators of some foreign companies which had invested in Turkey would tell about their problems and propose some solutions in that meeting.
(BRC-AÖ) 07.08.2003