ANKARA - State Minister Ali Babacan said on Wednesday that it was impossible for the economic program to succeed if citizens of the countries did not have confidence in administration.
Babacan held a news conference in Treasury. Recalling that amount of the loan that would be provided to Turkey within Stand-By agreement was 16 billion U.S. dollars in February 2002, Babacan said economic indications did not follow a positive course after that period.
Babacan said economic developments changed when the period after elections was considered, stating that, ''amount of loan we used from the IMF is below 1.2 billion U.S. dollars.''
Babacan said confidence of people in the government and in the party gradually increased, and that this feeling of confidence strengthened them to continue the policies they followed.
Babacan stressed that financial discipline and economic program continued without making concession.
BABACAN:''ISSUE OF ERASING ZEROS FROM TL IN 2005 TO BE DETERMINED AS A RESULT OF STUDIES OF TREASURY, CENTRAL BANK AND FINANCE MINISTRY''
Babacan said that the issue of erasing zeros from Turkish Lira (TL) would be determined as a result of studies of Treasury, Central Bank and Finance Ministry and it would be made public at the right time.
Babacan said that completion of fifth review studies with IMF on August 1, clarification of schedules for paying debts in 2004 and 2005 were new turning points in economy.
''Fight with inflation continues in a successful way and the decrease in inflation continues. Naturally Turkey talks about a new currency. We've been consulting with Central Bank the issue of erasing zeros from TL for the last two months. This issue requires a preliminary study regarding 2004 budget,'' said Babacan.
Stressing that there was no deviation from the targets determined for the end of the year, Babacan said that the target of 20-percent annual inflation rate seemed accessible. Babacan underlined that the last-12 month inflation figures as of August was the lowest figures since January, 1981.
Babacan said that he didn't expect any distortion from the targets of annual growth rate of 5 percent and 6.5 percent of non-interest surplus.
He added that technical studies which would start in the coming days for the sixth review within the scope of stand-by agreement with IMF continued.
TURKEY STARTS TO TAKE POSITIVE RESULTS FROM ACTIVITIES TO DRAW FOREIGN CAPITAL AS PORTFOLIO OR DIRECT INVESTMENT
Babacan said that Turkey started to take positive results from the activities carried on to draw foreign capital as portfolio or direct investment by reinforcing legal arrangements.
Babacan said that Justice and Development Party (AK Party) fulfilled comprehensive activities regarding Turkey's economic problems and their solutions. He added that a timetable was set for the things to be fulfilled not only on national level but also on international level.
Babacan said, ''we held continuous dialogues with all parts of society instead of creating theories on table for the solution of economic problems. We expressed in party and government program that foreign capital, which had an important role in the transfer of international information and experience, would contribute to the development of Turkish economy and with this goal we aimed to carry on dialogue and bilateral relations with international institutions and industrial institutions within the direction of our country's interests. This dialogue, which we have started before November 3 elections, continued with the same speed after formation of our government. We gave detailed information about economic program, party, government and policies and explained the change started in Turkey with all dimensions not only in our visits and contacts abroad but also to foreigners who visited our country.''
ASSESSMENT PROCESS ON U.S. LOAN IN CONGRESS WILL END ON SEPTEMBER 20
Babacan said assessment process on the U.S. loan in the U.S. Congress would end on September 20.
Babacan replied to question in the press conference which he held at Treasury. He said that assessment process on 8.5 billion U.S. dollars of loan which was expected from the United States to Turkey continued in the U.S. Congress.
Recalling that a delegation from the Treasury had gone to Washington in August and held meetings with officials from the U.S. Treasury Department, Babacan said that technical contacts continued till September 2 after the delegation returned to Turkey.
He said that there were about 19 technical issues which should be discussed during that process and stated that most of those issues were discussed.
''We informed the U.S. Department of Treasury on September 2 that they could start the process. Officials from the U.S. Treasury discussed this issue with the U.S. Department of State. It sent a letter to the U.S. Congress on September 5 and the negotiation process started,'' Babacan said.
Stating that there was a suspension process for 15 days in the Congress, he said that this process would end on September 20.
Babacan said that this loan was not an essential loan for Turkey and stated that they did not take into consideration this loan in all projections. He said that it did not mean that developments were negative and noted that they would not reflect the loan to any financing table till the first tranche came to Turkey.
Babacan said that the loan could also affect positively decrease in 2004-2005 debt ratios.
Babacan said that demands for Turkish debenture bonds increased after their road show in the United States and thus, they took a decision for issuing debenture bonds.
Babacan said that Institute of International Finance (IIF) would hold a meal on Saturday in which representatives of 500-600 finance sectors would attend in Dubai and Prime Minister Recep Tayyip Erdogan would make an opening speech as the single speaker and this would draw attention to Turkey.
Babacan reminded the journalists that he had held some promotion meetings last October in London, New York and Boston to brief international finance institutions on economic program.
Babacan said famous finance institutions of the world showed interest in the promotion meetings, stating that they replied questions of those institutions about political views and economic program.
Stressing that they had the opportunity to hold a road show to inform about the developments in Turkey in the past one year, Babacan said, ''we fulfilled targets of last year. U.S. institutions appreciated our determination.''
Babacan said the promotion program took place between September 8 and 12, and noted that they gave information about the general economic and political conditions of Turkey, ongoing economic program, recent macro-economic developments, budget and borrowing dynamics, and monetary and foreign exchange policies.
''We are pleased to see that foreign investors closely cover Turkey's economy,'' Babacan said they had the opportunity to give information about Turkey and the economic program.
Babacan said it was important to continue this dialogue, and stated that his meetings would continue with U.S. institutions. He said they were planning to stage such kind of programs in various European countries in the future.
Babacan said despite their busy schedule, they had the opportunity to participate in meetings in some American universities and to meet with Turkish businessmen. He said they listened to the problems of Turkish businessmen.
Babacan said reiteration of confidence in their government and economic policies is what they gained from the meetings.
Treasury Undersecretary Ibrahim Canakci, Central Bank Deputy President Fatih Ozata and some other bureaucrats had participated in the promotion meeting in the United States.
BABACAN: ''IMF DELEGATION WILL COME TO TURKEY FOR SIXTH REVIEW ON SEPTEMBER 25''
Asked whether or not IMF wanted additional taxes to be also carried on in 2004, Babacan said that 2004 year budget's conforming to the 6.5 percent primary surplus target was their basic goal and stated that studies on this issue started recently. He added that the budget would be submitted to the parliament on October 17. Babacan said that budget items might change till October 17 and added that IMF did not have any recommendation about continuation of additional taxes.
(EÖ-AÖ) 17.09.2003