Fitch Upgrades Turkey's Rating To B+

ANKARA/ISTANBUL - Fitch Ratings upgraded on Monday the long-term foreign and local currency ratings of Turkey from ''B'' to ''B+''.
A statement of Fitch said that the outlook for the long-term ratings was stable.
At the same time, the agency affirmed Turkey's short-term rating at ''B.''
The statement said that the upgrade reflected progress towards sustaining macroeconomic stabilization, most notably the decline in inflation and interest rates as well as exchange rate stability, underpinned by on-going fiscal consolidation and economic reform under the International Monetary Fund (IMF) program.
The statement read, ''along with strong bilateral and multilateral financial support, and the government's commitment to further economic and political reform necessary to secure agreement from the European Union to begin the accession process, the reform credentials of the government have been strengthened and ameliorated short-term fiscal and external financing concerns. The fiscal financing outlook for 2004 is relatively benign and it would take a series of major shocks for the government to encounter difficulties in meeting its debt servicing obligations this year.''
''However, Fitch warns that concerns over the sustainability of public finances remain, including the reliance on 'one-off' measures to meet the 6.5 percent of Gross National Product (GNP) primary surplus target in 2003 and the slow progress of privatization,'' the statement noted.
The statement added, ''the credibility of the government's economic program remains fragile and with the current IMF program due to expire this year, Fitch believes that it will be important to secure a fresh framework to anchor medium-term reform expectations and policy delivery. This could materialize in the form of a new arrangement with the IMF and/or an invitation from the EU to Ankara to commence accession talks.''
(BRC-AÖ) 09.02.2004