ANKARA, Aug 6 (AFP) - Turkish Prime Minister Recep Tayyip Erdogan said Friday that his government would hold talks with the International Monetary Fund on drawing up a possible new stand-by deal when the current one ends next year.
"We have decided to launch talks in order to continue our ties with the IMF in 2005 and coming years in the framework of a new stand-by deal which includes the use of resources," Erdogan told reporters after a meeting of his Justice and Development Party (AKP).
Erdogan gave no further details on the planned stand-by deal, and said work was still going on to work out the details.
The current stand-by deal was signed in February 2002 when Turkey ran to the Fund for help after a severe financial crisis in 2001 plunged the country into its worst recession since World War II.
In return for the loan, Ankara promised to implement drastic reforms under a three-year austerity program aimed at returning to firm growth.
The aid package, which is based on a basket of currencies and calculated in what the IMF calls special drawing rights, was worth 16 billion dollars at the time of signing, but based on current exchange rates is now worth some 19 billion dollars.
The country`s economy recovered significantly last year, but some observers worry progress could be short-lived if the government loosens fiscal policy.
The stand-by deal expires in February 2005.