PARIS - Turkey report of Organization for Economic Cooperation & Development (OECD) states that ''Turkey is at crossroads. If it overcomes some traps, it can enter into a sustained period of strong growth.''
The report says, ''the recent recommendation by the EU commission to start accession talks - if confirmed by the European Council in December - promises to strengthen the international anchors and could underpin Turkey's shift to a stronger growth path.''
''After hitting the most severe crisis of its recent history in 2001, the Turkish economy bounced back and is now among the fastest growing economies in the OECD,'' stated the report.
The report stressed, ''After slumping by 7,5 percent in 2001, GDP recovered by around 8 and 6 percent respectively in 2002 and 2003 and should rise by more than 8 per cent in 2004, exceeding government targets.''
It also draw attention to ''3 traps'' --''confidence trap, governance trap and informality trap''-- which caused previous crisis and instability in economic growth. ''New monetary and financial policies besides structural reforms which were adopted within the frame of close cooperation with International Monetary Fund (IMF) and World Bank under EU membership perspective will provide opportunities to escape from these traps,'' stated the report.
The report said that new economic policies brought important developments to Turkey but there are also some risks and indefiniteness. Views for Turkish economy were summed up as follows:
-Tight macroeconomic policies have significantly improved confidence and dropped risk premium and thus fed growth. Macroeconomic policy should continue to depend on a high primary surplus and strict monetary policies to drop inflation rate should continue.
-Quality of fiscal consolidation should be increased by directing the expenses to areas for growth. Public services of justice, education and infrastructure planning should be strengthened. Know-how transfer should be established among ministries and an effective supervision infrastructure should be formed to strengthen reliability of new system.
-Measures to decrease unregistered sector which forms 50 percent of Turkish economy that shows a strong performance. Unregistered sector should be decreased within the framework of a strategy based on economic encouragement and legal measures.
(GC-ULG) 21.10.2004