ISTANBUL (AA) - IMF's Senior Resident Representative in Turkey Hugh Bredenkamp has stated that the IMF is ready to sign a new stand-by agreement with Turkey for a three year period. ''Accordingly, we will carry Turkey to a higher level,'' told Bredenkamp.
Participating in a seminar titled ''Disinflation: Global Lessons and Expert Suggestions'' sponsored by Turkey Banks Union and International Institute of Finance (IIF) on Tuesday, Bredenkamp said that the drop in income, increase in inflation rates negatively affect the economy.
According to Bredenkamp, debt stocks have increased overtime and real interest rates jumped to higher levels. ''All of this constitutes barriers for investment. After the 2000-2001 economic crises, domestic debt has risen to a higher level. However, these problems have been dealt with effectively by the Turkish government,'' expressed Bredenkamp.
''Thanks to the efforts of the Turkish government, the net public debt has gone down to 70 percent,'' he said.
Bredenkamp praised Turkish progress made in budget management and went on saying that inflation has been brought down in Turkey. ''There was an urgent need for such an atmosphere in order to make Turkish products competitive globally. The banking sector reforms after the crisis of 2001 have been extremely successful. Private sector banks have better financial positions. The public banks are also successful. Privatization efforts are on the right track,'' remarked Bredenkamp.
''Turkish economic achievements in the past three years have made up for the losses incurred in 2001 crisis. The Turkish national income has increased by over 10 percent. This is almost a new world record,'' noted Bredenkamp.
''Inflation in Turkey will soon drop to one digit figures. One of the most remarkable achievements in Turkey in the past 2-3 years is high productivity and increase in wages,'' he stressed.
Bredenkamp pointed out to the importance of the improvement of tax collection and said that one of Turkey's economic problems is the presence of informal economy. ''Turkey must fight against informal transactions. The taxation system must be more simple and easily managed,'' stated Bredenkamp.
Referring to the issue of banking, Bredenkamp expressed that the IMF and Turkish government do not have different approach to new banking regulations.
''Turkey has an incredible potential. Turkey has a big market with a force of 70 million people,'' told Bredenkamp. ''We expect Turkey's per capita income to be over 4,000 U.S. dollars in 2004.''
Bredenkamp mentioned that one area in which Turkey made real progress is the macroeconomic area. ''In the past two years, Turkey has shown impressive development in the macroeconomic sector. There are still issues waiting to be dealt with, especially in the areas of state enterprises. The government must encourage both foreign and domestic investments,'' said Bredenkamp.
''There have been 16 different governments in Turkey in the past 25 years. Weak governments and coalitions have resulted in rapid policy changes which in turn hurt the economy,'' told Bredenkamp.
(ES-MS)
2004-11-23