|
IMF to lend Turkey $10B
|
 |
November 16, 2001: 5:21 a.m. ET
Turkey to get third rescue package to help economy in wake of terror attacks
|
LONDON (CNN) - The International Monetary Fund will recommend a new $10 billion loan for Turkey, an unprecedented third rescue for the nation this year.
Turkey has been bailed out by the IMF twice this year to the tune of $19 billion as a banking crisis rocked its economy. Turkey had planned to export itself out of trouble but September 11 put pay to those efforts.
IMF Managing Director Horst Koehler said: "In the aftermath of September
11 a financing gap of approximately $10 billion for the remainder of 2001 and 2002 has arisen."
Koehler, the IMF's top official, said Ankara's performance under its existing $19 billion loan was "very strong" and he would soon recommend the completion of the next review of Turkey's loan, worth $3 billion, and the negotiation of a new standby loan in the next month.
The new loan must be approved by the board of the IMF. But the IMF's biggest shareholder, the U.S., said it backed the loans.
"Turkey's implementation of their reform policies has been very strong," said U.S. Treasury Secretary Paul O'Neill.
"We are pleased that the IMF is recommending completion of Turkey's review and support the other recommendations presented to the board today," O'Neill said. "Combined with Turkey's commitment to continue to implement reform measures, these steps should help to reestablish the basis for economic growth."
As the only Muslim member of NATO, Ankara has grown in strategic stature since the September 11 attacks on the United States, which prompted the U.S.-led war on terrorism.
But even apart from Turkey's increasing geopolitical stature, its standing has risen at the IMF recently after authorities there pushed through a series of demanding economic reforms to improve its longer-term economic prospects.
Turkey needs the loan to pay off debts, which have soared as the country's currency, lira, was floated and lost more than half its value against the U.S. dollar.
Turkish officials have said the country needs up to $13 billion in new loans to deal with the country's massive debt mountain next year.
Koehler's upbeat words earlier on Thursday boosted Turkish shares by 5 percent and the lira and bonds also rose on the growing expectation Ankara would win IMF cash to plug the financing gap.
--Reuters contributed to this report 
|
|
|
|
|
|
|
