IMF supportive of Türkiye’s program, says official

WASHINGTON

The International Monetary Fund (IMF) is very much supportive of the reform program in place in Türkiye, says Alfred Kammer, director of the IMF European Department.

“That's also what we would be recommending to Türkiye, what the economic team there is carrying out,” Kammer said at the press conference on the release of the European Economic Outlook in Washington on April 19.

Kammer noted that in mid-2023 there was an absolute policy pivot, and the new policies in place on the monetary side with a substantial tightening, but also on the fiscal side with fiscal consolidation, which has started including to accommodate the increased earthquake spending, is indeed a completely different policy setting.

“We already see some achievements on this side. And it's not only on the disinflation side that will take longer to materialize fully, but vulnerabilities to Türkiye have been decreased because of this policy setting,” he added.

The IMF official said that he had a discussion with Finance Minister Mehmet Şimşek on April 18 and that Şimşek pointed out that these reforms are in place.

That program is expected to lower vulnerability further, bring inflation down durably over time and also create that climate for investment to take place so that there will be a shift in the growth pattern and the rebalancing of growth, Kammer said.

In response to a question about whether there is a need for a new IMF program in Türkiye and if there are talks with Turkish authorities on this, Kammer said there is no discussion on an IMF program supporting Türkiye.