IMF talks may progress at G-20 summit

Bloomberg

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Turkey and the IMF have been holding technical talks on a follow-up agreement since a $10-billion loan accord expired in May. The global credit crunch is reducing the foreign investment Turkey needs to grow, increasing pressure for a new arrangement with the fund.

“It is possible to expect some concrete developments in terms of our IMF relationship” at the summit in Washington, Ekren said yesterday during a visit to the southeastern city of Mardin. “Right now, it's not easy to say if we're in agreement with the fund or not. Talks are still taking place.”

Turkish Prime Minister Recep Tayyip Erdoğan will be among heads of state at the summit Nov. 14 and Nov. 15 to discuss the global credit crisis. While Turkey doesn't need IMF lending, it would welcome the market confidence an accord would bring, so long as the program matches the government's priorities, Economy Minister Mehmet Şimşek said Oct. 30.

Turkey and the IMF are divided over the country's move to directly allocate central budget funds to local municipalities, Ekren said. Local elections are due by March 2009 and the ruling Justice and Development Party wants to win control of major cities in the predominantly Kurdish southeast and on the Aegean coast in the west of Turkey.

If an agreement is reached it will be the third IMF support package the ruling Justice and Development Party has managed.

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