News Brief No. 98/22

News Brief: IMF Management Welcomes Turkey’s Staff-Monitored Program

June 30, 1998

The management of the International Monetary Fund (IMF) welcomed Turkey’s announcement today of policies of disinflation to be monitored by IMF staff.

The Turkish authorities and the management and staff of the IMF have been pursuing a close dialogue on policies designed to preserve macroeconomic stability and reduce inflation in Turkey. In this context, a delegation headed by State Minister Gunes Taner visited IMF headquarters June 25-27, 1998 to discuss with IMF Managing Director Michel Camdessus the government’s recent actions and policy intentions that are described in a statement that was released in Ankara earlier today.

Building on a strengthening of policies in the first half of 1998 that have begun to lower inflation, the government aims to achieve a significant further reduction in inflation over the next year and a half, through strict fiscal policy, a supportive and closely-coordinated monetary policy, and structural reforms, including stepped up privatization.

IMF management supports Turkey’s disinflation efforts and believes that the authorities’ policies, if fully implemented, are consistent with those efforts, and has agreed to quarterly monitoring by IMF staff of the implementation of their program, covering the 18 months to end-1999. The authorities intend to make the staff’s assessments public.

The Executive Board of the IMF will be informed of the authorities’ policies in the context of the forthcoming 1998 Article IV consultation, expected to be discussed by the Executive Board in early August.