ECONOMY

Solbes: EU lacks the money to help Turkey

SORRENTO – European Commissioner for Monetary Affairs Pedro Solbes said yesterday that the European Union was keen to help Turkey financially, but did not have sufficient funds to provide direct aid. We cannot consider giving any extra funding to Turkey because we have a very tight budget, Solbes told reporters on the sidelines of a banking conference in southern Italy. But I agree (with Belgium Finance Minister Didier Reynders) that it would be good if we could do something as quickly as possible, he said after 20 minutes of talks with Turkish Economy Minister Kemal Dervis. Dervis is spearheading a drive for additional International Monetary Fund loans in the wake of the September 11 attacks on the United States, which have had a powerful knock-on effect on Turkey’s tourism industry and the economy as a whole. Solbes said after meeting Dervis that Turkey had made a general request for help from the EU but would not say if Turkey, which financial sources in Ankara say is seeking up to $13 billion of fresh IMF funding, had specified an amount. Reynders and French Finance Minister Laurent Fabius were both positive after they held bilateral meetings with Dervis about Turkey’s push for new money on Thursday and Dervis himself was upbeat about the progress he was making. The work is going very well and I hope that before the end of the month we will have agreed on a (new 2002 macroeconomic) scenario, he told Reuters. He also confirmed he had made a formal request to the IMF for more money, but said he did not wish to discuss specific numbers. He said the attacks dealt a serious blow to Turkey’s economy and forced it to rework its forecasts for next year. Reworking those numbers was delaying the disbursement of an IMF tranche worth around $3 billion to Turkey that had been due in October under an existing loan arrangement. Dervis said he hoped cash would be cleared by the board once it received the reworked budget plans. (Reuters)