IMF’s Decision Will Lower Interest Rates

This would positively affect the Turkish economy, according to business authorities and economists. They also say postponing payments on Turkey’s total debt of 183 billion dollars would rid the financial sector of speculations about Turkey’s ability to make its debt payments in 2004 and 2005. The amount of debt the Treasury is required to pay this year will decrease, lowering interest rates and debt-servicing costs.

The IMF’s decision is a boon to a government grappling with an unexpected budget shortfall brought on by salary increases for civil servants, the loss of 25 million dollars projected income from the deforested land bill, which has yet to be approved by the President, and the Constitutional Court’s cancellation of the Supplemental Motor Vehicle Tax.

Mustafa Ozge, Ramazan Solak / Istanbul, Ankara / TURKEY