Govt announces EU pre-accession economic program

The government has announced the details of a long-awaited stimulus package to be implemented over the next three years as part of efforts to cushion the global economic crisis' impact on Turkey. Speaking at a press conference in Ankara, alongside Economy Minister Mehmet Simsek and Finance Minister Kemal Unakitan, Deputy Prime Minister Nazim Ekren yesterday said the EU Pre-Accession Economic Program will first be sent to Parliament for approval and is expected to be completed by the end of 2011. Stating that Turkey is being affected by the crisis like all other countries, Ekren said the government had reconsidered economic forecasts in light of the crisis. Ekren said the government will step up work on having an automatic tax system for the whole country next year. "The tax collection system will be revised before the end of this year," he added. "Public spending on civil service wages and expenditures on State Economic Enterprises will be arranged in line with economic targets." The government will not create new extra-budgetary funds or arrange the budgets of local administrations, he explained. Ekren said the government will not halt public investments and is expected to allocate some €12.2 billion for the Southeastern Anatolia Project (GAP) through 2012. "The middle-term plan involves the basic principles of a standby deal that the government expects to sign with the International Monetary Fund soon," he said. Under the program, the budget deficit to gross national income ratio this year would be 4.6 percent, followed by 3.2 percent for 2010 and 2.8 percent for 2011. The new package would also provide for the effective operation of a credit guarantee fund. "The packages (to fight the economic crisis) we have introduced so far total $750 billion, and their ratio to the budget is 17 percent," he said. Turkey has one of the most steadily growing economies in its region with a $750 billion gross domestic product, said Ekren. He said they expect a 3.6 percent contraction in the economy for 2009. "For 2010 we predict 3.3 percent growth, and 4.5 percent by 2011," he added. Turkey's exports will amount to $104 billion this year and $111 billion and $120 billion in 2010 and 2011, respectively. Turkey's foreign trade deficit will be $34 billion this year, and $43 billion and $54 billion in 2010 and 2011, he added.