Anadolu Agency: News in English, 01-08-10

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ANADOLU AGENCY

NEWS

10 AUGUST 2001 Friday

CONTENTS

[01] TURKEY-PRESS SCAN

[02] IMF: ''REACHING NON-INTEREST BUDGET SURPLUS TARGET IS VITAL FOR TURKISH ECONOMY''

[03] YILMAZ RESPONDS TO QUESTIONS ON NTV ''IF TURKEY WANTS TO START MEMBERSHIP TALKS WITH THE EU, IT HAS TO LIFT THE OBSTACLES IN FRONT OF FREEDOM OF THOUGHT AND EXPRESSION IMMEDIATELY''

[04] MAJORITY OF BIG INDUSTRIAL COMPANIES BASED IN ISTANBUL

[05] DERVIS MEETS WITH EXPERTS FROM BRAZIL, MEXICO AND ISRAEL

[06] TURKEY APPROVES ''BLACKSEAFOR''

[07] CENTRAL BANK SELLS 60 MILLION DOLLARS

[08] FOREIGN AFFAIRS MINISTRY BRIEFS ARAB COUNTRIES ON ISRAELI PRIME MINISTER SHARON'S VISIT TO TURKEY

[09] PRIME MINISTER ECEVIT: ''TALKING ABOUT NATIONAL SECURITY IS UNNECESSARY FOR THE STATE''

[10] ISRAELI INDUSTRY AND TRADE MINISTER ITZIK VISITS ITO

[11] PRIME MINISTER ECEVIT MEETS WITH FOREIGN MINISTER CEM AND GENERAL BUYUKANIT, DEPUTY CHIEF OF GENERAL STAFF

[12] S&P: ''TURKEY IS DOING ITS BEST TO REDUCE FEARS ABOUT ITS FINANCIAL POSITION''

[01] TURKEY-PRESS SCAN

HURRIYET (LIBERAL)

Sezer also asked Sharon to lift the economic sanctions Israel is imposing on the Palestinian people.

INCREASE IN DOLLAR EXCEEDS 100 PERCENT SINCE FEB. 22
The increase in U.S. dollar exceeeded 100 percent on Wednesday when the Central Bank announced one U.S. dollar as one million 382,000 TL. The Turkish Lira lost 100.8 percent value against the U.S. dollars since Turkey switched to a floating currency system in February. This shows that Turkey has become 50 percent poorer since Feb. 22, 2001.

MILLIYET (LIBERAL)

YILMAZ SAYS HE IS CONCERNED ABOUT TURKEY
Deputy Prime Minister and the leader of the Motherland Party (ANAP) Mesut Yılmaz said that he was concerned about Turkey. ''I try to activate the society in order to overcome this concern. I am ready to sacrifice myself if necessary to this end,'' Yılmaz said. Speaking to NTV private channel, Yılmaz said that ''Turkey goes through its most important transformation process since its foundation. Transformation is the national programme of Turkey and the latter has to fulfil the political criteria in order to be a member of EU. The most important political criterium is the right to freedom of thought and expression.''

SABAH (LIBERAL)

CEM EXTENDS SUPPORT TO YILMAZ
Foreign Minister Ismail Cem said that it is in the hands of Turkey now to join the European Union (EU). ''Turkey has to be quick,'' said Cem and commented that there is no difference of opinion between the Foreign Ministry and the General Staff in foreign politics. Yet Cem refrained from commenting about the domestic politics.

CUMHURIYET (LEFT)

FOREIGNERS TAKE CONTROL OF TURKISH INDUSTRY
Turkish companies, which have become cheaper due to the economic crisis and devaluation, started to be bought by the foreign capital. In May, 50 percent of Turk Tuborg was bought by Carlsberg Brewier, 30 percent of Dardanel was transferred to an American fund. In the last six months, the share of Beligan Deceuninck in Ege Profil increased from 47 to 87 percent.

RADIKAL (LEFT)

A.A GETS RAFET GENC NEWS STORY AWARD
The Progressive Journalists' Association (CGD) presented Mehmet Guler, the Director General and President of Anadolu Agency (A.A) Executive Board, and A.A correspondent Coskun Ergul the ''Rafet Genc News Item Prize.'' The CGD gives this prize to commemorate Rafet Genc, one of the former chairmen of the association. Ergul and Anadolu Agency were awarded with the prize due to Ergul's news item about the testimonies given in line with the operation into corruption in energy tenders. CGD Chairman Ismet Demirdogen said that there is difficulty in expressing thoughts in Turkey, adding that the debate on national security and the tension it has caused has revealed one again the fact that the right to freedom of expression is necessary for everybody.

TURKİYE(RIGHT)

INFLATION TARGET TO BE DISCUSSED WITH BRAZILIAN, MEXICAN AND
ISRAELI CENTRAL BANK REPRESENTATIVES
The Central Bank will have a round table meeting with high level central bank executives from Brazil, Mexico and Israel to benefit from the experiences of these countries in their fight against inflation. ''This meeting will guide us in the decisions we will take in the coming days,'' one Central Bank official said.

ZAMAN (CONSERVATIVE)

[02] IMF: ''REACHING NON-INTEREST BUDGET SURPLUS TARGET IS VITAL FOR TURKISH ECONOMY''

IMF experts Turkey asssessment covered the developments between May 15 when the new economic program was approved and July 12 when the second credit tranche of 1.5 billion U.S. dollars was released.

The report said despite the two big economic crises that shook the Turkish economy, Turkiye Is Bank, Akbank, Yapi Kredi and Garanti Bank achieved to make profits.

Below are the recommendations IMF experts made in the conclusion part of the assessment report:

-Economic program should be implemented completely without any faults for success.

-The monatery policy to bring down inflation will continue based on floating currency system. Reaching the non-interest budget surplus which is 5.5 percent of the gross national domestic product is vital for program's success.

-As addition to steps taken regarding banking reform, possible problems in this sector must be monitored closely and the necessary measures should be taken immediately.

-The support of international finance circles and the society is critical for the program's success.

The IMF experts briefed the economic developments that took place after May 15 as follows:

''The positive market reaction for the approval of the economic program by IMF Executive Directors on May 15 lasted short. Interest rates did not decrease because of doubts about the government's faitfullness to the program, deviations in May and the uncertainity caused by the debt swap. Inflation started dropping. The program was implemented well despite the doubts in money markets and delays in certain measures.''

''It was agreed that the interest rates will drop if the program is implemented completely and market confidence is maintained. The Turkish government stated that it would take the necessary steps to make up for the deviations in price increases for public workers and minimum wheat prices. The additional budget issued in June was a positive step for the program. The government started receiving help from the private sector besides the international financial support to pay back its foreign and domestic debts.''

According to the report of IMF, the debt swap undertaken in June 2001 year has become successful. The government's debt payment profile has progressed in a considerable extent in return to its swaping its treasury bonds on TL basis with longer term and dollar-indexed bonds. In the same way, the external positions of the banks have positively affected from that.

The report also referred to the measures in the banking sector and noted that Turkish banks have generally become weaker after the crises. Yet the four biggest banks of Turkey have been profitable despite their getting weakened financially in the first quarter of the year. The remaining 23 medium and small banks weakened in a considerable extent.

The report recounted that the Banking Regulation and Supervision Agency (BRSA) requested many banks to increase their capital. Three of these banks could not do that and the plans of two banks were not found convincing and thus they were transferred to Savings Deposit Insurance Fund (SDIF) and an extra period of time was given to a bank till the end of August in order to clear up its situation.

Recounting that the release of the second tranche of IMF loan was delayed from July 3 to July 12 due to certain delays in banking measures and the conflict that took place regarding the administration of Telekom, the report added that the recently formed Telekom executive board and administration are in line with the economic programme.

[03] YILMAZ RESPONDS TO QUESTIONS ON NTV ''IF TURKEY WANTS TO START MEMBERSHIP TALKS WITH THE EU, IT HAS TO LIFT THE OBSTACLES IN FRONT OF FREEDOM OF THOUGHT AND EXPRESSION IMMEDIATELY''

Yilmaz responded to a number of questions during a news program titled ''Eko Diyalog'' on NTV private news channel on Wednesday night.

''What I expect from the national security discussion is to find an answer to whether Turkey needs these limitations to preserve national principles or not. Could there be an expansion in the field of freedom? If we do that, do we risk national principles? This is what I want to discuss. I believe that Turkey will miss the EU train if Turkey doesn't remove these unnecessary obstacles in September or October and its ties with the modern world will break. That is when its national integrity and secular system will be at risk,'' Yilmaz commented.

Yilmaz indicated that there was nothing that couldn't be overcome between the national security concept and the national program. ''There is an understanding in Turkey which interpretes the national security concept larger than it is necessary and this prevents us from from integrating with the EU,'' he said.

''There is both a significant willingness and a resistance against change in Turkey regarding EU membership,'' Yilmaz said, adding that it was feared that certain values would be at risk if Turkey entered the EU.

''I've been receiving very antidemocratic reactions in the last two days. What I want to open to discussion is not Turkey's national borders. I'm not announcing any secrets about Turkey's national security either. What I say is that there must be a discussion about the frame of national security concept. If Turkey reaches European standards in freedom of thought and expression, would that risk its unitary and secular system? I think it wouldn't.''

''This is what Europe wants from us: Everybody should be able to express his or her opinion and no thoughts should be banned with the condition that these thoughts won't turn into violence or force. This is the standard that exists in Europe. Think once that Turkey has limitless freedom of thought. I'm asking people: Is Turkey's unitary and secular system would be threatened in that situation?'' Yilmaz continued.

''What I want to discuss is not the national security concept. Because national security is a vital thing and it is an extremely important subject for every state. Turkey has to be more careful than other countries on this subject. I accept all these. What I'm saying is that Turkey could realize the conditions of the EU by preserving its national security,'' he said.

Responding to questions about economy, Mesut Yilmaz said that one of the most important problems of economy is the one seen in real sector.

Yilmaz said that the problems of the real sector have urgency and they can't be delayed.

''We discussed in the cabinet meeting today. Mr. Kemal Dervis had meetings with the representatives of the real sector in the afternoon. We must firstly deal with the real sector's problems, because if the real sector does not improve, the studies of the government about the financial sector won't yield any result. The financial sector will also be negatively affected from that. Secondly the government has transferred a significant amount of source to Eximbank's credits to revive the real sector,'' he said.

When asked when the economy would start to grow again, Yilmaz said that ''I think it will start as of fall this year and its effects will clearly be seen as of the beginning of the new year. Turkey goes through a big transformation and we are at a very critical stage of this transformation. We have to decide certain issues which we have been late to discuss. I think the one we have today is a late discussion.''

Yilmaz stressed that if Turkey can't take serious steps in one or two months, it will face the danger of missing the EU train.

[04] MAJORITY OF BIG INDUSTRIAL COMPANIES BASED IN ISTANBUL

According to the study carried out by Istanbul Industry Chamber (ISO), there are 38 industrial companies in the provinces of Gaziantep, Kayseri, Denizli and Eskisehir which are called as ''Anatolian Tigers.''

The firms are registered with 48 trade and industry chambers.

Istanbul comes the first among the provinces where these companies are based. Among the first 100 big industrial companies, 53 of them are in Istanbul, 13 companies belong to the public sector and seven of them are in western Izmir province.

There are five companies among the first 100 firms from Bursa and Adana, three from Ankara and Kocaeli, two from Gaziantep, and one from Gemlik, Edirne, Konya, Kayseri, Denizli, Adapazarı, Karabuk, Mersin and Balıkesir.

The public sector has 30 companies, Bursa has 23, Kayseri has 15, Adana has 14, Kocaeli has 11, Denizli has 10 and Gaziantep 8 among the 500 biggest companies of Turkey.

Other places where the biggest 500 industrial companies are registered are Edirne, Karaman, Suluova, Kahramanmaras, Tokat, Ordu, Eskisehir, Konya, Gemlik, Adapazari, Karabuk, Mersin, Balikesir, Kutahya, Bolu, Corum, Unye, Canakkale, Giresun, Karacabey, Tekirdag, Trabzon, Van, Inegol, Corlu, Adiyaman, Uzunkopru, Manisa, Kirsehir, Isparta, Samsun, Antalya, Bulancak, Mardin, Akhisar, Nigde, Tarsus, Dortyol and Salihli.

There are no managements among the biggest 500 industrial companies from cities other than Van in Eastern Anatolia and Gaziantep and Adiyaman in South East Anatolia.

A majority of industrial companies are in Marmara region.

[05] DERVIS MEETS WITH EXPERTS FROM BRAZIL, MEXICO AND ISRAEL

Central Bank Governor Sureyya Serdengecti, Central Bank Deputy Governor Sukru Binay, Brazilian Central Bank Deputy Governor Daniel Luis Gleizer, Mexican Central Bank Economic Researches General Director Alejandro M. Werner and Prof. Nissan Liviatan from Israel are attending the meeting.

Central Bank had earlier said in a statement that the inflation targeting which was used by the developed countries in early 1990s was also being employed by developing countries in recent years.

The banks said that the inflation target decided upon between the Central Bank and the government would be announced to public and all economic policies would be run in coordination to reach this target.

''In the inflation targeting system, the inflation target will be the only nominal peg of economic policies and Central Bank will determine monetary policies by assessing all economic data, not only the foreign currency rate and monetary values. Central Bank will also maintain transparency by regularly informing the public about monetary policies and implementations, '' the bank said.

[06] TURKEY APPROVES ''BLACKSEAFOR''

BLACKSEAFOR, which is known as ''Black Sea Naval Cooperation Task Group,'' was voiced firstly in 1998 by Admiral Salim Dervis, the then Naval Forces Commander and it was later developed.

BLACKSEAFOR carries great importance as countries of Bulgaria, Georgia, Romania, Russia, Turkey and Ukraine which were in two different groups during the Cold War era, will make cooperation in the Black Sea for the first time.

According to the agreement signed by the agreement on April 2 in Istanbul, the six countries are urged to form a cooperation task between their naval forces and this task force is foreseen to take action whenever it is called. The task group will carry out search and rescue operations in sea, humanitarian aid operations, anti-mine measures, environment protection operations, good will visits and other missions decided by the sides.

Diplomatic and military sources said that BLACKSEAFOR is not directed against any state, adding that this is not a military alliance.

The group will take all of its decisions unanimously and the capabilities of the group will not be used for the interests of any country. The group will carry out a manoeuvre once a year.

BLACKSEAFOR won't have a permanent headquarter as it will form a force upon call. The countries will allocate their ships and personnel on paper and bring them together when necessary.

The main target is to set up cooperation atmosphere in Black Sea.

At least four countries have to ratify the agreement for the agreement to go into force.

Every country which is member of BLACKSEAFOR will join the force with its own capabilities and force. The group will also undertake the mission of sweeping the mines remanining in the Black Sea from the First World War.

FOREIGN TRADE INDICES -EXPORTS INCREASE, IMPORTS DECREASE IN JAN-MAY
ANKARA - While exports increased in amount, imports decreased in the period between January-May, 2001 compared to the same period last year. The prices increased in exports and decreased in imports.

According to the State Institute of Statistics (DIE) data announced on Friday, the imports amount index decreased by 0.9 percent, but import prices index decreased by 0,9 percent in May 2001 compared to April 2001. Export amount index increased by 9,1 percent in May compared to April and the export prices index decreased by 1,5 percent.

The export amount index increased by 28,3 percent, but the export prices index decreased by 0,5 percent in January-May this year compared to the same period last year. The import amount index decreased by 28,2 percent, but the import prices index increased by 6,1 percent in the same period.

According to 12-month averages, exports amount index rose 11.9 percent and imports amount index increased by 6.7 percent.

In this period, exports price index reduced by 1.7 percent while imports price index rose 4.3 percent.

[07] CENTRAL BANK SELLS 60 MILLION DOLLARS

The average bid in the auction which the Central Bank held within framework of forex auctions program became 1 million 397 thousand 617 Turkish liras (TL).

Maximum bid was 1 million 399 thousand 850 TL and the minumum bid was 1 million 396 thousand 100 TL.

[08] FOREIGN AFFAIRS MINISTRY BRIEFS ARAB COUNTRIES ON ISRAELI PRIME MINISTER SHARON'S VISIT TO TURKEY

Ambassadors of Palestine, Iraq, Syria and Lebanon, and charge d'affaires of Egypt, United Arab Emirates, Oman, Kuwait, Morocco, Yemen, Jordan, Katar, Algeria, Saudi Arabia, Tunisia and Libya were in attendance at the meeting held by Foreign Affairs Ministry Deputy Undersecretary Ugur Ziyal.

Responding to questions of journalists following the meeting, Fouad Yaseen, the Palestinian Ambassador to Turkey, said that the meeting was very beneficial and productive.

Describing Turkey as a ''great power'' in its region, Yaseen thanked Turkish people and government for performing a productive role.

Referring to recent developments in the region, Yaseen stressed, ''peace cannot be settled without security, and without withdrawal of Israel from occupied territories. First of all, this occupation should come to an end.''

Yaseen noted that new contacts could be set up between Turkey and Palestine.

Responding to a question about yesterday's suicide attack in Jerusalem, Yaseen said, ''these are consequences of current situation. Anything can be expected as long as occupation continues. Sharon should understant the fact that any development would not occur in case of continuation of occupation. Both sides should make some concessions.''

Sources said that representatives of Arab countries thanked Turkey for its attitude, and asked Turkey to maintain this attitude.

[09] PRIME MINISTER ECEVIT: ''TALKING ABOUT NATIONAL SECURITY IS UNNECESSARY FOR THE STATE''

Prime Minister Ecevit responded to questions of journalists following his meeting with National Education Minister Metin Bostancioglu.

When asked by a journalist, ''discussions have been continuing on the issue of national security. The General Staff released a statement to give a response to State Minister and Deputy Prime Minister Mesut Yilmaz, the leader of the Motherland Party (MHP). The General Staff also criticized the government's some economic policies. What is your assessment?'' Prime Minister Ecevit said, ''earlier, I expressed necessary things on the issue of national security. According to my point of view, talking about the issue is unnecessary for the state.''

When recalled by a journalist that Yilmaz claimed that Turkey had been acting slowly in fulfilling the European Union (EU) full membership criteria, Prime Minister Ecevit said, ''I think that such a slowness is out of question. Because our parliament and government worked hard day and night till the recess. This productive working period will restart in the new legislative year. The package of constitutional amendments will be taken up. The package includes extending freedom of expression and some other freedoms.''

Referring to economic developments, Prime Minister Ecevit told reporters, ''if real sector works in a more productive way, we will succeed in preventing unemployment, reviving economy and overcoming economic difficulties. Therefore, we, as the state, will do our utmost to revive the real sector. We have allocated a source for export to this end. Unfortunately, the state's sources is limited for the time being. State Minister Kemal Dervis for Economy held talks with representatives of banks and real sector. We expect banks and finance sector to assist real sector by cooperating with it.''

Referring to Israeli Prime Minister Ariel Sharon's visit to Turkey, Prime Minister Ecevit said, ''my meeting with Prime Minister Sharon was covered by the Israeli press in a different way. I do not want to talk about the issue any longer.''

When asked whether or not he had held talks with General Huseyin Kivrikoglu, the Chief of General Staff, Prime Minister Ecevit said, ''General Kivrikoglu has not been in Ankara for the time being. He went abroad to spend his holiday.''

[10] ISRAELI INDUSTRY AND TRADE MINISTER ITZIK VISITS ITO

Dalia Itzik and accompanying delegation visited the Istanbul Chamber of Trade (ITO).

Responding to questions of journalists following the meeting, Itzik said that they attributed great importance to relations with Turkey.

Itzik stressed that both Turkey and Israel could further improve their economies with their bilateral relations.

Responding to a question about Manavgat water project, Itzik said that they could purchase water from Turkey after finalizing works on some details.

Responding to another question, Itzik said that Israel had a great potential, and added that Turkish and Israeli firms could cooperate in many fields.

Itzik called on Turkish firms to invest in Israel.

Meanwhile, ITO Executive Board Deputy Chairman Zekai Erez said that the meeting had focused on further improving economic relations between Turkey and Israel.

Erez recalled that Turkey's exports to Israel were 159.7 million U.S. dollars and its imports from Israel were 116.3 million U.S. dollars in the first quarter of 2001.

He noted that Turkey's exports to Israel increased by 17.5 percent in 2001 compared to previous years, pointing out that there were 50 companies with Israeli capital in Turkey as of May 1, 2001.

[11] PRIME MINISTER ECEVIT MEETS WITH FOREIGN MINISTER CEM AND GENERAL BUYUKANIT, DEPUTY CHIEF OF GENERAL STAFF

Responding to questions of journalists following the meeting which lasted for about an hour, Cem said that the European security and defense policies were reviewed at the meeting.

''The issue has a military dimension. Therefore, we assessed the issue together with the National Defense Ministry and the General Staff. We will maintain our works,'' he said.

When recalled by a journalists that the U.S. and British war planes bombed some targets in Iraq, Cem told reporters that the issue was not brought onto agenda of the meeting, adding that the meeting focused only on European security and defence policies.

Cem added that discussions on the issue of national security were not taken up at the meeting.

[12] S&P: ''TURKEY IS DOING ITS BEST TO REDUCE FEARS ABOUT ITS FINANCIAL POSITION''

In its latest review on developments in Turkey's economy, S&P said that supportive comments from the IMF made the local markets feel more comforted and this comfort would continue especially when the IMF remained supportive.

According to the review, the debt servicing outlook for August-December provides some comfort that the government could survive until November.

It said that the recent measures to swap debt held by the Central Bank into paper maturing in 2-6 year time together with other measures had reduced the debt servicing for August-December by an estimated 4,500 trillion Turkish liras (TL).

For August there was an almost split between the public and private sector debt servicing and so the government was relying on borrowing 5,400 trillion TL to meet the private sector need of 4,300 trillion TL, it said. ''However, November looks to be the crunch time when the government needs to service a near record 8,800 trillion TL of domestic debt, 80 percent of which will be in private hands.''

It added that funding would always be a key issue in Turkey's economy and its attempts to raise it would also face pressure.

''Using Nigeria's example, maybe the IMF would lend additional funds if Turkey too had a 'space program' or better still develop a winter ski resort to keep tourism revenues buoyant for most of the year,'' it said.

Standard and Poor's affirmed B (-) rating for Turkey and has ''negative'' outlook.

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