[stop-imf] clips on Argentina and Turkey

[Robert Weissman]

Excerpts from World Bank's press review:

Headlines for Friday, December 28, 2001:
- IMF READY TO WORK WITH ARGENTINA.
- TURKEY EXPECTS $16 BILLION OF INTERNATIONAL AID.
.

IMF READY TO WORK WITH ARGENTINA.

 The Argentine government will try to solve its social crisis before fulfilling
its massive debt obligations or negotiating with the IMF, interim President
Adolfo Rodriguez Saá said late Thursday, writes Agence France Presse.

"We have explained to the IMF that first we must solve the social emergency,
because (social) exclusion and unemployment must be dealt with," he
said. "We
are going to present a sustainable program, but first we ask for
patience."  "We
must have a transparent, disciplined government. Any official suspected of
corruption or wrongdoing will be immediately removed from office," he said.

Rodriguez Saa said he had asked the International Monetary Fund's number two,
Anne Krueger, for "understanding" in the wake of his decision to suspend debt
payments.

IMF and Argentine officials will meet in January, the leader noted,
although an
exact date and venue have not yet been set.

Meanwhile, one day after Rodriguez Saa announced that a new currency, the
argentino, would circulate beginning in January alongside the peso and dollar,
the peso plunged from its one-to-one peg with the dollar to 1.30 on the black
market.

Earlier Thursday, IMF chief Horst Koehler said he was ready to work with the
Argentine government, adds AFP.  "I wish to assure you, Mr President,
that the
International Monetary Fund remains ready to work closely with your government
to develop a sustainable solution to Argentina's economic problems," he
wrote in
a letter.

Koehler also expressed concern over bloody protests and looting that
resulted in
30 deaths last week.

"I wish to congratulate you on taking office as president of the
republic of
Argentina and to express my deep sorrow for the tragic events of the recent
past," he said, according to AFP.

BBC Online reports that Argentina has called for other governments to
help it
resolve its financial crisis. "We are going to seek support from governments,"
foreign minister Jose Maria Vernet said. "Once we have the support of the
governments we will sit down to start rescheduling the debt.
Negotiations will
not begin directly with creditors."

Meanwhile, the New York Times reports (C1) that a plan by the new Peronist
government here to create an emergency currency is running into
opposition, as
details emerge and owners of businesses or anyone with a bank account
comes to
realize that the proposal is backed only by promises and not by hard cash.

 Growing doubts about the government's intentions led to long lines outside
banks today, as middle-class Argentines tried to get their hands on
dollars or
pesos before the new system, announced on Sunday but largely ignored
during the
Christmas break, goes into effect. Depositors unable to withdraw money from
their accounts demonstrated outside a downtown bank today, blocking one
of the
capital's main shopping streets for several hours.

In related news, the Financial Times reports (p4) that an estimated 1 million
unemployed Argentines will be put to work cleaning streets, filling
potholes and
planting trees as part of the emergency package being worked out by Adolfo
Rodriguez Saa, Argentina's interim president. The threat of further social
unrest has left the provisional government with little option but to rush
through a work program.

Rodolfo Gabrielli, the new interior minister, said on Wednesday he had granted
money for 150,000 temporary positions to the long-term unemployed in five
provinces. He hoped to "reach 1 million families in January."

Meanwhile, the Wall Street Journal reports (A6) that economists say that his
program is full of inconsistencies that could aggravate the debt and currency
woes that underlie the country's chronic unemployment problem.
                                                                        
       
                                                                        
       
                                                                        
       


TURKEY EXPECTS $16 BILLION OF INTERNATIONAL AID.
Turkey expects about $16 billion of financial aid from international
institutions under a new three-year programme to help drag its economy
out of
its worst recession in years, Turkey's Deputy Prime Minister Mesut
Yilmaz said
Thursday, reports Agence France Presse (12/27).

"Part of the funds are those designated earlier by the International Monetary
Fund and part of it is finance from the World Bank," Yilmaz said,
according to
the Anatolia news agency, says the AFP piece.  He did not give further details.

Two weeks ago, the IMF announced that it had agreed in principle to support
Turkey's three-year economic program with a new stand-by credit
facility, but
did not specify the size of the credit.

The IMF said in a statement that the funds were designed to support an economic
reform programme, and close a financing gap projected at $10 billion
through the
end of 2002.

   Turkey has been grappling with a severe economic crisis since
February when
the government abandoned a pegged exchange regime to contain a grave cash
crunch.  In May, Turkey began implementing a tight economic recovery programme
in return for multi-billion-dollar aid from the IMF and the World Bank.