Annals of the University of Oradea: Economic Science (Jul 2013)
THE END OF IMF - TURKEY RELATIONSHIP
Abstract
Abstract: IMF has been created to make international cooperation on financial matters stronger and for solving the problems of balance of payment. However, the IMF formed policies in order to solve problems of balance of payment till the 1980s, expanded its effectiveness much more by controlling the structural adjustment programs after the 1980s, and undertook the role as an international lender of last resort on crises caused by globalization trends. In developing nations, foreign and domestic deficit occurred due to infrastructural causes that have created economic instabilities portrayed through inflation and unemployment. Especially foreign debt problems sourced by the foreign trade deficit transformed into an economic crisis for these countries. Many countries affected by such economic crisis applied to IMF and its Stabilization Program with the aim of providing economic stability in the hopes of recovering. The important thing here to point out is that the economic programs used by countries during their economic crisis are supported by the IMF in reality. In this situation Mexico and Argentina can be given as a good example. IMF has undertaken the same mission in Turkey with seven stabilization programs put in practice and nineteen Stand-By Arrangements between them. But IMF has failed many times in Turkey just like in many developing countries. This is because IMF did not take into consideration economic and social structure of countries in stabilization programs put in practice. Today, Turkey has reached to an important point from the way of its relationship with IMF; more clearly, Turkey is determined to achieve its future without IMF. Turkey-IMF relationship in the framework of stand-by agreements in the past half century of our economic and political history has come to an ending point. After a period of 51 years of intense relations, Turkey decided to determine its calculations of credit limit by the way of advantages and disadvantages and continue its relations in this way. In this context, this study will try to prove therotically that Turkey will put in place to foreign credit support with the purposes of carrying out stabilized policies and protecting itself from financial shocks. Finally, Turkey will contact IMF with requirements of the rules and regulations that are in its advantage.
