- The Washington Times - Thursday, April 5, 2001

Turkeys economic crisis has become so worrisome that the country is seeking a savior. Kermal Dervis, Turkeys new economy minister, has been dubbed the messiah, and may well be the countrys best hope for an economic miracle. In his efforts to shore up confidence and secure liquidity, Mr. Dervis traveled to Washington last week to meet with administration and International Monetary Fund (IMF) officials. There he laid out his bold goal of pushing forward 15 laws, mostly related to banking reform, by mid-April.

But discord within government ranks is undermining strides Mr. Dervis could make for Turkey. While the economy minister tried to convince officials in Washington of Turkey´s resolve to push forward structural reform, Prime Minister Bulent Ecevit dismissed Mr. Dervis´ plans as too ambitious. In view of the gravity of Turkey´s economic situation, it would certainly have been helpful if Mr. Ecevit had reached a consensus on financial issues before Mr. Dervis set off for Washington, especially in view of the capital flight that political infighting spurred in Turkey in February.

As should have been expected, the appearance of chaotic disagreement roiled an already wary market. It also frustrated many Turks. Leaders of the governments´ three-party coalition "have got together, shooting at Dervis," wrote Necati Dogru in the Sabah newspaper. "They have chosen him to be their commander. Now they are shooting their own commander."

Indeed, if Turkey is to reach its long cherished goal of integrating with Europe, it should put structural and democratic reform on the fast track. Turkey has a good chance of being invited into the European Union, but only after it aggressively privatizes industry, banks especially, and improves press freedoms and human rights.

Investors first began withdrawing capital from Turkey in mid-2000, over fears the banking sector was unstable. By then, the IMF had already established a loan program with Turkey. So far, the fund has disbursed about $4 billion to Turkey, and still has $6 billion it is willing to distribute, depending on Turkey´s fulfillment of the loan program´s goals.

Fortunately, Turkey´s policy-makers are highly motivated to overcome this crisis, given the prospect of EU membership. Turkey should put its trust in Mr. Dervis. Although he won´t work a miracle, he can lead the way to reform.

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