8.5-Billion-Dollar-Loan With Iraq Condition

The agreement on the 8.5-billion-dollar loan from U.S. to Turkey was signed in Dubai. U.S. Treasury Minister Snow said that the ten-year loan was not tied to Turkey’s sending troops to Iraq.State Minister Ali Babacan and American Treasury Minister John Snow signed the agreement on the 8.5-billion-dollar loan, which will be extended by U.S. to Turkey, in Dubai on Monday. Snow said that this loan had nothing to do with sending troops to Iraq. However the agreement states that there are two conditions for this loan. One of these conditions is for Turkey to carry out strong economic policies. The second one is that Turkey should cooperate with U.S. in Iraq. Snow said; U.S. Defense Department will also monitor whether or not Turkey meets the conditions of the agreement.Snow said that this loan was extended to Turkey for her to carry on with the economic reform process and minimize the negative effects of the operation in Iraq. Snow said; Turkey is one of the most important partners of U.S. in this region and she is also an important partner in fighting terrorism. The success of Turkey in her economic and political reform process coincides with the interests of U.S. The support of U.S. aims at contributing to the economic policies of the government.On whether or not Turkey’s sending troops to Iraq is a condition of the loan, Snow said; Providing peace to Iraq or contributing to the forces to provide stability in Iraq are not the conditions that indicate Turkey’s cooperation with U.S. in Iraq. This support package is not tied to Turkey’s sending troops to Iraq. These two are separate issues. However the statement of Snow that U.S. Defense Department would also monitor Turkey’s compliance with the conditions, caused suspicions.Turkey will use this loan to repay her internal and external debts. The repayment of the loan will start after a 4-year period-of-grace and will be completed in 10 years. The loan will be extended to Turkey in equal installments within 18 months. The last two portions of the loan can be converted into a grant if Turkey asked to do so. The government plans to use the first portion of the loan at the beginning of 2004. News from Dubai that the loan agreement was eventually finalized in Dubai, boosted the morale of markets in Turkey. The stock market closed the day with 13 thousand 845 points and Dollar fell to 1 million 355 thousand TL, its lowest value of 2003.PM Erdogan commented after the approval that “The success of our program has been confirmed. There will be no populism.”�