IMF forces new board at Turk Telekom
The Turkish government has backed down in a dispute with the IMF over the managment of Turk Telekom. The landline monopoly, will be getting a new management board after a billion dollar loan was withheld.
Turk Telekom will be getting a new board after Turkey’s government gave in to pressure from the International Monetary Fund (IMF) over crisis loans for the troubled country.
“It was decided to summon the Telekom board again in order to make changes to the Telekom managing board,” said Prime Minister Bulent Ecevit.
But he rejected the IMF’s complaint that the current board, appointed just a month ago, lacks the experience necessary to prepare the landline monopoly for privatisation later this year. The TT sell off is one of the conditions of the multi-billion dollar loan aimed at bailing out the rapidly foundering Turkish economy.
The IMF has withheld $1.6 billion of the cash over the board dispute, forcing Ankara to act.
“The IMF claims that the new administration chosen by the Telekom general board does not meet the criteria of the letter of intent (which set out the terms of the loan),” said Ecevit.
“Just as we do not agree with this opinion, we also find it hard to explain why this issue is given so much importance.”
The Prime Minister went on to say that the government would appoint a new board for TT to stop “our relationship with the IMF being overshadowed by an artificial problem.”
Ecevit also promised to sort out the numerous failed banks that are currently in receivership in Turkey. The government has previously promised the IMF that the banks, victims of the economic crisis will be shut by the end of the year.
The government has been planning to sell Turk Telekom for over a year now, but the conditions of sale have been repeatedly changed after the company failed to attract any international bidders.