Turkish gov't says has no plan for unlimited deposit guarantees

Kemal Unakitan said fiscal policy is to be the number one priority for government and fiscal policy would target debt stock as well as the budget deficit. He added unemployment may rise along with the economic growth slowdown.

 

Vatan daily reported Thursday that the Turkish government plans to implement an unlimited guarantee on all deposits for two years to tackle the impacts of the global financial crisis.

 

Economists and analysts have been warning the Turkish government to take measures against the crisis; however, the government has been reluctant to implement tough measures ahead of the local elections in March 2009.

 

Vatan daily said the deposit guarantee would be for two years starting from the day that the legislation would come into effect or until December 31, 2009.

 

The deposit guarantee in Turkey now stands at 50,000 YTL (25,000 euro).

 

The unlimited deposit guarantee would follow the legislation that would bring incentives to attract the funds that Turkish citizens hold in overseas bank accounts.

 

Turkey is among those countries hard hit by the global financial turmoil. The Turkish lira hovers around its lowest levels in more than two years, while stocks have lost almost half their value.

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