Turkey signs grant deal with IMF

Once dependent on its loans, Turkey has turned the tables on the International Monetary Fund (IMF) and has become a lender for a relief fund run by the international body criticized for dictating strict rules on the borrowers.

The country signed a grant deal with the IMF with regards to The Catastrophe Containment and Relief (CRR) Trust Fund. The relevant international agreement was published in the Official Gazette.

Accordingly, Turkey, represented by the Treasury, will provide $1 million in financial contributions to the IMF, as a proxy of CCR Trust Fund, within the framework of local laws and budgetary allocations each year.

The grant will be used for the purposes specified in the CCR Trust Fund within the scope of the Post-Catastrophe Relief window or Catastrophe Containment window in order to provide debt service relief.

Turkey will not undertake transfers and exchange rate risks related to the usage as well as all taxes and other public charges associated with the conclusion and implementation of the said agreement outside the country.

The grant will be by the proxy in accordance with the CCR Trust Fund Instrument, and used to provide debt relief under the scope of the fund. The said agreement will be put into effect after the IMF receives a written notification from Turkey about the completion of their internal procedures needed for the effect. Following the entry into force of the agreement, Turkey will determine the date of grant payments up to six months.

Following the 1960 coup, Turkey has had a lengthy relationship with the IMF that continued until recent years. Through stand-by agreements, the country kept its economy seemingly stable in the face of crises as it received loans that further added to the country's debts. The country paid its last loan installment three years ago, closing a page in its long history with the IMF, viewed as a victory for a country whose economy, defense and other sectors have been dependent on other countries and international bodies for decades.