Turkey aid hopes boost shares

Floods have made life harder for the Turkish people

Turkey's stock market has soared to close to its highest level this year after the government said it expects fresh cash injections worth $16bn (£11bn) from international agencies.

The fresh funds would help lift the country, which has suffered torrential rain and flash floods in recent days, out of its worst recession since 1945.

The International Monetary Fund (IMF) and the World Bank are expected to lend Turkey the money over the next three years, Deputy Prime Minister Mesut Yilmaz said.

"Part of the funds are those designated earlier by the IMF and part of it is finance from the World Bank," Mr Yilmaz told the Anatolia news agency.

Turkey is expected to write a letter of intent to the IMF ahead of a meeting of its executive board during the last two weeks of January.

The board is expected to approve the programme then, Mr Anatolia said.

The index of leading shares listed on the Istanbul stock exchange gained 4.1% on the prediction, closing at 13,609.

Lasting difficulties

The IMF has already injected $15.5bn into the Turkish economy since 1999.

Yet, the country's economic problems have remained.

A crisis forced Turkey to abandon its pegged exchange rate regime in February this year.

The regime had been seen as a key feature of the IMF's previous rescue operation for the country's economy.

The forthcoming cash would deal with a $10bn financing gap during 2002 and would aim to stabilise the economy.

The three-year economic program was announced in principle by the IMF but a formal confirmation of its size remains forthcoming.