U.S., Turkey Reach Agreement on Hefty Loan

Reuters ^ | Sep 22, 2003 | Glenn Somerville and Anna Willard

[optimistically_conservative]

DUBAI (Reuters) - The United States and Turkey on Monday finalized an $8.5 billion loan pact to bolster the Turkish economy and offset costs incurred during the U.S.-led war against Iraq (news - web sites).

Reuters Photo

U.S. Treasury Secretary John Snow, who negotiated with Turkish officials in the early hours of Monday morning to seal the deal, said the pact would not compel Turkey to send peacekeeping troops to Iraq.

"This assistance package offered by the U.S. to Turkey and the deployment of Turkish troops in Iraq are two separate issues," Snow said.

The agreement does, however, require the country to cooperate with the United States in Iraq.

The U.S. loan is to have a 10-year maturity and to be paid out in four equal disbursements over about 1-1/2 years.

Snow left no doubt he hoped the agreement would help mend ties between the two NATO (news - web sites) allies frayed after Turkey refused in March to let U.S. forces invade neighboring Iraq from its soil.

"Turkey is a valuable regional ally of the U.S. and is a partner in the global war on terrorism," Snow said of the deal at a news briefing. "It is in the U.S. interests that Turkey maintain its economic stability and continue its ambitious economic and political reform process."

It sets two conditions: that Turkey puts "strong economic policies" into place and that it is "cooperating with the United States in Iraq."

Turkey also has a $16-billion loan program with the International Monetary Fund (news - web sites). The U.S. Treasury has previously said Turkey must stay on track with its IMF program to get U.S. loans but the statement Monday made no reference to the IMF.

The U.S.-led war against Iraq hit many sectors of Turkey's economy hard.

Because of its geopolitical significance, the U.S. State and Defense departments also are intensely interested in seeing that Turkey regains economic stability.

The loan pact was a long time coming. President Bush (news - web sites) offered the money to Turkey in March despite its decision not to let U.S. troops use Turkish soil as a launch pad into Iraq, but talks bogged down for months.

It was unclear that a pact would be ready for signing at the IMF meetings in Dubai this week, but Snow got together after midnight Sunday with Turkish officials and they talked into the small hours to iron out final details for Monday's signing.

"The contribution of Turkish troops for peacekeeping and stability operations in Iraq is not a necessary condition for determining Turkish cooperation in Iraq," Snow specified.

[boycott]

I am sure we'll forgive the debt in a few years. Why ask them to pay the debt when the American people can carry the burden.

One day we'll have leaders that will put America first.

[Dog]

If I'm reading this correctly we just got Turkey on board ..

[Dog]

We do have a leader who puts America first...

[concerned about politics]

Sounds like a good deal to me.
Help a friend, and in return we get a friends help.
Fair enough.

[optimistically_conservative]

If I'm reading this correctly we just got Turkey on board ..

I'm not sure. This seem more like covering our bets and throwing out bait. Erdogan and the AKP are still floundering for a national policy on the US Coalition in Iraq and seem to be settling on PKK/KADEK as a keystone issue.

Of course, this was an interesting statement to make prior to this deal:

Erdogan said, ''this is very interesting. As far as information we have received, Iraqi people are almost missing Saddam era.''

[optimistically_conservative]

I hope so. What I find ironic is it would cost $1.5 - 3 billion to bring back the manning for two additional divisions in the US military. I wonder how far the other $5-7 billion would go to equipping them as a light division, and/or a Spec Ops/Civil Affairs/Psy Ops force for counter-terrorism nation building/stability operations?

[KarlInOhio]

Is this the same loan we were holding in front of Turkey when they decided to hang the 4th ID out to dry? Sorry Turkey, you might be useful, but I wouldn't consider you to be a trusted ally.

[KantianBurke]

"U.S. Treasury Secretary John Snow, who negotiated with Turkish officials in the early hours of Monday morning to seal the deal, said the pact would not compel Turkey to send peacekeeping troops to Iraq."

[concerned about politics]

said the pact would not compel Turkey to send peacekeeping troops to Iraq."

"U.S. Treasury Secretary John Snow, who negotiated with Turkish officials in the early hours of Monday morning to seal the deal, said the pact would not compel Turkey to send peacekeeping troops to Iraq.
BUT.......
"This assistance package offered by the U.S. to Turkey and the deployment of Turkish troops in Iraq are two separate issues," Snow said.
The agreement ......does,....... however, require the country to cooperate with the United States in Iraq.

[Brian S]

Perhaps Kennedy wasn't so far off with his "bribe leaders in the region" comment after all... :/

[SJackson]

If you'd like to be on or off this middle east/political ping list, please FR mail me.

[fortaydoos]

Spend your own d*mn money, not mine, on your "friends."

[bert]

....Perhaps Kennedy wasn't so far off with his "bribe leaders in the region" comment after all......

I think the correct term is baksheese. A little grease is expected to make the wheels turn smoothly. We have a foreign corrupt practices act so bribes are against the law. A little grease is the price of doing business in most of the world and for sure Clinton never did any thing for free.

[mewzilla]

Who says money can't buy ya love?

[Mortimer Snavely]

During Gulf War One, Turkey was the first country to do anything about Hussein. The very day after Iraq invaded Kuwait, Turkey closed the Iraqi border and lost a major trading partner. The economy went into free fall, and Bush I promised to help take up the slack. Economic warfare means that when you turn on the tap, there's no water. Basic services disappear. The help promised by the White House never arrived, and economically Turkey was left gasping on the ropes. Additionally, PKK support groups spread like crabgrass throughout the US and Western Europe, with no unambiguous refutation from the USA, while Turks by the thousands were massacred by PKK cadrés hell bent on establishing a Marxist-Leninist totalitarian hell hole out of Northern Iraq and all of Southeast Anatolia.

Turkish national security has been degraded, not enhanced, by US and Allied actions. They learned that no good deed goes unpunished, and were a bit more circumspect this time around. Turkish soldiers being blindfolded, bound, gagged and imprisoned by US forces in Northern Iraq in deference to Kurdish sentiments hasn't helped things, either.

[concerned about politics]

Spend your own d*mn money, not mine, on your "friends."

You could try making out a long form on next years income tax.
I'd spend money in a second on national security interests - short as well as long term.
I would be extremely opposed to a new tax and spend useless social program on a bunch of slothy, lazy, do nothing paracitical Democrats.
It's a matter of priority.

[Mortimer Snavely]

ka-PING!!

[elfman2]

I wonder what the market cost of underwriting an 8.5 billion dollar loan to Turkey right now would be. Half a billion? A billion? That is the cost to us.

Funny, Ted Kennedy’s complaining about this now, calling it a bribe, but he’s also complaining about not getting UN control of the war, and this kind of payoff is that would have been required 100 fold to get France, Germany and Russia on board.

[paul51]

Haven't we already learned how much we can count on them?