Frankfurt address: Camdessus focuses on financial reform, stresses IMF role in reducing poverty

• Pages: 337-339

Page 337

It is commonly admitted that it is in the area of financial relations that globalization has had the most pronounced impact on our lives. Financial markets have become integrated to a large extent, with undeniable benefits for the best-managed economies. Yet on two occasions, the more vulnerable economies were exposed to severe crises with dramatic consequences in financial and human terms.

These two occasions could be seen as the first two economic crises of the new millennium-the Mexican crisis of 1994-95 and the so-called Asian crisis, from which the world is just emerging. But every crisis has its silver lining, not least by bringing attention to bear on underlying vulnerabilities that the international community had not identified earlier.

IMF approves emergency assistance in wake of Turkish earthquake

In a press release issued on October 13, the IMF announced that it had approved SDR 361.5 million (about $501 million) in emergency assistance for Turkey in support of the government's efforts to limit the adverse effects of the devastating earthquake that struck the country on the night of August 17. This amount is available immediately. The financial support from the IMF complements the generous response from the international community that will become available in the coming months. Following are excerpts of a statement by IMF Deputy Managing Director Shigemitsu Sugisaki following the Board discussion.

"Directors expressed their deepest sympathy for the people of Turkey following the devastating earthquake that hit the Marmara region, causing immense human suffering and extensive material damage. Directors considered that the drawing from the IMF will help complement the resources that Turkey needs to sustain the reconstruction and to meet the immediate financing needs associated with relief and reconstruction, while ensuring an adequate level of reserves.

"Directors commended the authorities for their skillful crisis management thus far, which had been well received by markets. While the attention of the authorities was naturally focused on the immediate need to ameliorate the impact of the earthquake, Directors were encouraged that the authorities' policy response had been cast within an overall policy framework oriented toward strengthening the public finances and reducing inflation. These actions attest to the authorities' continued commitment to adhere to the pursuit of sound macroeconomic and structural policies, despite the serious challenges they now face.

"Directors also welcomed the authorities' commitment to ensure that all relief expenditure programs will be well targeted and managed in a fully transparent and accountable way." Background

The Marmara earthquake has been one of the most severe in the last 20 years, claiming the lives of 15,600 people, injuring more than 25,000, and leaving about 500,000 homeless. Shops and other microenterprises took the brunt of the damage to businesses, and...