Turkish Economy Cools After Call for Early Vote; Premier Unveils Plan to Bolster Market
Seven weeks after Prime Minister Mesut Yilmaz called early elections on the strength of his government's economic track record, Turkey is trying to weather the fallout from the economic collapse in Russia, its principal trading partner.</br></br>Until this summer, Turkish officials had been predicting that the country would escape the economic contagion spreading from Southeast Asia. As of mid-year, the economy had enjoyed three years of steady growth, and Yilmaz's anti-inflation policies had won the approval of the International Monetary Fund and brought foreign investors flocking.</br></br>But Russia's festering economic problems already had begun to erode Turkey's strong base, and the recent Russian financial collapse and the free fall of the ruble have sent shock waves southward.</br></br>According to recently released government figures, Turkey's official trade with Russia declined 15 percent in the first half of this year. The unofficial export of textiles and other goods to Russia and other former Soviet Bloc countries, which earned the Turks around $8.5 billion in foreign exchange two years ago, is expected to bring in little more than $4 billion in 1998.</br></br>Overall, Turkey has seen its trade deficit grow to $7.5 billion in the first half of this year. In addition, internal commerce is undergoing a cyclical slowdown, analysts say. Concerns have gradually spread among investors, who looked to Yilmaz to implement policies that might halt the economic slide.