Turkish recovery from recession key to global rebound in 2020: IMF

WASHINGTON/ISTANBUL: Turkey's recovery from recession is an important part of an expected global pick-up in 2020, the IMF's chief economist said on Tuesday, adding there was no reason to believe the country was "even contemplating" requesting assistance from the Fund.

Turkey tipped into recession last year after a punishing currency crisis, leaving its companies and banks saddled with foreign-currency debt.

"In our forecast for Turkey this year there would be negative growth but we are expecting a recovery in 2020. And in fact this recovery is an important part of the element that goes toward the whole global recovery," said Gita Gopinath, the International Monetary Fund's chief economist.

The IMF trimmed expectations for global growth to 3.3 percent this year. A return to 3.6 percent growth next year was "subject to considerable uncertainty" because it rested in part on rebounds in Turkey and another struggling emerging market, Argentina, it said in a report.

As Turkish Finance Minister Berat Albayrak prepares to unveil new structural reforms on Wednesday, analysts have said some form of IMF assistance in support of the plan would offer reassurance to investors.

But Gopinath, asked about this at a press conference in Washington, said: "We have no reason to think that Turkey is even contemplating coming to the IMF so that's where we are at this point."

She however added that Turkey's economy was "certainly under stress."

The IMF expects Turkey's economy to contract by 2.5 percent this year before growing at the same rate percent next year. It expanded by 2.6 percent last year, when the Turkish lira tumbled up to 30 percent against the dollar.

In its report on Tuesday, the IMF said greater transparency about and strengthening of financial balance sheets "would be helpful in addressing lingering uncertainties," as would more efforts to relieve corporate debt.