The central bank spent $ 4.5 billion, one sixth of its reserves, to defend the lira. These attempts, however, failed to restore confidence and the Turkish authorities decided on 22 February 2001 to allow the lira to float freely. Turkey’s economic programme was again strengthened following the crisis that led to the floating of the lira.
The new economic framework included increased transparency, accountability and good governance in both the private and public sectors. The improved programme aimed to strengthen the primary fiscal position of the public sector, reduce the government’s immediate borrowing requirement and address major bank restructuring. Market sentiment, however, again started to deteriorate in early July 2001 when the IMF postponed a portion of the Turkish loan.