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ANKARA, Feb 12 (Reuters) - The head of Turkey's top business association said on Thursday after talks with Prime Minister Tayyip Erdogan that the discussions showed there was serious progress in talks with the IMF on a loan deal.
Turkish business leaders have long called for a fresh loan programme, to replace the $10 billion accord which expired last May, and shore up the $750 billion economy which has slowed sharply under the impact of the global financial crisis.
However, the protracted IMF talks were suspended in January due to disagreements over its terms, raising concerns about whether a deal -- expected at around $25 billion -- will be agreed.
"We saw that there was serious progress in the talks with the IMF," TUSIAD Chairwoman Arzuhan Dogan Yalcindag said after the talks with Erdogan.
Statements from top Turkish officials over the past week or so have sent conflicting signals about prospects for an agreement before municipal elections in late March.
On Wednesday, Economy Minister Mehmet Simsek was reported as saying he believed differences in the talks would be resolved soon, but he subsequently said there were no new developments. Erdogan himself has made ambivalent comments about the likelihood of an agreement.
Analysts say the government may be trying to drag out talks with the Fund in order to avoid having to curtail spending ahead of polls. Any major stand-by agreement would accompany strict fiscal conditions for the government.
Financial markets still expect a deal to be worth around $25 billion to help Turkey roll over external debt due this year.
The IMF has been pushing for tighter fiscal policy and a higher primary surplus while the government has wanted to use IMF money to stimulate economic growth. (Writing by Daren Butler)