(Recasts, adds invitation to IMF mission)
By Humeyra Pamuk
LONDON, April 3 (Reuters) - Turkey expects progress in talks with the International Monetary Fund on a loan deal to help it weather the global crisis and will invite a mission from Washington this month, the government said on Friday.
A deal with the IMF, possibly as big as $25 billion, has gained urgency since the ruling AK Party scored its worst election result since 2002 on Sunday, hurt by voter dissatisfaction over the government's handling of the economy.
Talks with the IMF on a stand-by deal were suspended in January due to disagreements over issues such as unregistered income, government spending and tax administration. Turkey's previous $10 billion loan deal with the fund expired last May.
"Positive progress will be achieved with the IMF in the coming period. A timetable will be set out and delegations will continue talks," Turkish Prime Minister Tayyip Erdogan told a news conference in London.
"We are conducting talks with the IMF in a framework of constructive cooperation."
Economy Minister Mehmet Simsek told reporters Turkey would invite an IMF mission to visit Ankara this month for talks.
Erdogan held talks with IMF Managing Director Dominique Strauss-Kahn on the sidelines of a G20 summit on Thursday.
The lira
Business leaders in Turkey have long been clamouring for the government to agree a new loan deal with the IMF.
Turkey's economy shrank by 6.2 percent in the fourth quarter of last year as consumers stopped spending and an export-oriented industry halted production. After several years of stellar growth, it is now widely expected to go into recession in 2009.
The government has announced a series of economic stimulus packages it hopes will kick-start the economy, although analysts say the measures, such as temporary value-added tax breaks, were too late to halt falling demand. (Writing by Paul de Bendern; Editing by Chris Pizzey)