By Andrew Walker BBC Economics correspondent

The United States is offering Turkey at least $4bn (�2.45bn) in aid as compensation for the economic consequences of a possible war in Iraq, the International Herald Tribune newspaper has reported.

Meanwhile the Financial Times newspaper has said International Monetary Fund (IMF) officials are worried about the deteriorating finances of the Turkish government.

Both reports were based on remarks attributed to unnamed officials from the United States and the IMF.

The US offer is, it appears, intended to offset the economic consequences of a war, if Turkey cooperates.

Concerns

The US wants to be able to use military bases and other facilities in Turkey for action in neighbouring northern Iraq if there is a war.

Turkish officials fear that there would substantial losses, notably to the country's tourism income.

Other reports suggest the IMF is concerned about the government's finances, even before the possible effects of a war are taken into account.

Turkey has an IMF loan and the policy requirements that go with it include tighter control of its borrowing needs.

Firm plans

The IMF's second in command, Anne Krueger, said after a recent visit to Turkey that the government needs to translate its good intentions into actions.

The best she could say of the budgetary measures and privatisation plan the government had already announced was that they were helpful initial steps.

US officials are reported to have told Turkey that any additional war-related aid will only be given if the government finances are improved.

A draft letter of intent to the IMF was apparently described by US officials as not sufficient.