Violence reshaping Turkey’s economic profile

Violence reshaping Turkey’s economic profile

In the aftermath of the serial bombings in Turkey during the last period investors need to assess the country’s trajectory on economic development and political stability. Does Turkey still benefits the blooming economic activity of the beginning of the Erdogan era, has it maintained the status of one of the few countries that succeeded to beat the IMF policies and won the confidence of investors for its fast growing economy in a vast variety of sectors? Where the promises of the big mediator between Europe and Asia as well as western Democracy and Islamic faith met and still keeping the country as an inescapable ally and possible example in the new Middle East quagmire?
Geography and People are still the big assets of the country. In the crossroad of continents and a millennial history the country will always be even in decline an unavoidable player. From Hegel to Trotsky Turkey had to grapple with a heritage that included Russian and Soviet politics as illustrated by the communist exiled leader and abide by the Sultan’s “unrestricted Despotism” as coined by the great philosopher of History.
In a country with so many divides enlightened despotism did play as an option and the Erdogan era certainly marked a new beginning for the country’s economy. Growth rates were steadily positive even during the crisis except for a short period in 2009 and now the approximately one percent forecast is not in a position to unveil the vulnerabilities of the Turkish economy at a point to endanger the political and economic stability.
However, if growth rates and economic dynamism are not putting politics at risk other factors have submerged Turkey in a profound crisis.

Foreign policies incongruities

Bad options in foreign policy have weighted severely in the course of action of a country so big and important at the regional level that could not afford to fail. Yet it did in more that one ways. Its relations with Israel paid the price of an over ambitious policy that saw Turkey as the ultimate guarantor of the rights of all Palestinians. Muslim Brotherhood in Egypt was also an ally putting Turkey at a future untenable situation. The U. S. also could never forget the Incirlik episode during a critical phase of the War in Iraq.
Syria was of course the ultimate test and here again an overwhelming neo-ottoman ambition led Turkey to serious errors in their choices. Their unconditional policy of overthrowing Assad was associated in the course of events with favorable neutrality towards the Islamic state reality. Pursuing the motto that the enemy of my enemy etc. had to find a way to restrain the Kurdish military successes that were inevitable since the goals of War were actually to overthrow a dictator without knowing anything about the next day.
Due to its blindness and the wish to play a great power role in a meta-Assad era Turkey is losing on all grounds in that respect. Relation with Iran deteriorated at the moment when Iran is making a forceful come back in the international scene having cut an important deal with the West.
And last but certainly not least it messed up with Russia in a way that will take years to align future acts and relations with vital interstate interests. There is obviously a problem with Turkish foreign policy and it would have been difficult to interpret the choices made if one does not see the intimate interconnection between foreign policy and the existential danger that the Turkish state and politics feel when the unity of the state is threatened.
Kurds again then one should conclude. Yes but not only. What Erdogan is hiding is much bigger. It always concerns the unity of the State but the policies implemented goes in the opposite side. The more repression is exercised the greater is the apocalyptic events that explode in the heart of the state and the regime’s center of power.

The great divides are unveiled

It will be pretentious to account them all. Still one can distinguish those that remain internal as the one about Western Turkey and Eastern Anatolia, North and South, Modernity and Islam and those that interconnect badly with international balances. Those balances that Turkey thought it could manage but now are working against. Internal discrepancies in culture and civilization are problems that affect state integrity and as shown by the events in Gezi Park are capable of putting the whole regime on its knees.
However, the ethnic divide seems by far the more dangerous. It is though a paradox that the case Erdogan worked so hard from 2005 for a whole decade arriving at major concessions with the Kurds is turning as the decisive issue in view of the future unity of the Turkish state.
A Civil war is consolidating in some areas in the South and the terrorist accusation is becoming a mere euphemism. All military means are used intensively and shelling of enemy positions in Syria or the South reveals the graveness of the situation. All this when the Kurdish party HDP has 10% in Parliament. Erdogan’s efforts were blown to ashes and that is eventually the greater defeat in its political career. The initial audacity of the Erdogan’s Kurdish initiative is sold by plain civil war. This will mark Turkish history from now on and exploiting the situation for consolidating an autocratic personal rule will be unsustainable.

Europe through Syria or vice versa

In this environment the grey economy is booming, a great part of Syria’s money are passing through Turkey via supplies, oil and refugees.
Refugees are not a major concern for Turkey not least for the economy. Refugees have their own money (one has to calculate the trafficking income of 1 million people to understand the magnitude of just one parameter of the drama) and Turkey is going to be paid lavishly for holding the Gate to Europe close. Refugees are used as a weapon in the negotiation with Europe and this could be mutually beneficial if Turkey understood what great opportunity lies in a rapprochement with Europe and especially Germany in this rare occasion of the refugee crisis.
European perspective could be critical for Turkey as a way to cope with the accumulation of great divides that have put the country to a permanent stalemate in main politics and War in the South.
A new dynamism is necessary that could overpass the tendency for fundamentalism and backwardness that can no more cover the deep rifts of society. Oppression and recourse to strict traditional values will just exacerbate the differences of the opposing sides leading to conflict.
A Turkish European move could be at present commensurable to Kemal Ataturk’s modernist blow to old ottoman society. Is Erdogan up to the task? One has certainly the right to doubt. In this logic good relations with Greece and a breakthrough in the Cyprus reunification process could act as a stage towards a major turn. Investors are great detectors of change tack actions and Turkey’s stance in the Syria peace negotiation especially towards the Kurds, actions in the Refugee crisis and engagement in the new European opportunity for Turkey eventually through the Cyprus question will hold Turkey high in their economic choices.

By Dr. Spyros Damtsas