The Economic Crisis Did Not Hit Everyone – Eyes On Turkey
Turkey does a better job at meeting the criteria for the implementation of the euro compared to the other countries in the euro zone, and the fast pace of development raises question marks regarding who needs who more. Does Turkey need the European Union or are things just the other way around?, according to the Herald Tribune.
Pundits for decades have kept declaring that Turkey is unfit to join the European Union ranks, because it is too backwards from an economic standpoint and it cannot join the community.
However, this argument is no longer valid since Turkey is fast becoming an economic power to be reckoned with, having a very fast pace of development, with a group of competitive international companies that enter the export markets in Russia and the Middle East and bring back investments in the billions of dollars.
Many of the European states, affected by the aging population and the high level of debt, will be lucky to see an economic growth of 1% this year, while Turkey has already announced 11.4% economic growth for the first quarter alone, the second widest economic growth worldwide, after China.
This development in the situation, however, raises an entirely new question, who would reap more benefits from Turkey’s accession to the European Union, Turkey, or Europe?
The old powers are losing energy, on an intellectual as well as economic level. Turkey is sufficiently strong to make do on its own, said Vural Ak, 42, founder and general director of the Intercity leasing company, the largest firm of its kind in Turkey.
Ak drives around in a Ferrari, but this does not prevent him for being an active Muslim, keeping a passage of the Qur’an on his desk and not drinking any alcohol.
The transformation is extraordinary for Turkey’s economy, which, just ten years back, had a budget deficit of 16% and a 72% inflation rate.
The change is deeply linked with the coming to power of current Prime Minister Recep Tayyp Erdogan, who combined social conservatism with a cautious budget policy, turning the Party of Justice and Development, AKP, into the most influential political movement in Turkey since the republic was formed.
The evolution is even more impressive when considering the fact that Turkey is closer to the euro zone criteria, should it ever accede to the European Union, than most troubled economies who are already using the unitary currency.
Thus, the public debt, of 49% of the Gross Domestic Product, is way below the 60% ceiling allowed in European legislation, while the budget gap can easily be reduced below the 3% threshold next year.
The only major target left to be tackled is the reduction of inflation, which currently stands at 8%.
One of the most important businessmen in Turkey is Husnu M. Ozyeginm, who became the richest man in Turkey after selling Finansbank to National Bank of Greece, in 2006, and who is currently investing in the East. His new bank, Eurocredit, gets 35% of its profits from operations in Russia.
Other important members of the Turkish business environment include Mustafa Latif Topbas, founding president of the BIM discount store chain, which registered the speediest development in the country among retail companies, and Murat Ulker, leader of chocolate and cookies maker Yildiz Holding, which serves 110 markets worldwide.
The two billionaires have close ties with Erdogan, who once owned a wholesale company distributing Ulker products, while Topbas is a close adviser to the Prime Minister.
Turkey’s exports rose 13% in June, and the country has close economic ties with Iraq, Iran, Russia and Azerbaijan.
These connections justify Turkey’s strong stance against Israel, but there are also fears that Ankara authorities went too far in this direction, perhaps due to the upcoming elections.
Thus, the aggressive tone used against Israel could go against the doctrines of modern Turkey’s founder, Mustafa Kemal Ataturk: peace at home, peace in the world.
The power equation is changing in the Middle East, according to Carnegie Endowment, and Turkey rises a new player, given the United States’ soon proven powerlessness in Iraq and lack of results in talks with Iran. Thus, Turkey rises as a potential factor that will influence future events, given its hybrid nature and positioning at the crossroads between the Muslim world, the West and the East.
