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    Back to old Turkish pragmatism?

    Güven Sak, PhD02 July 2016 - Okunma Sayısı: 1325

    There were more news coming out of Ankara this week than many Western countries have in years. Some of it was good news, some of it less so. In the thick of it, I see two strands of policymaking, two tendencies in decision making that I will call HQ1 and HQ2.

    HQ1 represents the pragmatic streak running through Turkey’s Republican history, and HQ1 was busy this week. The Turkish-Israeli accord was finally signed after 6 years of discord following the Mavi Marmara incident. Communication between Putin and Erdoğan has ended the rift that started with the downing of the Russian jet. When ISIS suicide bombers hit Istanbul’s Ataturk airport, the state also acted with calm determination. Flights were immediately resumed, order was restored.

    Then three Turkish ministers went to Brussels for the opening of another chapter in Turkey’s EU accession process. The chapter itself is not important, but its opening signaled that the process is still on. This is significnat in the long run because the EU’s engagement with Turkey that started in 2004 has been at the core of the Turkish economic miracle so far. That is how Turkey went through structural reforms and transformed itself from a struggling developing country into a mid-tech industrial economy. The EU was crucial to both, the economic and political stability of Turkey at the time.

    Now Turkey needs another jump towards high-tech, and it will need a renewed EU engagement process to do it. Complying with the acquis is an administrative reform process for Turkey, and it should use it to implement a new set of structural reforms. The current EU-Turkey agenda of deepening the Customs Union Agreement and visa liberalization is not enough for this kind of reform. To deepen cooperation, Turkey and the EU should use the migration crisis, as they have tried to do thus far. The EU needs Turkey to be stable to protect freedom of movement within its borders, and Turkey needs the EU’s policy agenda to drive it forward. If properly leveraged, this could yield the structural reforms Turkey needs. HQ1 has always gotten along well with the EU, and it reminded us this week why that is so important.

    All this would mean that this was a good week, except that HQ2 was busy too. HQ2 is the part of Turkey that craves the short-term power rush that comes with subjugating political opponents. Its fingerprints are all over a new law regarding the reorganization of high courts that was rammed through parliament this week. Now, Turkey of course, needs a reform of the judiciary. The country’s courts have long been vastly overburdened and it they never been impartial. Yet the law that has just passed illustrates perfectly that Turkey cannot design a credible reform process by itself. The bill is not about impartiality but rather the further concentration of power. It allows the executive to pack the courts, which is nakedly in violation of the constitution. In the long run, it will destabilize the country, which is the exact opposite of what reforms are meant to do. HQ2 doesn’t like the EU very much, which was all too evident this week.

    Meanwhile, Turkey needs investment. Yet both foreign and domestic investors are currently refraining from putting money into the country. The outward-to- inward direct investment ration has increased to around 34 percent as of April 2016. In December 2015, the ratio was only 30 percent. The average for 2002-2007 for ODI to FDI was around 15 percent. This means that there is a lot less foreign money coming into Turkey. I think HQ1’s pragmatism is aimed to stem this flow, and perhaps eventually even to reverse it. HQ2 however, is sabotaging the country’s credibility, making it a less predictable place for investors to park their money in.

    HQ1 has been lazy of late, but this week its diplomats seem to have been at work. I hope that it will continue at this pace, and once again sideline HQ2 in the country’s governance.

    This commentary was published in Hürriyet Daily News on 02.07.2016

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