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TURKEY


 

 
Key Economic Data 
 
  2002 2001 2000 Ranking(2002)
GDP
Millions of US $ 182,848 147,700 199,300 24
         
GNI per capita
 US $ 2,500 2,530 3,080 95
Ranking is given out of 208 nations - (data from the World Bank)

Books on Turkey

REPUBLICAN REFERENCE

Area (sq.km) 
780,580

Population 
68,109,469

Capital 
Ankara 

Currency 
Lira 

President 
Ahmet Necdet Sezer 

  

Background:
Turkey was created in 1923 from the Turkish remnants of the Ottoman Empire. Soon thereafter the country instituted secular laws to replace traditional religious fiats. In 1945 Turkey joined the UN and in 1952 it became a member of NATO. Turkey occupied the northern portion of Cyprus in 1974 to prevent a Greek takeover of the island; relations between the two countries remain strained. Periodic military offensives against Kurdish separatists have dislocated part of the population in southeast Turkey and have drawn international condemnation. 

Update No: 084 - (29/04/04)

Terrorism puts a spanner in the works
Premier Recep Tayyip Erdogan has just celebrated the first anniversary of his party's historic electoral victory, which took place on March 10th last year, 2003.. Earlier this year, at a meeting with a group of journalists in Switzerland, the Turkish prime minister spoke of his hopes for "a year of positive change" in a country athirst for reform. 
The policy, he explained, was to speed up the process of "restoring the armed forces to their proper role", and taking "the last big steps" toward Turkey's membership of the European Union (EU), while the economy, in the doldrums for a decade, would start showing signs of a turnaround. EU membership is to be discussed at the EU summit in December. Istanbul is to be the venue of the next NATO summit in June. 
What Erdogan could not have predicted was a wave of terrorist attacks that has exposed the basic weaknesses of his political strategy. The recent attacks in Istanbul have cast doubt on Erdogan's ability to press on with his plan to recast the Turkish republic by excluding the military leadership from politics. Many Turks, including some in Erdogan's Justice and Development Party (AKP), believe that with terrorism threatening the nation, this is no time to pick a fight with the armed forces. 
The attacks have already led to an increase in popular support for the secularist parties which wish to keep the army at the centre of Turkish political life. The terrorist attacks also counteract Erdogan's hopes of a real economic recovery. The Turkish economy has been showing some positive signs in the past few months, partly due to an enlarged budget deficit. But there are already signs that the terrorist attacks are having a dampening effect on Turkish morale as a whole. Tourism, the nation's third largest source of foreign currency, is adversely affected, while the effects on medium and long-term investors remain to be assessed. 
The third goal of Erdogan's strategy, Turkey's passage into the European Union, is also threatened. The prospect of Turkey turning into a new battlefield for terrorism is not likely to generate greater support for Turkish aspirations within the EU. 
The Istanbul attacks have been attributed to Al-Qaeda, but this is just a little too convenient to be wholly plausible, without the fullest examination. The attribution suits Erdogan down to the ground. The very mention of Al-Qaeda is guaranteed to attract the attention and support, of Washington. Also, by claiming that the terrorists were "foreign elements", the prime minister can foster the idea that the Turks are victims of an external enemy. 
It can be argued by contrast that the terrorist attacks in Istanbul are, partly at least, the result of almost a quarter of a century of attempts to mix politics with religion - attempts in which Erdogan's party, and its four predecessors, have played a leading part. 
The first politician to create a religious force, at the time against the left, was Prime Minister Adnan Menderes, who was ousted in a military coup and hanged in 1960. The groups that he had fostered, and partly financed through public funds, did not raise a finger to help him in his hour of need. 
In the 1970s there came Suleiman Demirel, a political heir to Menderes, playing the religious card. Demirel benefited tactically by this manoeuvre and managed to become prime minister on two occasions. In time, however, he also was ditched by his allies. 
One man who reckoned that he had played the Islamist card to the full was Necemettin Erbakan, known to his followers as "Khojah" which means "master". 
It can be contended that Erdogan has made the mistake that Menderes, Demirel and Erbakan made before him, overplaying his hand. The terrorist attacks that have hit Turkey have little to do with Iraq or even rising hatred for the United States. Both Iraq and hatred for the US are used as pretexts by Islamist groups who want to destroy Erdogan's government, or any secular government in a western model. 
The only way to deal with the threat, it can be maintained, is to form a broad popular front dedicated to the values and traditions of Turkish democracy. Erdogan can take the lead in that direction. But before he does he must realize that anyone who mixes politics and religion risks having that mix explode in his face. 

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AUTOMOBILES

Renault Trucks for assembly in Turkey

Renault Trucks is planning to produce trucks in Turkey two years after setting up an assembly-line plant, New Europe reported recently. 
Speaking at a meeting recently for the promotion of new Renault truck models 8x2 Premium and 6x2 Midlum, Renault Trucks Turkey Director General, Eric Labat, recalled that the Renault Trucks had set up a venture "Renault Trucks Industry" in Turkey in 2002 for production of trucks. "Our aim is to make Turkey one of the European industrial bases of Renault Trucks. In addition to equipment and machines used in fabrication, fabrication of our middle class commercial vehicle cabs have been transferred from northwestern part of France to Bursa. Our primary investment in the project is above €10m. Cabs produced in Turkey are later exported to France. In the next phases of our project, we are planning to produce spare parts like chassis and axles here. In this way, we are thinking of setting up an assembly-line plant in 2006," he said. "We are planning to make production in Turkey. We want to decrease the cost by investing in Turkey and market the vehicles we produce here to all countries where Renault Trucks exist, including Europe," he added.

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CREDIT RATING

S&P increases Turkey's credit note, warns about C/A

New Europe reported that the International credit rating agency Standard and Poor's (S&P) increased Turkey's long-term local currency rating from B+ to BB- recently. The rating of BB- shows that positive developments occurred in dept repayment of a country. S&P also raised the economic outlook from stable to positive.
S&P credit analyst Ala's Al-Yousuf said in a statement: "The improvement in Turkey's creditworthiness reflects the progress that the government is making on both the economic and political fronts toward restoring durable macroeconomic stability."
A statement released by S&P pointed out that growth in gross domestic product (GDP) would be close to the 5% target in 2003 and 2004.
It also emphasised that inflation in the consumer price index (TUFE) would regress to the 12% target by the end of the year. It was also mentioned there is no reason to believe that the central bank would fail to reach its inflation target for 2004.
There were, however, a few words of warning in the S&P statement. It noted that the current account deficit based on GDP would expand 2.50% and 2.75% in 2003 and 2004, respectively; however, the floating exchange rate and international reserves of US$34bn should be enough of a safety valve to prevent another crisis.
On the other hand, public sector debt, financial flexibility and the real interest rate were cited as major risks in economy. It was recorded that the exact debt in the public sector would amount to 65% of gross national product (GNP) by the end of the year. However, it was emphasised that the ratio of GNP to debt would be decreased to 70% towards the end of this year.
It stated that the economic-political reforms to solve the Cyprus problem have garnered support from the European Union (EU). Al-Yousuf also disclosed that ongoing developments in reforms, stability, economy and the EU negotiations might increase Turkey's credit rating.

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FOREIGN LOANS & AID

World Bank to continue support of Turkey

World Bank President, James Wolfensohn, said recently in an International Investment Consulting Council meeting held in Istanbul that the World Bank will continue to extend support to Turkey, New Europe reported. 
After visiting the International Finance Corporation (IFC) office in Istanbul, Wolfensohn spoke to journalists. Asked whether a new stand-by agreement between Turkey and the International Monetary Fund (IMF) will be needed in 205, Wolfensohn said that he did not have detailed information on what arrangements had been made with the IMF, but he knew that the World Bank would continue extending its support to Turkey. In answer to the question about the amount of the credit they would transfer to the Turkish economy in 2004 and 2005, Wolfensohn said that he could not comment on that precisely; however, it could be in the ballpark of US$1.5bn.

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INFORMATION TECHNOLOGY

Ankara and Islamabad move to push up IT cooperation

Pakistani Federal Minister for Information Technology, Awais Ahmad Khan Leghari, recently called for greater cooperation between Pakistan and Turkey in the fields of information technology and telecom sectors, New Europe reported recently.
"The government has already liberalised the telecom sector in Pakistan which offers great potential for investment in the sector given a low tele density," he told Turkish Ambassador to Pakistan, Hasan Kemal Gur, who met the minister to discuss issues of bilateral interest. The government efforts to promote the IT and telecom sectors were highlighted, with particular focus on the expansion of the Internet and telephone facilities in the far-flung areas of the country.
Leghari said that the government was actively encouraging private-public partnerships and there were plenty of opportunities for the Turkish businessmen to forge such partnerships with PTCL and other such entities in Pakistan to ensure mutual benefits to the two countries. He further added that the organisational restructuring of PTCL was also under way to bring about a change in the business attitudes and to prepare the company for the competition likely to set in following the entry of new players in the wireless local loop and long-distance international telecommunication areas.
Referring to the e-government initiative of his ministry, he said it had launched an aggressive programme to ensure a quick delivery of IT enabled public services to the people. International giants like Microsoft, Sunmicrosystems and Oracle were already coming to Pakistan in big way to participate in the growth of the telecom sector, Leghari explained.
Gur assured the Pakistani minister of his country's full support and cooperation in the promotion of IT in Pakistan.
He told the minister the IT companies in his country were keenly looking forward to investing in Pakistan in the wake of the deregulation process in the telecom sector in the country.

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TOURISM

Package for promotion of Turkish tourism

The ministry of tourism and culture intend to increase the number of tourists by 20% compared to last year and has prepared a new promotional package, which will be used by 60 countries, New Europe reported recently. 
Turkey's historic and natural beauties will be introduced through the photos of 2002 Miss World Azra Akin. Minister of Tourism and Culture Erkan Mumcu, who held a press meeting at the Lutfi Kirdar Cultural and Exhibition Hall, said that a new process has started in Turkish tourism with new expectation and perspectives. Stating that they would make efforts to promote Turkey all over the world in a contemporary way, Erkan said, "We will point out Turkey's cultural property and richness in this new promotion process." Adding that they planned to extend the campaign by organising cultural and artistic activities, which will increase the number of tourists in Turkey. 
Mumcu believes that Turkey will achieve tremendous success in the field of tourism. He stated, "We expect 16.5m tourists to come to Turkey this year and which will result in a US$12.5bn tourism income. We estimate that this number will increase thanks to new investments, diverse tourism products and a prolonged tourism season. Our goal was 20m tourists for 2007 in the past. In line with the results of tourism market, this number is valid until 2006. So, we will reach the goal of 30m tourists, which we aimed through 2010, in 2009."

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