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TURKEY


 

 

In-depth Business Intelligence

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 

  

Update No: 090 - (27/10/04)

Turkey, others agree to head Afghan force
Turkey has had a difficult time of it in its relations with the US, formerly the cornerstone of its foreign policy, ever since its parliament in March 2003 refused to allow US troops to transit Turkish territory in the forthcoming Iraq War. It is winning its way back into Washington's good graces now by another initiative.
Turkey is to take command of the NATO-led peacekeeping force in Afghanistan next February, to be followed by Italy, Britain and Spain in six-to-eight-month stints, NATO officials said on October 20th.
The North Atlantic Treaty Organization (NATO) took over the International Security and Assistance Force (ISAF) last year, but has struggled to expand it out of the capital Kabul. 
In June it confirmed the setting up of five provincial reconstruction teams in the north of the country, but it is behind schedule in moving into the west and other regions. The command arrangements until 2007 were agreed in NATO's military committee, said a NATO official. "It gives us the stability and planning ... for this long term operation," he said.
Currently ISAF is commanded by the Eurocorps, an intervention force created under a 1992 Franco-German initiative which includes troops from Belgium, Spain and Luxembourg. Eurocorps succeeded Canada in August. 

Turkish media mixed in reaction to EU accession report 
In the aftermath of a European Commission (EU) report on Turkey's EU accession drive, there is a dispute developing in some member states on the impact of blending a secular Islamic state into the mainly Christian fabric of the organization. In Turkey, meanwhile, reaction to the report has been mixed. 
The Commission report, published on October 6, urged the commencement of accession negotiations with Turkey, but set no firm date for the start of such talks. It also established strict guidelines for the negotiations, and established an unprecedented pre-condition under which Turkish citizens may be subject to restrictions on their movements within the EU. In addition, the commission stressed that it could not guarantee that the accession negotiations would culminate in Turkey's admission to the 25-state organization. 
The report has prompted spirited public discussion within the EU, especially in France and Germany. During a parliamentary debate in France on October 14, Prime Minister Jean-Pierre Raffarin said Turkey's desire for membership "is not illegitimate," but he stressed that "neither Europe nor Turkey" is presently ready for Ankara's inclusion in the EU. French government officials have suggested the inclusion of Turkey, a relatively poor and predominantly Islamic country, could upset the EU's social, political and economic balance. President Jacques Chirac has vowed to hold a national referendum on the issue. 
In Germany, leaders of the main opposition Christian Democratic Union (CDU) announced October 15 that they would drop plans for a petition drive against Turkey's membership in the EU. Party officials expressed concern that the move could stoke a domestic political backlash, given that Germany is home to 2.5 million Turks, many of whom came to the country as "guest workers." The conservative CDU has advocated that the EU establish a special relationship with Turkey, instead of extending full membership. 
British Prime Minister Tony Blair has been among the most vocal supporters of Turkey's eventual accession. In comments published by the German mass-circulation daily Bild, Blair said: "A stable, democratic Turkey in the EU is extremely important for the stability and security of the region." However, Blair emphasized that accession talks could last a decade or longer. 
The response of Turkish leaders to the European Commission report has been restrained. Prime Minister Recep Tayyip Erdogan said in a recent interview broadcast on Greek television that he preferred to emphasize the report's positive conclusion - that Turkey, after more than 40 years of knocking on the EU's door, was at last ready to gain eventual admittance, the Cumhuriyet newspaper reported. Turkish officials indicate that they will work to ease EU concerns between now and a December EU summit, at which EU officials could set a date for the start of accession talks. 
Many Turkish political commentators are also emphasizing the positive. Sami Kohen, a prominent analyst for the Milliyet daily, said the commission's conditions should not cause Turks to lose sight of the overall message. "The commission, for the first time, recommends that [accession] talks start with Turkey," he wrote. 
The conditions have potential benefits for Turkey, analyst Guneri Civaoglu said in a Milliyet commentary published October 7. Civaoglu argued that the commission's stringent criteria will help Turkey complete its political metamorphosis - turning from an autocratic/authoritarian state into a modern democracy - in an astoundingly short period of time. "This [the accession process] will be difficult, will [exert] pressure on whoever is in power," Civaoglu said. "Yet this is an initiative of creating a miracle." 
Euro-sceptics in Turkey, meanwhile, are using the commission report as ammunition in their effort to sway public opinion against EU membership. Gunduz Aktan, one of Turkey's most prominent Euro-sceptics, characterized the conditions as "unacceptable." Aktan went on to castigate pro-EU analysts and officials as being overly "submissive" in pursuit of EU membership. 
"If you act with pathological emotions while pursuing something, you may get exactly the opposite of what you were seeking," Aktan wrote. "There are many love stories that prove this fact. Can't these people ever realize the fact that by being perceived as less interested [in accession], Turkey's full membership process might become considerably easier?" 
Political pundits tend to be more optimistic about the commission report than the general public, some analysts admit. The commission's conditions had wounded the national pride of many Turks, one TV newsroom editor told EurasiaNet. "[Public] morale is low," the editor said. "People are resentful that the EU report came with so many strings attached." 

Sick Man of Europe - not Turkey, but France
It is in some ways curious that France is so ambivalent about Turkish entry. An alliance with the Ottoman Turks was a perennial of French diplomacy from the time of Francois Premier in the early sixteenth century onwards. 
Turkey became widely known as the 'sick man of Europe' in the nineteenth century, a designation which at least recognised it as a European power. Now Professor Ahmet Insel has described France as "the sick man" of Europe. The reason is obvious: the official French resistance to Turkey's possible EU membership. 
An irony of history: Turkey has emulated France in almost all aspects throughout its modernization adventure, but now France is rejecting its "student." Or in other words, rejecting the failure of its own project. 
Whether or not Turkey did the right thing by adopting the French model during its own modernization process, could be the subject of another debate, but today Paris's strong rejection of Turkey causes great anxiety. 
Developments show that [French] President Jacques Chirac, who supports the start of negotiations with Turkey, is being isolated rapidly. The more Chirac's isolation increases, the pressures on him to say "no" in the December summit, and to go to Brussels with proposals other than those supporting membership or those paving the way for an extension of the process increase even more. 
The outcome of the debate in the French Parliament in early October can be summarized as a bargaining for an alternative proposal, a privileged partnership with Turkey, alongside membership. 
France, certainly, is never just France. It is the homeland of both Jean Monnet, the father of the EU idea, and Robert Schuman, the EU plan creator. Hence, the French treat the EU as their own child. They accept that they "wed" Germany and made the EU their child, but they are the "father." Other members, at the most, are seen as children, who need protection and care. 
Just before the war in Iraq, Chirac reproached the candidate countries then - now members - for supporting the U.S. that had made them lose their right to silence. This was obviously France's subconscious expression. If an EU decision is to be made, it is has to be approved first by France. 
Again, whether negotiations with Turkey will start or will be rejected, would be decided in Paris before anywhere else. Their objection of an issue is not the same as that of the Netherlands, Italy or even Britain. 
In case of an indirect implication by France that instead of a proposal urging the start of negotiations with Turkey as soon as possible, it will study an in-between formula, this would win the support of several countries. 
Those, who are suspicious or undecided about Turkey's membership, would also fight against Ankara by taking shelter under the wings of France. 
On the other side, the South Greek Cyprus Administration, Slovakia and Austria, which are subservient enough, would disclose their thoughts. Should all these really happen, it would no surprise to see the Netherlands and Denmark shifting sides. 
It is a strong possibility that Chirac, even though he is not bound by the anti-Turkey wave, will attend the December summit in Brussels ready with proposals he can market to his own public opinion. In the final analysis, the French leader, with a desire for one more presidential term, will not make any decision, in spite of pressure from his people. Hence, until December, France will remain Ankara's biggest headache. 

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AUTOMOBILES

Car production soars 76% in 8 months

Turkish car production rose 75.7% to 292,436 units in the first 8 months of the year, extending a strong upward trend in place since 2003. Total vehicle production in the January-to-August period was 529,640 units that are 74% increase year-on-year, the Automotive Industry Association (OSD) according to reports from reporter.gr on September 10th. In August alone, car production rose 69.7% to 21,572 units, while total production was up 75% to 43,934 vehicles, OSD said. The automotive sector is one of the main factors for economic growth in Turkey, recovering from a 2001 financial crisis that shrank the economy by more than 10%. Total vehicle sales were 498,583 units in the first 8 months of the year, a 174% surge in the market. Of that, 302,840 cars were sold, OSD said.

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AVIATION

New services from Lufthansa for business class customers

Lufthansa Airline's PartnerPlusBenefit programme, which provides special advantages for companies, has become operative in Turkey, New Europe reported recently.
Companies that send employees to foreign countries will be able to buy tickets over the Internet for Lufthansa and Lufthansa members Air Dolomiti, Augsburg Airways, Contact Air, Eurowings and Lufthansa Cityline thanks to the programme, which Lufthansa prepared in Turkish. Member companies will earn points for first, business and economy class tickets purchased, and they will be able to use these points for free tickets or upgrades. They can also redeem their points for cash. Lufthansa Turkey general manager, Sadik Elmas, said they would work hard to promote the programme. Commenting that they plan to increase the number of members to 300, Elmas said: "Thanks to the programme, we expect to get a 2,750m Euro endorsement in one year."

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FOREIGN DEBT

Turkey repays €589m in foreign debt

Turkey repaid €589.60m of its foreign debt between September 1st and 15th. Central Bank data shows that during the said period the treasury repaid €222m, the Central Bank 10.5m and administrations with general and consolidated budgets repaid €22.85m. €334.25m went to the International Monetary Fund (IMF), Turkish Daily News cited on September 18th. Turkey repaid €1.575bn in foreign debt in January, €2.567bn in February, €2.349bn in March, €1.166bn in April, €1.124bn in May, €1.225bn in June, €1.748bn in July and €1.192 in August. The IMF was repaid €4.3725bn in the January to August period. Turkey has repaid €13.569bn of its foreign debt since the beginning of the year. Turkey repaid €15.365bn of its foreign debt in 2003.

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FOREIGN ECONOMIC COOPERATION

Turkish, Iranian ministers discuss trade, cooperation

Turkish State Minister, Kursad Tuzmen, said recently that trade volume between Turkey and Iran would reach US$3bn at the end of this year, Anatolia News Agency reported.
Speaking to reporters after meeting Iranian Minister of Roads & Transport, Ahmad Khoram, in Tehran, Tuzmen said trade volume between Turkey and Iran may reach US$4.5bn and noted that the real potential is in the range of US$10bn, reachable within 2-3 years.
"However, continuation of trade in a balanced way is important. There is a serious foreign trade deficit between Turkey and Iran. This deficit will further increase when Turkey purchases natural gas from Iran in large quantities. We request that Iran implement a reduction on tariffs. Preferential trade agreement should also be signed soon," Tuzmen said.
Stating that Turkey carefully monitored the controversy regarding GSM operators TAV and Turkcell, Tuzmen said Turkish companies planning to invest in Iran were cautious on this issue.
"I have come to Tehran together with 500 businessmen. More than 220 Turkish companies will attend the 4th International Tehran Industry Fair. This is an indication that Turkey is interested in Iran," Tuzmen added. 
Tuzmen said completion of studies for the Bazerban-Gurbulak border crossing was an important step, stressing that improvement works at Kapikoy-Razi customs office and construction of a new highway will link eastern Turkish city of Van to Iran.
Khoram said the Iranian government was resolved to improve economic and political relations with Turkey and expressed hope to overcome actual tensions in the coming months.
Tuzmen quoted Iranian officials as saying that the Iranian government would bring agreements with (GSM operators) TAV and Turkcell onto the agenda of their parliament in three weeks.
"Khoram told me that the process of decision making will be completed between the parliament and the government within two or three months. He said that result will probably be positive, since legal infrastructure of the agreements is ready," Tuzmen said.
Tuzmen will attend the inauguration of the 4th International Tehran Industry Fair and visit Turkish stands.

Tuzmen: Turkey-Finland trade volume to rise

Turkish State Minister, Kursad Tuzmen, recently said that the government expects a 50 per cent increase in trade volume between Turkey and Finland, the Turkish Daily News reported.
Tuzmen, who met with Finnish foreign Trade and Development Minister, Paula Lehtomaki, and Finnish businessmen in the Finland-Turkey Business Forum, organised at the Hyatt Regency Hotel, provided information about commercial activities between the two countries.
Recalling that among 6,511 foreign-partnered companies in Turkey, only 19 were Finnish, Tuzmen called for Finnish businessmen to increase that number by investing in Turkey. Stating that during the reform process leading Turkey to integration with the European Union, things were made easier for foreign investors in Turkey.
Tuzmen, who said the volume of trade between Turkey and Finland had potential for expansion, said: "We estimate that the volume of trade between the two countries, which was 500m Euro will exceed one billion Euro in the next term. I believe that we can reach this number at the end of this year." 
Meanwhile, Lehtomaki said she believed that their visit to Turkey would contribute to the improvement of relations between the two countries. Also in the Business Forum the Turkish Industrialists' and Businessmen's Association (TUSIAD) and the Confederation of Finnish Industries signed an agreement on cooperation.

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FOREIGN LOANS

World Bank agrees loan, grant for Turkish projects

The World Bank will provide Turkey with a loan of US$20m and with a grant of US$7m. Releasing a statement, the Turkish Treasury said recently that the agreements on the loan and the grant were signed by the World Bank and Treasury officials of Turkey in Washington DC, Anatolia News Agency reported.
"Under the World Bank's Country Assistance Strategy (CAS) for 2004-2006, preparatory works have been going on over the Anatolia River Basins Rehabilitation Project. The project targets support for sustainable natural resources management practices in 28 microcatchments in several regions in Anatolia and to increase the income of the population which was affected by impairment of natural resources," it said.

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MINERALS & METALS

Eldorado Gold begins mine construction

Eldorado Gold Corp (EGO) has obtained all the permits and approvals necessary to start building its Kisladag mine in Turkey, New Europe reported recently. In a news release, the Canada-based mining company said the recent issuance of the construction permit by the Directorate of Public Works - Usak concluded the permitting process required to construct and commission the operation. It further added that site activities will be underway this month, with road construction, contractors mobilising to site, water well drilling and electrical powerline construction, reported Dunya Online on September 9th. Eldorado said it remains on schedule to start production at the mine late in 2005. Exact timing of the start of commercial production will depend on winter weather conditions in 2004-2005 and the associated impact on the leach pad construction schedule, it noted. Kisladag will start production at an annualised rate of 164,000 ounces for its first year, rising in year two to 240,000 ounces at a cash operating cost of €165 an ounce for a planned mine life of 14 years.

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TELECOMMUNICATIONS

Ankara mulls to open tenders for Telekom & Tekel

Turkish Justice Minister and government spokesman Cemil Cicek said on September 20th, "We are planning to open tenders for the privatisation of Turkish Telekom and for Tekel in October. Also, efforts are under way for a public offering of state-run Turkish Airlines (THY) in November." Anadolu agency correspondents reported that during a news conference following a meeting of Council of Ministers, Cicek said, "work on the process of a public offering of THY shares to be launched on November 17th are continuing with speed." "The tender for the 51% block sale of Turkish Telekom was opened in the first week of October. The tender for Tekel's tobacco operations would be launched in the third week of November," Cicek added. 

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