‘Anatolian Tigers’ attribute success to Turkish government
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Kai Ryssdal: The European Union’s in the middle of its annual meetings about expansion, considering whether to extend offers of membership to countries outside its immediate circle. Turkey’s been trying to get in for years now. It’s been hung up mostly on political issues. Economically, it’s doing a whole lot better than some countries that’re already in the EU — Greece, Portugal and Ireland to name just a few. The Turkish economy has grown by more than 8 percent this year. It’s a far cry from the days of International Monetary Fund bailouts.
In the first of two reports, Marketplace’s Stephen Beard explores Turkey’s turnaround.
Sound of military guardsmen shouting and marching
Stephen Beard: On a small hill in Ankara, Turkey’s army performs its most sacred duty: Guarding the tomb of the republic’s founding father, Kemal Ataturk. More than 80 years ago, he turned this country into a secular, modern-minded, westward-looking state. Today, some say, his legacy is in mortal danger.
Haldun Solmazturk: It’s a fight for the soul of the Turkish nation.
Haldun Solmazturk, a retired army general, says the ruling Islamic party, the AKP, is determined to unravel Ataturk’s reforms.
Solmazturk: This is their mission, to take this country and move it further to the what they call our “our civilization,” meaning the Muslim civilization.
But in spite of such fears of creeping Islamization, the ruling party has proved highly adept at managing the economy and fostering enterprise.
This small furniture maker is based in Kayseri in Turkey’s Asian heartland, Anatolia. The company is one of the region’s booming businesses, the so-called Anatolian Tigers.
Safak Civici: The metal beds we are exporting to Switzerland, Germany, Austria.
Safak Civici and her family quadrupled their sales to around $4.5 million over the past four years. Unusually for an entrepreneur, she and many of her fellow business people here attribute much of their companies’ growth to the government.
Civici: Without this political regime that we have right now, I don’t think it would have grown that much. It would have grown but not that much.
She’s benefited from a raft of business friendly measures, like interest-free loans to finance exports. She says the ruling AK party is not trying to turn Turkey into another Iran. It’s just encouraging the equivalent of the Protestant work ethic and a conservative, unlavish lifestyle and that’s certainly the norm in this town.
Safak: You won’t see very many BMWs, you won’t find a Porsche. You will not find these fancy, high-life type cars.
Beard: They are not ostentatious people?
Civici: Yes, they don’t like to show off.
There’s rather more showing off back here in Istanbul, amid the skyscrapers of the financial district. But even here, there’s much less of the opulence of London or New York. Turkey had its financial meltdown nine years ago. After that, financial regulation of the banks was tightened, the budget deficit reduced. And claims, Suruhan Dogan head of investment banking at the Finanzbank, there’s now less of the western-style excess.
Suruhan Dogan: We don’t have the bonus system that has been a major trouble in western economies.
Beard: You can’t be happy about that as an investment banker, surely?
Dogan: Well in the short term, you might resent it. But I guess that is what is securing our long-term employment.
We should not exaggerate the virtues of the Turkish economy. Inflation at 9 percent is too high. But says veteran Turkish commentator Sami Cohen, things are better than in Europe.
Sami Cohen: Greece and Ireland and Portugal are in bad shape, their economies are in bad shape. And Turkey’s doing quite well. Now this adds more to the self-confidence of Turkey.
On the Turkish street, people seem pumped up by the country’s relative success. Turkey seems to be giving up its old dream of joining the European Union and is forging closer links with the Middle East.
In Istanbul, I’m Stephen Beard for Marketplace.
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