Turkey Update

TURKEY UPDATE June 26, 2001 POLITICS UNDER THE SHADOW OF “THE THIRD WAVE” On May 28, Prime Minister Bulent Ecevit celebrated his 77th birthday, as well as the second anniversary of the formation of the three-party coalition government after the April 1999 general elections. In a long speech devoted to outlining the achievements of the government, Ecevit stressed that his Democratic Left Party (DLP) was working in full harmony with the National Action Party (NAP) and the Motherland Party (MP). Listening to Ecevit, one might have been forgiven for overlooking the reality that the country he leads is still reeling from the effects of two major financial crises his coalition stumbled into during the last eight months and that Turkey has been obliged to seek a massive new stand-by emergency aid package from the International Monetary Fund (IMF). To be sure, the very durability of the coalition — it has been in office longer than any coalition in Turkish history — and its ability to manage numerous problems during the past two years are impressive. Its very cohesion, however, buttressed by the mantra of “stability,” has also unfortunately sheltered it from the need to undertake a major restructuring or reshuffle in response to its reverses, which would have almost certainly provoked resignations in most Western democracies. Moreover, with Turkey still under the political management of the team that dragged it into its current economic difficulties, domestic and foreign financial analysts, who welcomed the appointment of Minister of State for the Economy Kemal Dervis after the February crisis, are freely speculating about the likelihood of Turkey hitting an even more devastating “third wave,” possibly before the end of 2001. As Atilla Karaosmanoglu, who in similar fashion was himself brought as economy minister from the World Bank three decades ago, commented last week, the question constantly being asked of him was not whether the wave would come but when. Consequently, notwithstanding the apparently unshakable confidence of Ecevit and his coalition partners, it seems unwise to predict that the current coalition will be able to ride out the major challenges ahead or have cause to celebrate its third anniversary. Such prudence would seem all the more appropriate after the closure of the Islamist Virtue Party (VP) on June 22 by the Constitutional Court, which has added yet another major factor of instability into the equation. GOVERNMENT BY DEFAULT The current government’s virtual lock on power, which effectively impairs the ability of the Turkish political system as a whole to deal with its economic problems, is a direct product of the dynamics that have characterized Turkish politics during the past four years. The DLP-MP alliance, which is at the core of the current coalition, catapulted into office in the immediate aftermath of the virtual expulsion of the Islamist Welfare Party (WP) and the True Path Party (TPP) government from power in June 1997 following military pressure. Ecevit and Mesut Yilmaz, the leader of the MP, then displayed a remarkable degree of cooperation until the fall of the Yilmaz-led government over corruption allegations in November 1998. Following a brief interregnum of minority government by the DLP until the April 1999 elections, the two Turkey Project • Center for Strategic and International Studies 1800 K Street, NW • Washington, DC 20006 • Tel: (202) 775-3724 • Fax: (202) 775-3199 • http://www.csis.org politicians resumed their partnership in government, this time with Devlet Bahceli and his NAP as the third partner. With Bahceli demonstrating an unexpected and surprising flexibility as deputy prime minister to underline NAP moderation and pragmatism and to overcome lingering suspicions relating to the party’s earlier ultranationalist activism, Ecevit, Bahceli and, Yilmaz — also a deputy prime minister — have been able to systematically eradicate intra-coalition glitches through regular “leaders’ summits,” invariably also attended by Ecevit’s eminence grise in the DLP, the third deputy prime minister, Husamettin Ozkan. The three leaders, who enjoy a comfortable majority in the Turkish Grand National Assembly (TGNA), have benefited enormously from the absence of a politically feasible alternative government. The larger of the two other parties represented in the TGNA, the VP, the virtual successor to the banned WP, had been frozen into virtual inaction as it awaited the verdict of the Constitutional Court, which finally decided on its closure like its three direct predecessors, while so-called reformists and traditionalists in the party jockeyed for advantage. The other opposition party, the TPP, headed by former prime minister, Tansu Ciller, has also been unable to take advantage of the difficulties faced by the government and, like the VP, was virtually ostracized by the three coalition partners. With the only other major nationwide Turkish political party, the Republican People’s Party (RPP), shut out of the TGNA as a result of its failure to exceed the 10 percent national threshold in the last elections, Turkey has essentially been living through government by default. In addition to its virtual immunity from serious challenge from the opposition in the TGNA, the coalition has also taken full advantage of the virtual dictatorship of the party leaders in the Turkish political system. The members of the TGNA owe their positions to the leaders who chose to include them in their electoral slates, and, their loyalty, combined with legitimate fears of exclusion in the next elections, have permitted the three coalition leaders to squash the slightest insubordination within their parties. Ecevit’s apparent unwillingness to tolerate a speech at the DLP Congress in April by long-shot challenger Sema Piskinsut, was matched by Bahceli’s rationalization of strong-arm tactics by fellow NAP parliamentarians against one of his ministers, Sadi Somuncuoglu, during the run up to the election of a new president last year and by Yilmaz’s recent move against Interior Minister Sadettin Tantan, who resigned from the MP following the abrupt removal of his portfolio. Despite these advantages, however, the coalition could not have sustained itself in office so easily without the support of the mass media, which has been fully cooperative in controlling the political agenda. The mass media groups, which have extended their influence from newspapers into TV with the blessing of Ankara, not only have given full backing to the policies of the government and, as much as possible, to cushion the political effects of the crises, but have also gone so far as to undermine the credibility of the politicians — and even maverick journalists — who have attempted to challenge the coalition leaders or their policies. Needless to say, the media moguls have extensive business interests, which are directly or indirectly tied to the actions of the government. These were revealed once again following the collapse of Etibank, which had been acquired by the smaller of the two mass media groups, Medya Holding, during Yilmaz’s tenure as premier, as well as by the government-sponsored media bill recently vetoed by President Ahmet Necdet Sezer. In fact, it could legitimately be argued that the entire Turkish business community is constrained in its relationship with the government by the understandable need to maintain good relations with the Turkish politicians who happen to be in power. After all, despite the much-ballyhooed privatization during the past two decades, the government in Ankara still controls around half of the Turkish economy and, among other tools of persuasion, retains the power to disburse tenders to favored bidders. It is noteworthy that while the Turkish Industrialists' and Businessmen's Association (TUSIAD), the most powerful of the Turkish business organizations, has recently been critical of the government’s economic performance, the previous Turkey Project • Center for Strategic and International Studies 1800 K Street, NW • Washington, DC 20006 • Tel: (202) 775-3724 • Fax: (202) 775-3199 • http://www.csis.org head of TUSIAD, Erkut Yucaoglu, was praising the government for providing stability and enabling businessmen to plan for the decade ahead just before the November 2000 crisis. DERVIS “THE SAVIOR”? In spite of its virtually unchallengeable position, the coalition was nevertheless forced to make one major adjustment during its term in office. After the February crisis, Ecevit persuaded his skeptical coalition partners that the appointment of an “outsider” — Dervis — was necessary to try to restore the confidence of the international financial community in the Turkish economy. In other words, Dervis had to be brought in to obtain desperately needed financial assistance, which would otherwise be denied to the government, thus threatening its continuation in office. Ecevit’s gambit has been partially vindicated, as, on his third return to Washington after his appointment in early March, Dervis was able to announce a new aid package on April 27. The IMF and the World Bank, where Dervis had been a vice president until Ecevit asked him to join the government, promptly gave Dervis’s new economic program their public approval and, on May 15, the IMF board duly approved the additional aid package, raising assistance to Turkey to $19 billion. The news immediately buoyed the Turkish stock market and currency, which had been in the doldrums since the February crisis, and despite subsequent ups and downs, the stock market has remained

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