Turkey in Europe Monitor

Edited by

Michael Emerson and Senem Aydln

January 2004-February 2005 Nos. 1-14 TABLE OF CONTENTS

Preface ...... i No. 1, January 2004 Introductory Note from CEPS...... 1 Speech by Romano Prodi at the Turkish Grand National Assembly, January 2004...... 1 Strategy Paper and Report of European Commission on the Progress towards Accession by Bulgaria, Romania, and Turkey, November 2003...... 5 Turkish Business Perspectives (contributed by TÜSIAD)...... 9 No. 2, February 2004 Introductory Note from CEPS...... 10 Speech by Recep Tayyıp Erdoğan, Prime Minister of Turkey, at the Council on Foreign Relations, New York, January 2004...... 10 Speech by Recep Tayyıp Erdoğan, Prime Minister of Turkey, at Harvard University, Kennedy School of Government, January 2004...... 14 Introduction to the joint CEPS/EFPF project Strategy for the EU and Turkey in the Pre-accession Period...... 15 Turkish Business Perspectives (contributed by TÜSIAD)...... 18 No. 3, March 2004 Introductory Note from CEPS...... 19 “The Cyprus Endgame” ...... 19 Michael Emerson “The Cyprus Chronicle”...... 20 Senem Aydın Turkish Business Perspectives (contributed by TÜSIAD)...... 28 No. 4, April 2004 Introductory Note from CEPS...... 29 “Views of the European Parliament on Turkish Accession” ...... 29 Senem Aydın Distribution of Votes in the European Parliament on the Oostlander Report ...... 34 Turkish Business Perspectives (contributed by TÜSIAD)...... 36 No. 5, May 2004 Introductory Note from CEPS...... 37 “Euro-Turks: A Bridge, or a Breach, between Turkey and the European Union?” ...... 37 Ayhan Kaya Turkish Business Perspectives (contributed by TÜSIAD)...... 47 No. 6, June 2004 Introductory Note from CEPS...... 48 Executive Summary of “Turkey and the European Union: Just another Enlargement?”...... 48 Kristy Hughes Speech by Fabrizio Barbaso, Director General DG Enlargement, Ankara, May 2004...... 50 Turkish Business Perspectives (contributed by TÜSIAD)...... 56 No. 7, July 2004 Introductory Note from CEPS...... 57 Extract from “Turkey as Bridgehead and Spearhead – Integrating EU and Turkish Foreign Policy” Michael Emerson & Nathalie Tocci...... 57 Turkish Business Perspectives (contributed by TÜSIAD)...... 64

No. 8, August 2004 Introductory Note from CEPS...... 65 Extract from “European Integration and the Transformation of Turkish Democracy”...... 65 Senem Aydın & E. Fuat Keyman Turkish Business Perspectives (contributed by TÜSIAD)...... 75 No. 9, September 2004 Introductory Note from CEPS...... 76 “Turkey and the European Budget: Prospects and Issues” ...... 76 Kemal Derviş, Daniel Gros, Faik Öztrak & Yusuf Işik Turkish Business Perspectives (contributed by TÜSIAD)...... 82 No. 10, October 2004 Introductory Note from CEPS...... 83 Extract from “Turkey’s Cultural and Religious Heritage – An Asset to the European Union”...... 84 Ingmar Karlsson Extract from “An Asset but not a Model: Turkey, the EU, and the Wider Middle East” ...... 87 Steven Everts Extract from “Ankara et l’UE, les raisons du ‘non’” ...... 92 Jean-Louis Bourlanges Turkish Business Perspectives (contributed by TÜSIAD)...... 97 No. 11, November 2004 Introductory Note from CEPS...... 98 “The Turkish Gate: Energy Transit and Security Issues” ...... 98 John Roberts Turkish Business Perspectives (contributed by TÜSIAD)...... 113 No. 12, December 2004 Introductory Note from CEPS...... 114 “Growth and Immigration Scenarios for Turkey and the EU”...... 114 Refik Erzan, Umut Kuzubaş & Nilüfer Yıldız Sections of the Presidency Conclusions of the Brussels European Council December 2004 ...... 125 Turkish Business Perspectives (contributed by TÜSIAD)...... 128 No. 13, January 2005 Introductory Note from CEPS...... 129 “The Impact of Turkey’s EU Membership on EU Voting”, CEPS Policy Brief...... 129 Richard Baldwin & Mika Widgrén Turkish Business Perspectives (contributed by TÜSIAD)...... 140

No. 14, February 2005 Introductory Note from CEPS...... 141 “Turkey in the European Union: Consequences for Agriculture, Food, Rural Areas and Structural Policy” ...... 141 Arie Oskam, Alison Burrell, Tuğrul Temel, Siemen van Berkum, Natasha Longworth and Irene Molina Vilchez Turkish Business Perspectives (contributed by TÜSIAD)...... 150

Note: For purposes of making the Turkey in Europe Monitor available for free downloading on the CEPS online bookshop, the volume is listed as No. 15 in the CEPS publication series on EU-Turkey Work- ing Papers.

PREFACE

he Turkey in Europe Monitor was initially an electronic bulletin prepared by the Centre for European Policy Studies (CEPS) on a monthly basis during the year preceding the December T 2004 European Council summit and its immediate aftermath. Following the December 1999 Helsinki European Council, Turkey officially embarked upon the EU accession process as a candidate country. The Copenhagen European Council on December 2002 took this decision further by concluding that accession negotiations would be opened with Turkey upon the fulfilment of the Copenhagen political criteria. Major political developments in the country led to the decision to open accession negotiations at the December 2004 European Council summit.

The aim of the Turkey in Europe Monitor in this context was to present objective and in-depth evaluations of developments in the relationship between Turkey and the European Union, and Turkish policies undertaken with a view to EU membership. During 14 months, the Turkey in Europe Monitor was sent to over 3,500 international recipients, featuring key official documents and speeches, original research, and evaluations of the process underway. This collection of essays, papers, speeches and official documents will continue to serve as a documentary record of the concerns and advances made at a key point in the relationship between Turkey and the EU.

CEPS acknowledges the kind support of the EU Information Group of Turkey (ABIG) in the production of the Turkey in Europe Monitor.

Daniel Gros, Research Director, CEPS Michael Emerson, Senior Research Fellow, CEPS

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CEPS Turkey in Europe Monitor

No. 1, January 2004

Introductory Note from CEPS

This is the first of a series of monthly bulletins pects for Turkish accession. It provides the full produced by the Centre for European Policy text of Romano Prodi’s speech delivered on 14 Studies (CEPS) with the aim of providing ob- January 2004 to the Turkish Grand National jective and in-depth evaluation of develop- Assembly on his recent visit to Turkey. ments in relations between Turkey and the Romano Prodi was the first Commission European Union, and Turkish policies under- President to visit Turkey since 1963 and his taken on the road to EU membership. Future speech is considered to be highly significant in issues will include original documents, edito- conveying the most recent views of the Com- rials on specific issues, overviews of the major mission regarding the latest situation in EU- developments of the month and a section on Turkey relations and the developments regard- Turkish business perspectives prepared mainly ing Cyprus. This issue also provides the sec- on the basis of information supplied by the tion of the Commission’s Strategy Paper on Turkish Industry and Businessmen Association Turkey, outlining the Conclusions of the (TÜSIAD). Commission’s Regular Report of November 2003 on Turkey. This issue of CEPS Turkey in Europe Monitor focuses on the Commission’s view on the pros- Michael Emerson and Senem Aydın

SPEECH OF ROMANO PRODI, THE PRESIDENT OF THE EUROPEAN COMMISSION, AT THE TURKISH GRAND NATIONAL ASSEMBLY Ankara, 14 January 2004

President of the Turkish Grand National As- Turkey and the region sembly, Since its creation exactly 80 years ago, the Members of Parliament, Turkish Grand National Assembly has been the centre of gravity of the political life in this Excellencies, country. Its contribution to the construction of Ladies and Gentleman, a modern, secular country and to the development of democracy has been immense. Since It is a great honour for me to address the Turk- the founding of the Republic, Turkey has en- ish Grand National Assembly today. I know deavoured in determined fashion to build such that this privilege has been extended to very a society, overcoming a number of obstacles few personalities in the past. I acknowledge along the way. Meeting the standards of the this as an important symbolic honour for the contemporary civilisation was the paramount European Union, and for the European Com- objective assigned by the founder of modern mission in particular. Turkey, Mustapha Kemal Atatürk. It was his ambition that Turkey should become a modern

| 1 2 | TURKEY IN EUROPE MONITOR democracy at peace with itself and with its ciliation rather than conflict, peace, based on neighbours. His vision was for Turkey to be interdependence, rather than war, the rule of fully part of the European family of nations. law rather than the force of arms. They laid the foundations for a Union, which has brought The huge support by the population for the stability, security and prosperity, the largest democratic reforms reflects this attitude. From single market in the world and a common cur- the revolutionary changes in the twenties to rency. With economic progress have come the most recent and groundbreaking political social solidarity and a strong guarantee of civil reforms, we can see that your assembly has rights and liberties. These are outstanding always been at the frontline of progress. achievements, given Europe’s chequered his- I am privileged to be the first Commission tory. President to visit Turkey since Walter Halltein We are also engaged in an unprecedented in 1963. Since then, the European Union has process to further develop our co-operation. changed fundamentally from an economic Our goal is to create a European Union, which community to a fully-fledged political Union. is able to respond to the expectations of its Turkey has also evolved substantially over citizens and to play a full role in world affairs. these years. My visit reflects the fact that relations between the European Union and Turkey I would have hoped to come to Turkey in the have never been so strong, and that important wake of a decision on a new constitution for decisions for the future of Turkey’s candida- the European Union. Unfortunately this is not ture are due to be taken later this year. yet the case, but we will continue to work to that goal, and I am confident that agreement As this is my first official visit to Turkey, I will be achieved in due time. The EU’s institu- would like to recall Turkey’s important role in tional architecture needs to be redesigned, so contributing to the security and stability of that our institutions can function more trans- Europe during the cold war. This recognition parently and more effectively. In view of partly explains our strong interest in Turkey enlargement, these reforms are more important developing into a prosperous and stable de- than ever. Turkey, through its participation in mocracy based on rule of law and values the work of the Convention on the future of which we all share. Europe, has contributed its experience and Turkey is endowed with unique characteristics creativity to this common task. among European countries: the combination of These achievements however need to be con- a secular, democratic state with a prevalently solidated and expanded to meet new chal- Moslem population. I am convinced that Tur- lenges, especially in foreign and security pol- key can bring a unique contribution to peace icy, in the fight against crime and injustice, and regional stability at the beginning of this and in economic integration. At the EU level new century. Turkey's repeated call to fellow we must seek to act decisively and with one Moslem countries to actively promote democ- voice. That means establishing a sounder insti- racy and human rights constitutes a powerful tutional framework for a genuine Common message. Foreign and Security Policy and, above all, the The outbreak of the Iraqi war at Turkey's south political will to act together. eastern border understandably was a cause of considerable fear and anxiety amongst Turkish EU-Turkey relations decision-makers and population. Last year, in this delicate situation, important decisions I would now like to share with you some were taken in Turkey, including by the Grand thoughts about Turkey’s European aspirations. National Assembly. Let me assure you that we I am well aware that there is an impressive are fully aware of the significance, for Turkey degree of consensus in Turkey in favour of and for the region, of the stability and integrity joining the European Union. In fact there of Iraq. seems to be close to unanimous support for the modernisation strategy. But there are concerns as to how Turkey is perceived within the EU. Future of Europe And it is true that EU-Turkey relations are in- Fifty years ago, far-sighted leaders in Europe creasingly a subject of public debate. embarked on a new course: they chose recon-

NO. 1 / JANUARY 2004 | 3

Contrary to the situation in Turkey, the public democracy. The question of full democratic opinion in the EU is not unanimous in favour- control of the military, including full parlia- ing a Turkish membership. It is in my view mentary authority over the defence budget, is important for the political leadership in the EU also being addressed. Turkey has ratified ma- and in Turkey to recognise and manage this jor UN Covenants on Civil and Political rights political reality. There are those who are con- as well as on Social and economic rights. Pris- cerned about the religious dimension. Others oners sentenced for non-violent expression of have raised issues such as the capacity of the opinion have been released. The legislation on Union to integrate a country of the size and fighting against torture has been considerably with the demography of Turkey, the economic strengthened and incommunicado detention development of Turkey and Turkey’s geo- has been abolished. graphical situation. We need to reply to these Looking back over the last couple of years, I concerns. can say that there has been a profound change The fact that Turkey belongs to Europe was in the climate of our bilateral relations. We recognised already in our Association Agree- have moved a long way in terms of how we ment of 1963. I know that the overwhelming approach and perceive each other. Whereas majority of the Turkish people share the same earlier we could not agree on Turkey's position values and objectives as other Europeans. with respect to the Copenhagen political crite- They want to live in democracies based on the ria, we now very largely share a common as- rule of law and the respect of human rights. sessment of the situation, including in the area Terrorist attacks in Turkey, as elsewhere, are of human rights. We have deepened our dia- intended to undermine such values. They will logue on the political criteria and are discuss- not succeed. ing issues in detail, openly and without taboos. Since Turkey was granted candidate status in In its November Report, the Commission high- Helsinki in December 1999, it has made im- lighted those areas where more progress is pressive progress towards meeting the Copen- needed such as the strengthening of the inde- hagen political criteria. Candidate status has pendence and efficiency of the judiciary, the helped Turkey to embark upon a process of overall framework for the exercise of funda- far-reaching constitutional and legislative re- mental freedoms, the full alignment of civil- forms. military relations on EU standards as well as the improvement of the situation in the South We have been impressed by the determination East. of the Turkish Government to carry forward these reforms. By publicly declaring that po- We are pleased to hear that Turkey is commit- litical reforms are first and foremost for the ted to address its remaining shortcomings. I benefit of Turkey's own citizens, the current understand that your Assembly is currently government led by Prime Minister Erdoğan is dealing with very important draft legislation following the footsteps of Turkey's march to- such as the penal code. The National Plan for wards modernisation. the Adoption of the Acquis adopted by the government in July 2003 foresees a crowded A major constitutional reform and seven legis- agenda of legislative reforms in a wide range lative packages have been adopted in a very of areas related to the acquis communautaire. short period of time. It is noteworthy that many of the reforms have been adopted While of course I applaud the remarkable unanimously, with bipartisan support from the achievement of the Turkish governments and majority and the opposition. parliament in your unprecedented reforms, it is also clear that the task of ensuring their sys- In its successive reports, the European Com- tematic and effective implementation presents mission has recognised the scope and signifi- an even greater challenge. I would neither like cance of the reform process. These initiatives to discuss here the remaining reforms needed have addressed some of the most sensitive is- nor to elaborate on details about their imple- sues in the Turkish context, such as the aboli- mentation. Both aspects are fully described in tion of the death penalty and the lifting of the the Accession Partnership and in the Novem- ban on languages other than Turkish, which is ber Report that I have mentioned above. a sign of the growing maturity of the Turkish

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What remains to be done is therefore clear to that this implies, brings considerable benefits you and I can assure you that there will be no to Member States by participating in policy new conditions. What will matter is full and fields such as economic integration, foreign effective implementation. If the Turkish peo- and security policy, justice and home affairs. ple are to enjoy the principles and values largely shared by European citizens, it is es- Cyprus sential that the provisions and spirit of the legislative reforms should be respected through- Let me now turn to Cyprus. Let there be no out the country by different levels of govern- doubt that the European Union is aware of the ment and public administration, the judiciary significance that this island represents for Tur- and security forces. key and its people. Many in Turkey still re- member bitter historical events causing suffering and grievance. The awareness of history October 2004 report and recommendation allows us to move ahead. It was precisely the The Copenhagen European Council in De- strength of the Franco-German reconciliation, cember 2002 gave a clear political roadmap for which made fifty years of European integra- Turkey. In October this year, my Commission tion possible. will present its recommendation on whether Why should the people of Cyprus not benefit Turkey fulfils the Copenhagen political crite- from the same experience and pursue an irre- ria. This will be one of the most important de- versible process of reconciliation which would cisions to be taken by the Commission. Let me lead them to live a future of peace and prosper- assure you that our recommendation will be ity? based on an objective assessment. We will use the same criteria and methodology that so suc- It is high time to end the outdated division of cessfully has been used for all the other candi- Cyprus and its capital city. The spontaneous, date countries. Our track record in this context emotional and brotherly reunions of Turkish is excellent. No one has ever contested the ob- and Greek Cypriots after the opening of the jectivity in our assessment. There should be no divide between north and south have erased doubts that our assessment of Turkey and our the myth that peaceful coexistence between the recommendation will maintain the same stan- communities in Cyprus is not possible. dard. Credit will be given where credit is due, Cyprus will join the EU on 1 May 2004. It but at the same time there will be no room for would be a source of inspiration for us all if complacency. The European Council has made Turkish and Greek Cypriots were able to enter it clear that, if at the end of this year it decides the EU together. We therefore call upon all that Turkey meets the Copenhagen political parties to reengage in the UN led talks without criteria, accession negotiations will be opened delay. The objective should be to reach a set- without delay. tlement on the basis of the Annan plan in time If the European Council decides to open nego- for a united Cyprus to accede to the European tiations with Turkey, I should remind you that Union on 1 May 2004. Let me assure you that accession is not a formality, and not for the we on our part are ready to assist in finding a immediate future. The negotiations will take speedy settlement. time, reflecting the scale of the difficulties in I am convinced that securing a comprehensive many sectors faced by such a large and com- settlement by 1 May would be in the best in- plex country. I should also recall that the task terest not only of all Cypriots but for all of the of adopting and implementing the acquis Eastern Mediterranean. A settlement would communautaire is enormous, and has impor- also greatly facilitate Turkey’s membership tant implications for the legislature of Member aspirations and will clearly influence decisions States. Community legislation takes prece- to be taken in the second half of this year. Let dence over national legislation. The European me be clear, this is not a formal condition, but integration process, which incorporates a a political reality. This Assembly and Your growing number of common policies, involves Government have since the last elections a loss of national autonomy for Member shown an impressive sense of recognition of States. But the process of joint decision- and Turkey’s historic responsibilities. I am confi- law-making, and the sharing of sovereignty

NO. 1 / JANUARY 2004 | 5 dent that the same degree of wisdom will penhagen political criteria. The European guide you on this particularly sensitive issue. Council in Brussels on 12-13 December last has confirmed that this progress has brought Conclusion Turkey closer to the Union. Turkey now has a unique opportunity to Turkey's prospects for moving even closer to achieve its goal, and to consolidate its position the EU depend, above all, on its own capacity as a free and democratic society in the com- to fulfil the Copenhagen political criteria, not munity of European nations. only in law, but also in practice. These criteria were not invented for Turkey, but apply Let me stress that the European Union is, equally to all candidates. For our report next above all, a community of shared values based October, as in previous years, the Commission on the principles of liberty, democracy, human will apply the same principles to Turkey as to rights, fundamental freedoms and the rule of all other candidate countries. There should be law. All these values are enshrined in the no doubts that the report will be fair and objec- Charter of Fundamental Rights of the Euro- tive. pean Union. We are moving closer to our goal, the goal of In November of last year, the Commission Turkey taking up its rightful place among the noted that Turkey has made further impressive peoples of Europe, with shared principles, efforts, which constitute significant progress practices and ideals and a common future towards achieving compliance with the Co-

STRATEGY PAPER AND REPORT OF THE EUROPEAN COMMISSION ON THE PROGRESS TOWARDS ACCESSION BY BULGARIA, ROMANIA AND TURKEY November 2003

TURKEY IN THE ENLARGEMENT PROCESS – PROGRESS AND CHALLENGES

1. Progress made by Turkey in meeting the forward the reform process, in particular the membership criteria remaining legislative work by the end of 2003”, and supported its “on-going efforts The European Council in Copenhagen in De- made in order to fulfil the Copenhagen politi- cember 2002 recalled its decision in 1999 in cal criteria for opening accession negotiations Helsinki that Turkey is a “candidate state des- with the Union”. tined to join the Union on the basis of the same criteria as applied to the other candidate Over the past year the Turkish government has States”. It strongly welcomed “the important shown great determination in accelerating the steps taken by Turkey towards meeting the pace of legislative reforms in the areas covered Copenhagen criteria” and encouraged it to pur- by the political criteria. It has also taken im- sue the reform process energetically. It con- portant steps to ensure their effective imple- cluded that “if the European Council in De- mentation, in order to allow Turkish citizens to cember 2004, on the basis of a report and a enjoy fundamental freedoms and human rights recommendation from the Commission, de- in line with European standards. These efforts cides that Turkey fulfils the Copenhagen po- constitute significant progress towards achiev- litical criteria, the European Union will open ing compliance with the Copenhagen political accession negotiations with Turkey without criteria. delay”. Some of the reforms impinge upon sensitive At its meeting in Thessaloniki in June 2003, issues, such as freedom of expression, freedom the European Council welcomed “the com- of peaceful assembly, cultural rights and civil- mitment of the Turkish government to carry ian control of the military, and demonstrate the

6 | TURKEY IN EUROPE MONITOR determination of the Turkish government to The far-reaching changes to the Turkish politi- move ahead. Turkey has ratified two major cal and legal system over the past year are part UN Covenants on Civil and Political rights as of a longer-term historical process, and the full well as on Social and economic rights. Several benefit of these reforms will accrue to the prisoners sentenced for non violent expression Turkish people over a number of years. It will of opinion have been released. The legislation take time before the spirit of the reforms is on combating torture has been considerably fully reflected in the attitudes of executive and strengthened and incommunicado detention judicial bodies, at all levels and throughout the has been abolished. Many priorities under the country, ensuring a track record of effective political criteria in the revised Accession Part- implementation. Nonetheless, there are already nership have been addressed. clear signs of improvement in terms of enjoy- ment of human rights and basic freedoms. It is, However, in spite of the determination of the however, of great concern that Turkey has not government, the Commission considers that executed many judgements of the ECtHR, by Turkey does not yet fully meet the Copenha- means of ensuring payment of just satisfaction gen political criteria. A clear framework for or reversing decisions made in contravention guaranteeing political, civil, economic, social of the ECHR. and cultural rights is not yet fully established, and more efforts are needed to enhance the The Commission also recalls the Helsinki coherence of legal provisions and practice. European Council conclusions urging candidate countries to make every effort to resolve As regards the legislative and regulatory any outstanding border dispute and other re- framework, particular attention should be lated issues on the basis of the principle of given to the strengthening of the independence peaceful settlement of disputes in accordance and the functioning of the judiciary, the overall with the United Nations Charter. framework for the exercise of fundamental freedoms (association, expression and relig- As regards the economic criteria, Turkey has ion), further alignment of civil-military rela- significantly improved the functioning of its tions with European practice and the situation market economy, while macroeconomic im- in the Southeast. Cultural rights should be balances remain. Further decisive steps to- guaranteed for all Turkish citizens regardless wards macroeconomic stability and structural of their origin. reforms will also enhance the Turkish capacity to cope with competitive pressure and market Implementation of the reforms has to be forces within the Union. strengthened, which requires that all institutions and persons involved accept the spirit of Economic stability has increased with the con- the reforms. Responsibility for enforcing re- tinuation of the disinflation process, and struc- formed legislation related to fundamental free- tural reforms and the modernisation of Tur- doms, provisions for e-trial, respect of Euro- key’s market regulations and institutions have pean Court of Human Rights judgements, and advanced. The disinflation and reform process measures to combat torture, lies largely with should be maintained, in particular by main- judges and prosecutors. On the other hand, taining fiscal discipline, by restructuring and executive bodies at all levels are also respon- further privatising the banking sector and by sible for implementation of the political re- deregulating markets. In order to enhance the forms. In a number of cases, for example in growth potential of the economy, the inflow of relation to cultural rights and freedom of relig- foreign direct investment should be encour- ion, such bodies have narrowed the scope of aged by removing remaining barriers. A selec- the reforms by establishing restrictive condition of statistical indicators can be found in tions, hindering the objectives initially pur- Annex 6: Main statistical indicators (2002). sued. The setting up by the government of a Reform Monitoring Group in order to ensure Turkey’s alignment with the acquis has pro- the effective implementation of the reforms gressed in most areas but remains at an early and to overcome bureaucratic resistance is en- stage for many chapters. It is most advanced in couraging in this respect. chapters related to the EC-Turkey Customs Union but in this respect Turkey is not fully

NO. 1 / JANUARY 2004 | 7 meeting its obligations. Alignment is also as well as wider international issues. As from more advanced in areas where other interna- 2003 the Commission is supplementing the en- tional obligations exist which are similar to the hanced political dialogue with regular detailed acquis. Further legislative work is required in consultations with the Turkish authorities on all areas, and Turkey should focus on imple- Turkey’s progress in complying with the politi- menting its National Programme for the Adop- cal criteria. This approach will be further devel- tion of the Acquis, in line with the Accession oped in order to ensure a better mutual under- partnership priorities, more consistently across standing of the issues involved. The enhanced all chapters. Also, new legislation should not economic dialogue between the EU and Turkey move away from the acquis. Details on pro- covering issues of macroeconomic performance gress in the different chapters of the acquis can and stability and economic reforms is being be found in the conclusions of the Regular Re- pursued intensively. port on Turkey. The process of legislative scrutiny, carried out In many fields implementation is weak. Ad- in the sub-committees of the Association ministrative capacity in different areas needs Agreement, is being supplemented by TAIEX to be strengthened to ensure that the acquis is seminars and technical meetings or workshops implemented and enforced effectively. In some on specific subjects. cases, administrative reform should entail the establishment of new structures, for example The negotiations for the extension of the EC- in the field of state aid and regional develop- Turkey Customs Union to services, and the mu- ment. Where new regulatory bodies have been tual opening of public procurement markets, are set up, their autonomy should be assured and continuing with a view to their finalisation in they should be provided with sufficient staff 2004. and financial resources. In 2003 Turkey has started to participate in the The full conclusions of the Regular Report on European Environment Agency and the follow- Turkey can be found in Annex 2: Conclusions ing Community programmes: Enterprise and of the Regular Reports on Bulgaria, Romania Entrepreneurship, Gender Equality, Combating and Turkey. Discrimination, Combating Social Exclusion, Incentive Measures in the field of Employment, and the Sixth Framework Programme on Re- 2. Pre-accession strategy for Turkey search. Preparations for participation in a number of other programmes, including full partici- Over the past twelve months the European Un- pation in the educational programmes in 2004, ion has significantly strengthened the pre- are under way. accession strategy for Turkey. The Commission will continue to implement this strategy in its In April 2003 agreement was reached between different areas, particularly in view of the report the European Parliament, Council and Commis- and recommendation that it will present next sion to include Turkey in the pre-accession year on Turkey. heading of the financial perspectives and to provide substantially increased financial assis- A revised Accession Partnership was adopted tance for the period 2004-2006, amounting to by the Council on 19 May 2003. Its purpose is €1 050 million over the three years. Particular to assist the Turkish authorities in their efforts attention will be paid to providing assistance to to meet the accession criteria with particular both government and non-governmental bodies emphasis on the political criteria. It also forms in areas related to the political criteria. the basis for programming pre-accession assistance from Community funds. Overall the impact of Community assistance to Turkey is increasingly positive. As from Octo- The enhanced political dialogue has continued ber 2003 implementation of pre-accession fi- intensively under the Danish, Greek and Italian nancial assistance programmes has been de- Presidencies. Among the items discussed are volved to the Turkish authorities under the the political reforms in Turkey, human rights, “Decentralised Implementation System” (DIS). Cyprus, and the peaceful settlement of disputes, Meanwhile the Commission continues to take

8 | TURKEY IN EUROPE MONITOR responsibility for a large number of on-going and fundamental freedoms in line with Euro- projects. The backlog in commitments of EU pean standards. finance for Turkey has been further reduced in 2003. The Commission will verify whether The Commission will next year assess the pro- Turkey is meeting its obligations under DIS and gress made by Turkey towards meeting the ac- continue to strengthen its Representation in cession criteria as requested by the Copenhagen Turkey to ensure the continued success of its European Council. The Commission will issue financial co-operation programmes. a report and a recommendation before the end of October 2004 on whether Turkey fulfils the CONCLUSIONS AND Copenhagen political criteria. This should allow RECOMMENDATIONS the European Council to decide, at its meeting in December 2004, on the possible opening of Over the past year, by accelerating the pace of accession negotiations with Turkey. reforms, Turkey has made determined efforts and significant progress towards achieving As regards Cyprus the European Council has compliance with the Copenhagen political crite- repeatedly underlined its strong preference for ria and has made considerable progress towards accession by a united Cyprus. The Commission meeting the economic criteria. Turkey has also considers that there are favourable conditions continued progress towards meeting the acquis for the two communities to reach a comprehen- criteria, although much remains to be done in sive settlement of the Cyprus problem before many areas. Many priorities under the political Cyprus’ accession to the EU on 1 May 2004. To criteria in the revised Accession Partnership this end the EU should reiterate its call to all have been addressed. However, further efforts parties concerned, in particular Turkey and the are needed. This concerns in particular the Turkish Cypriot leadership, to resume the talks strengthening of the independence and the func- on the basis of the UN Secretary General’s pro- tioning of the judiciary, the overall framework posal. The absence of a settlement could be- for the exercise of fundamental freedoms (asso- come a serious obstacle to Turkey’s EU aspira- ciation, expression and religion), the further tions. The Thessaloniki European Council alignment of civil-military relations with Euro- stated the Union’s willingness to accommodate pean practice, the situation in the Southeast and the terms of a settlement in line with the princi- cultural rights. Turkey should ensure full and ples on which the EU is founded. The Commis- effective implementation of reforms to ensure sion is ready to assist in finding a speedy solu- that Turkish citizens can enjoy human rights tion.

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TURKISH BUSINESS PERSPECTIVES

Speech by Tuncay Ozilhan (President of • Turkey’s young, well educated and TÜSIAD Jan. 2001-Jan. 2004) trained population provides an opportunity for the EU to deal with “EU Membership is our Society Project” demographic problems;

Tuncay Ozilhan President of TÜSIAD (Jan. • Turkey’s relations with the EU, 2001-Jan. 2004), made a speech at the Euro- with her secular, democratic Muslim pean Academy in Berlin on 9th January on the identity and with her functioning occasion of the “TÜSIAD Bosphorus Prize for market economy, are of particular European Understanding” ceremony which importance in a post-September 11 gathered together the prominent European world; business and political circles. This year’s prize • Turkey offers to the EU the chance was given to Dr. von Kyaw, former Ambassa- of extending its zone of peace from dor and Permanent Representative of Ger- the Balkans, the Aegean Sea and the many to the EU. Black Sea to the Middle East, the Caucasus and Central Asia; Mr. Ozilhan reiterated the support of TÜSIAD to the efforts of the government towards EU • Turkey works hard to reach EU membership, including the democratic reform standards and expects to be treated process undertaken and the commitment to with the same understanding so gen- resolve the Cyprus problem soonest possible in erously extended to Central and a beneficial way to all parties. The main mes- Eastern European countries; sages delivered by Mr. Ozilhan to EU deci- • When it is time to decide on start- sion-makers included: ing accession negotiations with Tur- • Rather than being constrained by key, all the advantages of Turkey’s fears, concerns, details and parame- accession to the EU have to be bal- ters of today that will become mean- anced against the losses that the ex- ingless in ten years time, the per- clusion of Turkey would incur. spective of tomorrow has to adopted in taking the decision to start nego- The full text of the speech can be accessed at tiations with Turkey at the end of the www.tusiad.org/english.nsf year;

• Turkey is far from being a burden TÜSIAD IS A MEMBER OF THE UNION OF to the EU budget with her economic INDUSTRIAL AND EMPLOYERS’ CONFEDERATIONS OF EUROPE (UNICE) dynamism, entrepreneurial popula-

tion and the economic opportunities that is offered by the region where she is situated;

CEPS Turkey in Europe Monitor

No. 2, February 2004

Introductory Note from CEPS

This issue of CEPS Turkey in Europe Monitor This issue of the Monitor also introduces the provides the full text of Recep Tayyıp Er- joint project undertaken by CEPS and Eco- doğan’s speech delivered on 26 January 2004 nomics and Foreign Policy Forum (EFPF), to the Council on Foreign Relations on his Istanbul, entitled “Strategy for EU and Turkey recent visit to the USA. The speech is particu- in the Pre-Accession Period”. The aim of the larly significant for its coverage of Turkish project is to present the major problems and foreign policy and Turkey’s relations with the challenges posed in Turkey’s accession proc- Western World. This speech is followed by an ess in eight selected policy areas (agriculture, extract from the prime minister’s subsequent trade, services and banking, monetary and speech on 30 January 2004 to the Kennedy fiscal policy, energy, justice and home affairs, School of Government, Harvard University, domestic governance and foreign and security which evaluates the impact of the EU and US policy), identify innovative EU policies to spe- on Turkish democracy and Turkey’s contribu- cifically tackle these problems, and to create a tions to democratisation in the Middle East. framework in which these EU policies can complement and further encourage the process These two speeches may be regarded as ‘locus of reform in Turkey, thereby adding to the classicus’ statements of Turkey’s position on momentum of integration. these strategic issues. They may be read alongside the speech of Romano Prodi to the Turkish Grand National Assembly in January 2004 and a key policy document from the Michael Emerson and Senem Aydın European Commission that appeared in the first issue of this Monitor.

SPEECH OF RECEP TAYYİP ERDOĞAN, PRIME MINISTER OF TURKEY, AT THE COUNCIL ON FOREIGN RELATIONS

New York, 26 January 2004

Mr. Chairperson, the realm of interest of the transatlantic com- Distinguished Guests, munity, our foreign policy objectives and vision for the 21st century. It is a great pleasure for me to address this dis- One of the most characteristic features of the tinguished audience at this prominent institu- 21st century in these initial years is the process tion recognized for its substantive contribu- of transformation that is being experienced at tions in the formulation of U.S. foreign policy. the global, regional, and national levels. The I wish on this occasion to share with you, as process of change is almost always accompa- the political leader of a country prepared to nied by uncertainties and makes it difficult for assume a pivotal role in its region as well as in

| 10 NO. 2 / FEBRUARY 2004 | 11 nations to predict what lies ahead. However, ahead on the basis of this trend, that it rose the common interests and shared values that from its past historical experience and the are being cultivated by our alliance with the normative transformation required by the age United States of America over the course of 50 we live in. Turkey's contribution to this proc- years, along with our mutual resolve to secure ess will be facilitated by the approach in our peace, prosperity, and freedom in the world, foreign policy that I will now proceed to out- will be our guide to deliver us through this line. unpredictable period. Throughout the 20th century, Turkish foreign Despite all possible adverse developments on policy has rationally reconciled the Turkish a regional as well as global scale, Turkey's state tradition and Ottoman diplomatic heri- principal objective will not be altered. The tage with the realities of the world. Currently, main objective of Turkish foreign and domes- it is undergoing the process of meeting the tic policy is to provide the Turkish nation with requirements of the 21st century. The princi- the highest political, economic, and social ples of realism and integration with the West standards of our age, and to render, as we pro- inherent in this heritage continue to maintain ceed on our path towards this goal, peace as their importance in our current foreign policy the norm in international relations. Turkey, objectives. with the strength that it derives from historical Realism necessitates a rational analysis of the experience, its human resources, its culture, its process of globalization and interdependence administration's common sense, its democratic which are the prevalent themes of our times. and secular regime, regards this as an attain- We perceive international and regional coop- able objective, and seeks to join forces with eration as a force which, in addition to its eco- countries that share a similar vision. nomic benefits, enables countries and their Mr. Chairman, distinguished guests, the geog- peoples to become better acquainted and to raphy in which Turkey is located is one of establish relations that serve their common great potential. However, it is also a region interests, whereby peace is also served. Turkey where the full benefits of this potential cannot has, in fact, established a cooperation mecha- be reaped due to the instability and conflicts nism with port-linked regions, such as the that prevail. Turkey is therefore compelled to Balkans, the Black Sea Basin, the Caucasus, be vigilant in its foreign policy. It must also Central Asia, and the Middle East. We seek to try to prevent, to the extent possible, the ad- make these regional initiatives increasingly verse ramifications of instability and conflicts more effective in the period ahead. that arise in its region from negatively impact- From a realistic point of view, in addition to ing on its peace, stability, and development. the opportunities that globalization has to of- However, Turkey believes that the notion of fer, it also harbours a dynamic that can lead to geographical determinism--in other words, the new imbalances and inequalities. It would be concept that geography entirely dictates for- misleading to interpret globalization as either a eign policy--is somewhat obsolete in this day positive or a negative process. What is crucial and age. In this sense, it is not possible to de- is to be able to pursue policies from which op- fine the world's geopolitics of the 21st century timal benefits can be created from globaliza- in terms of conventional power politics. One tion for both our own nations and humankind also has to take into consideration such ele- at large. ments as political and social values, interaction In this connection, those who benefit the most between societies, identity, and cultural har- from globalization will surely be open, democ- mony. Turkey does not confine itself in this ratic, and free societies governed by the rule of respect in a strict sense to the framework of law. Regimes, on the other hand, that are national interest alone, but rather pursues a closed to the outside world, that do not appre- proactive foreign policy aimed at contributing ciate the value of the information society, and to regional and global peace and security, and that perceive globalization as a threat, will be encourages as well as activates regional coop- hard- pressed in ensuring the prosperity that eration initiatives. From this perspective, their citizens demand and in preserving the Turkish foreign policy aims at formulating a peace and security that the international com- new collective vision for the period that lies munity desires. Through peaceful foreign pol-

12 | TURKEY IN EUROPE MONITOR icy in favour of cooperation and collaboration humankind. We welcome the point made on that it perceives, Turkey helps the countries in this score by President Bush in his State of the its region to feel secure and encourages them Union Address last week. In this sense, foreign to open up to the world at large and to remain policy in the 21st century, over and above the within the scope of international law in their promotion of national interests, will be one of actions. the avenues for sharing humankind's intellectual development among different societies. Mr. Chairman, distinguished guests, one of the main points of departure of Turkish foreign One of the main obstacles for humanity to live policy is its place and membership within the together in peace and freedom in the 21st cen- structures of the Western World. This is an tury could emanate from the lack of under- expression of the Turkish Republic's historical standing among societies. We should not per- location and of the nation's quest for contem- mit this to happen. We must allow collectiv- porary modernization and democratic devel- ism to foster in a genuine manner that does not opment. Turkey's candidacy to the European raise mutual suspicions among societies. We Union is also the end result of this location. must demonstrate our goodwill with our actions. We must not disregard the global bene- Our advanced integration with Europe, which fits that idealism based on rational realism has we regard as an integral system of values to offer. through our membership in the European Un- ion, will represent far more than merely a ba- Turkey, located in a difficult geography, per- sic partnership. The Muslim identity of the ceives our own security as our No. 1 priority, Turkish population has not prevented it from but we also realize that our security will be interacting intensely with the West in general, threatened if our neighbours are not safe and at and Europe in particular, or from becoming an peace. This is precisely why we believe that effective member of European institutions and our search for security must, above all, be a organizations. In this context, Turkey has al- collective effort. We believe that cooperation ways been a strong advocate of the transatlan- and a determined and realistic stance is the tic partnership. most effective way to combat common threats. The successful conclusion of Turkey's acces- This is an equally valid means to combat such sion process to the European Union will repre- global problems as terrorism and the prolifera- sent the harmonization of a Muslim society tion of weapons of mass destruction, and to with the peoples of Europe on the basis of address poverty, famine, contagious diseases, common, universal, and democratic values. and climate change. The fight itself is far more One of the chief benefits of this harmonization important than the differences in approach that is the positive effect that it will have towards may arise, even among allies, at times in re- the adoption of these values we consider to be spect to the modalities of foreign policy. universal in nature by the countries that sur- As the problems we face are common to us all, round Turkey. We continue to voice our opin- we must elaborate common solutions. In de- ion that the Islamic world needs to address termining the objectives and methods of this these problems in a realistic manner and to fight, we must act on the grounds where the assume responsibility rather than blame others. international community is strong, not where it In this connection, we also place emphasis on is weak. We must develop the means to make such concepts as democratization, human international structures more effective so that rights, the rule of law, good governance, ac- the solutions we find to our common problems countability, transparency, and gender equal- are lasting. ity. The United States, as a superpower, has a rare In order for the achievements of Turkey in opportunity in that regard. The United States, these areas to serve as a source of inspiration as a global power, must use this responsibility for the countries in our periphery, we must well to help the developed world be better un- demonstrate that the West and Europe are in- derstood by the developing one. We stand clusive concepts. We must explain to countries ready to assist in this task in any way that we that question the universality of these values can. that they are indeed the product of harmony and civilizations and the collectivism of all

NO. 2 / FEBRUARY 2004 | 13

The close cooperation and solidarity between The United States of America has the greatest our two countries that spans a half century resources to overcome this misleading percep- constitutes a solid foundation for our future tion on a global scale, with its wealth of common endeavours. Our collaboration with knowledge, its prominent universities, and ad- the United States in pursuit of peace and jus- vanced level in social sciences. In this sense, tice during the Cold War era was effectively American think tanks also have an important continued in the first major conflagration of role to play. the post-Cold War era, namely the Gulf War. We believe that the following can be realized Despite the heavy economic toll of the sanc- in what we see as a realistic scenario, based on tions regime it had to foot, Turkey's crucial what we view as attainable and what we wish support for the international coalition contin- to achieve in terms of what Turkey can ac- ued with Operations Provide Comfort and complish. Northern Watch. In the coming years, Turkey will achieve an We have coordinated our efforts to peacefully exemplary level of success in its efforts to resolve disputes and remove sources of con- strengthen its economy, pursued with a sus- flict that threaten international peace in a wide tainable development approach. In addition to geography. We have worked together from maintaining the economic relations it enjoys Somalia, Bosnia- Herzegovina, and Kosovo to with the West, it will effectively develop its Afghanistan. We have pursued common inter- economic potential with its neighbours in ests to bring peace and stability to the Middle close vicinity. The Turkish government will East, the Balkans, and the Caucasus. And to- set an example for good governance. day we continue our efforts to bring peace and stability to Iraq. We seek the same objectives To this end, it will reinforce the notion of a in consolidating the independence of, and transparent, compassionate, effective, and ac- promoting democracy and stability in, the countable system of government. It will facili- Central Asian republics. tate, through such means as e-government, the creation of a healthy information society. It We have vested interests in the Baku-Tbilisi- will open the gates for government, civil soci- Ceyhan pipeline venture that will tap the vast ety, and private enterprise, yet at the same time oil reserves of the Caspian Basin. The trans- take the necessary measures to protect vulner- portation of this energy resource to world able social groups from the ill effects of glob- markets via Turkey by early 2005 will have alization. important implications for economic development and, consequently, regional stability. Turkey will most likely become a member of the European Union within a reasonable time. Mr. Chairman, distinguished guests, closing The position that Turkey occupies in the wider the gap between the developed and developing sense, at the heart of the Eurasian geography, worlds, in both economic and political terms, will assume greater importance on the East- will be the greatest guarantee of world peace. West and North-South axis in line with the To attain this long-term goal, the first steps to common interests of the whole region. With be taken must include a means to a better un- the help of ongoing projects in the field of en- derstanding of and dialogue between different ergy, which is of vital importance for its de- civilizations. For Muslim countries to be better velopment strategies, Turkey will not only be understood in the West, a more objective ap- able to meet the ever- increasing domestic de- proach towards Islam should be adopted. It mands, but will also become a hub in the should be clearly seen that those who commit transportation of the Middle East and Caspian violence in the name of Islam do not represent energy resources to international markets. In this faith in any way. The allegation that there other words, with the investments made in the is an antagonism between the Islamic world energy sector, Turkey will act with a strategic and the West emanates from a misleading re- vision that not only prepares for, but shapes ductionism. There are people on both sides the future. that are deceived by this fallacy. Intellectuals, Turkey, being aware of the importance of re- politicians, and public opinion-makers in soci- gional cooperation and interdependence in all ety must assume responsibility in preventing fields, will play a central role in the security such misunderstandings.

14 | TURKEY IN EUROPE MONITOR field as well. To this end, it will contribute to and military power, but with its capability to the defence and security policies of the Euro- contribute to universal values and to facilitate pean Union on one hand, and assist the main- the interaction of these values among different tenance of transatlantic links on a realistic and regions. In this regard, Turkey will be a reli- sound basis on the other. able power for the maintenance of security, a partner for economic development, and an ally As I am nearing the end of my speech, as a in overcoming existing instabilities in its vi- stable country with a successful development cinity, primarily in the Middle East. Thus, model, its place within the Western world, its Turkey will become a source of inspiration for rich historical heritage and identity, Turkey the countries in its region in taking steps will become a symbol of harmony of cultures which will prevent them from becoming failed and civilizations in the 21st century. Turkey states. will achieve this not only through its economic

SPEECH OF RECEP TAYYIP ERDOĞAN, PRIME MINISTER OF TURKEY, AT HARVARD UNIVERSITY, KENNEDY SCHOOL OF GOVERNMENT

Massachusetts, 30 January 2004 transformation process that has been premised … on the principle that “sovereignty belongs to the Dear Members of the Faculty and Students, people”, a pluralist democracy has been established step by step since 1946. At the core of Distinguished Guests, this process lies, of course, the determined disposition of the Turkish people towards moder- If the countries of the Middle East perceive the nity. This vocation facilitated Turkey’s choice advice to democratise and the emphasis on re- of taking part in the Free World led by the US gional processes as ill-intentioned foreign inter- after World War II. vention, they would be mistaken. For the development of some of the most advanced democ- Once that choice had been made, our member- racies of today third countries and international ship to NATO and the process of our accession institutions have made essential contributions. to the EU have been elements of encourage- In fact, the democratic community is constantly ment and confidence on our path to modern monitoring democratic standards. One of the civilization and government. Not having ex- positive sides of globalisation has been the pro- perienced the particular democratisation history tection accorded by the democratic community of Western Europe which straddles centuries to the democratic ideal. and in numerous wars, Turkey has found the opportunity to develop her democracy in a rela- As I consider Turkey’s own democratization tively smooth transition process thanks to process I clearly see the benefits of our interac- NATO and the EU. tion with the outside world, notably with the US and the EU. Even if we take for granted Robert As we stand today, Turkey has successfully Kagan’s thesis that “Europeans come from travelled great distances in her efforts to Mars and Americans from Venus” we should achieve most advanced democratic standards. nonetheless underscore that both are part of the My Government has also taken very significant same Solar system. Europe and the US are part steps to realize this vocation of the Turkish of the same value system. This community of people, and carried the Turkish democracy to shared values stands tall not on the foundations highest norms through radical and historic re- of any religion. It’s built on adherence to de- forms. We have instituted not a self-styled democratic values. mocracy but a universal understanding of democracy. The Turkish people have entered a historic transformation process with the founder of Re- public, Kemal Atatürk. In the course of this Dear Members of the Faculty and Students,

NO. 2 / FEBRUARY 2004 | 15

Our region and the Muslim world is closely and Distinguished Guests, carefully observing Turkey’s membership process to the EU. Our membership to the EU is Turkey is ready to do its fair share to promote desired by all our neighbours. Both the Syrian democratization in the Middle East and to fa- President whom we have hosted recently and cilitate such a momentous transformation. Tur- the new President of Georgia have indicated key can make valuable contributions to that that thanks to Turkey they expect to become effect. neighbours of Europe. It is necessary to see that Foremost, Turkey is an established democracy if accession negotiations do not start despite the at the intersection of Europe and the Middle political will we have shown and all the far East. In the development of her democracy reaching reforms we have realized, the negative Turkey has drawn positive strength from Euro- message would not be lost on others. Our de- pean and Euro-Atlantic processes. Currently, mocracy and modernity as well as the network she is making historic strides to establish an of external relations I have outlined have been environment of cooperation in her neighbour- inevitably making Turkey an example, a model hood. These steps are conducive to the birth of as well as a partner. a new culture of positive relations in our region based on cooperation and interdependence. As Turkey proceeds in the direction of mem- Turkey has a valuable partnership with the bership to the EU, also the modern democratic United States built on strong ties of alliance and values which she represents create greater at- friendship as well as harmony of a strategic traction in the Middle East. This attraction will world view. With the EU, more than forging enable the Euro-Atlantic community to act as a cooperation, Turkey is on the path of integra- catalyst for positive change in peace and inter- tion. Decision by the EU to launch accession action with the outside world. The web of co- talks with Turkey will be the victory of the operative relationships that Turkey has woven message that democratization is the starting helps harmonize the strategic interests of the point of the project of harmony of civilizations. peoples of the region, the US and EU.

STRATEGY FOR THE EU AND TURKEY IN THE PRE-ACCESSION PERIOD

A joint project of the Centre for European Policy Studies (CEPS), Brussels and Economics and Foreign Policy Forum (EFPF), Istanbul

CEPS is undertaking a joint project with the thus focus on areas of cooperation and possi- Economics and Foreign Policy Forum, entitled ble integration that would be developed in par- “Strategy for the EU and Turkey in the Pre- allel and complementary to the accession Accession Period” which is operational from process. The general supervision and coordi- December 2003 until December 2004. The aim nation of the project is provided by Daniel of the project is to identify the major problems Gros and Michael Emerson (CEPS), and by and challenges posed to Turkey’s accession Kemal Derviş and Sinan Ülgen (EFPF). process in eight selected policy areas (agricul- Part of the reticence that is widespread in the ture, trade, services and banking, monetary EU to analyse the specific consequences of and fiscal policy, energy, justice and home Turkey’s membership stems from the fact that affairs, domestic governance and foreign and it is usually assumed that this would be ‘yet security policy), identify innovative EU poli- another enlargement’, involving essentially the cies to specifically tackle these problems and same problems as the current one, only on an create a framework in which these EU policies even larger scale. The basis for this apprehen- can complement and further encourage the sion is that Turkey is, like many of the Central process of reform in Turkey, thereby adding to and East European countries (CEECs), a rela- the momentum of integration. The project will tively poor country with a large agricultural

16 | TURKEY IN EUROPE MONITOR sector and deep seated problems of govern- CEECs, the EU reduced its trade barriers ance. However, we see a number of important asymmetrically, but retained contingent pro- policy areas in which the issues raised by the tection (although anti-dumping facilities were accession of Turkey will be quite different never invoked). By contrast Turkey is already from those experienced with the CEECs, rein a customs union with the EU, and hence quiring a different approach on the part of the already much more integrated with the EU EU in preparing Turkey for full membership. than the CEECs on the eve of their accession. Hence, the standard EU ‘strategy’ during pre- Hence trade liberalization is not an issue. accession, where the EU helps candidates in However, the operation of the customs union the task of adopting the acquis with modest is far from perfect. The issues to be dealt with financial aid and generous doses of technical includes the extension of validity of the pref- assistance, but without involving the candi- erential trade agreements that EU negotiates dates in current EU policy initiatives, is likely with various countries to Turkey, the distribu- to be insufficient in the case of Turkey. Turkey tion of customs revenues and the treatment of does not have to overcome a legacy of central re-exports and triangular trade with, in particu- planning. The key challenge in this case is lar, the Mediterranean. rather to overcome the potential points of fric- tion in a pro-active manner by starting con- 3. Services, and banking in particular, by crete forms of cooperation already during the Daniel Gros (CEPS) and Murat Üçer (Koç pre-accession phase. This needs to be worked University-EFPF): Turkey here presents some out by the EU and Turkey together within the of the problems of the CEECs in the early framework of various policy areas, taking into 1990s with an inefficient banking system that account the different challenges and opportu- was for some time used as a conduit for hidden nities posed by Turkey compared to those (and sometimes not so hidden) subsidies. The brought by the CEECs. recent currency crisis in Turkey might have served (as in some CEECs) as a catharsis, but The eight policy areas that will be covered in numerous problems in implementing and en- the project will be structured as follows: forcing a new regime of modern banking supervision remain. Moreover, Turkey has so 1. Agriculture by Jo Swinnen (CEPS) and Erol far not followed the CEECs in opening radi- Hasan Çakmak (Middle East Technical Uni- cally its banking system to foreign take-overs. versity-EFPF): Many CEECs specialize in In addition the weight of the state banks in the products (wheat, meat, milk) that are most banking system and macroeconomic instability heavily subsidized by the CAP. Hence their remain as important bottlenecks in the devel- participation is expected to be very costly and opment of the financial system in general and even until now the EU market is not open for the banking system in particular. these products (and the EU runs a surplus in agricultural goods with the CEECs). By con- 5. Monetary and fiscal policy by Marco Air- trast, Turkey specializes in products that are audo (LUISS fellow at CEPS), Daniel Gros not subsidized by the CAP (fresh fruits, nuts, (CEPS) and Kemal Derviş (EFPF): Turkey is etc.) and face much lower barriers for its ex- a case apart from any of the CEECs in having ports to the EC (3% on nuts, and 0% on dried very large unresolved problems of public fi- sultanas, figs and apricots). As a consequence nance and monetary instability, as witnessed in Turkey has a significant trade surplus with the recurrent financial crises of the last decade. In EU in agriculture (exports Euro 1,953 million, particular Turkey’s very high public debt-to- imports Euro 707 million in 1998-99). It is GDP ratio and poor credibility in financial thus likely that Turkey’s accession to the CAP markets makes for a huge debt service burden would involve quite different issues, although on the budget. Moreover intermittent financial nonetheless formidable ones, since Turkey has crises make for huge swings in the effective more farmers than all of the EU-15 combined. interest rate on Turkish borrowing, such that the interest burden has at times been in the 2. Trade by Yiannis Zahariadis (Department range of 15-20% of GDP. However the Turk- for International Development, UK), David ish situation has features in common with Italy Kernohan (CEPS) and Sinan Ülgen (EFPF) : before the Euro. The almost miraculous, and at During the negotiation process with the any event extremely important reduction in

NO. 2 / FEBRUARY 2004 | 17

Italian interest burden as the credibility of its completely different group of countries (Syria, accession to the euro zone advanced, is an ex- Iraq, Iran and the Caucasus), thus posing dif- perience worth recalling when thinking about ferent policy challenges. Turkey’s monetary future with the EU. How- ever this hypothesis of early association or 7. Domestic governance by Senem Aydın accession to the euro zone would mean much (CEPS) and Fuat Keyman (Koç University- new thinking at the EU/ECB end, and an open- EFPF): Turkey has made important progress ing of the banking system to foreign owner- towards the fulfilment of the political aspects ship. of the Copenhagen criteria. There are nonetheless areas where further progress is still needed 5. Energy by John Roberts (Platts energy especially in terms of the implementation of group), Christian Egenhofer (CEPS) and these reforms. The issues will include the Necdet Pamir (EFPF): Turkey is a transit cor- ways in which the EU can help in this respect, ridor increasingly for Russian, Caspian and with programs and instruments that can be Iranian oil and /or gas. Current investments are made available to Turkey to accelerate this being made in pipelines and networks that add process of adjustment. up to a matter of strategic importance for the EU’s security of energy supply: the Blue 8. Foreign and security policy by Michael Em- Stream gas pipeline from Russia, the Baku- erson and Nathalie Tocci (CEPS), Can Bu- Ceyhan oil pipeline, a possible Baku-Erzurum haralı (EFPF): The Copenhagen European gas pipeline, the gas pipeline connecting with Council concluded the two year dispute con- Iran and the gas network linkage now being cerning Turkey’s participation in the EU’s se- constructed between Turkey and Greece. The curity and defence policy (ESDP). The agree- EU has a strategic interest in diversity of en- ment ensured that Cyprus and Malta as coun- ergy supplies, and how Turkey manages the tries that were not included in NATO’s Part- above and other options will be a significant nership for Peace would not be included as factor. Therefore an EU-Turkish energy dia- possible locations of ESDP activities and op- logue could be valuable, leading to EU and erations. However, while an agreement was European Investment Bank (EIB) contribu- reached it remains unclear what Turkey’s sub- tions to the financing of important projects. stantive input in ESDP will be. More specifi- The electricity sector will be examined, in cally, this project would assess the possible view of the potential from growing Turkish cooperation between Turkey and the EU in demand for imports from neighbours, espe- specific regions in the Wider Europe and its cially the Balkans. neighbourhood where Turkey has special interests: namely the Caucasus, the Middle East 6. Justice and home affairs by Joanna Apap and Central Asia. (CEPS) and Kemal Kirişçi (Boğaziçi Univer- sity-EFPF): Accession of the CEECs relieves In each of these policy fields, joint or separate some member countries (essentially Germany working papers by CEPS and EFPF authors and Austria) from direct responsibility for con- will be prepared. The output of the project will trolling the EU’s Eastern borders. The length include a general report and a short paperback of the EU’s external border does not change a book publication by CEPS, a number of work- lot. The main issue in this area with the ing papers on sectoral topics to be published CEECs is that the latter would like to keep electronically and a collection of the most somewhat open borders with their Eastern relevant contributions in an edited book to be neighbours. By contrast, in the case of Turkey published by an academic publisher. The re- there is little relief on the Eastern border of sults will also be disseminated via two final (present and future) EU members, the length conferences in September and October which of the external border of the EU increases will respectively be held in Brussels and Istan- dramatically and this border will be with a bul.

18 | TURKEY IN EUROPE MONITOR

TURKISH BUSINESS PERSPECTIVES similar inclination is expected to occur in the by upcoming local elections. Enhancing this trend through expanding expenditures or other TÜSIAD – TURKISH INDUSTRY & populist policies creates the most important BUSINESS ASSOCIATION risk for the maintenance of fiscal discipline.

www.tusiad.org As for the EU membership perspective, the government has demonstrated significant ef- TURKISH ECONOMY 2004: MORE forts, especially in the field of political re- REFORM, MORE GROWTH forms, with a view for the opening of accession negotiations with the EU. We expect the gov- While the external risks for Turkish economy ernment’s will to complete the remaining leg- gradually decrease, the decisiveness of the islative work to persist. government in implementing the economic program will determine the course of Turkish In our macroeconomic scenario, the decision economy in 2004. of the government will be in favour of permanent economic stability, rather than populist Three interrelated factors will be crucial for tendencies resulting in an increase in wages economic prospects in 2004. These are: and pensions. Another issue that concerns the • the success of the government in main- implementation of the economic program, taining political stability; namely the remaining structural reforms due in 2004, seems to be less challenging com- • the implementation of the IMF sup- pared to the previous agenda. However, the ported economic program and; cost of inaction regarding the structural re- • EU membership perspectives. forms would not only be economic but also political. The first and the second factors seem to be less problematic as the government has so far ab- www.tusiad.org/english.nsf stained from creating tensions in internal politics and contributed to political stability in the country. With respect to the implementation of TÜSIAD IS A MEMBER OF THE UNION OF INDUSTRIAL AND EMPLOYERS’ CONFEDERATIONS the economic program, the forthcoming local OF EUROPE (UNICE) elections will be a significant test. Recalling the rapid increases in spending by coalition parties prior to the last national elections, a

CEPS Turkey in Europe Monitor

No. 3, March 2004

Introductory note from CEPS tailed chronology of the UN sponsored negotiations in the last three months, starting with This issue of CEPS Turkey in Europe Monitor the Turkish Prime Minister Erdoğan’s idea to focuses on the settlement of the Cyprus con- mandate Kofi Annan ‘to fill in the blanks’, and flict, which has reached the most decisive turn culminating with the presentation on 31st in its history with the final (fifth) Annan Plan March of the 5th and final version of the Annan and the upcoming referenda scheduled to take Plan, now to be submitted to the referendum. place on 24 April. The monitor provides first a short political assessment of the choices be- Michael Emerson and Senem Aydın fore the referendum. Second, it contains a de-

The Cyprus Endgame The yes-yes outcome is the only one that EU Michael Emerson has wanted to discuss. There is no Plan B, they say. A no-no outcome, or a no in the north and So Kofi Annan has ‘filled in the blanks’, and yes in the south (no-yes) would also be rela- the final revised Annan Plan for re-unifying tively predictable in their consequences. In the island will be put to referenda on both both cases Greek Cyprus would accede alone, sides of the island on 24 April, exactly one the status quo would continue for the north, week before EU accession day on 1 May. and there would be some cloud over Ankara’s priority to get a positive decision in December Whatever now the outcome, the Annan plan for the opening of accession negotiations for for Cyprus will go down in the annals of con- Turkey itself. The cloud would be darkest in flict resolution as an outstanding performance the event of a no-yes outcome, but this sce- by the UN mediation team. This has combined nario seems the least probable. the respected role of Kofi Annan himself, complementing the painstaking professional The principal parties are now surely consider- work of Alvaro de Soto, his Special Represen- ing the implications of a yes-no outcome, and tative. While the EU itself could not be a neu- how to campaign in the next three weeks. tral mediator with Greece as member state, the Prime Ministers Erdoğan for Turkey and Talat EU enlargement dynamics were crucial in de- for Northern Cyprus have already effectively blocking the frozen conflict, yet also in signal- signalled that they campaign for a yes. Presi- ling confusing and contradictory incentives. dent Denktas is campaigning for a no, but his However, the endgame now reveals an unex- credibility as actor in the drama has been go- pected scenario for the referenda results: yes in ing down fast. His recent remarks, mentioning the Turkish north and no in the Greek south the words Verheugen and Nazi in the same (yes-no). At least that is what the opinion polls sentence, have relegated him to the theatre of have been saying in recent days and weeks. the absurd in European political circles. This presents a radically different set of advan- The yes-no scenario now presents an unex- tages and risks for the two principal parties. pected challenge for the Greek Cypriot leader-

| 19 20 | TURKEY IN EUROPE MONITOR ship. Up until recently it had been a relatively stage some kind of informal association ar- credible discourse to blame the difficulties on rangement with the EU for this non-sovereign the Denktas problem. But now Denktas is vir- territory might be devised. But in the mean- tually marginalized, and the Erdoğan-Talat time there would have been no return of land partnership is making a highly credible push to to the Greek community, nor return of dis- be perceived as the positive party. For exam- placed per-sons to their former homes. What ple it was Erdoğan’s admirable initiative to then for Turkey? The politics of the EU’s De- mandate Kofi Annan to ‘fill in the blanks’. cember decision are still highly uncertain, but at least in this scenario Turkey would be re- By contrast President Papadopoulos for his leased from blame for not trying hard enough part has been equivocal. He accepted giving to get a solution over Cyprus. For Denktas it the mandate to Kofi Annan, but has left it am- might even become the dream scenario (with biguous whether he would campaign for a yes no credit to him), as Turkish Cyprus would not vote in the referendum. Returning from the cede any land or property, yet gain in interna- talks in Switzerland on 1 April he declared tional goodwill. For Greek Cypriots it would “unfortunately our effort was not successful”, become closer to a night-mare, losing any arguing that too many of his concerns had not hope of regaining land and property, or with- been met. European public opinion appreciates drawal of Turkish troops, and entering into the well that the Greek and Turkish Cypriot de- EU under a cloud at the same time. Finally, mands have naturally been contradictory. Who what conclusions might be drawn by the two gets the benefit of the doubt? At this stage parties as they define their referendum cam- European leaders are unlikely to deviate from paign strategies? For the Turkish Cypriot and the judgment made by Kofi Annan. He who Turkish sides the answer seems self-evident: challenges the Anna Plan loses. On 1 April to campaign even more clearly and strongly Papadopoulos still reserved his position on the for a yes outcome, since if the Greeks Cypriots referendum, promising only to set this out “in vote no they will still have won political a few days”. goodwill, to be translated into some-thing con- What if it is a yes-no outcome? The Greek crete later. For the Greek Cypriots and Greece Cypriots would still get accession on 1 May, itself, there must be now a serious assessment but under a cloud, perceived as having become of the risks for them of a yes-no outcome. the unreasonable party. The precise conse- Maybe the Greek Cypriot and Greek leader- quences of this cannot be forecast, but the least ships will develop an increasingly positive that can be said is that when complex bargain- campaign fast, maybe to rescue still a yes-yes ing develops as usual in the EU Councils over vote for what the rest of Europe regards as a a mass of issues, the Greek Cypriot positions win-win solution. would indeed have a cloud over them for some time to come. What then for Northern Cyprus? Most of the The Cyprus Chronicle EU would probably want to do something Senem Aydın friendly to help them, if they vote yes. The Cankaya Meeting, 8 December 2003: An- most natural development would be to find kara made its first move towards the re- way to allow northern Cyprus to export. launching of negotiations over Cyprus at a Northern Cyprus might unilaterally align itself summit meeting at Cankaya (the Presidency’s on elements of EU law, for example for tech- residence), attended by Prime Minister Recep nical standards and certification of goods. The Tayyıp Erdoğan, Minister of Foreign Affairs Republic of Cyprus as member state might try Abdullah Gul, the Chief of Staff and top-level to block any concessions, and there would be civilian and military representatives. The complicated legal discussions what decision- summit conclusions stated that ‘Turkey will making rules would apply (simple decision of continue to contribute to the negotiation proc- the Commission, or qualified majority in the ess of the UN, in close cooperation with Presi- Council, or unanimity). This would not be a dent Denktas and the new government’. pleasant dossier for the new EU-25 to have to confront. In the medium term Northern Cyprus Elections in Northern Cyprus, 14 Decem- could not be just left to rot away. At some ber: These parliamentary elections were the

NO. 3 / MARCH 2004 | 21 first major turning point in Cyprus itself, Greek Cypriots to support the re-launching of where the opposition parties (Republican negotiations. Erdoğan also intensified his con- Party-CTP led by Mehmet Ali Talat, and tacts with the UN Secretary General. Peace and Democracy Movement-BDH led by Cyprus summit in Ankara, 4 February: On Mustafa Akinci) together gained the same Erdoğan’s return from the US, a Cyprus sum- number of seats as the two parties on the na- mit was convened with Rauf Denktas, Mehmet tionalist side (National Unity Party-UBP led Ali Talat (now Turkish Cypriot Prime Minis- by the former Prime Minister Derviş Eroglu, ter), Serdar Denktas (now Turkish Cypriot and Democrat Party-DP led by Serdar Denk- Deputy Prime Minister) and Abdullah Gul. tas). The outcome was a coalition government The summit concluded that ‘Turkey and formed on 11 January 2004 by the pro-Annan KKTC (Turkish Cypriot State) affirm their Plan CTP and the more sceptical DP. As it was aim to reach a just and sustainable settlement a very fragile coalition agreement, the policy on the island and will undertake the necessary of the new government on the Cyprus question measures to support the efforts of the UN Sec- was going inevitably to be highly sensitive to retary General’. Ankara’s position, which had already shown signs of movement. The elections were fol- Rauf Denktas, Papadopoulos and Annan lowed by a letter from George Bush to the meet in New York, 10 February: As a result Greek and Turkish prime ministers, urging of these developments, Annan invited Denktas them to take the necessary steps for a solution and Papadopoulos to New York. The Turkish on the island. However the letter created re- government exerted considerable pressure on sentment in Cyprus, particularly among the the reluctant Rauf Denktas to go to New York. Greek Cypriots. He eventually accepted to attend the talks in New York. Initially both Cypriot leaderships National Security Council, 23 January rejected Annan’s proposal to ‘fill in the 2004: After the elections, the National Secu- blanks’ in the case of a disagreement. Annan rity Council (NSC) of Turkey convened to dis- convened another meeting the next day at cuss Cyprus. The declaration released at the which he expected suggestions from the par- end of the meeting stated that ‘Turkey contin- ties. On 11 February, the Turkish side intro- ues to support the initiatives of the UN Secre- duced a surprise time-table, which aimed to tary General and restates its political will in facilitate an agreement before the EU acces- reaching a solution on the island through nego- sion day on 1 May. The Turkish proposal en- tiations while taking the Annan Plan as a point visioned a three-step process, whereby: of reference’. • First the two sides attempt to reach an Erdoğan meets Annan in Davos, 24 Janu- agreement between themselves. ary: Following the NSC meeting, Prime Min- ister Erdoğan met UN Secretary General Kofi • Second, in the event of failure, Turkey and Annan in Davos, and went a step further than Greece would join in the negotiations. the position emerging from the NSC. He • Third, and again in the event of failure to called for the re-launch of negotiations on the reach an agreement, the Plan would be basis of the Annan Plan, and, even more im- completed by the Secretary General, put to portantly, accepted that the Secretary General separate referenda on both sides of the could ‘fill in the blanks’ if the parties them- green line, which would then need to be selves failed to mutually agree on changes in ratified by the parliaments of Greece and the Plan. He also asked Annan to appoint an Turkey. impartial mediator and prepare a shorter text on the basis of which the negotiations would This proposal was welcomed warmly by An- be conducted. Annan was not receptive to ei- nan. The Greek Cypriots asked for the inclu- ther of these latter ideas, but stated that he was sion of the EU in negotiations, but this propo- encouraged by the shift in Turkey’s attitude. sition was rejected by the Commission itself. An agreement was finally reached on the Erdoğan’s visit to the US, 25 to 31 January: Turkish proposal, and negotiations were re- During this visit Erdoğan reiterated his state- launched on 19 February. ments in Davos. The State Department subsequently increased pressure on Greece and Proposals and major issues: During the en- suing negotiation phase, both sides submitted

22 | TURKEY IN EUROPE MONITOR proposals for changes to be made to the Annan • (Or) voting rights based on ethnicity that Plan, which were refused by the opposite par- would prevent Greek Cypriot residents in ties. Northern Cyprus to vote for the Turkish Greek Cypriot proposals included: Cypriot constituent state and represented in the Senate. Harmonisation of the founding Constitution • • A reduction in the Annan Plan’s upper limit with the EU acquis and international law. of 10% in the land ownership of Greek This entailed eliminating the restrictions on Cypriots in the North. the freedoms of settlement and property acquisitions included in the Plan. • Continued military presence by Turkey, and special relations with Turkey. • Increase in the number of members of the Presidential Council from 6 to 9 (4 Greek • Rehabilitation provisions for those dis- Cypriots and 2 Turkish Cypriots to be in- placed as a result of territorial readjust- creased to 6 Greek Cypriots and 3 Turkish ments (regarding homes and employment). Cypriots) Greek Cypriots declared that they reject all the • Increase in the Presidency term. (The ear- Turkish proposals a couple of days after they lier versions of the Annan Plan provides for were submitted. The Turkish Cypriots also a ten-month rotation between the President rejected most of the Greek Cypriot proposals and the Vice-President). after they were discussed in the negotiations. • The referendum to take place after the rati- The derogations question: One of the most fication of the agreement in the Turkish important issues for the Turkish side concerns Parliament (which would be against the the ‘derogations to the EU acquis’. The Annan provisions of the Turkish Constitution, as Plan introduces important derogations to the an incomplete agreement cannot be brought acquis in its Annex V, which mostly safeguard to ratification before the Parliament). the interests of Turkish Cypriots. The initial • Finalisation of all common state laws be- version of the Plan would restrict the right of fore the end of negotiations. return if the properties of displaced persons were occupied by other displaced persons or • Increase in the amount of land to be re- had been significantly improved, or if their turned. return would result in their community repre- • Immediate UN control over the land to be senting over 20% of the population of that vil- returned by the Turkish Cypriots. lage and over 10% of the residencies and land ownership of that constituent state. • An increase in the proportion of Turkish immigrants in northern Cyprus to return to In terms of the ‘three freedoms’, while the Turkey. freedom of movement would be immediately liberalized, there would be restrictions to the Turkish Cypriots proposals include: freedoms of settlement and property acquisi- • The Swiss model regarding the status and tion, which would be phased over time. Ac- equality of both sides. cording to the initial plan, after an initial mora- • The Belgian model with respect to Cyprus’ torium period (of six years), there would be relations with the EU. 0% of Greek Cypriots living in the north, (except for those over 65 and residents of 4 vil- • Establishment of a commission responsible lages in Karpaz, who could return after two for the compensation of Turkish Cypriots years). In years 7-10 this figure would rise to for the incidents of 1963-1974. 7%, in years 10-14 to 14%, and in years 14-21 • Limitation of Greek influence on the is- Greek Cypriots would not exceed 21% of the land after Cyprus’ accession to the EU. population of northern Cyprus. After 21 years the parties would review whether these dero- Further restrictions on the proportion of • gations were still necessary. Greek Cypriots allowed to settle in the North at the end of a transitional period of The initial Plan also restricted the rights of 15 years. Greek (or Turkish) nationals to reside in Cy- prus, if their numbers reached 10% of the Greek Cypriot (or Turkish Cypriot) constituent

NO. 3 / MARCH 2004 | 23 state. In addition, the Turkish Cypriot con- De Soto paper, 16 March: The ‘give and stituent state could take temporary economic take’ part of negotiations was scheduled to ‘safeguard measures’ during the first three start on 12 March. Due to the substantial dis- years of EU membership, if EU laws threat- agreements between the two sides, this could ened the economic development of northern only start on 17 March on the basis of a paper Cyprus. The figures regarding the limits to the submitted by the UN Special Representative right of return, restrictions on property owner- Alvaro de Soto the day before. The two sides ship in the North and limitations on the rights could only negotiate on the points included in of Greek (Turkish) nationals to reside in Cy- this paper. prus were revised further with the 4th and 5th De Soto’s paper included the following issues Annan Plans, which are described in further brought forward by the Turkish Cypriots: detail below. • Turkish/Greek voting rights based on eth- The Accession Treaty already been signed by nicity or the refusal of the right to vote to the Republic of Cyprus, and later approved in Greek Cypriots residing in Northern Cy- EU member state parliaments, states only prus to protect the 24/24 balance in the loosely in Protocol 10 that, in the event of an Senate. agreement, account would be taken of the terms of a settlement. The Turkish and Turkish • Redrawing the borders separating the two Cypriot sides were concerned that unless the sides to make them straighter, so to avoid specific provisions of the Plan regarding tem- Greek Cypriot settlements cutting through porary and permanent restrictions would be the Turkish Cypriot lands. included in EU primary law (i.e., through an • Reduction of the ratio of Greek Cypriots to amendment of the Treaty of Accession), the return to Northern Cyprus (which was fore- provisions of the Plan safeguarding Turkish seen to reach 21% in the third version of Cypriots could be challenged in the European the Plan). Court of Justice and could well be denied. The • Continued Turkish military presence. Greek Cypriots had already displayed inten- tions to erode the safeguards to the Turkish • Inclusion of the agreement as EU primary Cypriots by emphasising that they would con- law to resolve the problem of derogations. duct the negotiations within the framework of • A requirement to provide jobs and housing the “Annan Plan and the EU acquis”. for the Turkish Cypriots who will be dis- On 13 February, Annan declared that the EU placed after the agreement. had committed itself to align the agreement Greek Cypriot demands included in the De with EU acquis. This was followed by the Soto paper were: work of a commission composed of EU legal experts, which decided that approval of the • Ratification of the agreement by the Turk- agreement at the IGC would be sufficient and ish Parliament before the referendum. that there would be no need for Parliamentary • Increase in the number of members of the ratification. A meeting of Turkish legal experts Presidency Council. with EU officials also failed to bring a solution • Greater territorial readjustments. to the problem. Subsequently, Erdoğan sent a letter to Kofi Annan on 15 March, requesting • The territorial readjustments in the shortest him to intensify his efforts to resolve this is- time possible and the immediate control of sue. (Although it would be impossible for an UN over these lands. agreement to be approved by all EU member • Specification of the exact number of Turk- state parliaments before 1 May, one could ar- ish Cypriot citizens that migrated from gue that if the Commission were to be man- Turkey and those with residence permits as dated to propose an amendment of the Treaty well as a reduction in their numbers. of Accession, that could then be sent for par- • Specification of the federal ministries and liamentary ratification thereafter, taking for the introduction of a system where the dep- example up to 24 months after which the uty minister needs to be from the opposite agreement becomes part of EU primary law, community and visa versa. which could be sufficient to ease Turkish Cyp- riot concerns).

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The Greek Cypriots reacted to the De Soto • Land: The Plan did not introduce any paper, claiming that it placed too much em- changes to the amount of land to be re- phasis on the Turkish demands. turned to the Greek Cypriots. Approxi- The Four meet at Burgenstock, Switzer- mately 7% of land in the North (65 vil- land: Negotiations between Greek and Turk- lages) were to be returned to the Greek ish Cypriots continued on the basis of the De Cypriots. However mechanisms and phases Soto document, but the two sides have failed of territorial readjustments were further to reach an agreement. It became evident that clarified. Land would be returned in 6 in accordance with the three stage-plan, Tur- phases over a 42 month period under the key and Greece were going to be included in interim administration of Turkish Cypriots the negotiations from 24 March onwards. In and the supervision of UN. the meanwhile, on 17 March, Rauf Denktas • Presidential Council: The members of the declared that he would not attend the Switzer- Presidential Council were increased from 6 land four-party talks. He stated that attending to 9 to improve functionality. 3 of the the talks would mean giving false hopes to his members will not have voting rights while people as he expected no progress in negotia- the other 6 will comprise 4 Greek Cypriot tions. Turkish Cypriots were to be represented nationals and 2 Turkish Cypriot nationals. by Mehmet Ali Talat and Serdar Denktas. • Presidential Terms: The President and the The meeting of the Four did not proceed as Vice-President of the Council shall rotate planned. Talks between the Turkish Foreign every twenty months instead of the ten Minister Abdullah Gul, the Greek Foreign months envisaged initially. The first Presi- Minister Petros Molviyatis, the Turkish Cypri- dent in each term shall be the member hail- ots and the Greek Cypriots could only start ing from the more populous constituent with a dinner on 27 March. In the meantime, state (Greek Cypriot state). meetings were held between EU officials and Turkish representatives on resolving the prob- • Federal Legislation: Federal laws were lem of derogations. However the EU proposal further specified and attached to the Foun- to accept the plan as an ‘act of adaptation’ ap- dation Agreement. proved by the Council was refused by the • Return of Affected Property: The mecha- Turkish officials on the grounds that this failed nisms for the return of affected properties, to place the Annan Plan in EU primary law. an issue with a large impact on the Greek The Turkish side insisted that this should also Cypriots, have been clarified further with be ratified by EU member state parliaments. the fourth version of the Plan. Any citizen Erdoğan made a statement hinting that the with a claim to affected property has a right failure to make the plan a part of EU primary to reinstatement or compensation, except law could lead the Turkish side to withdraw those that are occupied by other displaced from the commitment to submit the Plan to persons (in which case the two properties referenda. may be exchanged), and those where sig- Annan presents the 4th Plan, 29 March: nificant improvements have been made. Erdoğan and Karamanlis arrived at Burgen- • Limits to Greek and Turkish Nationals: stock on 29 March and Annan has presented Until Turkey’s accession to the EU, Cyprus the amended plan to the four parties, instead of may limit the right of Turkish (or Greek) waiting for them to reach an agreement by 31 nationals to reside in Cyprus if their num- March. In a press conference, De Soto stated ber has reached 5% of the number of resi- that the Plan addressed Turkish Cypriot con- dent Cypriots citizens holding Turkish (or cerns regarding freedom of movement and Greek) Cypriot internal constituent state settlement, returned properties and the voting citizenship status. Thus, the 10% upper for the Senate, whereas it incorporated Greek limit regarding the settlement rights of the Cypriot concerns with respect to efficiency Greek (or Turkish) nationals in the initial and applicability of the provisions of the plan. plan was reduced. More precisely, in response to Greek Cypriot • Shorter Transition Period: General elec- demands, the 4th Plan incorporated the follow- tions at constituent, federal and European ing provisions:

NO. 3 / MARCH 2004 | 25

Union level would be held on 13 June, after draw any proceedings currently before it which the constituent state and federal gov- concerning affected property. ernments shall operate regularly. • Restrictions on the Acquisition of Prop- In response to Turkish Cypriot demands, the erty: Those persons who have not been 4th Plan incorporated the following provi- permanent residents for at least 3 years in sions: the Turkish constituent state (mainly imply- ing Greek Cypriots) cannot purchase im- • Political Equality: The Plan more strongly movable property in the North for as long emphasises that the relationship between as the GDP per capita in the North does not both sides is one of ‘political equality reach the level of 85% of the GDP per cap- where neither side may claim authority or ita of the South. This provision aimed to re- jurisdiction over the other’. lieve concerns regarding ‘large scale buy- • Restrictions on Settlement: The numbers out of land’ in the North by the Greek Cyp- of Greek Cypriots (or Turkish Cypriots) to riots. return to the North (or South) have been • Voting for the Senate: Senators will be reduced from 21% to 18%. After an initial elected not on the basis of constituent state moratorium of 5 years (6 in the initial ver- citizenship status, but by Greek Cypriots sion of the Plan), 6% were to return be- and Turkish Cypriots separately. This re- tween 6th and 9th years, 12% between the lieves the Turkish Cypriot concerns that 10th and 14th years and 18% thereafter. It with increasing Greek Cypriot settlement in was added that these restrictions were to be the North, balances in the Senate would lifted after 19 years or on Turkey’s ac- change in favour of the Greek Cypriots. cession to the EU, whichever one is earlier. Thereafter, each constituent state may take • Economic Safeguards: Turkish Cypriot safeguard measures to ensure that no less constituent state can take appropriate safe- than two-thirds of its Cypriots permanent guard measures for up to 6 years to combat residents speak its official language as their difficulties posed to its economy by the mother tongue is not substantially altered, EU’s internal market. indicating a 33% upper limit on the Greek 1 Annan presents the 5th (Final) Plan, 31 Cypriots returning to the North. March: The two parties presented their opin- • Continued Military Presence: Greek and ions and suggestions regarding the 4th revised Turkish contingents would be permitted to version of the Plan by the morning of 30 stay on the island under the conditions that March. On this basis Annan presented the final each contingent does not exceed 6,000 until 5th version of the Plan on 31 March. The final 2011, and 3,000 thereafter until 2018 or Plan did not differ much from the 4th version. Turkey’s accession to the EU, whichever is The most significant changes made upon the sooner. The Greek contingent, not exceed- demands of Greek Cypriots included the fol- ing 950 and the Turkish contingent, not ex- lowing: ceeding 650 could re-main thereafter, subject to five-yearly re-view with the objec- • Continued Military Presence: The five- tive of total withdrawal year review of the continuation of the Turk- ish and Greek military presence on the is- • Affected Property (property which was land, which would begin in 2018 or upon lost by the owners due to inter-communal Turkey’s accession to the EU was reduced strife, military action or the unresolved di- to three years. vision of the island): The Plan provides a domestic remedy for the solution of all • Restrictions on the Acquisition of Prop- matters related to affected property. It re- erty: It was added that restrictions on the quires the new Republic to request the acquisition of property in the North by the European Court of Human Rights to with- Greek Cypriots could also be lifted after 15 years while retaining the provision of the 1 Exceptions were retained for those over 65 and 4 4th Plan that these could also be lifted villages of Karpaz. A fifth village, Kormakiti was when the GDP of the North reaches 85% of also included among the areas where these restrictions would not apply.

26 | TURKEY IN EUROPE MONITOR

the GDP of the South, in case this happens social security. Constituent states participate in earlier. the formulation and implementation of policy in external relations and EU affairs, in accor- • Return of Affected Property: Property dance with Cooperation Agreements modelled return regimes were further clarified for on the Belgian example. The Federal Parlia- those living outside the areas of territorial ment is composed of two Chambers: the adjustment. All dispossessed owners have Chamber of Deputies (with 36 Greek Cypriot the right to reinstatement of one-third of the and 12 Turkish Cypriot members) and the value and one-third of the area of their total Senate (24 members from each sides). The property ownership, and to receive full and executive power will be vested in the Presi- effective compensation for the remaining dential Council with 6 (4 Greek Cypriot and 2 two-thirds. They have the right to rein- Turkish Cypriot) voting members. The Plan statement of a dwelling they have built, or strives to ensure workability, thus no vetoes in which they lived for at least 10 years, are included, as with the 1960 Constitution. and up to one donum of adjacent land, even Decisions of Parliament require the approval if this is more than one-third of the total of both Chambers by simple majority, includ- value and area of their properties. ing one quarter of voting Senators from each The most significant change made upon the constituent state. However for specified mat- demands of the Turkish Cypriots was: ters such as ratification of international agreements on matters which fall within the legisla- • Request for Adaptation of Primary Law: tive competence of the constituent states (rati- The attached letter to the President of the fication of treaties and adoption of laws and European Council was amended to request regulations concerning airspace, continental the European Union to endorse the Founda- shelf and territorial waters; adoption of laws tion Agreement and to accommodate its and regulations concerning citizenship, immi- terms by adapting the terms of ac-cession gration, water resources and taxation; approval before 1 May 2004 in a way that “results in of the federal budget and the election of the the adaptation of primary law” and ensures Presidential Council), a special majority com- the “legal certainty and security” of the prising at least two fifths of sitting senators Foundation Agreement within “European from each constituent state is required, in addi- Union’s legal system for all concerned”. tion to a simple majority of deputies. The deci- This amendment is intended to facilitate an sions of the Presidential Council require a agreement between the Turkish side and simple majority of members, but including in the EU over the issue of derogations. all cases at least one member from each con- Beyond the details. From the first to final ver- stituent state. Regarding security matters, the sions of the Annan Plan, the essence of the objective is of demilitarisation of the island proposal has been for a United Cyprus Repub- where there would be both a federal police lic, as a single state in international law, with a force and forces in the two component states. federal government and two equal constituent There would be a Supreme Court to uphold the states of the Greek Cypriots and the Turkish constitution. The Court would comprise of an Cypriots. The status and relationship of the equal number of judges from each constituent United Cyprus Republic, its federal govern- state and three non-Cypriot judges. The Su- ment and its constituent states is modelled on preme Court would inter alia resolve disputes the status and relationship of Switzerland, its between the constituent states or between the federal government, and its cantons. The main states and the federal government. functions of the federal government would be Talks over derogations: The issue of deroga- external relations, relations with the EU, Cen- tions remains unresolved. Despite the requests tral Bank functions, federal finances, commu- of the Turkish side and the UN itself, the EU is nications, aviation, citizenship, and natural insisting on adopting the plan as an “act of resources including water. The essential com- adaptation”, where there will only be Council petences of the two constituent states would be approval and no parliamentary ratification by tourism, protection of the environment, the use the EU member states. One may argue that the and conservation of energy, fisheries and agri- possibility of non-ratification by EU (espe- culture, industry and commerce, zoning and cially Greek) parliaments poses a political risk planning, education and sports, health, and

NO. 3 / MARCH 2004 | 27 for the EU to take this decision. Talks between the negotiations over the EU’s financial per- EU officials and Turkish representatives are spectives in 2005. continuing. Although the Turkish side is The prospects of a ‘yes’ vote in the North look strongly opposing the present EU position, it more promising. In a press conference held does not seem to have a detrimental effect on after the submission of the Plan, Erdoğan re- their commitment to holding the referenda. In plied to a question on the referenda by stating the absence of any unforeseen and outstanding that ‘he wishes to see the results of their ef- development, this last 5th version of the Plan forts’, indicating the Turkish government’s will be put to referenda on the two sides on 24 expectations of a ‘yes’ vote for both sides. April. Turkish Cypriots are also more positive about The Referenda, 24 April: However the re- the plan. In the recent elections the pro-Annan sults of the referenda may be mixed. Recent Plan parties received 51.24% of the votes. A opinion polls suggest that a majority of Greek recent opinion poll confirms this result with Cypriots oppose the Annan Plan, with the ‘no’ 51.1% of the Turkish Cypriots in favour of the vote according to three opinion polls estimated Annan Plan. However, this is a narrow margin, at 54%, 53% and 62%. The final version of the and a ‘yes’ vote on the Turkish side should Plan seems even to have increased these nega- also not be taken for granted. Although the tive perceptions. According to an opinion poll reactions to the final version of the Plan have by Antenna, a Greek Cypriot TV station, more generally been positive, there still remain seri- than 70% of Greek Cypriots would vote ous concerns among many regarding the against the latest version of the Annan Plan. amount of Greek Cypriots to return to North Another poll conducted on 1-2 April by VPRC and those that will be dispossessed after terri- suggest that 84.7% of the Greek Cypriots op- torial adjustments. It is evident that there will pose the Plan. The international community also be negative campaigning in the North, strongly encourages the Greek Cypriots to based mainly on these issues and led by Rauf push for a ‘yes’ vote in the referendum. The Denktas himself. Commission has declared that approval of the Annan Plan would be an important factor in

28 | TURKEY IN EUROPE MONITOR

TURKISH BUSINESS PERSPECTIVES • By the beginning of the next decade Turkey by will be an energy corridor as gas and oil TÜSIAD pipelines will cross the country from north TURKISH INDUSTRY & BUSINESS to south and east to west. The European ASSOCIATION Union will be one of the beneficiaries of www.tusiad.org such a development since these multiple TRACK RECORD ON THE PROGRESS pipelines will enable it to diversify its en- TOWARDS THE EU ergy sources.

• We are the watchdogs of the reform proc-

ess. We will not let it fail. Moreover we TÜSIAD inaugurated its Paris office with a have no doubts in our minds that our cur- ceremony opened by the speeches by State Minister, Ali Babacan, France's Economy and rent government is committed to the mem- Finance Minister, Francis Mer, and the Presi- bership agenda. This agenda includes the supremacy of civilian authority as well. dent of the Confederation of French Enter- prises (MEDEF), Antoine Seillière. • Turkey will have done its part in securing a Cyprus resolution. We hope that our Greek In the opening ceremony, TÜSIAD President counterparts will do the same. Ömer Sabancý addressed the public with a speech. The main messages conveyed by Mr. • We are all more appreciative of a world Sabancý to the participants included the fol- order where secular thinking prevails. We lowing points: all have a common interest in not allowing a so-called clash of civilizations. Just as • As of March 2004, the rate of inflation much we have a common interest in stabi- dropped to single digit levels, a feast for- gotten for over a generation. Growth has lizing the Middle East and assure the been restored to the economy even if em- emergence of a secular, representative political order in that critical region. ployment figures have not yet caught up with the rebound. Interest rates are at the • What we ask from our partners in the EU is lowest since a quarter century ago and encouragement and a fair assessment when budgetary discipline has been mostly re- December arrives. Turkey is ready for the stored. From now on, the Maastricht crite- process of negotiations, which we know ria and the Lisbon Strategy of the Euro- will take several years to successfully con- pean Union are also our main guidelines. clude. • Turkish companies are emerging as world- • The decision to start accession negotiations class competitors in sophisticated indus- will propel Turkey towards the final stage trial products. We are committed to bring of its political, economic and social trans- Turkey’s economy to the standards of most formations. We then hope to contribute to competitive countries in terms of techno- the shaping of Europe that is being logical sophistication. launched as the continent unifies. • Our economic dynamism is helping the economies of neighbouring countries. We The full text of the speech can be accessed at: expect Armenia to soon join Syria, Iraq, www.tusiad.org/english.nsf Georgia, Russia, Iran and other regional countries as a viable trade partner of Tur- TÜSIAD IS A MEMBER OF UNICE key when the border is opened. (UNION OF INDUSTRIAL AND EMPLOYERS’ CONFEDERATIONS OF EUROPE)

CEPS Turkey in Europe Monitor

No. 4, April 2004

Introductory Note from CEPS

This issue of CEPS Turkey in Europe Monitor Second, it contains the positions of national focuses on the views of the European Parlia- delegations within Parliamentary Groups and ment on Turkish accession to the European the national debates surrounding the issue Union. The monitor provides first a brief over- prior to the EP Elections to be held in June. view of the views of Parliamentary groups on The monitor also provides the distribution of Turkish membership and the Oostlander Re- votes on the Oostlander Report. port on Turkey which was approved by the Parliament on 1 April. Michael Emerson and Senem Aydın

EU membership. Many commentators argued Views of the European Parliament as a result that the report was more positive on Turkish Accession than the previous ones, specifically in the way that it acknowledged Turkey’s candidacy and Senem Aydın emphasised full membership as a goal to be attained. The debates over Turkey’s accession to the European Union are becoming more intense The Report was adopted with 211 votes in fa- with the European Parliament elections draw- vour, 84 against and 46 abstentions. The most ing closer. On 1 April, the Parliament voted to striking pattern in the votes was the over- adopt the Oostlander Report which decided whelming support of the PSE (Party of that Turkey does not yet meet the Copenhagen European Socialists) and ELDR (European political criteria required for EU membership Liberal Democrat and Reform Party) to the and that more progress is needed before An- Report, with only one against vote in ELDR kara can expect a date from the EU for the and two against and two abstentions in the opening of accession talks. While recognising case of PSE. The conservative PPE-DE the legislative reforms already enacted in the (European People’s Party and European country, the Report criticised Turkey for lag- Democrats) was divided over its stance. After ging behind in implementation especially with their proposal to insert the ‘privileged partner- respect to the fight against torture, discrimina- ship’ clause in the Report was turned down, tion of religious and ethnic minorities, con- the German CDU/CSU delegation to the PPE- tinuing influence of the army in politics and DE voted against the Report in a bloc, with the judicial system. During the debate that only a few exceptions, and was supported by preceded the voting, the MEPs rejected an the French and Austrian members of the PPE- amendment proposed by the German Christian DE. A majority of MEPs from the GUE/NGL Group (Group of the European United Democrat members of the conservative PPE- Left/Nordic Green Left) and Verts/ALE DE Group which would have offered Turkey a (Group of the Greens/European Free Alli- ‘privileged partnership’ status rather than full ance) have also voted in favour of the Oost- lander Report. These voting patterns give some general insight as to the positions of par-

| 29 30 | TURKEY IN EUROPE MONITOR liamentary groups on Turkish accession to the adopted and published a declaration titled ‘For EU. As the socialist, liberal, extreme left and a new Turkey Policy: Privileged Partnership green groups seem to broadly favour eventual vs. EU Accession’ (Für eine Türkei-Politik: Turkish accession, the majority of the conser- Privilegierte Partnerschaft statt EU- vative centre-right seems to oppose it. It would Mitgliedschaft). however be misleading to treat these groups as monolithic entities and considerable attention This document attempts to justify the estab- needs to be given to the differences in the lishment of a ‘privileged partnership’ which opinions of national party delegations within would be an extended version of the customs parliamentary groups to understand where union agreement with increased financial aid, Turkish accession stands in the national de- youth and cultural programmes, on the bates prior to EP elections to be held in June. grounds that full accession of Turkey to the Union would hamper the efficient functioning 1. PPE-DE-Majority against Eventual of the EU with the country’s large population Turkish Accession and the problems related to its market economy. The document also draws attention to The biggest parliamentary group in the EP, ‘defining the borders of Europe’ by arguing PPE-DE, despite the strong opposition of that countries such as Ukraine would also have most of its national delegations to the Turkish a legitimate claim to join the EU after a possi- accession, is still not a united front in this is- ble Turkish accession, where membership of sue. Hans-Gert Poettering, the Chairman of the both would have detrimental effects on the EPP-ED Group speaking to the European Par- already troubled German economy. liament has declared that as far as Turkish membership is concerned, they are not of one More recent objections to Turkey’s accession opinion. He added that the one point they have also been raised by the French centre- agree on is that Turkey is an important, strate- right in the PPE-DE Group. Some prominent gic partner with which they need to foster UMP MEPs such as Alain Lamassoure, after close relations. voting against the Oostlander Report of the Parliament, declared that ‘the vote was an op- The most prominent campaigner in the PPE- portunity for the UMP to express their opposi- DE Group against Turkish accession is the tion to Turkey’s entry into the EU’ and that CDU/CSU delegation from Germany. They ‘this would likely be UMP’s position during were actually the first in Germany to take up the European elections’. Following the recent this issue as a major element of their cam- statements of the new foreign minister, Michel paigning strategy against the SPD and the Barnier, on 7 April that France would oppose Greens that have a favourable attitude towards Turkey’s entry into the EU ‘under current cir- Turkey’s entry into the EU. Back in May cumstances’ as ‘Turkey does not respect the 2003, the head of the German delegation of the conditions, even if it is preparing to do so’, PPE-DE Group in the EP stated that the EU Alain Juppé, the leader of the ruling centre- ‘owes clarity to its neighbours, whose hopes right UMP and a close associate of French should not be raised if they can’t be fulfilled’ President Jacques Chirac, decided to publicly and continued to argue that ‘that is one of the oppose Turkey’s candidacy to the EU. He ar- problems with Turkey, which is an important gued that the countries on the periphery of the ally and partner.’ Michael Glos, the head of growing EU, such as Turkey, ‘have no busi- the CSU faction in the German Parliament has ness joining (the bloc), otherwise it will be announced back in September 2003 that the diluted’. He has concluded that ‘the UMP does ‘rejection of Turkish EU membership due to not want to see negotiations with Turkey at the its different culture and poor economy would end of the year’. In the same line with the be an issue in European Elections’. Thus, German Christian Democrats, he proposed a CDU leader Angela Merkel’s proposal to offer ‘privileged partnership’ with Turkey. Turkey a ‘privileged partnership’ on her visit to Turkey in February this year did not come In response to the uproar that the two conse- as a surprise to many observers. Following quent statements caused in Turkish media, Merkel’s proposal which was strongly rejected Barnier made another statement on 18 April, by Turkey, the CDU/CSU group in the EP has warning against ‘shutting the door’ on Ankara,

NO. 4 / APRIL 2004 | 31 signalling a softening of his previous stance. too soon to take definite decisions regarding He argued that in the case of rejection, ‘there accession talks.’ as ‘Turkey is too far away is a risk that Turkey will return to another from meeting the agreed accession criteria’. model’ and added to repeat his previous claim The Dutch national delegation in the PPE-DE that ‘there is no question of Turkey’s acces- group also lacks a clear cut position on the sion in the current circumstances or in the topic. One of the influential figures of the short term’. President Chirac has recently Dutch CDA in the PPE-DE group and the rap- made parallel statements, supporting Turkish porteur of the most recent EP Report on Tur- accession in the long run while reminding that key, Arie Oostlander, has declared that ‘Tur- the country is not currently ready for full ac- key is in fact not ready to start accession nego- cession. Regarding the opening of accession tiations’, but that negotiations could still start negotiations, the French President has stuck to after the Commission’s assessment with the his neutral position by emphasising the impor- political criteria being the first chapter in the tance of the Commission’s Report to be deliv- talks. The party spokesman has also recently ered in October. According to many observers, argued for the conservation of Turkey’s candi- while the official French position represented dacy while pointing to the non-negotiable cri- by Chirac and Barnier focus on the impossibil- teria of Copenhagen. ity of Turkish accession in the short term while keeping the option of granting the coun- Other PPE-DE delegations, most notably the try the opening of accession negotiations and British Conservative Party, Spanish Popular thus not negating their previous policy, the Party, Berlusconi’s Forza Italia and the Swed- upcoming elections to the EP require the UMP ish Moderate Party seem to have a more fa- to take a tougher stance on the issue. UMP vourable attitude towards Turkish member- faces serious competition from the extreme- ship. The British Conservatives have tradi- right who has made this issue one of its central tionally been supportive of Turkish entry themes in the EP elections as well as from which was driven, according to many, by their other prominent parties of the centre-right hope that this would lead to a looser commu- such as the UDF who has traditionally op- nity of nation states and thus prevent further posed Turkey’s membership to the EU. Hop- political integration. The Conservative MEP ing to avoid a repeat of the defeat the party Van Orden who is also a member of the dele- received in March’s elections to France’s re- gation to the EU-Turkey Joint Parliamentary gional councils, the UMP is put under im- Committee has recently criticised the Oost- mense pressure to not to lose ground on this lander Report for ‘sending a lukewarm mes- front. sage’ to Turkey and has affirmed that Turkey’s destiny as a full member needs to be acknowl- Another national party group in the PPE-DE edged. However, in the same debate, another that is strongly opposed to Turkish accession conservative MEP, James Elles, adopted the is the Austrian People’s Party (ÖVP) that opposite stance by emphasising EU’s absorp- mainly competes against Haider’s FPÖ which tion capacity and by arguing that ‘the most is constructing its whole EP election campaign sensible thing would be to say that there is real around this issue. Their position was well uncertainty in the Union’s current political demonstrated in their rejection of the Oost- situation, and to be extremely cautious before lander Report on grounds that Turkey was ac- giving Turkey the green light at this stage’ knowledged as a candidate country. The Dan- which suggest that individual differences exist ish members of the PPE-DE, Danish People’s within the party. Both have abstained from Party, have also recently announced a cam- voting on the Report like the majority of Brit- paign against Turkish membership on mainly ish conservative MEPs. the grounds of identity. The Belgian (Flem- ish) Christian Democrats seem to have a softer The Spanish Popular Party has been an ardent but a more ambiguous stance on this matter. supporter of Turkey’s integration to the EU, CD&V has recently published its EP election seen by many as a consequence of Aznar’s manifesto in which there is an emphasis on the Atlanticism. In a speech delivered on February urgent need for a debate on the borders of 2004, the former foreign affairs minister, Ana Europe and the conservation of European Palacio, has stated that Europe needs to be identity, followed by the statement that ‘it is ready for its next challenge which is ‘Europe-

32 | TURKEY IN EUROPE MONITOR twenty-five countries plus Bulgaria, Romania Among the PSE Group, some of the most and Turkey’. The major Italian party of the prominent supporters of the Turkish bid seem centre-right, Forza Italia, has also been advo- to be the German social democrats, the SPD. cating Turkish membership as clearly demon- Many observers believe that SPD’s strong strated in Berlusconi’s statements that ‘Italy stance stems from the need to establish itself at will do all it can to help advance Turkey’s bid the opposite end in the face of increasing to join the European Union’ and that the sup- competition from CDU/CSU that has a clear port that they have been giving to Turkey ‘will policy line on this matter and to capture the continue to increase’. The chairman of the votes of the Turkish immigrants in both the Swedish Moderate Party, Bo Lundgren, has European and the national elections. This was often warned the EU against ‘moving the best reflected in the way Schroeder visited goalposts as Turkey advances’ while citing the Turkey on 23 February, immediately a week Copenhagen political criteria as a ‘very strict’ after Merkel had arrived to propose the ‘privi- condition. The conservative New Democracy leged partnership’ scenario. On his visit, he Party in Greece that recently overthrew the announced that ‘Turkey can always count on Socialists from power also seems to support Germany for support’ and that their vote ‘will the Turkish aspirations. After coming to be for the start of accession negotiations in the power, Prime Minister Karamanlis said they shortest time if Turkey has fulfilled all the cri- supported Turkey’s European Union bid as teria’. Regarding the political reforms in the long as Turkey complies with EU regulations. country, he declared that Turkey was on ‘the Despite Karamanlis’ pledge for continued right path to get a green light to open acces- good relations with Turkey during his election sion talks at the end of the year’ and that ‘there campaign and afterwards, many are still scep- are good chances to see that at the end of the tical as to whether he will sustain the friendly year’. atmosphere initiated by his rival, Papandreou. An even stronger advocate in the PSE Group 2. PSE-Majority in Favour of Eventual is the British Labour Party. The Labour dis- Turkish Accession, Negotiations Depending course regarding Turkish accession is mainly on the Commission Report based on security considerations. The foreign minister, Jack Straw has recently defined The second biggest Parliamentary Group in Turkish accession as an ‘acid test of Europe’s the EP, PSE, has in general a more favourable ability to counter the myth that it is doomed to approach towards the matter than the conser- conflict with Islam’ and asserted that Europe- vatives. In their recent review of the plenary ans need to be clear that ‘Turkey will be session where the Turkish and Croatian appli- treated as any other EU candidate, without fear cations were discussed, the Group has af- or favour’. These concerns are also frequently firmed its opinion than ‘an enlarged EU leads voiced by Tony Blair who argues that ‘the EU to increased stability and prosperity for all should allow mainly Muslim Turkey to be- Europe’ and that therefore, the Group ‘sup- come a member of the bloc to demonstrate its ports the applications for membership of coun- commitment to the creation of a tolerant and tries with European vocation and willing to diverse Europe’. take over the acquis communautaire.’ After voting largely in favour of the Oostlander Re- This unequivocal support seems to be shared port, the Group declared that it has ‘success- also by the Dutch Social Democrat Party fully defeated an attempt by leading members (PvdA) who came to the conclusion in a na- of the EPP to firmly close the door on Turkey’ tional parliamentary debate in February that as ‘the amendments tabled by EPP Members the decision to start negotiations with Turkey would have meant an end to any hopes for should be taken in December. Although the Turkish accession even at this early stage of Spanish Social Democrats have been quite negotiations’. They added that ‘taking a more silent on the issue so far, the Turkish Ambas- constructive approach, PSE Group Members sador to Spain has recently made a statement want to work with Turkey to ensure that a that his contacts with Zapatero’s party suggest range of basic criteria are met and to not take that Spain’s support for Turkey’s EU bid will any definitive decisions at this point in time’. continue. The Swedish social democrats continue their support with their sustained empha-

NO. 4 / APRIL 2004 | 33 sis on the fulfilment of the Copenhagen politi- line is that ‘accession can accelerate reform in cal criteria. The Greek PASOK with Papan- Turkey and secure stable democratic govern- dreou, credited as the architect of the recent ment there in the future’ and ‘ if the European rapprochement between Turkey and Greece, is Council approves the opening of accession also among the pro-Turkish accession group in negotiations in December 2004, the ELDR the PES. The French Socialist Party has also will continue to offer its support for Turkey’s been broadly favourable to Turkey’s acces- eventual place in the European Union’. This sion, with some extra demands regarding the stance is mostly shared by the British, Swed- Armenian issue. Socialist Party Foreign Af- ish and Belgian Liberal Democrats. The Dan- fairs Secretary-General, Pierre Moscovici re- ish Liberal Party of Fogh Rasmussen seems to cently blamed the UMP for ‘their extreme op- be more ambivalent on the issue, mostly due to portunism’ in their stance on Turkish acces- the fierce opposition from the Social Democ- sion. He stated that their Turkish policy has rats and Conservatives who oppose Turkish not changed and that they want negotiations to accession. The liberal prime minister has cho- start if Turkey fulfils the Copenhagen criteria. sen to remain silent for the time being, making He defined the three main problems facing general and vague statements such as ‘it can Turkey as ‘securing secularism, the army’s not be a surprise that candidates on a list have role in politics and the Armenian genocide different opinions on Turkey’. The Dutch Lib- issue’. erals (VVD) on the other hand are explicitly against Turkish membership. Jules Maaten, the There is also a minority faction of the PSE leader of the VVD fraction in the EU has re- Group that opposes or has rather ambiguous cently argued that for countries such as Croatia views on Turkish accession. The Austrian and Turkey, negotiations can only start upon Social Democrats, while not opposing Tur- the reform of European institutions which is key’s candidacy believe that it is not ready for perceived by them as a distant possibility. accession negotiations. The Italian Left is keeping so silent on the issue that they have 4. GUE-NGL and Verts/ALE-Majority in not mentioned Turkey in their election mani- Favour of Eventual Accession with Strict festo which expresses their detailed views on Application of the Copenhagen Political enlargement and the future of Europe. The Criteria Danish Social Democrat Party, on the other hand, is strongly against it. While there is al- The fourth and fifth biggest Parliamentary most a ‘negative’ consensus building up in Groups in the EP, GUE-NGL and Austria, the position of the Danish Social De- Verts/ALE, are generally supportive of Turk- mocrats is considered more as a strategic move ish accession. They both favour a serious EU to capture the liberal votes from the electorate accession offer to Turkey, linked to demands as a sudden shift of policy is observed. The on the Kurdish issue and respect for human former Danish Prime Minister and Social De- rights. In the case of the GUE-NGL, specifi- mocrat top candidate for the June European cally due to the weight of the French extreme- Elections, Poul Nyrup Rasmussen was one of left, the Armenian issue is also strongly tied to the ardent supporters of Turkey’s candidacy in Turkey’s accession demands. Most argue that 1999, now suggesting that he ‘is not certain ‘recognition of the Armenian genocide’ should that Turkish EU membership would be a good be one of the preconditions of Turkey’s mem- idea’. bership.

3. ELDR-Majority in Favour of Eventual The Turkey in Europe Monitor, after the Euro- Turkish Accession, Negotiations Depending pean Parliament elections, will also evaluate on the Commission Report the positions of the national party delegations of the new member states on the issue of Turk- The third biggest Parliamentary Group in the ish accession. EP, ELDR, is most probably the strongest supporter of Turkish accession. Their official

34 | TURKEY IN EUROPE MONITOR

Distribution of Votes in the European Parliament on the Oostlander Report

NO. 4 / APRIL 2004 | 35

Abstention

PPE-DE: European People’s Party and European Democrats (centre-right, conservative, biggest national group being the CDU/CSU from Germany. Largely against Turkish accession, voted against in a bloc upon the rejection of their proposal for a privileged partnership with Turkey.) PSE: Party of European Socialists (centre-left, largely supportive of eventual Turkish accession, voted in favour of the Report with overwhelming majority) ELDR: European Liberal Democrat and Reform Party (liberals, largely in favour of eventual Turkish accession, voted in favour of the Report with overwhelming majority) GUE/NGL: Group of the European United Left/Nordic Green Left (largely in favour of eventual Turkish accession, voted in favour of the Report with overwhelming majority) Verts/ALE: Group of the Greens/European Free Alliance (largely in favour of eventual Turkish accession, voted in favour of the Report with overwhelming majority) UEN: Union for a Europe of Nations EDD: Group for a Europe of Democracies and Diversities NI: Non-attached

The full text of the Oostlander Report can be accessed at http://www2.europarl.eu.int/omk/sipade2?PUBREF=-//EP//NONSGML+REPORT+A5-2004- 0204+0+DOC+WORD+V0//EN&L=EN&LEVEL=3&NAV=S&LSTDOC=Y

36 | TURKEY IN EUROPE MONITOR

TURKISH BUSINESS PERSPECTIVES

TÜSIAD TURKISH INDUSTRY & BUSINESS ASSOCIATION

www.tusiad.org

GERMAN BUSINESS SUPPORTS TURKEY’S MEMBERSHIP TO THE EU

A high-level meeting between the Federation • The Presidents of TÜSIAD and BDI note of German Industries (BDI) and the Turkish with satisfaction the progressive development Industry and Business Association (TÜSIAD) of bilateral trade relations and investment. was held on 21 April 2004 in Istanbul. The Customs Union with the EU and recent steps to enforce stable economic and monetary The competitiveness of Europe, Turkey’s policies in Turkey will contribute to the further status as a candidate for EU membership and expansion of the Turkish economy and eco- bilateral economic relations were at the heart nomic relations with Germany. of this meeting. • The Presidents of BDI and TÜSIAD share On this occasion, Dr. Michael Rogowski, the the view that business could benefit greatly President of BDI and Mr. Omer Sabanci, the from the further European integration of President of TÜSIAD issued BDI-TÜSIAD Turkey. joint declaration that contains the following main messages: • BDI and TÜSIAD point to the decisions of the European Council in Helsinki and Copen- • TÜSIAD and BDI call on the European hagen granting Turkey the status of candidate Union to accelerate the implementation of for EU membership and offering negotiations Lisbon Strategy as well as the institutional in 2005 if the conditions are met. reforms and to secure its ability to act as a global political and economic power. • TÜSIAD and BDI are concerned that it could be very detrimental for the political and • The early adoption of a constitutional economic stability in Turkey and in Europe as treaty will facilitate the decision making proc- a whole if efforts to facilitate Turkey’s acces- ess in an enlarged European Union. Structural sion to the EU guided by the Accession Part- and agricultural policies must be adjusted to nership document of the European Commis- the budget restraints in Member Countries and sion come to a halt or are reversed. to the challenges of the future.

BDI and TÜSIAD emphasise the importance of a clear European perspective for Turkey. The The full text of the declaration can be accessed at: business communities in both countries need a www.tusiad.org/english.nsf reliable framework to develop their operations TÜSIAD IS A MEMBER OF UNICE both on a bilateral level and in Europe. (UNION OF INDUSTRIAL AND EMPLOYERS’ CONFEDERATIONS OF EUROPE)

CEPS Turkey in Europe Monitor

No. 5, May 2004

Introductory Note from CEPS this objective in mind, the article seeks to dis- This issue of the CEPS Turkey in Europe cover the perspectives of Euro-Turks on the Monitor presents an article by Dr. Ayhan EU and ‘Europeanness’; the political culture Kaya from Bilgi University, Istanbul, on the that they have created in the West; the kinds of Turkish origin migrants living in Germany and incorporation strategies they have constructed France. The article comprises some of the vis-à-vis their countries of settlement and their findings of a major research project conducted thoughts on key issues such as citizenship, de- by Dr. Ayhan Kaya and Dr. Ferhat Kentel, mocratisation, political participation, global- aiming to investigate the question of whether isation, human rights, equality, rule of law, the Euro-Turks living in Germany and France justice, religion, multiculturalism, intercul- can be a driving force for Turkey in its process turalism, co-existence and political institu- of integration into the European Union. With tions.

Michael Emerson and Senem Aydın

Euro-Turks: permanent settlers, active social agents and A Bridge, or a Breach, between decision-makers. Lately, there is an emerging middle class group of Euro-Turks who are in- Turkey and the European Union? volved in many different sectors such as service, tourism, catering, telecommunication, Ayhan Kaya∗ construction, etc.

There is a common belief in western European There is also a lack of awareness in both home- countries that the Turkish origin migrants and land and ‘hostland’ concerning the characteris- their children do not integrate into social, po- tics of migrants and their children. Euro-Turks litical, economic and cultural life of their set- have been stereotypically represented as Al- tlement countries. According to the same mancı (German-like) in Turkey and ‘foreigner’ common belief, Turks’ political motivations in in the west. It is still commonly believed in their countries of settlement are primarily Turkey that Turkish origin migrants and their shaped by their homeland. However, there are descendants in the west are Gurbetci1 who recently many indications and academic works have a great orientation towards the homeland displaying an alternative picture. Contempo- and will someday return home. On the other rary Turkish origin migrants and their descen- hand, they are also called Almancı, a term dants in the west can no longer be simply con- which depicts such people as being rich, eating sidered temporary migrant communities who pork, having a very comfortable life in the live with the ‘myth of return’, or passive vic- west, losing their Turkishness, and becoming tims of global capitalism who are alienated by the system and swept up in a destiny dominated 1 The term ‘gurbetci’ refers to someone in ‘gurbet’ by the capitalist west. They have rather become (diaspora), which is an Arabic word deriving from garaba, to go away, to depart, to be absent, to go to a foreign country, to emigrate, to be away from ga- ∗ Associate Professor, Istanbul Bilgi University, raba, to go away, to depart, to be absent, to go to a Department of International Relations, and Centre foreign country, to emigrate, to be away from one’s for Migration Research. homeland, to live as a foreigner in another country.

| 37 38 | TURKEY IN EUROPE MONITOR increasingly Germanized, Anglicized, and pean countries are being mapped out in the re- Frankified etc. They are also stereotypically search. Turkish origin migrants and their de- called as ‘foreigner’ in their own countries of scendants constitute a rather heterogeneous settlement. The common stereotypical labelling group of people in Europe in respect to their of ‘Turk’ in the west strongly indicates that recent economic, political, cultural, ethnic and Turks are conservative, religious, veiling, poor, religious dispositions. Thus, one of the prem- nationalist, longing for homeland, un- ises of this work was that these separate groups integrating, and violent. This research aims to would pose both strong support and reservation reveal that Euro-Turks are highly diversified to Turkey’s EU membership. Analyzing the and have very little in common with the ‘Al- public opinion among the Turkish diaspora manci’, ‘guestworker’ or ‘foreigner’ stereo- groups in Western Europe may help us find out types of the past. It uncovers invisible Euro- if diasporic Turkish communities may provide Turks who also identify themselves as Turkish the Turkish society with new opportunities and origin migrants and their children originating prospects in the formation of a more open and from Turkey like those who somehow fit into democratic society in Turkey. Another premise the category of stereotypical ‘Turks’ visible in of this work is that boundaries between Turkey the public space with their outer looks and and the diaspora are no longer that strict, they clothing styles. The work also challenges the are rather blurred. For instance, it has lately common belief in the west that Turks do not been realized that the Islamic resurgence in the integrate in their country of settlement and that diaspora has resulted in the reinforcement of Turkish-Islam does not comply with the west- religious organisations in the homeland. The ern way of life. same process is also applicable to the Kurdish and Alevi revival in Turkey, because both so- The project titled ‘Euro-Turks: A Bridge, or a cial movements are to some extent constrained Breach, between Turkey and the European Un- by modern diasporic formations. Hence, these ion” was conducted by Ayhan Kaya and Ferhat phenomena make it clear that diasporic forma- Kentel in the period between September 2003 tions may have a strong impact on the home- and March 2004. The research was held in land formations. Germany and France, and included both qualitative (in-depth interviews and focus group This research aims to understand whether the discussions) and quantitative methods (1065 Euro-Turks have developed certain commit- structured interviews with 90 questions in ments vis-à-vis the European Union and Euro- German, and 600 in France). The structured peanness; what sort of a political culture they interviews were conducted in November 2003 generated in the west; what kind of incorpora- by two local public poll companies in Germany tion strategies they constructed vis-à-vis their and France with the involvement of Turkish countries of settlement; and their contempla- speaking university students fluent in either tion about some essential issues such as citi- German or French. The interviews were made zenship, democratization, political participa- in three languages (Turkish, German and tion, globalization, human rights, equality, rule French) depending upon the choice of the in- of law, justice, religion, multiculturalism, interviewees. It should be noted here that 21 per- terculturalism, coexistence and political institu- cent of the interviews held among the German- tions. These questions are all addressed in a Turks were conducted in German, and 31 per- way that could make us compare their views cent among the French-Turks in French. about the homeland and ‘hostland’. This research is essential in a conjuncture character- Euro-Turks: A Bridge, or a Breach, between ized by intensive discussions in Turkey and Turkey and the European Union? abroad concerning the EU integration process, the European Constitution, the European The ongoing research aims to investigate the enlargement process, the Cyprus question, the question of whether the Euro-Turks living in secularism debate, and religious fundamental- Germany and France can be a driving force for ism. The conjuncture is also unique in the Turkey in its process of integration into the sense that there is a shift in the west from mul- European Union. Social, political, and cultural ticulturalist discourse to interculturalist dis- discourses of Turkish diasporic subjects con- course. However, the scope of this work will cerning Turkey-EU relations in the two Euro- only be limited with the claim that Euro-Turks

NO. 5 / MAY 2004 | 39 do not pose a threat to their countries of settle- myths, memories, peoples, regions, and rights ment, but rather aim to incorporate themselves and duties granted to the EU citizens.3 into the western democracies and European identity. There are at least two definitions of Europe and Europeanness. The first is the one proposed by The research reveals that Euro-Turks do not the Conservatives in a way that defines Euro- pose a threat to the political and social system peanness as a static, holistic and prescribed of their countries of settlement, but rather have cultural entity. The second is the one proposed the willingness to incorporate themselves into by the Social Democrats, Liberals, Socialists the system. It is commonly known that Western and Greens underlining the understanding that European states, generally speaking, have the ‘Europeanness’ refers to a fluid, ongoing, dy- tendency to regard Islam as a threat to their namic, syncretic and non-essentialist process of national security. Instead, the research uncov- being and becoming. While the first definition ers that orientation to Islam among the Euro- highlights a cultural project, the latter defini- Turks could also be regarded as a quest for jus- tion welcomes a political project embracing tice and fairness. Accordingly, this work shall cultural and religious differences including Is- present some of the relevant qualitative and lam. The inclusive and responsible acts of the quantitative data gathered during the research. Social Democrats and Greens in Germany and In the end it will be proposed that the EU states France, for instance, are very well received by should give in the security discourse, and get the German-Turks. engaged in justice discourse in their responds to minority claims.2 Q. Which political view are you affiliated with Europeanness: A Constant Process of Being in your country of settlement? and Becoming Germany France Count % Count % Both the qualitative and quantitative data gath- Liberal parties 35 3,3 9 1,5 Conservative parties 28 2,6 4 ,7 ered in our research, point out that concrete Social democratic parties 288 27,0 169 28,2 understanding of Europeanness does not exist Greens and 91 8,5 31 5,2 among the Euro-Turks. However, the same environmentalist parties Radical right and observation corresponds to the receiving socie- 9 ,8 10 1,7 ties. There is actually no doubt that a deep- nationalist Radical left and 13 1,2 23 3,8 rooted sense of Europeanness does not also communist parties exist among the majority of the public; and In equal distance to all 44 4,1 32 5,3 actually an identity is ideologically being con- None of those above 557 52,3 322 53,7 structed by the political elite of the European Total 1065 100 600 100 Union gradually through education, European citizenship, and common history and future. The table above indicates that German-Turks European Union has evidently displayed a have recently become more affiliated with the stronger political unity since the Tindemans left wing political parties such as the Social Report (Leo Tindemans was then the Belgian Democrats (27 %) and the Greens (8.5 %). The Prime Minister) submitted to the European same trend is also visible among the French- Council at the end of December 1975, which Turks (28%for the Social Democrats and prompted the member states to form a unified 5%for the Greens). It should be mentioned here political entity with her own flag, anthem, that previously in the early stages of the migra- tory process Euro-Turks were more oriented towards the conservative parties due to their scepticism towards the left wing parties back in the homeland. The recent shift also implies that

2 Euro-Turks are becoming more involved and This classification is made by Will Kymlicka reflexive in daily politics of their countries of (2002) to refer to the ways in which the demands of minority groups have been identified in western and settlement in a way that displays that they are eastern European countries. He claims that western actually very well integrated. However there is European democracies usually define minority still a great amount of people who are not claims as a quest for justice and fairness, while eastern European states name such claims as a 3 For a detailed account of the Tindemans Report threat to their national security. see, Tindemans (1975); see also Maas (2004).

40 | TURKEY IN EUROPE MONITOR really engaged in domestic politics. The quali- Q. To which extent are you either positive or tative research also shows that the German- negative about the EU? Turks, for instance are very reflexive to the Germany France latest manoeuvres of the Christian Democratic Count % Count % Union (CDU), which tries to use Turkey’s can- Very negative 59 5,5 25 4,2 Negative 237 22,3 74 12,3 didature as an election campaign instrument to Both positive 312 29,3 137 22,8 attract the nationalist votes. Furthermore, the and negative CDU is not considered to be a European entity Positive 313 29,4 285 47,5 as it reduces the Europeanness to cultural and Very positive 29 2,7 39 6,5 No idea 115 10,8 40 6,7 religious homogeneity in an essentialist way. Total 1065 100 600 100 What is also quite striking for both countries is that almost the same percentage of Euro-Turks Generally speaking the Euro-Turks are positive is not affiliated with any German or French about the European Union. Approximately political party (around 53%in each country). 32%of the German-Turks and 54%of the However, cross-tabulations clearly point out French-Turks are in favour of the EU idea, that there is a growing tendency among the around 28%of the German-Turks and 17%of younger generations towards political integra- the French-Turks are not in favour. 29%of the tion, and also that the indifference to domestic German-Turks and 23%of the French-Turks politics is highly a common phenomenon have mixed thoughts about it. Those German- among those of lower social status. Turks who are negative about the EU are likely to think that the EU has gained a lot from Ger- Euro-Turks’ Perspectives on the European many’s prosperity, in other words from their Union prosperity. On the other hand, those French- Turks who are positive about the EU are likely Focus group discussions, in-depth interviews to think that the EU has given them more pros- and structured interviews display that the Euro- perity. This observation is also confirmed by Turks are in favour of Turkey’s membership to the fact that 6%of the German-Turks are sup- the European Union although there is also a portive of the EURO, while 25%of the French- remarkable amount of people who seem to be Turks support it. against it. Q. To which extent do you support Turkey’s Q. What Does European Union mean to you? membership in the European Union? Germany France Germany France Count % Count % Count % Count % Economic cooperation 513 48,2 382 63,7 She definitely should 157 14,7 49 8,2 Common cultural policy 61 5,7 34 5,7 She’d better 313 29,4 222 37,0 Democracy project 69 6,5 38 6,3 It doesn’t matter 251 23,6 115 19,2 Christian Club 227 21,3 67 11,2 She’d better not 165 15,5 76 12,7 Exploitation, Imperialism 74 6,9 24 4,0 She definitely 110 10,3 122 20,3 Political and military 51 4,8 44 7,3 shouldn’t super power No idea 69 6,5 16 2,7 Bureaucratic community 70 6,6 11 1,8 Total 1065 100 600 100 detached from public Total 1065 100 600 100 General tendency is that the Euro-Turks are in favour of Turkey’s entry into the Union. How- While around 48%of the German-Turks and 64 ever, this tendency is sharper in France (57 %) of the French-Turks regard the EU as an Eco- than in Germany (31 %). nomic Cooperation, 21%of the German-Turks and 11%of the French-Turks regard it as a Q. What does the EU membership of Turkey Christian Club. mean to you? Germany France More human rights 69,3 78,8 More democracy 62,7 66,7 More job opportunities 61,4 83,0 Moral breakdown 52,0 36,3 Exploitation 37,2 34,2 End of independence 23,9 24,0 Division of the country 23,8 22,5

NO. 5 / MAY 2004 | 41

The interviewees were asked what the EU richness”, “job opportunities”, and “familial meant to them, and they were given various and moral values” are the following items that items to comment on. Both German-Turks and are stated. What is remarkably different be- French-Turks gave similar answers to the fol- tween the German-Turks and the French-Turks lowing questions: Turkey’s entrance into the is that the German-Turks put emphasis on EU does not really result in the division of the symbolic contributions such as cultural (53 %) country (53%German-Turks, 58%French- and moral (32 %), and the French-Turks give Turks); it won’t result with the end of inde- priority to the material contributions like labour pendence (52%German-Turks; and force (73 %) and job opportunities (42 %). 58%French-Turks); membership will bring Those who do believe that Turks do not bring more democracy to Turkey (63%German- any contribution to the EU are relatively low Turks; and 67%French-Turks); and member- (4-5 %). ship will improve the implementation of human rights (70%German-Turks; and 79%French- Q. What kind of positive impacts do the Turks Turks). On the other hand, there is a big dis- have on the receiving society? (multi-response) crepancy between the German-Turks and the Germany France French-Turks in answering the following ques- Count % Count % tions: membership will cause moral breakdown Cultural diversity and 568 53,3 252 42,0 richness in Turkey (52%German-Turks; and 36%French Labour force 688 64,6 440 73,3 - Turks); membership will bring about exploi- Creating new job op- 405 38,0 242 40,3 tation in the expense of Turkey (52%German- portunities Turks; and 34%French-Turks); and member- Bringing new familial 341 32,0 121 20,2 and ethnical values ship will enlarge job opportunities Bringing humanitarian 286 26,9 111 18,5 (61%German-Turks; and 83%French-Turks). quality These figures expose that French-Turks seem Others 11 1,0 4 ,4 to be more in favour of Turkey’s membership I Don’t think that 41 3,8 29 4,8 they have a positive to the Union, and that they have less cultural, impact moral and communal concerns than the Ger- Total 1065 100 600 100 man-Turks. Q. What kind of negative impacts do the Q. To which extent are you positive or nega- Turks have on the receiving society? (multi- tive about the common currency, EURO? response) Germany France Germany France Count % Count % Count % Count % Very negative 537 50,4 166 27,7 Abusing the social 268 25,2 109 18,2 Negative 371 34,8 175 29,2 security system Both positive 71 6,7 97 16,2 Not adapting 287 26,9 198 33,0 and negative with local values Constructing their 282 26,5 195 32,5 Positive 46 4,3 127 21,2 own Very positive 17 1,6 25 4,2 closed communities No idea 23 2,2 10 1,7 Being lazy 252 23,7 92 15,3 Total 1065 100 600 100 Not obeying rules 387 36,3 141 23,5 Others 17 1,6 9 ,1,5 I Don’t think that 262 24,6 191 31,8 The tables below also indicate the perceptions they have a negative of the interlocutors about the positive and impact negative impacts of the Euro-Turks on the Total 1065 100 600 100 ‘hostland’. While a great proportion of the people in Germany think that Turks stand for Combining the two tables above, the Euro- cultural richness and labour force, a relatively Turks believe that their positive impact is big- lower proportion believe that Turks have nega- ger than their negative impact. Approximately tive impact with their incapability of obeying 32%of the French-Turks and 25%of the Ger- rules, closed community formations and dis- man-Turks believe that Turks have no negative tinct values. The interviewees commonly be- impact on the receiving societies. 36%of the lieve that the Euro-Turks primarily provide the German-Turks state that Turks generally do not European countries with labour force. “Cultural obey the rules, and 25%believe that Turks mis-

42 | TURKEY IN EUROPE MONITOR use the social security system. The misuse of EU Membership and Migration Prospects the social security system was one of the for Turks in Turkey mostly debated issues by the young generation German-Turks in the in-depth interviews and One of the commonly expressed concerns re- focus group discussions. In parallel with the garding Turkey’s membership to the Union is misuse of the social security system, 24%of the the possibility of immense immigration from German-Turks report that Turks are inclined to Turkey into the EU countries. However, our be lazy. On the other hand, the disability to qualitative and quantitative research exhibits adopt to the local values (33 %), the tendency the contrary. In the first place, those interlocu- of constructing ethnic enclaves (33 %) are the tors we interviewed in the in-depth interviews, mostly raised issues by the French-Turks in focus group discussions and structured inter- explicating the negative impacts of the Turks. views expressed that they would not recom- The ways in which different issues have been mend the Turks in Turkey to migrate to the EU phrased by both German-Turks and French- countries if Turkey gets into the Union (79 %). Turks are also subject to the separate incorpo- The reason for them to raise such a recommen- ration regimes applied by Germany and France dation is the difficulties they face in the EU: vis-à-vis the migrants. The issue of construct- rising unemployment, longing, law wages, dis- ing ethnic enclaves and communities raised by ciplined working conditions, lack of tolerance, the French-Turks seems to be highly linked and depreciation of moral values. However, with the fact that the Republican state tradition they generally have a strong belief that there is very sensitive about homogeneity and differ- would be an immense migration to the EU ence-blindness. However, the liberal democ- countries. This belief is in parallel with the ratic regime in contemporary Germany does common belief in the EU countries. Hence, the recognise the differences in a way that doesn’t experiences of the Euro-Turks should be problematise ethnic and cultural enclaves as clearly transmitted to the Turks in Turkey. On much as the French state does. the other hand, the previous experiences in the integration of Spain, Italy, Portugal and Greece Apparently, Euro-Turks have gained strong to the Union did not result in immense migra- merits in terms of developing a democratic po- tion. In these cases even reverse migration was litical culture highlighting human rights, de- experienced. It seems that the same could apply mocratization, participation, reflexivity, rule of to the Turkish case. The proportion of those law, rights, equality and trust. What is different people who would consider going back to the in this picture compared to the picture in Tur- homeland in the case of Turkey’s membership key is that they have generated a rights- to the Union is more than 30%in both coun- specific-political culture rather than a duty- tries. specific-one. The answers given to the questions comparing the rights, educational system, Q. Would you recommend those from Turkey police, democracy, human rights, social secu- to immigrate to Germany/France? rity system, job opportunities, legal system, the Germany France respect for rules and regulations, value human Count % Count % capital, equality, freedom of faith, and cultural I would recommend 220 20,7 227 37,8 I wouldn’t recommend 845 79,3 364 60,7 dialogue indicate that Germany and France are It depends 9 1,5 considered to be much more democratic than Total 1065 100 600 100 Turkey. All these answers depicting the drastic difference between Germany/France and Tur- Q. Do you expect an immense migration to the key, clearly indicate the deep-rooted democ- EU countries if Turkey joins the Union? ratic institutions and the high level of democ- Germany France racy in Germany/France. Turkey comes to the Count % Count % fore when the interviewees were asked ques- Yes 758 71,2 412 68,7 tions about mutual tolerance, and moral values. No 180 16,9 125 20,8 No idea 127 11,9 63 10,5 Total 1065 100 600 100

NO. 5 / MAY 2004 | 43

Q. Would you consider returning back to the year 2000, when the new citizenship law Turkey if Turkey joins the EU? was put into force. The number of the German- Germany France Turkish population having German citizenship Count % Count % was around 350 thousand, and now this figured Yes, I would certainly 91 8,5 58 9,7 increased up to 700 thousand people. The latest return. Yes, I would. 204 19,2 126 21,0 statistics we acquired in our research then cor- I don’t know. 405 38,0 173 28,8 responds to 59%who either have German citi- No, I wouldn’t. 253 23,8 166 27,7 zenship or plan to have it soon. And this per- No, I wouldn’t cer- 112 10,5 77 12,8 centage equals to around 1.5 million people tainly return. from among the total of 2.5 million German- Total 1065 100 600 100 Turks. The new German citizenship law actually signifies that migrants can be quite recep- Building New Identities and Bridges tive and incorporatist vis-à-vis democratic and inclusive political and legal changes. While on the one hand, Euro-Turks are officially defined in Turkey as either ‘gurbetci’, or Q. Do you have German / French citizenship? ‘Yurtdisindaki vatandaslarimiz’ (our citizens Germany France abroad), on the other hand, they are stereotypi- Count % Count % cally defined by the Turkish people in Turkey Yes, I have it 279 26,2 213 35,5 as either ‘Almanyali or ‘Almanci’ (German- I have 74 6,9 44 7,3 like). Both terms (Almanyali and Almanci) already applied. carry rather negative connotations in Turkey. I am planning 277 26,0 188 31,4 The major Turkish stereotypes about the Euro- to apply. I am not plan- 435 40,8 155 25,8 Turks are those of their being rich, eating pork, ning to apply. having a very comfortable life in Ger- Total 1065 100 600 100 many/France, losing their Turkishness, and 4 becoming more and more German/French. In On the other hand the fact that there are 1 mil- recent years, Euro-Turks began to raise their lion people (41 %) who are not willing to ac- voices to complain about the paternalist ap- quire German citizenship does not necessarily proach of the Turkish state towards themselves. mean that they are not integrationist, national- They no longer want to be perceived as passive ist, Islamist or whatever it may be. This per- and obedient persons in need for support, and centage is around 26%in France, corresponding cash machines making foreign currency for the to almost 100 thousand French-Turks. It may homeland. Constituting around 4 million in- be that some of the both German-Turks and habitants in the West, they rather want to be French-Turks are already pleased with the more active in the Turkish – EU relations and denizenship6 status, which gives them civil, to be supportive for Turkey in adapting herself social, and cultural rights, but not political with the new EU regimes. The rise in their rights. Another reason in the German context willingness to acquire German/French citizen- may be that German-Turks had expected a ship is a sign in this respect, addressing their 5 more democratic citizenship law to be put into potential and reflexivity in generative politics. effect without any limitation for dual citizenship. But perhaps their expectations dimin- The number of German-Turks who either have ished, and they did not see any further benefit EU citizenship or are planning to apply is in acquiring German citizenship. A third possi- around 59%in Germany and 74%in France. ble reason in the German context may be that These high numbers indicate that Euro-Turks Turks, who are mostly residents in the urban are prone to integration and political participa- space, preferred to ignore the new nationality tion. The latest statistics indicate that the num- law, which relatively required more bureau- ber of German-Turks naturalized doubled since cratic workload in city-states such as Berlin.

4 For a detailed analysis of these labelings see Kaya This may have had a discouraging impact on (2001). the German-Turks in the process of naturalisa- 5 The term ‘generative politics’ was first coined by Anthony Giddens (1994) to underline one of the 6 Denizen literally refers to those who reside in cer- essential elements of radical politics addressing the tain geography. The term is introduced by Thomas centrality of reflexive individual agency. Hammar (1990) in the migrancy context.

44 | TURKEY IN EUROPE MONITOR tion. A fourth justification in both German and both homeland and receiving country. It should French context may be that there is already a also be stated here that most of the Euro-Turks decline in the voting habits of Euro-Turks, who who have closer affiliation with the homeland are restricted with the law to vote in the Turk- come from the lower social status. ish general elections. The right to vote in their own residential areas is a great issue for Turk- Q. Which one of those below defines you ish citizens living abroad. most? (multi-response) Germany France Q. Which identifications suit you most? Count % Count % Turkish citizen 256 24,0 213 35,5 Germany France Turkish 240 22,5 145 24,2 Count % Count % Kurdish 45 4,2 23 3,8 Only Turkish 390 36,6 145 24,2 Muslim 348 32,7 96 16,0 First Turkish and 531 49,9 351 58,5 Muslim-Türkish 424 39,8 244 40,7 then European Alevi 35 3,3 22 3,7 First European 98 9,2 68 11,3 German (French) citi- and 74 6,9 54 9,0 zen then Turkish German (French)-Turk 77 7,2 106 17,7 Only European 40 3,8 21 3,5 Euro-Turk 60 5,6 36 6,0 Others 6 ,5 17 2,5 World citizen 56 5,3 64 10,7 Total 1065 100 600 100 EU Citizen 22 2,1 25 4,2 Others 10 1,0 1 ,2 The table shows that Euro-Turks themselves Total 1065 100 600 100 confirm their hyphenated identities (Euro- Turks): 60%in Germany and 70%in France. The sum of those defining themselves as Ger- Around 60%of the German-Turks define them- man citizen, German-Turk, world citizen and selves as either Turkish/European or (50 %) EU citizen is actually quite high (27 %). This European/Turkish (10 %). This ratio is goes up to 47%among the French-Turks. The 59%(Turkish-European) and 10%(European- difference between those defining themselves Turkish) in France. On the other hand, 37%of as either German-Turks or French-Turks is the German-Turks and 24%of the French- worth mentioning here. 7%define themselves Turks define themselves as “Turkish”. These as German-Turk, and 18%define themselves as figures differ from the findings of Hakan Yil- French-Turks. This is probably because of the maz (Bosphorus University, November 2003) definition of Germanhood and Frenchhood. that is displayed in his work on “Euroscepti- While Germanhood is considered to be an eth- cism in Turkey”. In his research 54%of the nic nomination, Frenchhood is defined as a Turks define themselves as “Turkish”, 30,5%as civic nomination letting those outsiders be in- Turkish-European and 4,7%as European- cluded in. Among the French-Turks civic iden- Turkish. Further analysis of the cross- tities are more phrased as in their defining tabulations also show that younger generations themselves Turkish citizen (36 %). This is and middle and upper-middle class Euro-Turks around 24%for the German-Turks. This table are more inclined with using hyphenated iden- shows us again that such definitions are subject tities such as European-Turkish. to the dominant regimes of representation by the majority society. Q. Do you feel yourself affiliated closer with Germany/France or Turkey? German-Turks generally define themselves as Germany, % France, % ‘religious’ (33 %), ‘patriot’ (22 %), ‘national- Turkey 48,5% 35,7% ist’ (17 %), ‘democrat’ (17 %) and ‘conserva- Germany/France 22,0% 25,3% tive’ (17 %). On the other hand, the French- Equal affiliation to both 26,9% 35,8% Turks use the following identifications to de- Equal detachment from both 2,6% 3,2% fine themselves ‘nationalist’ (27 %), ‘Atatürk- Total 100% 100% ist’ (21 %), ‘religious’ (21 %), ‘laicist’ (19 %)

and ‘patriot’ (19 %). This shows that the The table above indicates that most of the French-Turks are rather republican and unitary, Euro-Turks do not feel themselves closer with while the German-Turks are communitarian. their homeland. The cross-tabulations also reveal that younger generations have a growing tendency in affiliating themselves more with

NO. 5 / MAY 2004 | 45

Q. How do you define yourself with regard to Conclusion the identifications below? (multi-response) Germany France The data gathered by the structured interviews Count % Count % indicate that German-Turks, generally speak- Nationalist 188 17,7 160 26,7 ing, are more communitarian, religious and Leftist 37 3,5 35 5,8 Democrat 183 17,2 98 16,3 conservative than the French-Turks. Compared Religious 349 32,8 127 21,2 to the French-Turks, the German-Turks seem Conservative 180 16,9 27 4,5 to be less in favour of integration as they are Rightist 36 3,4 12 2,0 content with their ethnic enclaves, religious Atatürkist 93 8,7 127 21,2 archipelagos and traditional solidarity net- Laicist 39 3,7 112 18,7 Social democrat 84 7,9 40 6,7 works. However, other findings in the research Ülkücü (Ex- indicate the other way around. Although com- treme national- 42 3,9 48 8,0 pared to the German-Turks, the French-Turks ist) seem to get engaged more in a modern way of Revolutionary 10 ,9 18 3,0 Patriot 238 22,3 115 19,2 life orientating themselves to integration, Islamic 146 13,7 50 8,3 French language, secularism, laicism, and No response 3 ,3 3 ,5 French media on the one hand, they are en- None of those 2 ,2 4 ,7 gaged less in French domestic politics, political above parties, internet, theatres, and cinemas. How- Total 1065 100 600 100 ever, German-Turks seem to generate more It has been reported that 7,5%of the German- cosmopolitan, hybrid, global, and reflexive Turks and 10%of the French-Turks define identities in a way that redefines Europeanness, themselves as quite religious, a similar pattern which is actually subject to a constant change. with the Turks in Turkey. 89%of the German- Thus, the experiences of the German-Turks Turks and 80%of the French-Turks are re- actually seem to indicate that Islam does not ported to be relatively faithful. On the other necessarily contradict with Europeanness, hand, 2, 4%of the German-Turks and 10%of cosmopolitanism, modernity, and globalism. the French-Turks seem to be either atheist or faithless. Cross-tabulations clearly explain that Western democracies and citizenship regimes religiosity among the Euro-Turks is far from seem to fail in treating minority claims as a being essentialist and fundamentalist, and also quest for justice. As Kymlicka and Norman that religiosity increases among those of lower stated “immigrant groups that feel alienated social status. from the larger national and [religious] identity are likely to be alienated from the political Q. How do you define yourself with the follow- arena as well” (2000: p. 39). Traditional citi- ing statements regarding your faith? zenship rhetoric is inclined to aggravate the advance of the interests of the dominant na- Germany France Count % Count % tional group at the expense of migrants. Hence, Quite a religious it is unlikely that the classical understanding of person fulfilling 80 7,5 58 9,7 citizenship can resolve issues of co-existence all the require- of ‘culturally discrete’ entities. In order to ments of my faith Someone trying avoid the potentiality of conflict and alienation, to fulfil his reli- 571 53,6 279 46,5 there is an essential task to be undertaken: citi- gious requirements zenship laws should not be based on prescribed Faithful, but not cultural, religious, linguistic and ethnic quali- fulfilling the reli- 377 35,4 197 32,8 gious requirements ties. Moderate and democratic citizenship laws Someone who that should be formulated in line with the task doesn’t 26 2,4 28 4,7 stated above can be anticipated to resolve the really believe in emphasis made on ethnicity, religiosity and faith Someone who does nationality by migrants groups. 11 1,0 35 5,8 not have faith No response 3 ,5 This research has also revealed that there are Total not only those Turkish origin migrants in the 1065 100 600 100 west who fit into the category of stereotypical ‘Turk’. It has been displayed that the propor-

46 | TURKEY IN EUROPE MONITOR tion of Euro-Turks in this category is around 40 Gilroy, P. (1994). “Diaspora,” Paragraph 17, percent. However, it was also concluded that No.3 (November): 207-210. the majority of the Euro-Turks have become politically, socially, economically and cultur- Gilroy, P. (1995). “Roots and Routes: Black ally integrated active agents in their countries Identity as an Outernational Project” in H.W. of settlement. Around 20 percent of them have Harris et al. (eds.), Racial and Ethnic Identity: actually assimilated into the receiving society. Psychological Development and Creative Ex- On the other hand, 40 percent have generated a pression (London: Routledge). form of life embracing both homeland and ‘hostland’ in a way that constructs a bridge in Hall, S. (1991). “Old and New Identities, Old between. and New Ethnicities,” in Anthony D. King (ed.), Culture, Globalization and the World- References System (London: Macmillan Press).

Brecher, J. et al. (1993). Global Visions: Be- Hall, S. (1994). “Cultural Identity and Dias- yond the New World Order. Boston: South End pora” in P. Williams and L. Chrisman (eds.), Press. Colonial Discourse and Post-Colonial Theory (New York: Columbia University Press). Clifford, J. (1994). “Diasporas,” Cultural An- thropology 9, No.3: 302-338. Hammar, T. (1990). Democracy and the Nation State, Aldershot: Avebury. Clifford, J. (1992). “Travelling Cultures,” in L.Grossberg, C.Nelson and P.Treichler, Cul- Kaya, A. (2001) Sicher in Kreuzberg: Con- tural Studies (New York: Routledge): 96-116. structing Diasporas, Turkish Hip-Hop Youth in Berlin, Bielefeld: Transcript Verlag. Clifford, J. (1997). Routes: Travel and Trans- lation in the Late Twentieth Century. Cam- Kivisto, P. (2002). Multiculturalism in a bridge: Harvard University Press. Global Society, Oxford: Blackwell Publishing. Kymlicka, W. and M. Opalski (2002). Can Ganguly, K. (1992) “Migrant Identities: Per- Liberal Pluralism be Exported? Oxford: Ox- sonal Memory and the Construction of Self- ford University Press. hood,” Cultural Studies 6, No.1 (June): 27-49. Kymlicka, W. and W. Norman (eds.) (2000). Giddens, A. (1994). Beyond Left and Right: Citizenship in Diverse Societies, Oxford: Ox- The Future of Radical Politics, Cambridge: ford University Press. Polity Press. Maas, W. (2004). “European Rights and Mi- Gilroy, P. (1987). There Ain’t no Black in the gration within the Union,” Unpublished Paper Union Jack. London: Hutchinson presented in the Council for European Studies Conference, Chicago (11-13 March) Gilroy, P. (1993). Black Atlantic: Double Con- sciousness and Modernity. Cambridge: Har- Tindemans, L. (1975). European Union, Re- vard University Press. port to the European Council, Brussels.

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TURKISH BUSINESS PERSPECTIVES • In the context of Intellectual Property Rights, TÜSIAD underlined the impor- by tance of guaranteeing IP rights as a crucial factor for promoting creativeness, for TÜSIAD achieving sustainable development and for TURKISH INDUSTRY & BUSINESS increasing competitiveness. ASSOCIATION

• Regarding the latest constitutional www.tusiad.org amendments in Turkey, TÜSIAD declared

that in order to ensure the implementation BUSINESS COMMUNITY’S of the gender equality law, it is required INITIATIVES ON THE ROAD TO THE to provide constitutional protection for EU positive discrimination.

During the first five months of 2004, Turkish • At the occasion of the Europe Day, on business community has intensified initiatives th May 9 , TÜSIAD hosted in the Southeast- in view of strengthening Turkey’s EU member- ern town of Diyarbakir activities aimed at ship process. In this context, TÜSIAD’s work- providing information on EU history and ing groups have focused their agenda on the policies to high school and university stu- related chapters of negotiations with the EU. dents coming from different regions of

Turkey. This event was organised in co- TÜSIAD organised also a number of seminars operation with the regional business or- and expressed opinions in order to promote ganisations and the EU Information Office the alignment of Turkish economic and soin Diyarbakir. cial policies with the EU acquis:

• A report that analyses the negotiations • New orientations in the field of high edu- process of some of the candidate countries cation, science and technology within the with the EU is drafted. It aims to prepare framework of the EU’s Lisbon Strategy Turkey’s institutional structure to the ne- and the Bologna Process. gotiations process, following the expected

positive decision at the European Council • Further and better involvement of women in December 2004. in education, work force, politics and con-

sequently widespread women participation • In high-level meetings with the business in the decision-making mechanisms. federations from Germany (BDI), Den-

mark (DI) and the Netherlands (VND), is- • Current stage of Turkey’s alignment with sues related to the competitiveness of the the EU’s customs and internal market leg- European industries are analysed. In this islation and the shortcomings both in regard, TÜSIAD’s counterparts from the adoption and the implementation of the EU’s business community acknowledged relevant legislation. Turkey’s economic potential and impor-

tance of a clear European perspective for • Enterprise policy and entrepreneurship, Turkey. as the main driving force for economic growth and employment, are addressed alongside with the increased importance TÜSIAD IS A MEMBER OF UNICE of knowledge and innovation in the global (UNION OF INDUSTRIAL AND EMPLOYERS’ economy. TÜSIAD triggered a debate on CONFEDERATIONS OF EUROPE) how entrepreneurship in Turkey could be improved, considering that it is a key factor in increasing European economy’s global economic competitiveness.

CEPS Turkey in Europe Monitor

No. 6, June 2004

Introductory Note from CEPS

This issue of the CEPS Turkey in Europe Monitor presents an executive summary of and Fabrizio Barbaso, Director General of DG provides a link to the full text of a ‘Friends of Enlargement at the Middle East Technical Europe’ working paper prepared by Kirsty University in Ankara on 25 May 2004. The Hughes on the political and economic impacts speech titled ‘Turkey-EU Relations in the Per- of Turkish membership for the European Un- spective of the December European Council’ ion. The paper titled ‘Turkey and the Euro- provides certain insights to the Commission’s pean Union: Just Another Enlargement?’ views on Turkey before the preparation of the analyses whether Turkish accession can be Progress Report due in October. managed in a similar way to that of other enlargements. This month’s Monitor also provides the full text of the speech delivered by Michael Emerson and Senem Aydın

Turkey and the European Union: 2002 the European Council announced that if Just Another Enlargement? Turkey met its political ‘Copenhagen’ criteria by the end of 2004 it would open negotiations Exploring the Implications of Turkish Ac- without delay. Since 1999, and particularly cession since the election of the AKP government in November 2002, there has been radical and Kirsty Hughes rapid political reform in Turkey. Major political reforms have promoted democratisation, A Friends of Europe Working Paper on the and led to considerable steps forward in the occasion of the ‘Turkey’s EU end-game?’ area of human rights including minority rights European Policy Summit of 17 June 2004 and in the area of civilian control of the military. The EU goal has been a very important framework in underpinning these reforms and Executive Summary uniting disparate groups around reform.

This paper analyses the likely political and At the same time, reforms are not complete economic impacts of Turkish membership of and there are particular problems in many ar- the EU for the Union itself. It asks whether eas of implementation of reform including in Turkish accession can be managed in a similar the human rights area. Judicial reform remains way to that of other enlargements or whether inadequate. The European Commission has critics are right that Turkey is too big, too made clear its expectation of further progress poor, with too dangerous borders and insuffi- in a number of key areas before it draws up its ciently ‘European’ to join the Union. vital report on progress and its recommendation in the autumn to the EU’s leaders on whether to open negotiations. There is much Political Dynamics in Turkey agreement across different political groups and actors in Turkey, that opening EU negotiations Turkey was officially recognised as an EU is a vital step if the strong dynamic of political candidate in December 1999, and in December reform is to continue and become deeply

| 48 NO. 6 / JUNE 2004 | 49 rooted. There is also widespread pessimism in time when the EU is beginning to feel the Turkey at the impact on political reform if the negative impacts of its aging demographic European Council does not decide to open ne- profile. gotiations in December. Foreign direct investment in Turkey is exceptionally low. The prospect of EU membership Turkey in the EU - Economic Impacts together with increased political and economic stability at macro-level, and major reform of Turkey is a large country in population terms barriers at micro-economic level – including and a small one in economic terms. If Turkey tackling corruption and problems in the judici- joins the Union in 2015 it will have a popula- ary – could results in FDI flows of €2-4 billion tion of 82.1 million, slightly smaller than that a year. of Germany at 82.4 million, both accounting for just over 14% of EU28 population. By As a large poor country, Turkey will be eligi- 2025 at 87 million people, Turkey will be the ble for significant budget transfers from the largest EU member state and account for Union – though these will depend both on pol- 15.5% of the population. Looking forward to icy reforms in regional and agricultural poli- 2050, population is predicted to stabilise at 97 cies in the EU in the next ten years, and on the million – 17.7% of EU28 million (slightly less actual negotiations. Both the EU’s common than Germany’s 18.1% share today of the agricultural policy, and agriculture in Turkey EU25 population). will need further reform. Likely budget flows in the first 3 years of Turkish membership are Today Turkey’s economy is just 1.9% of estimated at a total of €45.5 billion i.e. around EU25 GDP. Assuming average annual growth €15 billion a year. Turkey’s own contributions of 5%, it would be 2.9% of GDP on accession to the budget will mean the net figure could be in 2015. Turkey’s GDP per head (at purchas- €30-35 billion (and negotiations may reduce ing power parity) is only 27% of the EU aver- this further). In per capita terms, this is almost age. Turkey’s economy is also characterised identical to the budget deal for the ten new by major regional inequality. Turkey’s mac- member states. roeconomic situation is stabilising after the 2001 crisis – opening of negotiations is expected to impact strongly and positively on the Turkey in the EU – Political Impacts sustainability of this recovery. But many further economic reforms are necessary. Labour The fact that Turkey will become the EU’s market – and education – reforms are vital if largest member state in population terms soon Turkey is to use its economic potential. Both after accession is one of the biggest impacts of youth unemployment and the exceptionally Turkish accession. Turkey’s strategic geo- low employment rate of women at 25.5% need graphical location and its large Muslim popu- to be tackled. lation also have implications for the EU. It is in the EU’s strategic interests that Turkey is Given its small size, Turkish accession will democratic, stable and prosperous and a have minimal impact on the EU economy. It friendly ally. Turkish EU membership can – as might have a very small but positive impact on with earlier enlargements – contribute to these EU25 GDP of 0.1-0.3% of GDP, an impact strategic goals. The impact of Turkish acces- which will increase if there are net migration sion – and of opening accession negotiations – flows from Turkey to the current EU mem- in demonstrating that the EU is a secular, mul- bers. The EU could benefit in particular from ticultural body not a ‘Christian club’ – will the different demographic profile of Turkey, also have important geopolitical ramifications. with its much younger, growing population. If migration flows from Turkey are similar to Institutionally, Turkey will have a large impact those anticipated from the new EU member on the Council and the European Parliament states from central and Eastern Europe, then but not on the European Commission. Assum- flows of around 225,000 a year would be an- ing a double majority system of voting oper- ticipated, with a long run eventual stock of ates in the Council (of countries and popula- about 2.9 million migrants. This would be at a tion), in an EU of 28 both Turkey and Ger-

50 | TURKEY IN EUROPE MONITOR many will have around 14.5% of the vote ways will have much in common with Medi- each. They will be strong players but unable to terranean member states like Greece, Spain block proposals even together but they will be and Portugal. able to block proposals with a third large country. The large countries are not in a posi- Overall, the paper concludes that Turkey will tion to push through proposals on their own have significant impacts on the Union but due to the need for a majority of countries as these impacts can be managed as those of pre- well as population. vious enlargements have been. Consequently, Turkey’s candidacy should be judged on the The largest 5 countries in an EU of 28 will same terms as that of other candidates – account for 60.3% of the vote by population. through adoption of the acquis and through This is only 3.4 percentage points higher than meeting the Copenhagen criteria. the share of the ‘big 4’ countries in an EU of 25 (where they have 56.9% of the vote). So The full text of the working paper can be ac- Turkey will be an important powerful player cessed at and will add to the already complex set of alli- http://www.friendsofeurope.org/pdfs/Turkeyandthe ances and blocking combinations that are pos- EuropeanUnion-WorkingPaperFoE.pdf sible. But in an EU of 28, despite its size, it does not add strongly to the dominance of the larger countries (assuming in any event that the large countries could and would agree). In terms of seats in the European Parliament, if Turkey-EU Relations in the perspective of seats are reallocated proportionately to take the December European Council account of Turkish, as well as Bulgarian and Romanian accession, then Turkey – and Ger- Speech by Mr. Fabrizio Barbaso, Director many – would both have 82 seats – 11.2%each General DG Enlargement of the total number. Ankara, Middle East Technical University,

25 May 2004 Turkey will have an important impact on EU foreign policy interests given its borders with Introduction the Middle East, Caucasus and the Black Sea. This will shift the Union’s borders to the I am pleased and honoured to be here today to South-East and increase the Union’s range of address this distinguished audience of An- interests in these difficult regions. Turkey will kara's famous Middle Eastern Technical Uni- look to be a significant player in the develop- versity. With its strong international back- ment of EU foreign policy but it will not be as ground and its reputation which stretches well important a ‘bridge’ to the Middle East as beyond Turkey, this university is well known some expect. Turkey will impact more widely for preparing outstanding young professionals on the already complex political dynamics of the coming generations. Many of them are among member states, including among the already making their mark on Turkey's prepa- larger member states, but Turkey alone will rations for EU membership. The programme not determine the future political evolution of of the this Third Conference on International the Union. And many issues around whether Relations offers an impressive number of in- the enlarged Union can find strategic leader- terventions from top scholars and specialists ship and direction, and whether it will aim for ranging on a wide number of issues related to further political integration, will become clear Europe in a changing world. in the next decade before Turkey joins. Europe is indeed changing. On 1 May, the There is a risk that Turkey as a member state European Union extended its membership could resemble the UK and be a rather awk- from 15 to 25 countries. This is the fifth ward player – but it is more likely than the UK enlargement to take place since the beginning to understand the political nature of the Union. of the European Community 50 years ago. In a It will also resemble in some ways the new historical perspective, the recent enlargement member states of central and Eastern Europe is more than another extension of the EU. It in some of its policy interests, and in other

NO. 6 / JUNE 2004 | 51 represents the application on a continental found to meet the Copenhagen political crite- scale of a model of peaceful and voluntary ria, then accession negotiations will start with- integration among free peoples. out delay. This is the clear roadmap for Turkey which was decided by the Heads of State and It demonstrates once again the attraction of the Government in Copenhagen in December European model of integration. But this 2002. enlargement is unlike those that preceded it. Never before had so many new Member States In the Commission, considerable efforts are joined the EU at the same time. Never before now being geared towards the preparation of have they been so thoroughly prepared, with a the report. We are intensifying our efforts, in sweeping transformation of their economic, Brussels and in Turkey, in order to establish an legislative and administrative systems. accurate assessment of the situation. As always, this report will be based on an objective Turkey in the EU enlargement process and thorough analysis. This will be one of the most important tasks of the Commission this While Turkey’s recent history is very different year. We have an intensive work programme from that of the central and eastern European to monitor Turkey’s progress in meeting the countries, a comparable process of transforma- Copenhagen criteria, accompanied by initia- tion has begun in Turkey. The decision of the tives to assist it in this goal. European Council in Helsinki in December My Directorate General for Enlargement is 1999 to give candidate status helped Turkey to actively pursuing a busy agenda which in- embark upon a process of far-reaching consti- cludes a series of formal and informal consul- tutional and legislative reforms in a very short tations with the Turkish authorities in the pe- period of time. Anyone visiting Turkey for the riod up to July 2004. We had this morning one first time in 5 years is surprised about the pace of our regular sessions of the regular monitor- of Turkey's change. Turkey today appears to ing of the political criteria. A seminar on cul- be more open, more self-confident and self- tural rights with EU experts was held last critical than it was before. People are eager to week in Ankara. At technical level, a series of see more reforms. It is noteworthy that many instruments have been worked out combining of the reforms have been adopted unani- seminars, fact-finding and expert missions. mously, with bipartisan support from the majority and the opposition. We are not only monitoring progress in meeting the political criteria, but also offering as- And yet the debate about Turkey's EU aspira- sistance by means of expert seminars and leg- tions is one of the most prominent questions in islative advice. Under a joint project with the our European agenda. There is hardly a day Council of Europe, for example, important where Turkey is not a focus of the European draft pieces of legislation such as the penal media. Developments in Turkey attract an ever code or the law on the press or on association growing attention, in Europe and on a wider are being reviewed. We are supporting training stage. The period we are living in is particu- programmes in human rights for the judiciary larly eventful. and for members of the security forces. We also offer assistance by means of twinnings, My purpose today is not to elaborate on these involving experts from our Member States difficult albeit fascinating subjects. Rather, I who provide advice to Turkish officials in would like to concentrate on giving you an their working environment. assessment of current relations between the European Union and Turkey, which have The significance of political reforms evolved remarkably in recent years and in particular since the Helsinki decision. Turning to the political criteria, it is possible to say that reforms in this area have been particu- As I am sure you know, the European Council larly impressive. Since the first reform pack- will have to decide in December, on the basis age was adopted in October 2001, numerous of a report and a recommendation of the initiatives have addressed some of the most Commission, whether Turkey complies with sensitive issues in the Turkish context. This the Copenhagen political criteria. If Turkey is progress has been explicitly acknowledged by

52 | TURKEY IN EUROPE MONITOR the European Council at almost every meeting area of human rights. We have deepened our in the recent period. The Brussels European dialogue on the political criteria and are dis- Council in December 2003 noted that the pro- cussing issues in detail, openly and without gress achieved has brought Turkey closer to any limitation. the Union. The package of constitutional amendments adopted by the Turkish Parlia- Turkey’s compliance with the Copenhagen ment on 7 May constitutes another step to- political criteria wards compliance with the Copenhagen political criteria. It showed once again the strong As I already mentioned, in a few months’ time commitment of Turkey to political reforms. it will be the Commission’s task to assess in its The new provisions in the latest reform pack- report whether Turkey meets the Copenhagen age touch upon a number of areas ranging political criteria. In view of the substantial re- from the judiciary, civil-military relations, forms already enacted, is Turkey close to freedom of the press and gender equality. meeting the Copenhagen political criteria? My Some of the changes, such as the abolition of reply would be that at this moment the process the State Security Courts and the withdrawal is not yet complete. Although further progress of the representative of the National Security has been achieved under the last package of Council in the High Education Board, address constitutional amendments, we understand that specific issues mentioned in the Commission’s the Turkish government itself has further plans 2003 Report and in the Conclusions of the to address all the remaining issues under the Brussels European Council of December 2003. Copenhagen political criteria by means of additional legislative packages. Among the is- One of the most perceptible results of these sues to be addressed, in our view, are: reforms so far has been a noticeable change of climate. Taboos have been broken one after - the need to continue and possibly to com- the other. Civil society is getting stronger and plete reviewing the basic legislation re- more organised. People are thirsty for free- lated to the exercise of fundamental freedom. The government appears to be deeply doms, such as the Penal Code, with a view aware of this as Non Governmental Organiza- to ensuring compliance with European tions are being consulted on the drafting of standards. legislation such as the new Penal Code. New - aligning the system of rights of defence channels have been set up to allow people to with EU Standards; report about cases of human rights violations - ensuring full Parliamentary control over and the population appears to be more aware military expenditures and in particular of its rights. over public procurement. The two extra- budgetary funds in the area of military ex- In short, the reform process has brought a new penditures will only be phased out by the mood of openness and freedom in public de- end of 2007; bate in Turkey. Issues whose mention could - removing the representative of the Na- previously trigger criminal proceedings, such tional Security Council in the High Audio as the role of the military, the Kurdish lan- Visual Board (RTÜK); guage, or cases of torture and ill-treatment, are - adopting appropriate legislation to address now freely debated. There is public debate the problems faced by non Moslem com- about equipping Turkey with a new and mod- munities. ern constitution enshrining the basic values on - -Easing the existing restrictions on Ra- which the EU is based. dio/TV broadcasting and education in languages other than Turkish. There has also been a notable change in the climate of our bilateral relations. We have The challenge of implementation moved a long way in terms of how we ap- We are also following the practical implemen- proach and perceive each other. Whereas ear- tation on the ground It is clear that the task of lier Turkish governments did not recognize the ensuring systematic and effective implementa- shortcomings under the Copenhagen political tion of the reforms presents a sizeable chal- criteria, we now very largely share a common lenge. The concrete effects of the reforms assessment of the situation, including in the

NO. 6 / JUNE 2004 | 53 should be felt by ordinary citizens in their islative reforms should be respected through- daily life. However, according to our informa- out the country by different levels of govern- tion, the picture is still mixed. ment and public administration, the judiciary and security forces. In this context, the case of There have been some first signs of implemen- Leyla Zana can be mentioned as a negative tation on the ground such as the liberation of example which casts a shadow on the imple- some political prisoners or the adoption of a mentation of the reforms. We have also been more active attitude in fighting torture prac- informed of persisting cases of honour crimes tices across the country. The Kurdish language and of incidents of disproportionate use of is being increasingly used in the context of force against peaceful demonstrations. various cultural events in the Southeast and elsewhere. In this context, the starting of Of course we don’t under-estimate the scale of Kurdish language courses in three cities in the challenge for a country of the size and Anatolia is welcome. After the lifting of the complexity of Turkey. The difficulties wit- state of emergency in the South East, there nessed in Turkey would be faced by any coun- appears to be some movement on adopting a try in a similar situation. But what matters is more integrated approach towards the issue of the steady determination to overcome hurdles internally displaced persons and the compen- and bureaucratic bottlenecks, and to establish a sation for damages incurred during the last two clear track record of progressive implementa- decades. tion of the reforms. We know that the task is considerable and we fully support the efforts But these positive developments are overshad- of the Turkish government to tackle these is- owed by some negative events. There contin- sues. ues to be court cases against people expressing non violent opinion. There is evidence that human rights defenders are still subject to har- The December 2004 decision assment and intimidation from the authorities. Although the scale of torture has been re- If the European Council decides to open nego- duced, there are still reports of cases of ill- tiations with Turkey, as President Prodi said treatment including torture, in particular in when he was in Turkey in January, accession custody. is not a formality, and not for the immediate In some areas, implementation faces consider- future. The negotiations will take time, reflect- able difficulties. This is the case for cultural ing the scale of the difficulties in many sectors rights where there is still no radio/TV broad- faced by such a large and complex country. I casting in language other than Turkish. I should also recall that the task of adopting and would like to recall that this issue has been on implementing the acquis communautaire is the agenda since a number of years now and enormous, and has important implications for we cannot see any progress on the ground so the legal system in Member States. Commu- far. nity legislation takes precedence over national legislation. The European integration process, In other areas, the situation does not seem to which incorporates a growing number of have moved much. As regards freedom of re- common policies, involves a loss of national ligion, apart from some positive developments autonomy for Member States. But the process in specific cases, there appears to be little pro- of joint decision- and law-making, and the gress towards systematic solution of the prob- sharing of sovereignty that this implies, brings lems faced by non Moslem communities. An- considerable benefits to Member States, par- other concern is that the degree of awareness ticularly in policy fields such as economic in- of the political reforms in the country appears tegration, foreign and security policy, justice to vary greatly according to the region. There and home affairs. are reports that, in some regions, local authorities have no information about the implications of the new laws and regulations. If the Turkish people are to enjoy the values largely shared by European citizens, it is essential that the provisions and spirit of the leg-

54 | TURKEY IN EUROPE MONITOR

What impact of Turkey EU accession? to reflect on how to best meet these challenges. We did the same when we embarked Turkey’s candidature for EU membership is a on negotiations with the member states that fascinating subject. As a matter of fact, it acceded on 1 May. leaves nobody indifferent as suggested by the vigorous debate which takes place across the Cyprus EU. As mentioned by President Prodi in his speech before the Grand Turkish National As- Ladies and Gentlemen, sembly in January this year, contrary to the At such a wide-ranging international confer- situation in Turkey, the public opinion in the ence, it would be inappropriate for me not to EU is not unanimous in favouring a Turkish mention Cyprus. We worked very hard with membership. There are those who are con- the UN Secretary General in the efforts to cerned about the capacity of the Union to inte- achieve a comprehensive settlement of the grate a country of the size and with the demog- Cyprus problem. Unfortunately, the outcome raphy of Turkey, the economic development of of the referendum in the island produced a re- Turkey and Turkey’s geographical situation. sult which did not allow a united Cyprus to Some see the issue in terms of the borders of join the EU on 1 May 2004. It is a matter of the future European Union: where will the EU deep regret that the Greek Cypriot community stop? Who will be next? Others are concerned, did not approve the Annan plan which was by the impact of Turkey’s EU accession on the supported not only by the EU but also by the nature of the European integration project. At international community at large. An unprece- the same time, everybody acknowledges that dented opportunity to bring about a solution to Turkey’s geopolitical position plays a very the long-lasting Cyprus issue was missed. important role in regional stability in an area which sits at the cross roads of the Balkans, At the same time, the Turkish Cypriots should Caucasus, Middle East, Eastern Mediterranean be congratulated for their desire to resolve the and Central Asia. The Commission is very island’s problem. Particularly in the latter aware of such considerations and has recently stages of the process, Turkey played a very proposed a strategy for relations with certain constructive role. Directly after the referenda, neighbouring countries, in order to ensure that on 26 April, the European Union expressed its the enlargement process does not lead to new intention to put an end to the isolation of the divisions in Europe. Turkish Cypriot community and to facilitate the reunification of Cyprus by encouraging the We can see that there has been a certain evolu- economic development of the north. An tion in public opinion as there appears to be an amount of €259 millions is being made avail- increasing understanding for Turkey’s EU as- able to support projects aiming at promoting pirations and its potential assets for the EU. At the economic development of the Turkish the same time, the prospect of the European Cypriot community. The Commission has ini- Parliament elections next months is prompting tiated the necessary planning to that end and some political parties in certain Member States intends to bring forward comprehensive pro- to campaign against Turkey’s possible acces- posals within the coming weeks. A sustained sion to the EU and to propose a “special part- spirit of cooperation between the two commu- nership” as an alternative. It is worth mention- nities will be necessary for the implementation ing that this option was rejected by a large ma- of the announced measures. jority of members of the European Parliament during the recent debate about Turkey. Conclusion On its side, the EU will also have to examine whether it is ready for Turkey's accession. It is In conclusion, the process of modernization of clear that the accession of a country with the the Turkish political system and its adaptation size and population of Turkey would have far- to the EU standards is underway. I am well reaching consequences on the functioning of aware that there is an impressive degree of the European Union. This would fundamen- consensus in Turkey in favour of joining the tally affect many policy areas and the func- European Union. For reforms to be enjoyed by tioning of the EU institutions. We would have all Turkish citizens in their daily life, it is es-

NO. 6 / JUNE 2004 | 55 sential that they permeate throughout Turkish Copenhagen political criteria but primarily for society. Turkey’s own sake. On the ground, there are already clear signs that implementation of the In this respect the representatives of civil soci- reforms has started. In the period ahead, the ety such as NGOs and the associations have a further development of EU-Turkey relations, key role to play through their contribution to including the decision to be taken in Decem- the public debate in a modern and pluralistic ber, will depend on Turkey’s capacity to dem- democracy. onstrate that it fulfils the Copenhagen political criteria, not only in legal provisions, but also On its part, the Turkish government continues in practice. I hope and believe that we will be to show a steady and impressive degree of de- able to reflect further progress in our upcom- termination to bring about political reforms, ing Regular Report. not only for the sake of complying with the

56 | TURKEY IN EUROPE MONITOR

TURKISH BUSINESS PERSPECTIVES demonstration and peaceful assembly, expanding by the freedom to use Kurdish in broadcasting and TÜSIAD election campaign periods. They removed some TURKISH INDUSTRY & BUSINESS anti-democratic elements in the Turkish Penal ASSOCIATION Code, introduced measures to improve police con- duct, gave prisoners/detainees immediate access to lawyers, lifted some restrictions on press, and eased www.tusiad.org restrictions on the ownership rights of minority foundations. DEMOCRATIC REFORM PROCESS IS SUCCESSFUL • The sixth package abolished the Article 8 of Anti-Terrorism Law, and terminated its current TURKEY IS READY TO START proceedings, for which Turkey has been widely ACCESSION TALKS WITH THE EU criticized by the Council of Europe and other international bodies. The package also revoked the authority of the Secretary General of the National Security Council (NSC) to appoint one member to TÜSIAD, starting from its first report on “De- the supervision board for cinema and music works. mocratisation in Turkey” in January 1997, has The sixth package also amended the related provi- consistently promoted the reform process in Tur- sion of broadcasting law (named as RTUK) to key that has been accelerated with the 1999 Hel- guarantee the right to broadcast in languages other sinki Summit decision declaring Turkey as a than Turkish. On the area of religious freedom, the “candidate country destined to join the EU”. This new clauses in the package eased the rules and pro- challenging process included many stages: cedures for construction planning with regard to places of worship for faiths other than Islam. These • The DSP-MHP-ANAP coalition government, changes also eased the registration of the real es- introduced the National Program in March 2001, tates of the foundations of religious communities enacted two important constitutional reform by expanding the application period. packages in October 2001 and August 2002, changed numerous laws and regulations and re- • The seventh package, adopted in August vised Turkey’s 75-year old Civil Code in Novem- 2003 emphasised the advisory status of the NSC, ber 2001. reduced the frequency of its meetings to once every two months, enabled the appointment of a civilian • These legislative changes removed military as its secretary-general and allowed greater parlia- officers as judges in the State Security Courts, mentary scrutiny over military expenses. amended political parties law to make judicial closure of parties more difficult, as well as introducing • The May 2004 legislative package achieves first steps in tackling crucial areas such as broad- most of the reform processes initiated and en- casting and education in mother tongues other than hanced through previous packages dating back to Turkish, reducing the political role and status of the October 2001. National Security Council, eliminating death penalty, and improving freedom of thought and ex- • As a clear sign of implementation, the Turkish pression. The packages expanded the right to asso- state radio and television (TRT) started broadcast- ciation, and imposed stricter penalties on human ing in Bosnian, Arabic, Circassian, and two com- traffickers. They also allowed non-Muslim minor- mon Kurdish dialects. Moreover, the Court of Ap- ity communities greater rights over religious prop- peals ordered the release of four former DEP erties. deputies on June 9. Turkey, signed the European Convention for the Protection of Human Rights and • The actual AK Party government passed five Fundamental Freedoms' Protocol. It also created major political reform packages in the last one and human rights committees for each province and half years. district, as well as established the High Board of Human Rights. The State Security Courts are fully The fourth and fifth reform packages included abolished. changes strengthening the fight against torture, broadening the scope of freedoms of association,

CEPS Turkey in Europe Monitor

No. 7, July 2004

Introductory Note from CEPS Turkish foreign, security and defence policies This issue of CEPS Turkey in Europe Monitor already in the pre-accession period. After pub- presents an extract from a CEPS working pa- lication on the CEPS web-site of the full text of per titled “Turkey as Bridgehead and Spear- the working paper, the subscribers to this head - Integrating EU and Turkish Foreign Monitor will receive an e-mail alert providing Policy”, prepared by Michael Emerson and access to it (hyper-link). E-mail alerts will Nathalie Tocci within the scope of the joint also be sent for the remaining working docu- CEPS-EFPF Project, “Strategy for EU and ments on democratic governance, justice and Turkey in the Pre-Accession Period”. The pa- home affairs, trade, banking, monetary and per takes as an assumption that the EU will fiscal policy, agriculture and energy. The re- decide to open accession negotiations with sults of the Project will be discussed at a one- Turkey at the end of 2004, and explores in this day conference at CEPS on 27 September context the potential for integration of EU and 2004.

Michael Emerson and Senem Aydın

Integrating EU and Turkish Foreign accelerate Turkey’s membership into the Un- Policy ion. Michael Emerson and Nathalie Tocci1 This process has already begun with Turkey’s Even if Turkey begins accession negotiations association with the EU’s nascent security and in 2005, full membership would occur proba- defence policy (ESDP). But this is only a bly only around a decade later. Turkey needs small beginning compared to the conceivable to pass and implement key reforms and nego- agenda. The intuitive reasons for this idea are tiate thirty-one chapters of the acquis. The EU twofold. First, Turkey’s neighbourhood has needs to ratify and implement its Constitution become the main source of the EU’s security and absorb at least twelve new member states. concerns, as stated in the EU Security Strat- However none of this excludes that the EU egy. EU-Turkey integration in the foreign pol- and Turkey might begin to integrate their for- icy realm would also allow an extended reach eign policies in the pre-accession period. Such of the emerging European Neighbourhood Pol- integration could both yield important benefits icy. Second, Turkey offers several specific to Turkey and to the EU, and it could serve to assets for helping the EU address its concerns and objectives, ranging from the concrete realities of location and logistics, through to matters of culture and ideology. 1 Michael Emerson is Senior Research Fellow at the Centre for European Policy Studies (CEPS), Brussels. Nathalie Tocci is Jean Monnet Fellow at In policy operational terms, Turkey has the the European University Institute, Florence. This role of geographic hub for regional coopera- note is an extract from a longer EU-Turkey Work- tion, it becomes a secure energy transport hub ing Paper entitled ‘Turkey as Bridgehead and for Caspian, Middle Eastern and Russian oil Spearhead – Integrating EU and Turkish Foreign and gas and it is well situated to become a Policy’, forthcoming on CEPS website forward base for the EU’s security and defence www.ceps.be.

| 57 58 | TURKEY IN EUROPE MONITOR policies. Turkey also has valuable human re- However EU policy is confronted by an in- sources to complement those of the EU for creasingly pressing dilemma: how to include cooperation programmes, ranging from busi- the region into its economic and security ness know-how to language skills relevant for spaces, without premature accession. The di- its wider neighbourhood. lemma is posed because the borders between member and non-member states in the Balkans In normative terms, Turkey could enhance the will be virtually impossible to control at the credibility of the EU as a foreign policy actor. frontiers. Turkey could contribute in three Turkey’s membership, like the current eastern ways. First, during the pre-accession period enlargement, would constitute a key EU for- there could be an expansion of the EU-Turkey eign policy act. The extent to which such an customs union to include the whole Western action would be successful would depend on Balkans. Second, Turkey’s experience in train- the degree to which accession would have con- ing police officers both from Turkey and from tributed to a transformation of candidate Tur- the Balkan and Black Sea regions represents a key, both in terms of its internal democracy major asset. The Turkish International Acad- and in terms of its foreign policy. This democ- emy against Drugs and Organised Crime ratic transformation by a predominantly Mus- (TADOC) is already a valuable professional lim country, would also send a striking mes- institute for the entire region. Third, Turkey is sage about the compatibility of democracy and well positioned to serve as a transit route for Islam, and of the multi-cultural inclusiveness rising European energy needs. The Greek- of the EU, thus emphatically repudiating the Turkish gas Interconnector project, linking to spectre of the ‘clash of civilizations’. The suc- the Tabriz-Erzurum gas pipeline (connecting cess of Turkey’s accession would also be Turkmen and Iranian gas) is expected expand measured with respect to its contribution to and connect on to the Western Balkans and conflict resolution, by having facilitated state- into Western Europe. society reconciliation within Turkey (i.e., vis- à-vis the Kurds) as well as state-to-state set- Black Sea tlement (i.e., between Greece and Turkey or In early 1990s Turkey was largely responsible between Turkey and Armenia). for initiating what became the Black Sea Eco- nomic Cooperation, an Organisation with a This paper explores these general arguments comprehensive institutional structure, which by going though a set of major theatres of op- has suffered from the non-involvement of the eration in the Turkish and EU neighbourhoods. EU and the scepticism of Russia. Forthcoming The idea is to review this set of sub-regions enlargements mean that the entire western and and to consider whether and how EU and southern coastlines of the Black Sea will be- Turkish interests are convergent and their po- come EU territory. As such, the obligations of tential policies complementary. Bulgaria, Romania and Turkey to comply with the acquis could provide a stronger foundation Balkans for regional cooperation on issues like the en- With Bulgarian and Romanian accession ex- vironment, transport, energy, fisheries and pected in 2007, and Croatia also expected to combating organised crime. join the accession process, EU interests in the Western Balkans are directed towards consoli- Turkey, together with Bulgaria, Romania and dating the transformation of the remainder of the EU itself, might follow the model of the region. Turkey for its part also has a vital Finland’s initiative in creating a ‘Northern interest in the stability of this transit region, Dimension’. This could either take the form of which separates it from Western Europe. The empowering BSEC with EU human and finan- interests of the EU and of Turkey thus seem cial resources, and perhaps adding a role as a convergent. In terms of their policies, Turkey forum for political dialogue between the CIS has already contributed to EU stabilization and EU. Alternatively, there could be an EU- efforts by participating in EU and NATO op- Black Sea core group, based on the Black Sea erations in Macedonia and Bosnia. states that are either EU members or candidates, and BSEC members that become ac-

NO.7 / JULY 2004 | 59 tively engaged in the European Neighbour- pied territories surrounding Karabakh, together hood Policy. with guaranteed transport corridors between Karabakh and Armenia, as well as between South Caucasus Nakichevan and Azerbaijan. Turkey would The EU has refrained so far from playing a establish normal diplomatic relations with substantial role in the South Caucasus, al- Armenia. In a final phase the status of Kara- though it expresses the intention to do so. Tur- bakh itself would be settled. key enjoys strong economic, political and military links with Azerbaijan and Georgia. Tur- Also in the case of the Georgian-Abkhaz con- key also plays an important role in the devel- flict, Turkey could play an important role. The opment of Caspian energy, with the Baku- existence of large diasporas in Turkey pres- Tbilisi-Ceyhan oil pipeline under construction, ently constrains its involvement. Turkey has and the planned gas pipeline to run alongside also limited influence on Russia, key to any it to Erzurum. Turkey also hosts important breakthrough in the conflict. But in a post- diaspora communities from the region, includ- settlement phase Turkey’s Abkhaz community ing 450,000 Abkhaz and 2 million Georgians. (larger than the population of Abkhazia itself) could play an important role in reconstruction Turkey’s potential role in the Caucasus and the efforts. Progress in Abkhazia could also allow EU’s recognition of the region’s importance re-opened rail links from Russia to Turkey and but unwillingness to take an active lead could the implementation of the proposed new oil dovetail each other. Yet their interests at pre- pipeline from Novorossisk to Supsa, linking to sent are not entirely convergent. Turkey’s role the BTC pipeline. The prospect of projects in the region has been limited by its relations such as these might induce Russia to shift its with both Azerbaijan with whom it has close positions. ethno-cultural ties, and Armenia with whom, due to historical legacies, relations have not Taken together this would mean a transforma- been normalized yet. This partiality has been tion of the perspectives for the region. They reinforced by the Nagorno Karabakh conflict, would combine with Turkey’s pre-accession which led Turkey to close its frontier with status leading the way for an enhanced ENP Armenia in 1992. In the recent past, Turkey towards the Caucasus. In turn, the seemingly has attempted to contribute to progress in utopian vision of a Stability Pact advocated by Karabakh by pursuing a trilateral forum with Demirel in 1999, could have greater chances the participation of Azeri and Armenian offi- of success a decade later. cials. But due to its positions, it has not been Central Asia an impartial mediating influence. In the early 1990s, the EU established contrac- What are the steps through which Turkey’s tual ties with all the Central Asian Republics relations with Armenia could be normalised, (Partnership and Cooperation Agreements), allowing Turkey to play a constructive role in but these have been rather thin relationships. conflict resolution? In a first stage, Turkey Technical assistance has been supplied under could open its eastern border for trade with TACIS, but this has not been an easy process, Armenia, and Armenia for its part could partly because of the scarcity of relevant ex- amend its constitution to remove political am- perts with Russian or Turkish language skills. biguities over its frontier with Turkey. The Financial assistance has been limited also, par- two countries could establish a truth and rec- ticularly when compared to the aid to Mediter- onciliation committee over the genocide ques- ranean and the Western Balkans, not to mention. The EU could support these steps. For tion Central and Eastern Europe. Turkey this would occur in the context of the accession process. For Armenia, the EU could Turkey instead has cultural, linguistic and reli- make the deepening of its relations through the gious ties with four of the five Central Asian new neighbourhood policy conditional on ef- Republics. In 1992 after the collapse of the forts in this direction. A second stage could USSR, Turkey embarked on an ambitious for- introduce progress on Nagorno Karabakh, in- eign policy initiative in Central Asia. It pro- volving Armenian withdrawal from the occu- vided emergency assistance and engaged in

60 | TURKEY IN EUROPE MONITOR numerous projects covering trade, investment, Secretary General) to discuss the institutionali- business cooperation, training in public ad- sation of relations between OIC and the Quar- ministration, media and education, communi- tet. cations and transport. However, particularly in the fields of culture and education, Turkey’s Iraq role was often perceived as patronising or as In principle EU and Turkish interests in Iraq attempting to impose Turkish cultural domina- are convergent. Like the EU, Turkey’s inter- tion. The Republics wanted to assert their own ests are in fostering a peaceful and democratic identity and did not wish to alienate Russia. In Iraq. However in view of its proximity, Tur- addition, Turkey’s own economic instability key’s sensitivities regarding Iraq go beyond meant that Turkey did not have the means to the general concerns of most EU actors. These assist state-building and development in Cen- concern first and foremost the activities of the tral Asia. PKK in Northern Iraq as well as the fear that a possible secession of Iraqi Kurdistan could However, Turkey’s accession process could fuel instability in south-east Turkey. offer the potential to strengthen both the EU and Turkish roles in Central Asia. The EU Yet irrespective of these fears, the possibility could benefit from Turkey’s bilateral ties. The of a Turkish invasion in Northern Iraq appears deficiencies of technical assistance due to the far-fetched to say the least. It is thus feasible lack of necessary language skills could be rec- that as and when there is a greater internation- tified to some extent through Turkish partici- alization of Iraq, Turkey (and in particular the pation. At the same time, these initiatives Turkish General Staff, who is the principal would not be tainted by pan-Turkic under- Turkish actor in Iraq) together with the EU tones. could develop a valuable operational and political partnership. The Arab-Israeli conflict

In the Middle East, the EU, despite being the A promising avenue of Turkey’s role in the largest donor to the Palestinian Authority and Gulf is the ‘Neighbouring Countries Initia- enjoying strong contractual ties with most tive’. The Initiative was born in 2003, stem- states in the region and Israel in particular, has ming from the common interest of all of Iraq’s always played a secondary role in any peace neighbours to prevent the war. It includes all process. The EU has been unwilling to use its of Iraq’s neighbours, with the exception of primarily economic instruments effectively in Kuwait (that supported the US invasion and the political realm. occupation), and also including Egypt. The countries of the Initiative have met five times Turkey’s accession process would not alter EU both before and following the American at- positions towards the conflict. In fact, EU and tack. So far the Initiative remains ad hoc, and Turkish views are largely convergent. How- the only item on the agenda has been Iraq. ever, Turkey’s role could contribute to the However, it is conceivable that the Initiative EU’s increased ‘actorness’ in the region. Tur- persists and institutionalises. If so it could be- key has enjoyed good relations with Israel and come of considerable interest to the EU, which is constantly improving its relations with the is still in the process of developing a concerted Arab world and with Syria in particular. Pro- strategy towards the war-torn country. vided the EU became more willing to use effectively its instruments, Turkey’s perceived Iran neutrality as well as its proximity could allow In recent decades Turkish-Iranian ties have the EU to act more credibly as a facilitator and been strained over the two aspects that have mediator between the parties. In view of its been viewed as most critical to Turkish na- membership of the Organisation of the Islamic tional security: namely political Islam and Conference, Turkey could also act as a bridge Kurdish separatism. Yet both threats have con- between the EU, as a member of the Quartet, siderably diminished in the last few years, and the OIC. In May 2004, Turkey together opening the space for EU and Turkish coop- with a sub-group of the OIC met with the EU eration in Iran. Like the EU, Turkey has an Presidency (as well as with Russia and the UN interest in a steadily reforming Iran, in Iran’s

NO.7 / JULY 2004 | 61 cooperation on terrorism, in restraining Iran’s Indeed in the context of the emerging ‘Broader nuclear programme and in ensuring energy Middle East and North Africa’ initiative of the security. Its preferred means to pursue these G8 summit Turkey has accepted to co-chair aims have converged with those of the EU the Democracy Assistance Dialogue. How- rather than of the US, opting for a policy of ever, precisely in view of Turkey’s secular engagement rather than confrontation. nature, there are serious limits to its ability and willingness to foster political change in the Beyond convergent interests, Turkish and EU Gulf. policies could be complementary. Turkey’s deepening political, social and economic ties United States could act as an asset to EU endeavours to en- Turkey and the US have been allies for over gage in dialogue with Iran. There is currently fifty years, both in the context of NATO and an annual flow of 450,000 Iranians crossing through their bilateral relations. The EU, Tur- visa free into Turkey for tourism, education key and the US have shared similar strategic and business purposes. The Tabriz-Erzurum interests. This has remained so both during the gas pipeline from Iran into Turkey is also of Cold War and thereafter. In other words, to- much interest to the EU, as this connects with gether with all European countries and the US, the Turkish gas network, soon to be expanded the Turkish Republic has always firmly placed and then linked with that of Greece and thence itself within the ‘West’. into the rest of the EU. The Iranian gas connection is viewed as particularly important to This is not to say that Turkey’s (or indeed the Europe given that Iran’s own network con- EU’s) relations with the US have been static. nects with Turkmenistan and that the EU is Particularly in the run-up and with the advent keen to develop alternative energy sources to of the 2003 Gulf war, relations between both Russia. Turkey (and several EU member states) and the US have been strained. On 1 March 2003 a Gulf and the OIC resolution was brought to the Turkish parlia- Both Turkey and the EU have an interest in ment by the ruling AKP government to allow gradual reform towards political participation, the temporary deployment of 62,000 US human rights, and then democratisation in the troops on Turkish soil. The deployment and Gulf region. They also have an interest in se- transit through Turkey would have allowed a curing cooperation of the Gulf countries in second front attack against Iraq. By a few energy security and in the fight against terror- votes, the motion failed to pass through par- ism. However both Turkey and the EU have liament and the American troops were re- enjoyed relatively thin relations with these routed to Kuwait. At the time, the rejection of countries. The EU has attempted in recent the motion appeared to have plunged US- years to relate to the Gulf countries though Turkey relations to their lowest ebb since the multilateral forums, exploring the prospects 1974 arms embargo following the partition of for deepening and institutionalising relations Cyprus. between the EU and the Gulf Cooperation Council (GCC). Turkey instead principally However the Turkish government is, notwith- relates to the Gulf through bilateral relations, standing, positioning itself to play a construc- as well as interacting with them in the context tive role in the Middle East, in a manner that is of the Organisation of the Islamic Conference convergent with both US and European de- (OIC). Particularly through bilateral commer- clared interests. Prime Minister Erdoğan en- cial ties, Turkey’s relations with most Gulf gaged in highly positive political debate in the states have been steadily expanding in recent US, as evidenced for example by his speeches years. Investors from the Gulf have also in January 2004 in New York and at Harvard. shown increasing interest in projects in Tur- The Turkish leadership is able to deploy ar- key. guments about favouring the progressive democratisation of the Middle East region, os- In principle, a secular and democratising Tur- tensibly supported by American as well as key could offer important lessons to the initia- European leaderships. tion of a reform process in the Gulf countries.

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In conclusion, following Turkey’s stance to- ing, pacifying and modernising role in its wards the war in Iraq, Turkish policy seems to neighbourhood beyond mere token actions, be settling down into a maturing, rather than a then the incorporation of Turkey into the breaking, relationship with the US. It has common external policy offers the prospect of brought also Turkey’s foreign policy closer to real advantages. In the contrary case it would the underlying ideology of European foreign be consistent for the EU to reject Turkey’s policy, even if the EU has itself been so deeply future membership once and for all. Yet in this split over Iraq. The scene is set therefore for a case the EU would run the risk of destabilising credible deepening of Turkish-EU collabora- Turkey itself, which could mean adding to the tion over future developments in the Middle chaos of the wider neighbourhood. East. Turkey’s EU accession stands to be of compa- Box A: Potential convergence, complementarity rable importance for the EU’s emerging for- or otherwise of EU and Turkish foreign policies eign and security policy as the recent acces- in major theatres of operation sion of the ten new member states put together, if not more so. Turkey is almost com- Balkans Convergent and complementary Black Sea Convergent and complementary pletely surrounded by a set of regions that rep- Potentially complementary resent the EU’s prime security concerns, from South but not yet convergent: special the residual instability of the Balkans to the Caucasus factors – Armenia and Azerbaijan West, the Caucasus, Central Asia, Iraq and Central Iran to the East, and Israel-Palestine and the Convergent and complementary Asia Mediterranean to the South. The Turkish ac- Convergent but risks of Russia cession would mark the end of the EU’s unintended effects enlargement to the East, while opening at the Mediterra- Convergent and complementary same time new dimensions to the EU’s rela- nean tionship to the Middle East and Eurasia to the Increasingly convergent and Middle East complementary South and East, regions that are unstable and Potentially convergent and unpredictable. Iraq complementary but special sensitivities – Kurds and Turkomans The potential advantages for the EU in inte- Convergent and potentially grating Turkey as foreign and security policy Iran complementary: special actor are several. Objective factors lie in con- sensitivities – Kurds and religion crete logistic and locational advantages, cou- Saudi Convergent and potentially pled to military capabilities and civilian hu- Arabia and complementary: special man resources that can be readily deployed in the Gulf sensitivity – religion the Eurasian and Middle Eastern neighbour- United Turkey is increasingly convergent States with EU positions hoods. More subjective but perhaps even more important are the prospects for the Turkish experience to be viewed as a positive prece- Conclusions dent by its neighbours. This general statement Does the idea of integrating Turkish and EU has a number of versions, some of which have foreign and security policies hold out the pros- been recently tried and failed (e.g. the pan- pect of something important and valuable for Turkic experiment in Central Asia in the early both parties. Would Turkey be an asset or li- 1990s). Some other variants are also likely to ability? Our conclusions are unambiguously provoke adverse reactions, like over-selling positive. the Turkish model of multi-party democracy and secularism in parts of the Arab world. Not This does, however, depend on the EU’s level only does Turkey’s democracy still have im- of ambition for its foreign and security policy. portant shortcomings. But also Turkey’s Arab Does the EU aspire to become a major actor in neighbours, in view of the legacy of Ottoman the nearby southern and eastern neighbour- rule, react adversely to arguments suggesting hoods, or does it prefer to retreat into itself their emulation of Turkey’s political and eco- behind the most secure possible external bor- nomic system. ders? If the EU truly aspires to play a stabilis-

NO.7 / JULY 2004 | 63

However more subtle arguments seem full of cies can be distilled into two terms used in promise. The Turkish case suggests that the military security studies: bridgehead and values of democracy, human rights, the rule of spearhead. In the present context these words law and secularism are not specific to any par- have meaning in terms of the civil values and ticular culture or religion. On the contrary they the objectives of an expanding European Un- are universal values with no geographical, cul- ion. The democratising Turkey would be the tural or religious limitations. Rather than rep- bridgehead of a modern, multi-cultural Europe resenting a static model of democracy, the right up to and alongside the ideological chaos continuing process of Turkey’s democratisa- and violence of the neighbourhood beyond. Its tion could act as a source of inspiration to its civilian, military and human resources could neighbours. The same is true also of the grad- be integrated with those of the EU and serve as ual transformation of Turkey’s security and a spearhead of the EU’s soft and not-so-soft foreign policy culture. While in the past Turk- power projection into the region. ish foreign policy had focused on the importance of military security and balance of power Box B: Turkey’s possible assets for EU foreign politics, it now increasingly appreciates the and security policy value of civilian instruments of law, econom- Objective factors ics and diplomacy, as well as of multilateral - Turkey’s accession would lead to an extended settings in which to pursue its aims. Related to reach of the European Neighbourhood Policy. this, the Turkish example demonstrates the - Turkey’s neighbours would become direct value of European integration as a key external neighbours of the EU. Turkey has the role of geo- anchor to domestic processes of modernisa- graphic hub for regional cooperation. tion. -Turkey is a secure energy transport hub for Cas- pian, Middle East and Russian oil and gas. - Tur- key is well situated to become a forward base for The final point concerns the EU’s own model. the EU’s security and defence policy, for military Turkey’s EU accession and integration would logistics and the credibility of the EU’s presence in vindicate the EU’s ambitions to represent an the region. inclusive project and a multi-cultural commu- - Turkey has valuable human resources to com- nity of values. If the EU and Turkey were to plement those of the EU for cooperation pro- make best use of their joint opportunities in grammes, ranging from business know-how to lan- the foreign policy domain, Turkey would build guage skills. on the advantages of its comparative openness as well as proximity to the Middle Eastern and Normative arguments- Eurasian neighbourhoods. The EU and Turkey -Rather than representing values specific to particu- could thus devise an original blend of open- lar cultures or religions, the Turkish case shows that democracy, secularism and human rights are ness towards their southern and eastern universal values. neighbours, with the model of a graduated ex- - Turkey’s EU accession would demonstrate ternal border of the EU. However Turkey Europe to be an inclusive concept, with a multi- would need to be re-assured that this would cultural values, open to different religions. not in any way deprive it of normal political - Turkey’s transformation of its security and for- rights as future member state. To have a eign policy culture, with less reliance on military graduated border regime that adds value is not power and greater emphasis on diplomacy and ci- to be confused with the negative connotations vilian instruments of a second-class member state. - Turkey’s accession would confirm the contribution of European integration to conflict resolution,

with the reconciliation between the Turkish state Finally, an integration of EU and Turkish stra- and its Kurdish population, its rapprochement with tegic cultures could in the context of the pre- Greece, and constructive role over Cyprus. sent turmoil in the Middle East and transatlantic discord over Iraq carry a message also to Synergy Washington, supporting a shift back towards - Combining this list of points could give a syner- multilateralism, moderation and the rule of getic boost to the EU’s capabilities and credibility law. as foreign policy actor across the EU’s southern and eastern neighbourhoods. Our conclusions in viewing Turkey as a potential asset to the EU’s foreign and security poli-

64 | TURKEY IN EUROPE MONITOR

TURKISH BUSINESS PERSPECTIVES tourism and finance, Turkey already offers im- by mediate substantial returns to the European TÜSIAD Union which it aspires to join. In return, Turkey TURKISH INDUSTRY & BUSINESS asks a low-cost, long-term commitment to work ASSOCIATION together. It is a textbook case of a win-win situation. www.tusiad.org - The start of accession negotiations, the markets TURKEY: are convinced, will remove the final barrier to A NEW CORPORATE WORLD investor confidence. Although Turkey attracts its FOR EUROPE share of portfolio investment, foreign direct investment has historically been below $1 billion per European Round Table of Industrialists (ERT) year. This is less than 0.5% of GDP. International prepared a report entitled “Turkey: A New Cor- experience shows that an economy of Turkey’s porate World for Europe” with the aim of assist- size and importance should be attracting six to ing the evaluation of the implications of potential eight times of that ratio. Re-confirmation of its Turkish membership to the EU. It provides ample eventual membership to the EU and the conse- information on the evolution of the relations be- quent stimulation of FDI will expand major tween EU and Turkey, and on the strength and employment opportunities. openness of Turkish industry. ¾ Many ERT companies (BP, British American Overall, the primary message of the report is Tobacco, Eczacıbaşı, Fiat, Lafarge, Nestlé, that Turkey's institutions and dynamic private Pirelli, Renault, Roche, Shell, Siemens, Total, sector are well prepared to start the negotiation TT&TİM, Philips, Tuborg, Unilever, Volvo) process that will lead to EU membership and a contributed to the report with the reflection of their higher level of welfare for both Turkey and the corporate experiences in Turkey: EU. - “Turkey could play a vital role with regard to ¾ Main headlines from the report include: global and regional development through her dominant position in the region, linking together - In recent years, Turkey has taken major steps diverse cultural and business traditions and cus- to restructure its economic, administrative, in- toms.” stitutional and judicial environment with the long-term objective of meeting the challenge of - “Turkey is an important country both as a pro- global competition as a strong partner of the EU. duction base and as a market. Recent developments such as increasing productivity, improve- - The obligations that Turkey has contracted with ments in FDI legislation and stability in political the EU have served as fundamental benchmarks and economic life have rendered Turkey more at- during difficult times. Turkey has responded to tractive for investment.” major economic crises with root and branch reform of its financial and regulatory institutions, - “Turkey has young and well-educated human thus demonstrating its reliability as a partner of resources with a high capacity of adaptation to new the EU. developments.”

- European endorsement of Turkey’s political aspi- - “With its large and growing domestic market, rations will, as much as any other conceivable fac- Turkey is a country with great potential.” tor, guarantee the long-term, stable macroeconomic environment which industry demands. That - “We invested in Turkey due to Turkey’s current environment, in turn, provides the conditions for domestic market, its potential domestic market and growth and opportunity which European manufac- geo-strategic location and skilled workforce.” turers are well situated to exploit. As a destination for exports, as an opportunity for investment, The full text of the report is available at and as a location for competitive manufactur- http://www.abgs.gov.tr/uploads/files/ERT%20Rapport.pdf ing, even as the source of invisible earnings in

CEPS Turkey in Europe Monitor

No. 8, August 2004

Introductory Note from CEPS consolidation in order to assess Turkey’s ability to meet the requirements of the Copenha- This issue of CEPS Turkey in Europe Monitor gen political criteria and evaluates the impact presents an extract from a CEPS working pa- of EU conditionality and the remaining prob- per titled “European Integration and the lems and prospects in four major areas – the Transformation of Turkish Democracy”, pre- role of the military, human rights, protection pared by Senem Aydın and E. Fuat Keyman of minorities and the judicial system. The full within the scope of the joint CEPS-EFPF Pro- text of the working paper is available at ject, “Strategy for EU and Turkey in the Pre- www.ceps.be. This and other working papers Accession Period”. The project is realised of the Project (justice and home affairs, trade, with the financial contributions of the Open banking, agriculture, energy, growth, budget- Society Institute of Istanbul, Akbank, Coca ary implications, monetary and fiscal policy) Cola and Finansbank. CEPS acknowledges will be presented for public debate at high- the kind support for the production of the Tur- level conferences to be held in Brussels on 27 key in Europe Monitor provided by EU Infor- September and Istanbul on 8 November. Those mation Group of Turkey (ABIG). The paper’s interested in attending either of the two con- general argument is that the Copenhagen po- ferences are invited to write to litical criteria constitute the leverage that is [email protected]. Participation in the making Turkish modernisation and democrati- conferences is subject to a limited number of sation more plural, multi-cultural and con- places. solidated. The paper presents a historical overview of modern Turkey from the perspec- Michael Emerson and Senem Aydın tive of political modernisation and democratic

European Integration and the Transforma- ment has made a number of important legal tion of Turkish Democracy and constitutional changes to upgrade Turkish Senem Aydın and Fuat Keyman1 democracy in accordance with European standards. The European Union for its part under- In recent years, Turkey’s reform process, stands that the accession of Turkey would be a aimed at opening of accession negotiations political act of huge importance for itself as with the European Union, has been impres- well as Turkey. It has therefore to inform it- sive. Since August 2002, the Turkish parlia- self about the political origins of the Turkish application, and to understand the nature of

1 Senem Aydin is a Research Fellow at the Centre the current political transformation underway for European Policy Studies (CEPS) and a PhD there. However this effort of understanding candidate at the Vrije Universiteit Brussel. E. Fuat has also, in our view, to be based on a crucial Keyman is Professor of International Relations at premise, that the issue of Turkey’s possible Koç University and a member of the Coordination accession should be decided on fair and objec- Board of EFPF. This note is an extract from a tive grounds, namely the standard admission longer EU-Turkey Working Paper entitled “Euro- criteria, and more particularly not on grounds pean Integration and the Transformation of Turk- of geographic or cultural essentialism, since ish Democracy”, available on CEPS website this would mean that the process had no point. www.ceps.be.

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In order to substantiate these points, we first the people to the level of contemporary provide a historical overview of modern Tur- (Western) civilisation. key from the perspective of political modernisation and democratic consolidation, followed The Kemalist elite also took seriously the by a discussion on the problems and prospects Weberian answer to the riddle of the 'Euro- that exist in Turkey’s attempt to fulfil the Co- pean miracle' - that the reasons behind West- penhagen political criteria. ern advancement could be located precisely in Western cultural practices. Kemalism under-

stood modernisation not just as a question of From Republican Origins to Democratic acquiring technology, but as something that Transformation could not be absorbed without a dense net- As Feroz Ahmad correctly observes, "Turkey work of cultural practices, which made in- did not rise phoenix-like out of the ashes of strumental thought possible. The commitment the Ottoman Empire. It was 'made' in the im- to political modernity had to be supplemented age of the Kemalist elite which won the na- with a set of cultural practices in order to tional struggle against foreign invaders and ground "the articulation of reason and capital the old regime".2 The history of the making of via the nation-state", or the institutional and modern Turkey has been that of Westernisa- discursive construction of national identity. tion, conditioned by "the will to (Western) The Kemalist elite initiated a set of reforms civilisation". In this process of 'making', the that had to be imposed from above to "enlighten the people and help them make image of the Kemalist elite was to "reach the 4 contemporary level of civilisation" by estab- progress". lishing its political, economic, and ideological prerequisites, such as the creation of an inde- Republicanism, nationalism, étatism, secular- pendent nation-state, the fostering of industri- ism, populism, and revolutionary reformism alisation, and the construction of a secular and were the six principles of the act of modern modern national identity. The Kemalist elite governance. Republicanism defined the na- thus accepted the universal validity of West- tion-state as impersonal rule, which was con- ern modernity as the way of building modern textualized as national sovereignty through Turkey. nationalism. Etatism was designated to foster capitalist industrialisation through import- The idea of the state employed by the Kemal- substitution policies carried out by the state, ist elite was by no means abstract. It was a and gave expression to the politico-economic reaction to two fundamental problems, which logic of the Kemalist elite. These principles had caused the decline of the Ottoman Em- indicated the acceptance of the dominance of pire.3 First, the Ottoman state was identified the West and the Kemalist elite's will to civili- with the personal rule of the sultan, which sation. They also indicate the significance of eventually led to its inability to compete with nation-state building for nationalist discourse. the European nation-state system. Second, the What gave specificity to Kemalist national- Islamic basis of the Ottoman state was re- ism, however, was its populist character, its garded as the primary obstacle to progress in rejection of the West as a class-based social Ottoman society. For the Kemalist elite, there formation. Populism meant, in the Turkish was therefore a need to create a nation-state context, the affirmation of the non-class char- distinct from the person of the sultan and acter of Turkish society. secular enough to reduce Islam to the realm of individual faith. This meant a reconstruction The second political period of the Turkish re- of the idea of national sovereignty. The state public began in 1945 with the transition to the was thus viewed not as an arbitrary institution, multi-party system, and later in the 1960s to nor an expression of class interest, but an ac- the rise of the New Left. As a result it was no tive agent that reshapes the nation to elevate 4 See Ernest Gellner (1995), Encountering Nation- 2 See Feroz Ahmad (1993), The Making of Modern alism, London: Polity. These reforms include "the Turkey, London: Routledge. hat revolution", "the reform of attire", "the adop- 3Heper, Metin (1985), The State Tradition in Tur- tion of a civil code", "the alphabet reform', and key, North Humberside: The Eothen Press. "the religious reform".

NO. 8 / AUGUST 2004 | 67 longer possible to define the Turkish political coup resulted in the transformation of state landscape purely on the basis of the secularist identity from radical secularism to what has versus anti-secularist axis. With the multiparty been termed neo-republicanism.5 By incorpo- system, the emergence of the liberal vision of rating Islamic discourse and implicitly umma Westernisation and modernisation presented a (a community of believers who are united by serious alternative to the Kemalist principle of the same Islamic faith) as its model of social étatism and populism. At the same time, with organization, and also by abandoning the radi- the rise of the New Left, the emergence of the cal secularism of the early republic to secure socialist vision challenged the non-class based its popular support and to open up the domes- populist image which had been used to define tic market to Islamic capital, the post-1980 Turkish society as an organic totality. How- military regime weakened the very conditions ever, these challenges did not lead to a signifi- of the existence of Kemalist nationalism and cant transformation of state identity. Nor did the republican state. they give rise to a radical rupture in the performance of Kemalist nationalism in giving The use of Islamic discourse and its notion of meaning to the making of modern Turkey. umma were considered by the military regime It was by then clear that Turkish modernisa- to be a temporary and short-term pragmatic tion should involve some elements of eco- strategy to restructure the political system and nomic and political liberalism, but this did not to restore the performative power of the Ke- alter the dominant role of the state and its malist republican state.6 However, such a con- strong nature vis-à-vis society. The effective tradictory move led to unintended conse- instruments of formal democracy were estab- quences. The first was that in the 1983 na- lished with the transition to multi-party and tional election, which marked the transition to parliamentary democracy in Turkey. There civilian rule, the neo-liberal Motherland Party were now free and recursive elections, and the came to power despite the resistance of the opposition parties were able to criticise the post-1980 coup military regime. The military governing party or the governing coalition. supported the Nationalist Democracy Party, The military coups of 1960 and 1980 were which had been formed as the "state party" of both short lived with relatively smooth transi- the post-1980 coup regime. This indicated the tions to civilian rule. However, the establish- crisis in the capacity the state to carry out the ment of formal democracy proved to be in- Kemalist vision. adequate to resolve the problems of the country. The regime's temporary and pragmatic appeal to the Islamic discourse became one of the The 1980 coup nonetheless brought about a enabling factors for the emergence and re- radical rupture in the making of modern Tur- emergence of Islamic organisations within key, the impact of which was deeply felt at both state and civil society as political parties, each and every level of Turkish society. At the or as tarikats (the religious brotherhoods), and economic level, the goal of industrialisation also for their increasing strength within the was decisively shifted from import- Turkish political landscape. While the re- substitution to export-promotion, and much gime’s objective of depoliticisation was tar- more emphasis was placed on market forces. geting the discourses of the left-right axis,

The crucial point here is that since export- promotion meant adaptation to the interna- 5See Faruk Birtek and Binnaz Toprak (1993), “The tional division of labour, the shift in industri- Conflictual Agendas of Neo-Liberal Reconstruc- alisation was in fact the transformation of tion and the Rise of Islamic Politics in Turkey”, Kemalism via laissez-faire, which however Praxis International, No. 13, p. 194, July. contradicted the Kemalist image of the or- 6Interestingly enough, the use of Islamic identity ganic state. While serving to create a secure by the military regime in the form of the Turkish- ground for the liberal restructuring of eco- Islam synthesis, in order to depoliticise society and nomic life, the 1980 coup also ironically cre- eliminate the Left-discourse from the political sphere, which contributed to the resurgence of Is- ated the ground for a new idea of the state lamic identity as a political force, ended in 1997, which could replace the Kemalist republican when the National Security Council declared that populist state, the existence of which the mili- Islamic fundamentalism constitutes a fundamental tary was supposed to protect. Indeed, the 1980 threat to secular regime.

68 | TURKEY IN EUROPE MONITOR whose modus operandi were not directed at Driving Forces of Turkish Democratisation the essential identity of Kemalist nationalism, in the 2000s it gave rise to discourses aiming primarily at dismantling that identity. Thus, the attempted Since 2000, it has become possible to observe depoliticisation brought into existence once five crucial developments (international and again the secularist versus anti-secularist axis. national) that have generated extremely important, if not system-transforming changes in The search for a political community both state-societal relations in Turkey. These have outside the terrain of and as a response to the forced political and state elites to come to Kemalist vision was one of the significant terms with the fact that democracy is not only themes of Turkish politics in the 1990s. The a normatively good system of governance, but political landscape was characterised by a also constitutes a valuable strategic and politi- clash between the discourse of progress and cal device to enable any country to be strong secularism versus the discourse of traditional- and stable in its homeland and in international ism and anti-secularism, as well the emer- relations. These developments have also cre- gence of the ethnic issues centred on the ated an adequate ground for the solution of the Kurdish question, whose activities ranged paradox that has described the process of the from the politics of identity to PKK terrorism. making and the remaking of modern Turkey.

This intersection between the decline of the The changing Turkey-EU relations since hegemony of Kemalist nationalism and the 1999. Since the Helsinki Summit of 1999, rise of Islamic discourse was crucial to the when Turkey was granted a status of a candi- crisis of identity that was then taking place in date country for full membership, Turkey-EU Turkish political life. This could be consid- relations have gained in ‘certainty’. This has ered to be a positive development, insofar as forced the political and state actors to focus on the emergence of alternative visions of mod- democracy, since the candidate country status ernity might be an indicator of multi- was requiring Turkey to fulfil the Copenhagen culturalism and pluralism. However, the Is- political criteria. This process still continues, lamic resurgence was mainly the outcome of and Turkey takes further measures to consoli- the ‘weak state consensus’, which was created date its democracy to get a starting date for through neo-liberalism, and which generated a negotiations. What is important here is that clash between the Western and the Islamic the more that Turkey-EU relations have visions of modernity. To the extent that the gained ‘certainty’ over time, the more Turkish weak state consensus aims at minimising state politics have come to terms with the fact that power rather than democratising it, it could democracy should be the only game in town. not provide for the democratic regulation of the state/society relations, in which Islamic The February 2001 financial crisis and Tur- identity acts not as the essence of an alterna- key-IMF relations. As the Turkish economy tive vision of society, but as an identity among collapsed in February 2001 and generated others in a multi-cultural, plural setting. devastating and tragic impacts on the country, the need to restructure state-economy relations The main conclusion from the impasse of became very apparent. Although the crisis Turkish politics in the 1990s, was the follow- appeared to be economic and financial, it was ing. Democracy could not only open possibili- in fact a crisis of governance, which has oc- ties for the articulation of essentialist claims to curred as a result of the populist, clientalist identity, but could also, on the contrary, lead and corruption-producing nature of Turkish to strategies against essentialism, nationalism politics. For this reason, the strong-economy and religious communitarianism. What was program, prepared in accordance with the most needed in Turkey as it approached the structural adjustment program of the IMF, had new millennium was the building of a democ- as its first aim to restructure the state through ratic consensus between state and civil soci- freeing the economy from Turkish politics. ety. Thus, it had become clear to political and economic actors that without a strong and stable economy, Turkey faced drastic problems, for which the viable solution is to democratise

NO. 8 / AUGUST 2004 | 69 both the state and its governing relations with in Turkey-US relations. What has become ap- society. parent, beyond its decision keep out of the war and occupation, is that as long as Turkey does The November 2002 elections and the AKP not solve its own Kurdish problem, it will face government. On the evening of 3 November security problems from Kurdish tribal forces 2002, as the final vote count came in, an elec- in Northern Iraq. This in turn means Turkey toral earthquake shook Turkish politics. The will remain very hesitant towards the political three parties that had formed the coalition future of Iraq involving, as a likely scenario, a government after the 1999 elections, as well federal system in which the Northern part will as two opposition parties, failed to pass the 10 be governed by the Kurds. The war on Iraq per cent national threshold and found them- has thus made the political and state elite real- selves left outside the parliament. The election ise that only a democratic Turkey willing to results demonstrated popular feeling that the solve its problems stemming from the ques- ineffective and undemocratic governing struc- tions of identity and difference, most con- ture based on economic populism, clientalism, cretely the Kurdish question, would be strong corruption and democratic deficiencies had enough to face up to the increasingly prob- run its course, and that a strong single-party lematic structure of the Middle East region in government with institutional and societal general and the post-war Iraq in particular. support could make Turkey a democratic and economically stable country. The AKP gov- The role of civil society: In addition to these ernment has indeed created political stability international and national changes, there have in Turkey, and has made a number of impor- been strong societal calls for the further de- tant legal and constitutional changes necessary mocratisation of relations between the state, for meeting the requirements of the Copenha- society and the individual. Since 2000 most of gen political criteria. the civil society organizations have made such calls, and in doing so have shown their sup- The Iraq war in 2003 and Turkish-American port of Turkey-EU relations. Strong eco- relations. The September 11 terrorist attacks nomic actors, such as the Turkish Industrialist have generated consequences for the world and Businessman Organisation (TUSİAD), the much beyond the killing around 3000 innocent Independent Industrialist and Businessman people. The unilateral declaration of the US- Organisation (MUSİAD) and the region-based led global war on terrorism, aiming at revital- and province-based Industrialist and Busi- ising the international politics on the basis of nessman Organisations (the SİADs) have sup- the normative and strategic primacy of secu- ported Turkey’s entry into the EU and initi- rity issues as opposed to global social justice ated lobbying-based activities for this end. problems, has not only concretised itself as They have voiced the need for more democ- war. It also unearthed the underlying problems racy in Turkey and recognised the role of the of the key international institutions, such as EU as international anchor for democratisa- the UN and the NATO, created a split in the tion. Similarly, a number of civil society or- process of European integration, and divided ganisations and think-tanks operating in vari- the world into those who are the friends of the ous fields have worked in their own ways for US and those who are against the war on ter- further democratisation and modernisation. rorism. Civil society has become an important element of Turkish politics not only through its Turkey has not been immune from this proc- discourse of democratisation but also by its ess, and this became clearer as the US em- associational activities. barked on its war against Iraq, and occupied the country in order to remove the Saddam All these changes - Turkey-EU relations, Tur- Hussein tyranny. Turkey with its border with key-IMF relations, the AKP single-majority Iraq found itself subjected to the military and government, Turkish-American relations and political demands from the Bush Administra- the increasing importance of civil society - are tion to deploy its military in its South Eastern together making Turkish modernity more so- regions. Turkey’s rejection of this demand, cietal, liberal, plural and multi-cultural, as with its famous parliamentary decision of 1 well as of transforming Turkish democracy March 2003, obviously created big problems into a more consolidated, substantial and

70 | TURKEY IN EUROPE MONITOR deepened democratic mode of governance. ety and by altering the domestic opportunity However, the current Turkey-EU process of structure.9 political conditionality appears to be most significant for societal modernisation and democ- The Helsinki Summit of December 1999 ratic consolidation. caused a significant shift in the EU’s policy towards Turkey by declaring it a candidate The EU-driven Political Agenda country and by subjecting it to the same formal mechanisms used for the Central and East By making basic norms of liberal democracy European countries to guide and measure pro- the sine qua non condition for membership – gress on the Copenhagen criteria. The Euro- its most important possible incentive and re- pean Commission published the first Acces- ward -, the EU has developed its policy of sion Partnership in March 2000, which was ‘conditionality’ as an instrument to transform followed by the preparation of the Turkish the governing structures, economy and civil ‘National Program for the Adoption of the society of the candidate countries, initially of Acquis’ by the Turkish authorities in March Central and Eastern Europe. The major in- 2001. struments of conditionality were ‘gate- Immediately following the approval of the keeping’ along with ‘bench-marking’ and National Program, the silence on political re- ‘monitoring’.7 Hence, the EU institutions de- form was broken with a record number of cided on whether or not to give the green light thirty-four amendments made to the Constitu- to the different stages along the accession tion in October 2001. The amendments were process which, in the case of Central and East not restricted to political rights, but extended European countries, consisted of privileged over a large area of socio-political life. Al- access to trade and aid, signing and imple- though most of these amendments dealt with menting enhanced association agreements, the matters of detail or were simply changes in starting of accession negotiations, the opening language that did not create a new legal situa- and closing of thirty-one chapters of the action, some of them were real constitutional quis, signing of the Accession Treaty, ratify- reforms, such as the shortening of pre-trial ing the Accession Treaty and finally, entering detention periods, the limitation of the death the EU.8 Benchmarking and monitoring were penalty to times of war and terrorist crimes, undertaken by yearly ‘Progress Reports’ out- changes that made the prohibition and dissolu- lining the steps taken by the candidate coun- tion of political parties more difficult, and ex- tries in fulfilling the Copenhagen criteria, and pansion of the freedom of association and ‘Accession Partnerships’ listing short and me- strengthening of civil authority in the National dium-term recommendations to achieve that Security Council. After the constitutional end. The Commission has also supported amendments, the new Civil Code entered into these mechanisms through a significant force on 1 January 2002, introducing signifi- amount of financial aid and technical assis- cant changes in the area of gender equality, tance. This has allowed the EU to offer re- protection of children and vulnerable persons. sources and legitimation to some actors and It established new practices and institutions in constrain the behaviour of others in the do- Turkish Law, such as pre-nuptial contracts on mestic sphere. It has influenced the democra- the management of family assets. tisation process of candidate countries primarily by empowering reformist elements in soci- There followed three ‘Harmonisation Pack- ages’10 in the wake of the Copenhagen Euro-

pean Council of December 2002. These not 7 Grabbe, Heather (2001), ‘How does Europeanisa- only aimed to translate the preceding constitution Affect CEE Governance? Conditionality, Dif- tional amendments into action by harmonising fusion and Diversity’, Journal of European Public Turkish Law with them, but also introduced Policy, vol.8, no.6, pp.1013-1031. 8 Noutcheva, Gergana et al. (2004) ‘Europeaniza- 9 Ibid, p. 17. tion and Secessionist Conflicts: Concepts and 10 A term of reference for a draft law consisting of Theories’, in Bruno Coppieters et al., Europeaniza- a collection of amendments to different laws, de- tion and Conflict Resolution: Case Studies from signed to amend more than one code or law at a the European Periphery, Ghent: Academia Press, time, and which was approved or rejected in a sin- pp. 1-50. gle voting session in the Parliament.

NO. 8 / AUGUST 2004 | 71 further reforms particularly in the fields of The strengthening of the credibility of EU human rights/protection of minorities, free- conditionality was immediately reflected in dom of expression and freedom of association. the subsequent reform packages adopted by The most notable of these were the easing of the Turkish government. Four comprehensive restrictions on broadcasting in and the right to sets of democratic reforms entered into force learn ‘different languages and dialects tradi- in the year 2003, aiming to improve the most tionally used by citizens in their lives’, namely criticised aspects of Turkish democracy, such Kurdish. These measures culminated in the as limits to freedom of speech and expression, Copenhagen decision of December 2002 that freedom of association, torture and mistreat- ‘if the European Council in December 2004, ment along with the strong influence of the on the basis of a report and a recommendation military on domestic politics. from the Commission, decides that Turkey With the two democratisation packages that fulfils the Copenhagen political criteria, the entered into force in January 2003, the Law on EU will open negotiations without delay’. Political Parties was further liberalised, the fight against torture strengthened, freedom of This decision was received with considerable the press further expanded, the procedures for disappointment in Turkey as general expecta- setting up associations eased and the restrictions had been raised in the country by the tions applying in the acquisition of property political elites as well as by the media that the by non-Muslim community foundations abol- decision to actually launch accession negotia- ished. Retrial of cases on the basis of the deci- tions with Turkey would have been taken at sions taken by the European Court of Human that Summit. However, contrary to some theo- Rights was also made possible, paving the ries circulated by the more fervent Euroscep- way for the retrial of some former Kurdish tics in Turkey, this disillusionment has not led nationalists such as Leyla Zana. to a slowdown in the reform process, nor has it led to the abandonment of the ‘EU Project’- The sixth reform package that entered into as it is often referred to in Turkey. In fact just force in mid-July 2003 became famous for the the opposite happened. The Copenhagen lifting of the infamous Article 8 of the Anti- Summit has fostered a ‘sense of certainty’ in Terror Law, with expansion of the freedom of EU-Turkey relations by giving a specific date speech, abolition of the death penalty and ex- for the beginning of accession negotiations.11 pansion of broadcasting rights in Kurdish. It Even though the year 2004 was a conditional was the final set of democratic reforms, how- date, it was nevertheless a significant step ever, which entered into force at the end of forward, as it provided Turkey with the pros- July 2003, that attracted the most attention, pect that full EU membership was a real pos- due to its emphasis on strengthening the civil- sibility.12 In the meanwhile, the EU also de- ian control of the military, as well as the addi- cided to significantly increase the amount of tional measures to strengthen the fight against financial assistance to Turkey. Pre-accession torture and the exercise of fundamental free- financial assistance would reach 250 million doms. Euros in 2004, 300 million Euros in 2005 and 500 million Euros in 2006 to ‘help Turkey In May 2004, there was another set of prepare to join the EU as quickly as possi- amendments to the Constitution, some of ble’.13 which consisted of harmonising the Constitu- tion with the previous democratisation pack-

11Öniş, Ziya and E. Fuat Keyman (2003), ‘Turkey ages. However, more significant amendments at the Polls: A New Path Emerges’, Journal of regarding the further civilianisation of Turkish Democracy, vol. 14, no.2, pp. 95-107. politics, reform of the judiciary and freedom 12Keyman, E. Fuat and Ziya Öniş (2004), ‘Hel- of press were also approved by the Parliament. sinki, Copenhagen and Beyond: Challenges to the The subordination of domestic law to interna- New Europe and the Turkish State’, in Mehmet tional law in the area of fundamental rights Ugur and Nergis Canefe (eds.) Turkey and Euro- and liberties was also now secured in the pean Integration: Accession Prospects and Issues, Turkish Constitution. The eighth democratisa- London: Routledge. 13European Union European Commission Repre- sentation to Turkey, ‘EU Funded Programmes in at:http://www.deltur.cec.eu.int/english/eufunded20 Turkey: 2003-2004’, December 2003 (accessible 04/01eufp04.pdf).

72 | TURKEY IN EUROPE MONITOR tion package adopted in July 2004 resolved Another reason that facilitated compliance by yet another long-criticised issue, repealing the Turkey was the perceived decrease in the provision that allowed for the nomination of a costs of these measures for the mili- member of the High Audio-Visual Board tary/security establishment, which used to be (RTÜK) by the Secretariat General of the Na- particularly high in the 90s. This was specifi- tional Security Council. The new Penal Code cally the case for reforms related to minority and the Law on Associations, currently pend- rights. The political costs of compliance were ing in the Parliament are also expected to be reduced with the virtual end of Kurdish terror- adopted before the Commission Report in Oc- ism in late 90s, weakening the previous oppo- tober. Most of the reforms in the past were sition of the military/security establishment passed immediately after or before crucial and strengthening the view that national unity European Council meetings, displaying once can be preserved through further democratisa- again the clear drive of the prospect of mem- tion, rather than via military means. bership. In addition to legislative changes, the gov- Policy Conclusions ernment has also taken specific steps geared towards securing effective implementation, Recent years have clearly seen substantial im- the most notable of which was the establish- provements in Turkish democracy. Nobody ment of Human Rights Boards in cities and today questions whether the basic institutions provinces as well as a special Reform Moni- of government – the parliamentary legislature, toring Group composed of various representa- the government and presidency – are function- tives of selected ministries and government ing democratically. Reforms recently under- bodies. taken have been addressing long-criticised aspects of Turkish democracy, particularly the As the prospect of EU membership and the role of military in politics, respect for human associated conditionality became more ‘real’, rights, protection of minorities and the judicial it became impossible to separate the domestic system. Yet while in legislative and institu- and international spheres from each other. By tional terms a lot has been achieved and few helping to create a ‘strong language of rights’ challenges remain, there is still much to be in the country, the EU started to play an im- done regarding implementation. portant role in furthering the change in state- society relations and provided legitimacy for For example, in the field of torture and ill- civil society organisations calling for a more treatment by the police and in penal estab- democratic Turkey and demanding recogni- lishments, there are still legislative measures tion of cultural and civil rights/freedoms.14 to be taken, the most significant of which are Similarly, the EU has also provided increasing the lifting of the statute of limitations for such legitimacy for the governing party AKP’s crimes, removal of law enforcement officials heavy emphasis on democracy and the protec- from active duty pending the outcome of in- tion of individual rights and freedoms, as was vestigation and abolishing the practice of giv- reflected in the speed of political reforms after ing a copy of medical reports to security offi- the Party came to power in November 2002. cers. Annulment of Article 159 of the Penal Democracy as advocated by the EU became Code and a comprehensive reform of the Law the ‘catchword and the strategy through which on Political Parties would constitute funda- the former Islamists seek to change the system mental steps in further expanding the freedom at the same time as they change themselves’.15 of expression. With respect to the freedom of association, the draft Law on Associations introduces the legislative remedies for long standing obstacles regarding government ap- 14 See Keyman, E. Fuat and Ahmet İçduygu proval mechanisms and cooperation with for- (2003), ‘Globalization, Civil Society and Citizen- eign associations. The draft, however, does ship in Turkey: Actors, Boundaries and Dis- not touch upon the broad authority of the Inte- courses’, Citizenship Studies, vol. 7, no.2, pp. 219- rior Ministry and government officials to in- 233. 15 Bazoglu Sezer, Duygu (2002), ‘The Electoral spect premises and records of associations. Victory of Reformist Islamists in Secular Turkey’, This would require further legislative action in International Spectator, vol. 37, no .4, pp .7-21. the next stages of the reform process.

NO. 8 / AUGUST 2004 | 73

The issue of the protection of minorities is no Given the pace of reforms in the last 3 years, longer a ‘taboo’ subject in Turkish political the remaining legislative and institutional life. There are serious efforts to improve the tasks could be achieved in a relatively short lives of minorities in Turkey. Regarding non- period of time by the Turkish authorities. Muslim minorities, the remaining problems in What requires more energy and more time are the field of property rights for community efforts geared towards changing the mindsets foundations and religious freedoms are re- of the public officials, in particular the police solvable through the correct and full applica- force, bureaucracy, military, public prosecu- tion of the provisions of the Treaty of tors, the judges and the citizenry of the coun- Lausanne. The other minority groups, particu- try. This is particularly the case for military- larly the Kurds, would benefit greatly from the civilian relations where the full implementa- extension of cultural rights such as the grant- tion of the comprehensive reforms requires ing of local broadcasting rights, the introduc- changes in the assessments of the military’s tion of optional language classes in public role, both in the eyes of the public and of the schools upon demand and the lifting of restric- military itself. tions on expressions of cultural identity. In order to ensure effective implementation of In the case of Turkey, the progress achieved such measures for all minorities, it is also nec- so far suggests that for the existing reforms to essary to undertake a gradual shift from the be entrenched and further proceed, the EU traditional interpretation of the monolithic should follow the same path as for Romania Turkish nation to a redefined notion of politi- and Bulgaria. It is generally recognised that cal community which requires a more inclu- the EU opened negotiations with these coun- sive and truly civic concept of citizenship. tries before they fully respected the Copenha- gen political criteria, with high degrees of cor- The guarantors of the rule of law and of re- ruption and malfunctioning public administra- form process, the judiciary, has also under- tions.16 Also one may bear in mind the case of gone significant reforms, the most notable of Latvia, where according to a report by the which was the recent abolition of the State European Parliament in February 2004 there Security Courts that have in the past dealt with remain significant problems regarding the crimes against the state. Future reforms should situation of its Russian minority. The opening focus on ensuring proper training and working of accession negotiations with Turkey on the conditions for the members of the judiciary, grounds of ‘sufficient progress’, to be fol- and ensuring its full independence from the lowed by regular assessments of compliance executive. Implementation here is a major with the political criteria upon closing of a challenge that will take many years. certain number of previously agreed chapters, is plausible. The process of change already extends throughout society, from the policemen who In the case of Turkey, the adoption costs of are actually now following the newly opened the ultimate transformation that will occur on Kurdish languages courses, to the civil ser- the path to eventual accession still seem to be vants who revise the implementing regula- perceived as high, particularly by the mili- tions, the military which decreases its spend- tary/security establishment, those at the ex- ing upon the request of the civilian power, the treme left and right of the political spectrum, judges and the public prosecutors who give and even for a majority of ‘social democ- increasing references to the European Con- rats’17. The costs are perceived to arise from vention of Human Rights, and the majority of the pooling of sovereignty, decentralisation the citizenry who support the European inte- and increased recognition of multiple identi- gration process. Further training and education 16 coupled with the continued and credible appli- Emerson, Michael, ‘Has Turkey Fulfilled the cation of EU conditionality would secure the Copenhagen Political Criteria?’, CEPS Policy path of reform which in the eyes of many is as Brief, April 2004, no. 48, p. 2. 17 Schimmelfennig, Frank et. al. (2003), ‘Costs, revolutionary as those achieved by Mustafa Commitment and Compliance: The Impact of EU Kemal and his followers in the 20s and 30s. Democratic Conditionality on Latvia, Slovakia and Turkey’, Journal of Common Market Studies, vol. 41, no. 3.

74 | TURKEY IN EUROPE MONITOR ties, which comprise the defining traits of We conclude with a suggestion, based on two European integration. These processes come words – fairness and objectivity. For the deci- into direct conflict with the authoritarian vision about Turkey’s readiness for the full ac- sions of nationalism based on a single identity, cession negotiations to be taken fairly, it has and lead the members of the anti-EU coalition to have an objective basis, which can only to regard major political reform along these mean the capacity and willingness of Turkey lines as a major threat to the unity of the na- to meet the Copenhagen criteria. Turkey’s tion.18 Although such resistance was also pre- place in Europe should not be based on reli- sent in a majority of the Central and East gious or geographical references. Instead, European countries, the levels are higher in Turkey’s identity and its compatibility with the Turkish context due to ‘historical legacies the Europeans norms of democracy and eco- and the peculiarities of her nation-building nomic modernisation should be judged on the experience’.19 There is no complete overthrow basis of an objective, historical and analytical of the existing system in the Turkish case, reading of modern Turkey. making it difficult to achieve reform from within the existing structures.20 The history of modern Turkey since 1923 has been one of modernisation and democratisa- A credible and consistent policy of condition- tion. However, this history has had, and con- ality is thus necessary to empower reformist tinues to have, its problems in linking together elements in Turkish society. In cases where modernity and democracy. Yet Turkey’s pro- the incentive of membership offered by the found political identity as a secular parliamen- EU requires the adoption of principles per- tary democracy appears indeed to be compati- ceived as threatening for the ruling elite, the ble with European norms of democracy and only means for the EU to bring about change liberal economy. That is evidenced in the fact are through direct democracy promotion and that the more Turkey has attempted to meet mobilisation at both elite and the mass level. the Copenhagen criteria, the more it has con- As an example, this indeed worked in the case solidated its democracy and made its moder- of Slovakia, in overcoming the resistance of nity liberal, plural and multi-cultural. Turkey the Mečiar leadership.21 In addition the EU has achieved this in a short period not only also needs to continue offering aid and assis- because of the strong political will to do so, tance to pro-democratic forces in Turkish so- but also because it has already established the ciety and to build transnational networks for institutions and norms of democracy and change. Close and direct links with civil soci- modernity. ety and the reformist elite are essential for further change to occur. Determined attempts to In this sense, we suggest that, rather than cul- change the perceptions of the elite, particu- turalist and essentialist discourses of Europe, larly in the security forces and the judiciary, which privilege religion and geography over would also prove beneficial. All these meas- universal norms of democracy and liberal ures would also be helpful in fostering ‘so- economy, the principle of fairness and objec- cialisation’ into European norms and values. tivity should be the basis of the EU’s decision about Turkey. Fairness and objectivity have the potential to create a reciprocal relationship 18 Öniş, Ziya (2003), ‘Domestic Politics, Interna- tional Norms and Challenges to the State: Turkey- between Turkey and the EU, in which both EU Relations in the Post-Helsinki Era’, Turkish parties have mutual benefits. While accepting Studies, vol. 4, no.1, pp. 9-34. Turkey as a full member of the EU would 19 Ibid, p. 5. demonstrate that the process of European in- 20 See Muiznieks, Nils and Ilze Brands Kehris tegration and its enlargement operates on the (2003), ‘The European Union, Democratization, basis of universal norms rather than religion and Minorities in Latvia’ in Paul J.Kubicek (ed.), or geography, the project of Europeanisation The European Union and Democratization, Lon- in Turkey makes a significant contribution to don: Routledge, pp. 31-55. the process of democratic consolidation and 21 See Krause, D. Kevin (2003), ‘The Ambivalent societal modernisation. With its secular mod- Influence of the European Union on Democratiza- tion in Slovakia’ in Paul J.Kubicek (ed.), The ernity and mostly Muslim identity, Turkey can European Union and Democratization, London: contribute to the reshaping of the political Routledge, pp. 56-86. identity of Europe as a multi-cultural space

NO. 8 / AUGUST 2004 | 75 governed by the universal norms of democ- of world governance, which our extremely racy and liberal economy. With such a politi- dangerous post-September/11 world needs cal identity, Europe will for its part reshape today. international relations as a democratic space

cles of the Civil Code and the Penal Code, as TURKISH BUSINESS PERSPECTIVES well as founding the Women’s Library and by Women’s Shelter and several other associa- TÜSIAD tions to defend women rights. TURKISH INDUSTRY & BUSINESS ASSOCIATION One of these associations, KA-DER (Associa- tion for the Support and Training of Women www.tusiad.org Candidates) promotes women’s representation in the parliament with a view to end gender WOMEN IN TURKEY AND THE EU inequality in politics.

Turkey’s progress towards EU membership KAGIDER is an influential association, is an important catalyst in empowering which promotes women entrepreneurship Turkish women and generating positive ef- (www.kagider.org). fects on the status of Muslim women in Europe and beyond. It is also interesting to stress that in some sectors such as banking, engineering, legal, and Turkish women’s achievements for gender the medical, the presence of Turkish women equality dates back to the Ottoman Empire. is among the highest in Europe. With the legal codifications of 1836 and constitutional reform movements of 1876 and The Women Initiative for Turkey in the EU 1908, women became more vigorous in claim- was founded with the aim of contributing to ing their rights. Accordingly, they dissemi- Turkey’s accession process to the EU. The nated the debate on gender equality and indi- broad perspective of this initiative is to promote vidual rights to public through their associa- women’s status in Turkey through better coop- tions and by publications in daily papers. eration with its counterparts, stimulated by the launch of accession negotiations with the EU. With the foundation of the Republic in 1923, the pace of the modernisation process of the Problems related to gender equality and society increased. Secularisation, adoption of women’s rights within the social, cultural and civil code and the enactment of law on the political sphere of a society are still a problem unity of education contributed positively to in Turkey. Women in the EU face discrimina- women’s status in society. Women’s access to tion and have to struggle for their cause as well. education and admission to public professions In this context, status of women in Europe will were substantial changes. In 1940s the per- be analysed in the below mentioned seminars: centage of women studying medicine, law, engineering, which are mainly seen as profes- “Raising Mutual Understanding: sions for men, was 42 %. Women acquired the Women in Turkey and the EU” right to vote in 1934 and in the next elections organised by KA-DER with the support of Eczacı- 18 women were elected to the Turkish parlia- başı Group, on September 13, 2004, ment. at the Bosphorus University, in Istanbul. http://www.ka- der.org.tr/sempozyum/eng/mainpage.htm Post-1980, academics, professionals, journal- ists and students raised consciousness on gender equality by challenging the patriarchal “Comparative Perceptions of Women’s Role structures in some segments of the society. in the EU and Turkey” They organised campaigns against domestic organised by Women Initiative, on October 13, 2004 violence and for amending discriminatory arti- at Palais des Beaux Arts, in Brussels. www.womeninitiative.info

CEPS Turkey in Europe Monitor No. 9, September 2004

Introductory Note from CEPS The first possibility is to calculate what Turkey This issue of CEPS Turkey in Europe Monitor would receive under the Common Agricultural presents the CEPS-EFPF working paper titled Policy and the Structural Funds, as a full “Turkey and the European Budget: Prospects member today. The second approach would be and Issues”, prepared by Kemal Derviş, to calculate what the EU would have to pay by Daniel Gros, Faik Öztrak and Yusuf Işik, in a likely accession date such as 2015, under cooperation with Firat Bayar, within the scope current rules. Although the authors are aware of the joint CEPS-EFPF Project, “Strategy for of the fact that the elaborated numbers may be EU and Turkey in the Pre-Accession Period”. altered, they reach the conclusion that net The project is realised with the financial con- transfers would have a significant impact in tributions of the Open Society Institute of Is- Turkey, while being a manageable amount for tanbul, Akbank, Coca Cola and Finansbank. the EU budget. CEPS acknowledges the kind support for the 10 working papers of the Project (justice and production of the Turkey in Europe Monitor home affairs, democratic governance, foreign provided by EU Information Group of Turkey policy, trade, banking, agriculture, energy, (ABIG).The paper argues that although it is growth, budgetary implications, monetary and highly speculative to calculate the cost of fiscal policy) and the Final Report that out- Turkish membership for the incumbent mem- lines the major findings and the conclusions of bers due to changes that both Turkey and the the Project are now available at www.ceps.be. EU are going through, there are ways to – at (see the end for the full list of working papers least to some extent – to calculate the cost that and further information on how to purchase Turkey as a fully integrated EU member would the final report). represent to the budget. Michael Emerson and Senem Aydın

Turkey and the European Budget: Prospects and Issues Kemal Derviş, Daniel Gros, Faik Öztrak and Yusuf Işik in cooperation with Firat Bayar1 The factors that will determine the speed of convergence of Turkish incomes to EU averages are discussed in Working Paper No. 8 of this same series. We present here a brief discussion of the impact Turkish membership would have on the EU budget. How much would Turkish membership cost the then incumbent members? This is a question that is at the same time straightforward and impossible to answer. It is impossible in the sense that the EU is evolving constantly so that it is difficult to predict with any precision what the financial consequences of accession of Turkey, in, say, 2014, would be. However, it is straightforward to calculate how much Turkey would cost the EU budget if it were to enter under present rules.

1 Kemal Dervis is former Minister for Economic Affairs, Member of Parliament and Member of the Coordina- tion Board, EDP. Daniel Gros is Director at CEPS. Faik Oztrak is former Undersecretary of the Turkish Treas- ury and Visiting Professor at Middle East Technical University. Yusuf Isik is Advisor to Kemal Dervis, and former Head of the Strategic Research Department of the State Planning Organisation. Firat Bayar is former Associate of the Turkish Treasury and Ph.D candidate at Middle East Technical University.

| 76 NO. 9 / SEPTEMBER 2004 | 77

One may be tempted to argue that the transfers In terms of negotiations, Turkey would thus be from the EU budget to Turkey will simply be fully part of the EU’s financial framework whatever member countries agree that these only during the 2018-2024 round. Given that transfers should be, because they do indeed for all present and former member states it under the current treaties all have to agree. On took between 5 and 10 years before they were the other hand, it would not be possible to ne- integrated into all support programmes, it is gotiate membership with any Turkish govern- thus likely that Turkey will benefit fully from ment if Turkey is not able to get a ‘fair’ deal, the EU’s budgetary support schemes some where ‘fairness’ will entail some comparison time after 2020. to other countries that will have joined rela- What will determine Turkey’s share in the EU tively recently. The three countries on which budget of the 2020s, are the rules that will by Turkish negotiators are likely to focus are then be in effect for everyone else and the Romania, Bulgaria and Croatia, assuming that level of development reached by the EU and the first two will have joined in 2007, and Turkey itself. One cannot know with certainty Croatia some time thereafter. Turkey will be what these rules will be and any long-term able to accept transition rules of the type ac- projections are therefore highly speculative. cepted by the 2004 accession countries as well as those already accepted by Romania and In reality, however, the discussion about the Bulgaria. And Turkey may even be ready to financial burden Turkey would represent for accept a lengthening of these transition rules the EU budget usually focuses on the current reflecting recognition of her size. Turkey will rules. The experience with the current not accept a deal, however, which would set it enlargement process suggests that over time apart from other member states in a qualitative the discussion will shift from how much it and lasting fashion. Nor is it actually likely costs to who will bear the (minor) burden. But that the EU would propose anything signifi- this point is still some way into the future. cantly less than fair to Turkey as the experi- Current circumstances have another impact, ence of Romania and Bulgaria suggests. The however, in that it is usually assumed that the principle of equal treatment of member states burden would have to be borne by the current is deeply ingrained in the EU’s framework – EU-15 because it is usually assumed that most even when it comes to financial matters. of the new member countries will remain net beneficiaries for quite some time to come. By A key factor limiting the degree of freedom of the early 2020s this might no longer be the the EU budget is the fact that the financial en- case, but again it is impossible to forecast with velopes are determined in a multi-annual any precision which of the new member coun- framework called the ‘financial perspective’. tries would no longer qualify for financial The current framework, which was decided support (under current rules) by that date. among the EU-15 in 2000, and thus long before the current enlargement, runs until 2006. The ‘maximum’ that Turkey would receive The next framework, which will be negotiated after a transition period under current rules is a à 25, will run until 2012. By that time Turkey ‘starting point’ many analysts have chosen.1 is not likely to have already become a member There are two variants to this approach. country so that it will have only a limited in- a) How much would Turkey receive if it fluence for the following financial framework, were a fully established member today? which would run until 2018, Assuming accession by 2015, this would imply that the finan- b) How much is Turkey likely to receive un- cial envelope for the first three years of Tur- der current rules by a likely accession key’s membership would have been decided date, e.g. 2015? by the EU-28 (the current EU-25 plus B, R The overall calculations are actually quite and HR). In this respect, the situation of Tur- simple in both cases since the budget of the key might thus resemble that of Bulgaria and EU is dominated by two items: Structural Romania, which are likely to join by 2007, so Funds (destined for regions with a GDP per that their first years of membership will also capita at PPP below 75% of the EU average) be covered by a financial framework in whose negotiations they were not present. 1 See Hughes (2004) as well as Quaisser & Reppegather (2004). 78 | TURKEY IN EUROPE MONITOR and the Common Agricultural Policy (CAP). 28 GDP (at present it amounts to only around The gross receipts of any member country are 2%) by the middle of the next decade. This to a large extent determined by these two implies immediately that the cost of extending items. current Structural Funds to Turkey would cost at most 0.16% of EU-28 GDP (=0.04*0.04). Turkey in the EU today The calculations for agriculture are potentially more complicated since one would have to If Turkey were a member country today, it guess the output structure of agriculture in could count on Structural Funds allocations, Turkey in about a decade and then calculate to which would be capped at 4% of its GDP as what extent this would change if Turkey par- decided at the Berlin European Council. Given ticipates in the CAP. This would actually be an that Turkey’s GDP has averaged around €200 exceedingly complex operation as one would billion in recent years, this implies immedi- have to take into account the entire in- ately that its allocation would be around €8 put/output matrix. For example, some com- billion annually. modities (maize) are used an input in the pro- It has also been calculated that extending the duction of others (meat). However, this is not current CAP to Turkey (with per hectare pay- necessary as an indirect approach can yield a ments based on current yields) would cost better result. around €9 billion. This implies that the total The starting point is that Turkish farmers are receipts of a hypothetical Turkish EU member likely to obtain at most 20% of their value today might be slightly less than €20 billion added from the EU’s CAP, for the simple rea- (Turkey would also receive funding under son that this is what farmers in the EU-15 ob- other programmes). Turkey would then also tain today: the CAP costs at present amount to have to contribute as all other member states 0.5% of GDP and the value added produced by to the EU budget. With a current contribution agriculture is about 2.5% of the EU-15 GDP. rate of around 1% of GNP (the ceiling for the EU budget is 1.25% of GDP, but the EU Agriculture produces at present around 12% of spends just slightly above 1% of GDP at pre- GDP in Turkey, but taking into account that its sent), this would mean around €2 billion annu- share has been declining continuously over the ally, leading to a net financial benefit of last decade, a reasonable assumption might be around €16 billion annually. Apart from the that in about a decade agriculture will account fact that this approach is based on today’s for about 10% of Turkish GDP at the maxi- conditions, the sum mentioned also represents mum. On this basis one can easily calculate an upper bound. the potential maximum cost of extending the present rate of support of the CAP to Turkey. Assuming, as before, that the Turkish econ- Turkey in 2015 in an enlarged EU omy accounts for 4% of EU GDP (and that In calculating the sums Turkey would receive agriculture contributes 10% to this), the cost of in 2015, it does not make sense to use current providing an ‘equivalent rate of support’ for euros since both the EU and the Turkish econ- Turkish agriculture would be 0.08% of EU-15 omy are likely to grow over the next decade. GDP (=0.2*0.04=02.*0.04*0.1). To repeat, this is again an upper bound. Other estimates Once again, the starting point for the Struc- arrive at much lower numbers; see for example tural Funds is that the absorption limit has Quaisser and Reppegather (2004) who argue been set at 4% of the recipient’s GDP. This that the cost of extending the CAP to Turkey implies that one can immediately calculate the should only be around 0.045% of the EU’s ceiling of what Turkey could receive under GDP. current rules for the Structural Funds, once one has an idea of the size of the Turkish The number calculated above is again an upper GDP. limit, as the CAP is likely to change over time, inter alia, because of the commitments made Under the growth scenario presented in section by the EU in the context of the WTO to abol- 2 above, Turkey will grow much more quickly ish exports subsidies, and the general limita- than the EU over the next decade and Turkish tions the WTO imposes on various types of GDP could reach about 4% of that of the EU- domestic agricultural subsidies in general.

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Moreover, it has already been agreed within The ceiling for the net cost should thus be the EU that the cost of the CAP should rise by around 0.20% of EU GDP (equivalent to about less than 80% of the increase in nominal GDP. €20 billion given today’s EU GDP of around This implies that the cost of the CAP as a per- €10.000 billion) under both illustrative calcu- centage of EU GDP has to fall over the next lations. decade.2 Depending on the overall growth rate of the EU, the cost of the CAP is thus likely to Transitional arrangements be less than 0.4% of the GDP of the enlarged EU once Turkey joins. Since any single coun- The numbers calculated above represent the try, even if it is the largest one, is not likely to maximum that would be achieved only after a get more than one-fourth of this sum, it is clear considerable transition period, as in the case of that the cost of extending tomorrow’s CAP to the new member countries from Central and Turkey cannot be more than 0.05 to 0.1% of Eastern Europe, assuming current rules. The the EU’s GDP. immediate post-membership transfers would be much lower, as in the case of all new mem- The gross cost (Structural Funds plus CAP) ber countries. As argued above, the experience together might thus amount to 0.26% of EU- of Romania and Bulgaria might be particularly 28 GDP (=0.096+0.16). Against the gross re- instructive in this respect given that these two ceipts, one would have to set the contribution countries have a similar GDP per capita and it that Turkey would have to make to the EU could thus be said that they set the benchmark budget. At present, and this is unlikely to for Turkey. Neither Romania, nor Bulgaria change any time soon, all member states con- will participate in the current negotiations for tribute at the same rate, or rather %of GNP, to the next financial framework, but the EU has the EU budget. The contribution rate is equal already proposed a certain allocation for them to the share of the EU budget in overall GDP. (and the two countries have not objected), Assuming that the EU budget will continue to amounting to a total of around €15 billion at be limited to around 1-1.2% of GDP, this im- current prices. Since the combined population plies that Turkey will have to contribute about of these two countries is about 30 million, 1.2% of its own GDP to the EU budget. Under Turkey should receive about 2.3 times as the assumptions made so far (Turkish GDP at much if it were to be treated equally on a per about 4% of that of the EU-15), this would capita basis. This would then amount to about then amount to around 0.048% of EU-15. €35 billion over three years. All this suggests Table 1. Maximum budgetary cost, full mem- that for the first years of membership, transfers bership in the range €9-12 billion per annum might be Turkey in Turkey 2015 in realistic. today’s EU enlarged EU The new member states from Central and (in billions of (as a % of EU Eastern Europe benefited also from modest current euros) GDP) amounts of pre-accession aid, originally under Structural 8 0.16 a programme, PHARE, whose primary justifi- Funds cation was to support the transition to a market CAP receipts 9 0.08 economy, not preparation for accession. The Total receipts 16 0.25 PHARE funds (mostly for technical assistance Contributions 2 0.05 for democracy building, etc.) were later aug- to EU budget mented by two additional programmes: (Max) Net 16 (0.16% of 0.20 SAPARD (support to structural change in ag- receipts for EU GDP) riculture) and ISPA (infrastructure). Over the Turkey last years (2000-03) the total support going to, Source: Own calculations based on current EU budgetary for example Bulgaria has been around €300 rules and regulations. million per annum, with about half coming from PHARE, one-third under ISPA and the remainder under SAPARD. The original justi- 2 For example, with a growth rate of nominal GDP fication for PHARE funding does not apply in of 5% p.a., this rule would imply that the budget the case of Turkey; but it is clear that a sub- available for the CAP would have to fall by around stantial amount of funding for democracy- 1% (not 1 percentage point) every year). 80 | TURKEY IN EUROPE MONITOR building will appear needed viewed from the confident enlarged EU that has successfully EU side. absorbed more than a dozen member countries during the first decade of the 21st century, the Since the equality of treatment is so much en- challenge of integrating Turkey into its rules grained in the EU approach, it is thus likely of financial support to its weaker member that as negotiations proceed a similar amount states will be manageable, particularly if some of financial support for the preparation for ac- of the recent member countries have in the cession will become available for Turkey as meantime graduated from the need for large- well. Scaling the funds available for Bulgaria scale financial support. Sustained rapid growth – either on a per capita or on a % of GDP basis in Turkey would be another key factor as it – yields a similar result in that the total avail- would dispel the fear that Turkey would be a able for Turkey might be just a bit below €3 drain on the EU budget for a long time to billion per annum (not immediately, but after come and reflect the rise of Turkey’s contribu- 4-5 years). This would correspond to approxi- tion capacity. mately 1-1.2% of GDP for Turkey (0.03% of the EU’s GDP or 2-2.5% of its budget).

Bibliography Concluding remarks Are figures in the range of 0.15% to at most Chislett, W. (2004), Turkey’s Membership of the 0.20% of EU GDP large or small numbers? European Union: A Rose or a Thorn, Working Compared to national government expendi- Paper No. 17/2004, Elcano Royal Institute, ture, which is usually around 40-50% of GDP, Madrid. they are negligible. However, a figure of, say, European Commission (2002), “Information note 0.17% of EU GDP would not be negligible on the main findings of a report on Macroeco- compared to the EU-budget ceiling of 1.25% nomic and Financial Sector Stability Develop- of GDP. The current discussion whether the ments in Candidate Countries”. EU budget should be limited to 1 or 1.25% of European Commission (2003), “Continuing GDP shows that sometimes even small sums Enlargement: Strategy Paper and Report of the can have a considerable political impact. It European Commission on the Progress towards must be stressed, however, that all the num- Accession by Bulgaria, Romania and Turkey”, bers referred to here are highly tentative. The Brussels (available at: rules themselves are likely to become more http://europa.eu.int/comm/enlargement/report_ restrictive for both Structural Funds and agri- 2003/index.htm#comprehensive). culture as the current discussions on reform of European Commission (2003), EPC, “Key struc- the CAP and Structural Funds show. tural challenges in the acceding countries: The integration of the acceding countries into the Nevertheless, the projections made here appear Community’s economic policy coordination realistic in terms of what is economically and processes”, Occasional Paper No. 4, July. politically likely to be feasible. Net transfers in European Commission (2003), EPC, Occasional the €9-12 billion range in the first post- Paper No. 4, July. membership years and of about €15 to €20 billion in the 2020s would constitute an impor- European Commission (2003), “Progress towards tant amount for Turkey, a significant but man- meeting economic criteria for accession: The ageable amount for the EU budget and be neg- assessment from the 2003 comprehensive monitoring reports and regular report”, ligible compared to the sum of national budg- Enlargement Paper No. 19, November. ets or the overall EU economy. European Commission (2003), “Regular Report on The budgetary side of membership negotia- Turkey’s Progress towards Accession”. tions is usually left to the very end because this is the only area with a zero sum game. European Commission (2003), “Projected trends in What Turkey gains, others must pay. In the candidate countries’ debt ratios in the light of the 2003 fiscal notifications”, Enlargement Pa- end, however, the numbers tell only part of the per No. 16, September. story. The nature of the financial package will depend to a large measure on how the EU has EUROSTAT (2003), “Statistical Yearbook on developed in the meantime. For a self- Candidate Countries” (available at: http://www.europa.eu.int/comm/eurostat).

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Gros, Daniel (2004), “Financial aspects of central Lejour, A.M., R.A. de Mooij and R. Nahuis (2004), bank independence and price stability: The “EU Enlargement: Economic Implications for case of Turkey”, CEPS/LUISS Working Countries and Industries”, in H. Berger, T. Document. Moutos and H-W. Sinn (eds), Managing EU Enlargement, Cambridge, MA: MIT Press, Hughes, Kirsty (2004), Turkey and the European forthcoming. Union: Just Another Enlargement, A Friends of Europe Working Paper. Quaisser, W. and A. Reppegather (2004), EU- Beitrittsreife der Turkei und Konsequenzen Lejour, A.M., R.A. de Mooij and C.H. Capel einer EU-Mitgliedschaft, Working Paper No. (2004), Assessing the Economic Implications of 252, Osteuropa-Institut, Munich. Turkish Accession to the EU, CPB Document No. 56, Netherlands Bureau for Economic Pol- icy Analysis, The Hague, March.

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TURKISH BUSINESS PERSPECTIVES mic conditions leading to a sustainable stabil- by ity. As an outcome of constantly ameliorating TÜSIAD economic TURKISH INDUSTRY & BUSINESS performance in the last two years, Turkey has ASSOCIATION stepped into the “low inflation-high growth” era. In Turkey, investments have risen even www.tusiad.org with the volatile external and internal prices. Cooperation between Turkey and IMF contin- 2005 ues to lead the country day by day to a better TURKEY AT THE EDGE OF A NEW economic condition. According to IMF, mac- ERA: roeconomic conditions in Turkey are at their THE EU AND NEW TURKISH LIRA best in decades.

On the 6th of October the European Com- The economic growth in Turkey will be em- mission will unveil the Regular Progress Re- powered by the launch of New Turkish Lira port and The Impact Assessment for Tur- (YTL). YTL will be in circulation from Janu- key. In addition, the Commission is re- ary 1, 2005. Conversion rate will be: quired to provide the European Council with a recommendation on whether or not 1 YTL = 1.000.000 TL to launch the accession negotiations with Sub-unit of YTL will be KURUS (YKr), the Turkey. On the verge of these reports and equivalent of cents in Euro. the recommendation, the intuition of the 1 YTL = 100 YKr European political and financial circles about the outcome is rather positive. Such a The composition of denominations for YTL feeling might be the result of encouraging banknotes will be 1, 5, 10, 20, 50 and 100. and clear messages conveyed by the The denominations for the coins will be Enlargement Commissioner, Günter Ver- 1,5,10,25,50 YKr and 1 YTL. The YTL and heugen following his monitoring visit to old Turkish Lira will co-exist during 2005 and Turkey and his meeting with Prime Minis- at the end of the year old Turkish Lira will be ter R.Tayyıp Erdoğan in Brussels. withdrawn from circulation.

Positive prospects regarding Turkey’s EU bid Coupling the ongoing hard work to drive in- increases the level of market confidence for flation down to single digit with the introduc- the Turkish economy. Recently, Standard & tion of YTL, the Central Bank aims at restor- Poor’s has raised Turkey’s long-term foreign ing Turkish citizens’ confidence to their own currency sovereign credit rating from B-plus currency as well as improving Turkish cur- to BB-minus and long-term local currency rency’s reputation in the world markets. Re- sovereign credit rating from BB-minus to moving zeros from the currency will also BB1. eradicate the technical and operational problems caused in the past by multiple zeros in Likewise, Fitch Ratings raised the outlook for currency. Turkey’s long-term foreign and local currency sovereign credit rating of B-plus to positive As the Central Bank authorities proclaim, the from stable.2 New Turkish Lira is the symbol and the evidence of Turkey’s determination to Progress in EU – Turkey relations has re- drive inflation down and move forward to- flected positively to the Turkish macroecono- wards EU membership.

1http://quote.bloomberg.com/apps/news?pid=1000 0085&sid=arw.AoL1Ro3Q&refer=europe 2http://www.fitchratings.com/corporate/ratings/issu er_content.cfm?issr_id=80442217

CEPS Turkey in Europe Monitor No. 10, October 2004

Introductory Note from CEPS strong message to the fastest growing segments of the European population that they This issue of CEPS Turkey in Europe Monitor will always be considered unwelcome and presents an article and extracts of two other second-class citizens even if they choose a articles, demonstrating the arguments that are secular way of life. This, Karlsson argues, used in favour of and against Turkish acces- would lead to the emergence of a ghetto Islam sion to the European Union. in Europe instead of a modern tolerant Euro- Ingmar Karlsson, the Consul General of Swe- pean Islam. den in Istanbul, in his article titled ‘Turkey’s Steven Everts from the Centre for European cultural and religious heritage-an asset to the Reform, in the extract from the article entitled European Union’, takes the three well-known “An asset but not a model: Turkey, the EU arguments often used in arguing against Turk- and the wider Middle East”, looks at two sets ish membership – absorption capacity of the of questions: the consequences of Turkey’s EU, security and geopolitics, the identity fac- accession for EU policies in the wider Middle tor - and develops counter-arguments to prove East and the ‘Turkey as a bridge’ or ‘model’ that Turkish accession will in fact be benefi- arguments. With respect to the first issue, he cial for the Union. Regarding the absorption concludes that Turkey has a lot to contribute capacity of the EU, the author highlights that to EU policies on the Middle East in terms of there can be no objection to Turkey’s incorpo- credibility, political access, know-how and ration into an EU which will in the foresee- economic leverage. Everts stresses that the able future be characterised as a political and prospect of Turkey’s accession should be used economic union with variable geometry, con- to deepen EU engagement in the Middle East centric circles and different speeds, rather and cites Israel – Palestine, Iran and Syria as than as the strong United States of Europe on areas that provide good opportunities for the American model. Karlsson responds to the early joint EU – Turkish action. He highlights security and geopolitical arguments that ad- that rejection by the EU would not only hinder vocate Turkey’s exclusion on the grounds that the reform process inside the country but that Turkey will import the instability of its region it would also jeopardise the ‘Europeanisation’ to the Union, by stressing the point that an of Turkish foreign policy that involves the excluded Turkey can not act as a firewall adoption of EU’s distinct foreign policy style against the crises in the Middle East as all the of promoting security through multilateral crises in the Middle East so far have directly mechanisms and institutional integration. Re- affected Europe and will affect even more so garding the ‘model’ or ‘bridge’ argument, in the future. He underlines that having Tur- Everts’ view is that Turkey cannot be a key as a full member will have significant ad- ‘model’ for democratising the wider Middle vantages for the Union as it will increase the East as it is a unique case in three key re- EU’s opportunities for pursuing a proactive spects: its long – standing ties with the West, policy in the Arab world and, with its stable its secular state structure, and the transforma- democracy, stand as a model for a Muslim tion of its political elite through the prospect world that is in need of such models. With re- of EU membership. According to Everts, the spect to the arguments that Turkey should be fact that Turkey has ambivalent relations with left out due to its ‘alien culture’ and its ‘relig- most of its neighbours in the region also ag- ion’, Karlsson highlights that a no to Turkey gravate the need to tone down the ‘Turkey as on religious and cultural grounds would cre- a bridge’ argument and avoid the ‘Turkey as a ate severe problems in the integration of ‘Eu- model’ rhetoric altogether. romuslims’ by sending out an immediate and Michael Emerson and Senem Aydın

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Turkey’s Cultural and Religious Heri- ployed over ten years ago when the EU’s tage – An Asset to the European Union eastward enlargement process started. In those by Ingmar Karlsson1 days the main opponents of Turkish membership – the CDU/CSU in Germany – were the Ever since Turkey concluded an Association keenest advocates of enlargement. Agreement with the then European Commu- nity in 1963, it has, apart from Bulent Ecevit´s The project of building a strong United States period as prime minister in the 1970s, pursued of Europe on the American model is no longer its ambition of joining the on the political agenda after the accession of ten new members on May 1 2004, and will be European Union. Turkey entered into a cus- even more passé by the time Bulgaria and toms union that has been in force since 1996 Romania join the EU in 2007. A united Caro- and its candidacy for membership of the EU lingian Europe must now be built up again by was confirmed in Helsinki in 1999. Paris and Berlin. The new enlarged EU will for the foreseeable future be a political and The rediscovery of the ‘Turkish peril’ in some economic union with variable geometry, con- quarters in Europe is therefore surprising. The centric circles and different speeds. What ob- basic principle of Roman law – pacta sunt jection is there to Turkey’s incorporation into servanda – is part of the European cultural such a union, particularly in view of the fact heritage. Anyone who ignores this principle that, with its geographical location, its size with regard to Turkey loses political credibil- and its decades-long membership of NATO, ity and flouts official EU policy, according to Turkey is a strategically important partner which Turkey is to be treated like any other which by itself would enhance the role of candidate. Accordingly accession negotiations Europe in global politics more than the ten should start as soon as the country meets the new members combined? The accession of Copenhagen criteria. Turkey – at the beginning of a new budget period in 2014, say – would increase the popu- The arguments against a Turkish EU member- lation of the Union by 12 per cent. There must ship that have been used so far have lost much be something seriously wrong with a union of their force in view of the rapid reform proc- that cannot absorb such an expansion. Demog- ess launched by the Erdoğan government and raphy, after all, is one of the most serious the result of the referendum in Cyprus. Con- problems facing the EU, not least in Germany, sequently, those who are opposed to Turkey’s and Turkey, with its large, youthful popula- membership now talk less about the country’s tion, could help to solve this problem. “EU maturity” and the fulfilment of the Co- penhagen criteria. Instead they argue that EU Security and geopolitical arguments cannot absorb a new member of the size of The geopolitical and strategic arguments that Turkey, that a Turkish membership would were used in favour of the accession of Po- cause serious geopolitical and strategic prob- land, the Czech Republic, Slovakia, Hungary lems and, last but not least, that EU is a com- and the Baltic states are valid for Turkey too, munity based on Christian values. in fact even more so than was the case in Cen- tral and Eastern Europe in the early 1990s. The absorption capacity of the EU Some day the enlargement process will come With 25 members the EU is said to be an to an end, but terminating it without admitting over-extended structure, and that further geo- Turkey would be a serious mistake and an graphical expansion can only take place the unwise policy. Those who are opposed to expense of a deepening of political coopera- Turkish membership seem to think of the EU tion. This line of argument – that Europe is as an “island in the sun”, a Switzerland sur- not powerful enough to absorb Turkey – can rounded by good, friendly neighbours. But only be described as political tactics. If there Europe’s geostrategic location is far from was any truth in it, it should have been de- idyllic. Europe must stabilize its own periphery to ensure that it is not affected by the

1 Ingmar Karlsson is the Consul General of Swe- problems that exist there. Turkish membership den in Istanbul. This article has first been pub- of the EU would strengthen Europe on its lished in Turkish Policy Quarterly, Fall 2004. most vulnerable front.

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Turkey now faces three geostrategic choices: could stand as a model for a Muslim world affirmation of its European identity, rap- that badly needs such models. The Turkish prochement with the Arab and Muslim world, membership of the EU would demonstrate the and integration with the Turkic-speaking peo- falsity of the argument that Islam and democ- ples of Central Asia. There is no doubt that the racy cannot mix and help to bring about fa- present Turkish government has chosen the vourable changes in the Islamic world’s atti- first of these three options and that the coun- tude to Europe. A no to Turkey in December try’s political and economic elite are playing would on the other hand have a radicalizing the European card. If this fails because the EU effect both in the Muslim world at large and defers its decision or refuses to admit Turkey within Turkey itself. It will strengthen the ar- to the Union, both the other options would gument of the fundamentalists that the Muslim become more feasible. In that case, the friends world must turn inwards because the rest of of modernization would probably not be able the world conspires against it and it will to persist in their pro-European stance. strengthen those in Turkey who question the Both the pro-Islam and the pan-Turkic option reform policies of the prime minister. would entail serious consequences for the stability of Southeastern Europe. Even though The identity factor – Is the EU a Christian Turkey is not likely to achieve a dominant community? position in the Central Asian republics, the The resistance to Turkish membership is not mere attempt to do so would have a destabiliz- only motivated by fears about the EU’s lack of ing effect and also exacerbate the existing absorption capacity and about the risk of im- problems in the Caucasus. It is in Europe's porting problems and disturbances, but also by vital interests to see to it that the problems in vague qualms about a culture that is regarded the Middle East, including Iraq, and the south- as alien. One argument that is now gaining ern periphery of the former Soviet Union do ground, especially in Catholic Europe, is not converge. There is an obvious risk of this linked to identity, namely Europe’s Christian happening if Turkey were to play the pan- values, which are mentioned as a reason for Turkic card. The second option, i.e. rap- keeping Turkey out. In that case it might just prochement with the Arab and Muslim world, as well be argued that Greece should not have would have an adverse affect on Europe too. been admitted to the EU because of its Eastern One argument against Turkish membership is Orthodox roots, that "semi-Orientals" such as that in that case part of the EU’s external fron- Romanians and Bulgarians should be kept out tier would abut on the most crisis-ridden and too and that Albania and Bosnia are forever troubled region in the world and that Europe doomed to be Muslim ghettos in Europe. should at all costs keep away from the problems of the Muslim world in general and the What will happen if the secularization process Middle East in particular. in Europe continues? Where do the limits of identity go? Will a secular country such as But we cannot escape this part of the world Sweden have to leave the EU in the not too and its problems, and therefore the opposite distant future when the number of Muslims conclusion is the most credible one, i.e. a rap- who go to mosques for Friday prayers is larger prochement between Turkey and this region than the number of churchgoers on Sundays? would bring its crises closer to us. The idea that a Turkey excluded from the European The Justice and Development Party has Community could be a firewall against the emerged as a result of the transformation of crises in the Middle East is politically naïve. Turkish Islamism and has come to power in All the crises in the Middle East so far have free elections. Turkey is now undergoing a directly affected Europe, and they will affect historic reform process that is mainly moti- us even more in future. If Turkey were a vated by the prospect of EU membership. member, this would increase the EU’s oppor- Prime Minister Erdoğan wants to transform tunities for pursuing a proactive policy in the the AKP into a modern European party – a Arab world. This is not without risks, but if Muslim version of a Christian Democratic Turkey remains outside the Union this will Party – and he needs Europe’s support for this have serious consequences. A stable democ- process. racy in a Muslim society, on the other hand,

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There have never been any religious criteria have been talking about Eastern Christianity for membership of the EU. To refuse Turkey we will soon be talking about Western Islam. admission on religious grounds would send a Islam must therefore be recognized and re- false and dangerous signal, especially after 11 garded as a "domestic" European religion. September 2001. Such a decision would ig- There is nothing which intrinsically prevents a nore the fact that Islam is a mainstream relig- Muslim from being as good a Swede as a ion in Europe today. As late as the end of the member of the Pentecostal Brethren or an ad- 1960s Europe was a net emigration area. But herent of the Jewish faith, or that mosques nowadays 10-15% of the population in most cannot become as natural a feature of Swedish Western European countries were born outside cities as churches have always been in Istan- their present home country, and a growing bul, Aleppo, Damascus, Mosul or Cairo. percentage of them were born outside Europe. More immigrants arrive in Europe every year Only a depoliticised and liberal Islam can be than in the USA. There are today at least 15 integrated into Europe, and such an integration million Muslims in the EU, which is more is only possible if it is paralleled by economic than the number of Protestant Scandinavians, and social integration. A future Europe with a and the number will increase as immigration flourishing Muslim presence and an open continues. European identity must therefore be based on self-criticism, a permanent and open dialogue The trend towards a multiracial and multicon- and a respect for diversity. We must realize fessional Europe is therefore unstoppable. that Muslims can make a positive contribution This trend will be further strengthened by cur- in the construction of a new Europe. Their rent demographic trends in Europe. Today, the presence should be seen as a source of en- birth rate among Muslim immigrants in richment and not as a problem. Europe is three times higher than in the non- Muslim population. If this trend continues the Young Muslims in Europe now mobilize for Muslim population will, given current immi- recognition, identity and survival. They often gration patterns, have doubled by 2015, while look upon themselves as a new force distanc- Europe’s non-Muslim population will de- ing themselves from traditional and interna- crease by 3.5%. Some estimates of the number tional bonds, wanting to be a European face of of Muslims in Europe in 30 years’ time are as Islam. They are not only born in the West by high as 65 million. Muslim parents. Some of them have grown up in mixed marriages and they know both a Three-four decades ago the Muslim immi- Muslim and a Christian way of living. They grants were coming to Europe looking for speak the languages and are born citizens of work and they planned to return home as soon European states and their common language is as possible. They therefore remained marked English, German, Dutch, French or Swedish. by their culture of origin, Indo-Pakistani, North African or Turkish. The parents tried to They are using Islam as a way of establishing protect their children from the unfamiliar the universal values they have in common European environment rather than integrating with those around them. Defining their own them into it. But most of these immigrants identity as Muslim thus is a way of interacting never went back. Their children were born in with the rest of society. Europe and became better educated than their parents. This led to new ways of thinking and With the sociological change there will be an now we can see how some kind of silent revo- ideological change as well. In Islam law and lution is taking place among the younger Mus- ethics are identical. If you change the ethics lim population in Europe. European Muslims you thus change the law. Through the princi- are now Muslims and not North-African, ple of "ijtihad" (to develop, interpret and ap- Indo-Pakistani or Turkish Muslims and a ply Muslim doctrines to contemporary situa- European Islamic culture is slowly develop- tions) there will be a new interpretation of Is- ing. lam. The integration of Europe’s Muslims depends on the adoption of a form of Islam that Islam is thus already today an integral part of embraces the principal Western political val- Europe and a European religion and as we ues; pluralism, tolerance, the separation of

NO. 10 / OCTOBER 2004 | 87 church and state, democratic civil society and Sending such a message could, before we individual human rights. know it, lead to the emergence of a ghetto Is- lam in Europe instead of a modern tolerant We are already today witnessing the emer- European Islam. Radical mullahs all over gence and creation of a several European Europe are already doing their best to exploit Muslim identities, German, French, British, Muslim immigrants’ psychological, cultural Swedish, Dutch etc. Interviews with Swedish and material problems for their own purposes, Muslims show that they are more and more and this message would only make their work focusing on their presence, role and future in easier. Sweden: What kind of multicultural Sweden do we as Muslims want to have in the future? If this happens, we might soon witness a What kind of multicultural state do we think is ‘clash of civilizations’ in Western Europe, not necessary to safeguard the long-term survival in the form of a military showdown between of the Muslims as a cultural, ethnic and reli- the West and the Islamic world, or as envis- gious minority group in Sweden and what can aged by Samuel Huntington, the proponent of we as Muslims do to bring this about? the clash of civilizations theory, but in the form of a continuous guerrilla warfare in ghet- They thus want to draft a new brand of Islam, toized suburbs of our cities. one that aims to reconcile the basic tenets of the faith - such as the five pillars, social jus- Against this background the decision taken in tice and submission to the will of God - with the Netherlands in December this year will be the realities of contemporary European life. fraught with consequences for the destiny of For this new generation "Euro Islam" is not a Europe. zero sum game. They see no contradiction in being Muslim and European at the same time. In a report from the Swedish Muslim Youth Association you can read: "The goal for young An Asset but not a Model: Turkey, the Muslims should be to accept, understand and EU and the Wider Middle East respect differences but also to understand by Steven Everts2don SW1P 3QL common values and goals and try to imple- [email protected] / www.cer.org.uk ment them. Young Muslims should form a 1. A success story for EU foreign policy, but bridge between the European and the Muslim what next? countries". At the December European Council, the heads If immigrants are integrated in this way, the of state and government will have to decide Islamic communities in Europe can become a whether and when to open accession talks bridge between Europe and the immigrants' with Turkey. EU leaders are rightly mindful of countries of origin. "Euromuslims" will then public opposition and the effects that Turkey’s be able to set an example, and transfer democ- membership could have on the Union’s cohe- ratic approaches and liberal ideas and reforms sion and capacity to act. But the best way for to their native countries. This would enable a the EU to consolidate and anchor Turkey’s fruitful triangular relationship to develop be- democratisation process is by giving Turkey tween the Islamic communities, their native the green light to start accession negotia- countries and their new home countries, since tions…It would be a triumph of EU foreign many people living in the Diaspora want to policy to welcome a successful Turkey, which maintain close contacts with their origins. has laid to rest the ghosts of military authori- tarianism and chronic economic instability. A no to Turkey on religious and cultural Europeans should say, loudly and repeatedly, grounds would be disastrous for Europe since that no one else has managed to transform, in it would send an immediate and strong mes- a peaceful and deliberate manner, the political sage to the fastest growing segments of the

European population that they will always be 2 considered unwelcome and second-class citi- Steven Everts is a Senior Research Fellow at the zens also if they chose a secular way of life. Centre for European Reform. This article is an extract from a longer CER essay, accessible at http://www.cer.org.uk/pdf/essay_turk_everts.pdf

88 | TURKEY IN EUROPE MONITOR system of a country as large and complex as whatever other EU policy objectives it may Turkey. have. Nonetheless, the prospect of Turkey’s accession is already forcing the EU to devote …It is a great pity that so few Europeans are more resources and develop more coherent willing to describe and sell the EU-Turkey policies towards the Middle East. Turkey’s relationship as a geostrategic success story for accession will increase the salience of the the EU, and a vindication of its distinctive Middle East, and accelerate the Union’s al- foreign policy style. Instead, the debate has ready deepening involvement in the region... concentrated on whether Turkey is ‘really’ European, whether it is ready to start acces- …From their side, leaders in the Middle East sion talks and what would be the conse- are already becoming frequent visitors to quences for the EU’s institutions, budget and Brussels. In future, more may pass through policies. This narrow debate on the merits and Ankara on their way to Brussels for consulta- costs of Turkey’s eventual membership is tions. By the same token, representatives from necessary. But many larger questions loom, civil society in the Middle East will expand such as: what kind of club should the EU be their contacts with both Turkey and the EU... and where are the borders of Europe? At the macro level, the biggest impact of fu- …There are also questions relating to Tur- ture Turkish membership will be on the mind key’s impact on EU policies towards the wider maps of EU officials and politi- Middle East… cians…Turkey’s accession will confirm and accentuate the shift whereby the EU has be- This essay will look at two sets of broader come a continent-wide, heterogeneous Union questions, first analysing the consequences of with a religiously diverse population and a Turkey’s accession for EU policies in the political outlook that is increasingly externally wider Middle East and then probing the ‘Tur- oriented. The EU and Turkey alike should ac- key as a bridge’ or ‘model’ arguments. It will knowledge this trend and maximise the poten- argue that Turkey is an asset for the EU, but tial benefits. not a model for the democratisation of the wider Middle East. It will conclude with rec- 3. The EU’s Middle East policies ommendations for policy-makers in Turkey Over the years, the EU has built up a dense and the rest of Europe. web of relations with the countries in the Mediterranean and the Middle East… 2. The macro impact of Turkey’s accession No one can say for certain how, once inside No outsider should expect quick results in the the EU, Turkey will influence EU policy on Middle East, given the exceptional levels of the Middle East. EU accession is probably ten instability, political tensions and economic years away, if not longer. In that period EU deprivation. But even EU officials admit that and Turkish foreign policy, as well as the the EU is underperforming in the Middle East. Middle East itself, are bound to change in un- Institutional incoherence, poor political disci- predictable ways. Therefore, the debate should pline, risk aversion and insufficient emphasis focus on Turkey’s influence on EU Middle on promoting good governance and democ- East policy in the pre-accession phase. racy have all taken their toll.3 While the EU has set itself the right objectives and devel- With its large population and strategic loca- oped a dazzling array of policies, partnerships tion Turkey can expect to exert some influ- and programmes, it lacks credibility and clout. ence over EU policies towards the Middle Turkey, as a Muslim country straddling East. But its influence will be limited. Already Europe and the Middle East, could be of help 25 member states (soon 27 or 28), plus the here, making EU policies perhaps more ac- Brussels-based institutions, have their say in ceptable to countries in the region, especially shaping EU policies… in the pre-accession phase before it becomes an EU member. Moreover, in the decade ahead, Turkey will remain in a position of being a ‘demandeur’, 3 Steven Everts, ‘The EU and the Middle East: a with its membership aspirations crowding out call for action”, CER, January 2003.

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4. Turkey’s international strategy University has rightly remarked that there has The principle challenge of Turkish foreign been a striking process of ‘Europeanisation’ in policy has been the need to balance the fact Turkish foreign policy.4 At a basic level, Tur- that the country borders on the Middle East key has adjusted its stance on various interna- (as well as the Caspian region and the Cauca- tional issues in line with the EU mainstream, sus) with its Western vocation and orienta- for instance on the International Criminal tion… Court (ICC). But more importantly, Turkey has started to adopt the EU’s distinct foreign Turkey’s elite has mostly stuck to three core policy ‘style’ of promoting security through tenets: conservative nationalism, strict secular- multilateral mechanisms and institutional in- ism and a strategic alliance with Washington. tegration. For instance, the Turkish govern- For decades, Ankara’s relationship with the ment has started to embrace the idea that a US was the lodestar of its foreign policy. This solution to the Cyprus question can only be US-centric orientation chimed with, and was found in the context of EU and UN involve- reinforced by, the huge influence of the mili- ment. Even before Turkey joins the EU, this tary establishment on Turkish foreign policy. socialisation process should continue. Both Relations with the rest of Europe and the EU the EU and Turkey should nurture this devel- mattered, but were always of secondary im- opment and make sure it becomes more portance. The deep ambivalence on the west deeply embedded in Turkey’s political class European side about Turkey’s membership and the wider national debate. aspirations fed this circle of mutual suspi- cion… In turn, Turkey has quite a lot to offer to the EU. It can contribute expertise and knowledge In the past few years, however, Turkish for- of the Middle East region. While Turkey has eign policy has changed profoundly. Turkey fewer Arabic speakers than one might expect, has made its EU membership aspirations the the country’s network of contacts, combined central tenet in its foreign policy. Its pro-US with the political capital of the AKP govern- stance remains solid, but is less automatic. In ment and the burgeoning economic ties, will March 2003 the Turkish parliament dared to be assets for the EU. But the biggest effect of say ‘no’ to Washington’s request to let its Turkey’s pre-accession status will be at the troops pass through Turkey to open a second level of political symbolism. The EU may front against Iraq. But the prospect of EU have a much better image in the Middle East membership has also affected Turkey’s re- than the US. But for many Arabs and Iranians, gional strategy. For example, Ankara has the EU is a white, Christian club with dubious moderated its position on the touchstone issue colonial legacies. There is a deep sense that of Cyprus… the ‘West’, of which Europe is a constituent part, is a hostile force to Muslims worldwide. Europeans with high hopes of what Turkey If the EU took in Turkey, it would send an may contribute to EU policies should realise immensely powerful signal to the contrary. that, most of the time, Turkey has played a Public statements by Egyptian and Iranian low-key role in the region. Turkey’s non-Arab leaders from the region make it clear that they status, coupled with the Ottoman legacy and support Turkey’s membership bid – and re- Turkey’s pro Western orientation have meant gard it as a litmus test for the EU’s reputation that in Turkish - Arab relations, ambivalence in the Muslim world. The unusual move by and ambiguity are always present. Some Ar- the Israeli Defence Ministry, to warn Ankara abs and Iranians have accused Turkey of be- privately that EU membership would harm traying its Islamic identity. At times they have Turkish – Israeli relations, underlines the same blasted the Turks for being a stooge of US point, while highlighting the ambivalence of imperialism and of having an unacceptably EU-Israeli relations.5 close relationship with Israel… 4 Kemal Kirisci, ‘Turkey, the EU and the Middle East: can Turkey help with the democratisation in In the past few years, Turkey has sought and the Middle East?’, Paper for a workshop on Turk- achieved a rapprochement with neighbours ish foreign policy, University of Otago, New Zea- such as Syria and Greece with which it had land, August 2004. fraught relations. Kemal Kirisci of Bogazici 5 Ha’aretz, July 5th 2004.

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Apart from these general effects, what would Iran be the impact of Turkey on EU policies to- Turkey’s growing political ties with Iran are wards specific countries in the pre-accession an asset for the EU as it seeks to expand its phase? influence and salvage the deal it forged in Oc- tober 2003 on Iran’s nuclear programme. The Israel-Palestine access of AKP leaders to Iranian leaders, cou- Turkey’s relations with Israel have been close, pled with the visa-free travel conditions, especially for a country with a Muslim popu- strengthen the argument that, especially in the lation. While solidarity among ordinary Turks pre-accession phase, Turkey could be a useful with the Palestinian cause has been great, at bridge between the West and Iran. As the in- the level of the government and military estab- ternational stand-off over Iran’s nuclear pro- lishment, the relationship with Israel has been gramme moves to a crisis point, Turkey and exceptionally strong… the EU have a shared interest in seeking a diplomatic yet effective solution. Both Turkey However, in recent years, Turkish-Israeli rela- and the EU have some leverage over Iran, and tions have become more strained, as the peace both will want to forestall a US military at- process has stalled and Palestinian hardship tack. Together, they should try to persuade the has increased… Sympathy for the Palestinians Iranians that national greatness does not de- is not an empty slogan for the new govern- pend on having a nuclear bomb, and that their ment… interests are best served by staying non- nuclear. Together, they must underline that if But there has been no abrupt break in Israeli- Iran continues to defy the demands of the In- Turkish relations, and none is likely to occur ternational Atomic Energy Agency (IAEA), in the near future since both countries benefit targeted economic sanctions will follow. To- from a close partnership. gether, they should also explain to the US and Israel that plans for ‘surgical strikes’ against Turkey’s relatively constructive relationship Iranian nuclear installations will be counter- with Israel could benefit the EU. The Union is productive by triggering a nationalist back- Israel’s biggest trading partner, but politically lash. While air strikes may delay a nuclear relations are troubled… Iran, they will not succeed in eliminating the two key ingredients of a military nuclear pro- The EU and Turkey could work together fruit- gramme: technological know-how and a keen fully on Israel-Palestine, trying to break the desire to acquire a nuclear deterrent. deadlock in the peace process. The objectives of both sides are the same, while the respec- Syria tive starting positions and relative diplomatic Turkey and Syria have had frosty relations for strengths complement each other well. decades, with tensions peaking in 1998 when Turkey threatened military action… But after Concretely, the EU and Turkey should help the Syrians expelled Öcalan in 1998, bilateral the Palestinians prepare for the day when Is- relations have started to improve… Improve- rael will withdraw from Gaza, so that Hamas ments in the Turkey-Syria relationship took does not take over. They should also try to use place while the EU was trying to persuade Israel’s disengagement from Gaza to push for Damascus that closer links with the EU would further withdrawals from the West Bank. In be possible – provided Syria was willing to practical terms, EU-Turkey co-operation could meet EU concerns… focus on reforming political institutions, or- ganising elections, training police forces and Turkey and the EU should work together even drawing up plans for a third party secu- closely in drawing Syria into a wider web of rity force. Significantly, Israeli Deputy Prime international cooperation and reciprocal obli- Minister Olmert has said that Israel would not gations. The EU can offer trade, technology, object to Turkish troops helping to provide know-how and investment, all of which the security in the context of an agreed political Syrian economy desperately needs. In political framework. terms, Damascus also needs more friends in the region and beyond. If it wants better relations with Europe, Syria will have to heed

NO. 10 / OCTOBER 2004 | 91 precise European concerns and demands, es- But culturally Turkey may well become more pecially in the area of WMD proliferation, its ‘Islamic’ as the AKP and other groups try to control over Lebanese politics and its support expand the role of Islam in public life, while for Palestinian militant groups. Turkey’s bud- respecting the main tenets of Turkey’s secular ding relationship with Syria may offer an ad- state structure. Put succinctly, in Turkey more ditional means of influencing the choices that democracy and more power for Islamic politi- the Syrian regime will make. As the dominant cal groups have gone hand in hand. But this land route for Syrian exports, Turkey stands to was only possible in the context of a firmly gain considerably from an intensification of secular political system, which is absent in the EU-Syrian trade relations. Together, the EU rest of the Middle East. and Turkey have an interest in demonstrating that a deft political strategy can achieve better The third reason why Turkey is unique is that results than America’s penchant for issuing the deepening of Turkey’s democratisation threats and isolating countries. took place largely because of the ‘golden carrot’ of EU membership. It is true, as Turkish 5. Why Turkey is not a ‘model’ for leaders often stress, that the reforms were nec- democratising the wider Middle East essary in themselves. But the prospect of EU …After the September 11th attacks, when re- membership has had a transformative effect lations between the West and the Muslim on the Turkish elite. This also means that a world shot to the top of the international different Turkish government will probably agenda, many commentators and politicians persist with the current reform agenda, even if, started to view and describe Turkey as a ‘stra- as is likely, there will be setbacks on the road tegic case’. Americans, especially, have to EU membership. But apart from the coun- grown fond of describing Turkey as an inspir- tries of the Balkans, the EU is not offering a ing example of a democratic, Muslim country membership perspective to any other country. where ‘moderate Islam’ has been remarkably Thus the EU will have to influence the rest of successful... the Middle East with only the ‘silver carrot’ of deeper co-operation in the context of its Turkey cannot be a ‘model’ for the progres- neighbourhood policy. sive democratisation of the wider Middle East. Turkey is a unique case. Its successful, if in- 6. Conclusions and policy recommendations complete, democratisation process cannot be …Turkey has a lot to contribute to EU poli- transplanted to other countries in the region cies on the Middle East: credibility, political for at least three reasons. The first is the most access, know-how and economic leverage. If straightforward: unlike any other country in handled deftly, the prospect of Turkey’s ac- the region, Turkey has a long-standing rela- cession could be a real boon for EU influence tionship with the West: institutionally through in the region. The reverse is also true: a rejec- NATO, and bilaterally with Washington and tion of Turkey would not only jeopardise the capitals in Europe. No other country in the reform momentum inside the country, but also region has the same, or even a comparable, counter the pro-EU and moderating shift in its starting position. Nor was any other country in regional policy. The EU would forego Tur- the region born out of an empire, which gives key’s contributions. And a shunned Turkey Turks greater political self confidence than will more likely side with the US – both in countries in the region that started off as colo- particular instances such as Iran or Israel - nies. Palestine, and in its overall foreign policy phi- losophy. Second, ever since the beginning of the Turk- ish republic, the strict secular nature of its po- Turkey and the EU should deepen their politi- litical system has put Turkey in a distinct in- cal relations well ahead of formal accession. ternational category. Turkey’s secular state Here are some policy recommendations for structure makes it akin to France – see for in- both sides to maximise the potential benefits: stance the similarity in policies on women’s headscarves – but very different from Arab For the EU: states, never mind Iran. • Use the prospect of Turkey’s accession to deepen EU engagement in the Middle

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East. The centre of gravity in the Union’s Ankara et l'UE, les raisons du "non" foreign policy is shifting south anyway. par Jean-Louis Bourlanges6 So leaders should make the most of Tur- key’s know-how and political links to La question de l'adhésion de la Turquie à l'Un- strengthen EU policies for the region. Is- ion européenne mérite-t-elle d'être posée? N'a- rael - Palestine, Iran and Syria provide t-elle pas été tranchée savant meme queue de good opportunities for early joint EU- letter? Le doute est permis si l'on considère Turkish action. que la possibilité d'une telle adhésion a été • Recognise that compared to the rest of the officiellement reconnue en 1963, date de la Middle East, Turkey’s case is unique in signature du traité d'association entre la three key respects: it has long-standing Turquie et la Communauté économique eu- ties with the West, it has a secular state ropéenne, mais que le débat sur le principe structure, and the bait of EU membership même de cette adhésion n'a jamais vraiment has transformed its political elite. More- pris corps au cours des quarante dernières an- over, Turkey has ambivalent relations nées. En France comme en Allemagne, le dé- with most of its neighbours in the region. bat était au reste surdéterminé par la guerre Thus, it is best to tone down the ‘Turkey froide et par la question de la cohésion du as a bridge’ argument and avoid the ‘Tur- camp occidental face à l'Est. key as a model’ rhetoric altogether. Tur- key is an asset for the EU but not a model ….Perçu comme un facteur de renforcement for the Middle East. ou d'affaiblissement de l'Alliance, l'accueil réservé à la demande turque d'association s'in- For Turkey: scrivait, en tout état de cause, dans un jeu • Use the anchor of EU accession to step up transatlantique bien davantage qu'européen. the normalisation of relations with Iran and Arab countries such as Syria. The Le débat fut de nouveau escamoté à Copen- paradox is that the closer Turkey gets to hague, en 1993, quand les Douze fixèrent les EU membership, the more it should be critères d'adhésion des États libérés par la de- able to forge closer ties with the Middle struction du Rideau de Fer. East. Both domestic and Western support for a strategy to reach out to the Islamic …. À partir de 1997, à Luxembourg, et surtout world will be greater once Turkey’s Euro- de 1999, à Helsinki, les membres du Conseil pean destination has been confirmed. And européen se sont progressivement engouffrés the more Turkey can champion its Middle dans la brèche ouverte à Copenhague et, sau- Eastern ties in Brussels and elsewhere, the tant allègrement par-dessus la question de more the EU will see Turkey’s accession l'appartenance à l'Europe du candidat poten- as a help for achieving its own Middle tiel, ont décidé que celui-ci avait « vocation » East objectives. — admirons l'élévation spirituelle du terme • Prepare for membership not just in terms choisi — à rejoindre l'Union européenne. Il lui of adopting the acquis communautaire – fallait seulement respecter tous les critères the body of EU rules and policies – but mais rien que les critères applicables aux also by incorporating the EU’s distinct autres candidats. De ce jour, la question de foreign policy ‘style’ of projecting stabil- principe qui n'avait encore été posée n'avait ity through political and economic inte- plus lieu de l'être. Le débat était clos avant gration. Turkey’s leaders must ensure that d'être ouvert et, passant des principes aux mo- the current ‘Europeanisation’ of Turkey’s dalités et au calendrier, la discussion changeait foreign policy continues, and permeates de nature. the country’s political class. ….Parce que la candidature de la Turquie con- fronte les Européens à un choix qui les effraie sur la nature — mono ou multiculturelle — de

6 Cet article sera publié fin octobre 2004 dans la revue Politique Internationale. Jean – Louis Bour- langes est

NO. 10 / OCTOBER 2004 | 93 leur Union, le débat qu'elle occasionne se déterminées par des confrontations religieuses présente de façon totalement biaisée. Par une reviendrait à nier l'histoire. Être européen ce sorte de transposition politique de la loi de n'est pas être chrétien mais l'avoir été, non pas Gresham sur les monnaies, les mauvaises individuellement mais collectivement, non pas questions chassent ici les bonnes. Les bonnes personnellement mais historiquement, non pas questions sont celles du degré d'appartenance cléricalement mais culturellement….. de la Turquie à la civilisation européenne et des conséquences de la transformation éven- …L'inscription géographique de cette identité tuelle de l'Union en un ensemble multicivilisa- culturelle est à l'évidence malaisée…. tionnel promis à une extension indéfinie. ….L'expansion planétaire du modèle européen n'est pas la cause unique de notre difficulté à Les mauvaises questions, légitimes assuré- assigner à l'Europe des frontières qui ne soient ment mais secondes par rapport aux autres, pas le simple produit de conventions privilégient les interrogations sur la démocra- géographiques ou diplomatiques. À l'ouest et tisation de la société et de l'Etat turcs ainsi que au nord, la frontière, l'eau et la glace, est les considérations diplomatiques relatives aux géographique bien davantage que culturelle. conséquences de l'ouverture des négociations …..À l'est, la situation est moins claire encore. par rapport à celles qui tiennent à la nature et à Non seulement rien de sérieux ne sépare la portée ultime du pacte qui lie les membres géographiquement le « petit cap d’Asie » de l'Union. qu’est l’Europe selon Paul Valéry, du reste du continent qu’elle prolonge, mais, sur le plan ….Il est de bon ton aujourd'hui de dénoncer de l’histoire et de la culture, s’est de longue l'archaïsme et le cléricalisme de ceux qui pro- date dessinée, à la charnière de l’Orient et de clament le lien nécessaire entre les frontières l’Occident, une immense zone grise em- héritées de la chrétienté et les frontières pro- pruntant à l’est et à l’ouest ses éléments con- jetées de l'Europe actuelle. Toute référence stitutifs. religieuse dans la définition de l’Europe — dédaigneusement qualifiée de « club chré- …Curieusement, toutefois, alors que la ques- tien » — paraît incongrue à ceux qui font, à tion de l'adhésion turque soulève désormais juste titre par ailleurs, de la laïcité, c'est-à-dire les passions, c'est au sud que la frontière de de la sécularisation et de la neutralité re- l'Europe devrait être regardée comme la moins ligieuse du pouvoir politique, l'une des valeurs contestable. fondamentales des sociétés européennes. Il s'agit là d'un étrange procès instruit au nom …..Aussi bien n'y en a-t-il pas une mais trois d'un mélange politiquement très efficace d'in- au sud de l'Europe : une frontière convention- génuité, de manipulation et d'ignorance….. nelle, celle des géographes, qui arrête l'Europe au Bosphore et passe à l'intérieur du territoire …..Manipulation que de confondre la recon- turc ; celle de l'islam, qui parcourt les États naissance du fait religieux comme élément balkaniques, les divise entre eux et à l'intérieur constitutif d'une culture déterminée avec le d'eux-mêmes ; la frontière politique, enfin, refus du pluralisme religieux comme élément celle qui sépare la Turquie des États bal- constitutif des sociétés européennes actuelles. kaniques. C'est à l'évidence cette dernière que C'est une idée singulière que de récuser, sous les Européens devraient retenir. On imagine prétexte que la pratique religieuse de chacun mal qu'on puisse vouloir remettre en cause les relève désormais de la sphère privée au même frontières actuelles de la Turquie ou laisser titre que le choix d'un livre, la décoration d'un durablement aux portes de l'Union les laissés- appartement ou la détermination d'un lieu de pour-compte musulmans du reflux ottoman — villégiature, le rôle central des croyances re- Bosniaques, Albanais, Kosovars, Macédo- ligieuses et des institutions ecclésiales dans la niens ou Bulgares — même si l'on ne doit pas formation des structures mentales propres aux sous-estimer les difficultés d'intégration au différentes sociétés et dans l'élaboration des modèle européen dominant de ces peuples modèles culturel et politique dans lesquels déchirés et tourmentés qui sont dans l'épais- celles-ci se reconnaissent. Nier que les fron- seur du trait. tières de l'Europe, fiction géographique mais réalité historico-culturelle, ont été largement

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….Le problème posé par la présence histori- s'agit pour eux que d'ajuster des intérêts con- que de la Turquie sur le territoire européen ne tradictoires et de tenter de substituer entre les se réduit pas à une querelle de bornage. Il peuples le dialogue et le droit à la confronta- oblige à s'interroger plus profondément sur la tion et à la violence, il leur faut s'affranchir nature des liens politiques passés et présents des contraintes de l'histoire et de la entre la Turquie et les États européens. Indé- géographie, chercher les nouveaux membres à pendamment de la différence de civilisation raison de ce qui les distingue et non de ce qui entre celle-là et ceux-ci, il serait absurde de les rapproche des anciens, engager l'Union sur contester que la Turquie a été dans le passé un la voie d'une expansion géographique progres- membre à part entière du système européen et sive mais illimitée. qu'elle est aujourd'hui un acteur majeur du système atlantique…. L'adhésion de la Turquie trancherait une hési- tation d'un demi-siècle entre deux conceptions …..On ne saurait ni ignorer la participation de l'Union, idéologique d'un côté, géopolitique historique de la Turquie au concert européen de l'autre. Elle consacrerait la victoire d'une ni en déduire que cette participation vaut lais- Europe éthérée, réduite à l'exaltation de sez-passer pour l'Union européenne. Ancêtre valeurs universelles et du droit, sur une rudimentaire tout à la fois du Conseil eu- Europe enracinée dans une terre et une histoire ropéen, du Conseil atlantique, du G8 et du particulière, la victoire d'une Europe onusi- Conseil de sécurité des Nations unies, le con- enne sur une Europe carolingienne…. cert européen n'était ni spécifiquement eu- ropéen ni constitutif d'une véritable Union. …L'Union européenne avec la Turquie aurait …..Sur le plan politique, on ne saurait voir l'avantage de contraindre peu et l'inconvénient dans cet instrument parfaitement informel de de promettre moins encore. ….Sur le plan négociation intergouvernementale entre des budgétaire, l'écart de situation entre ses mem- puissances rivales une quelconque préfigura- bres serait trop massif pour qu'on puisse le tion de l'Union européenne telle qu'elle aspire combler sans des transferts financiers con- à devenir : ce club d'« amis éternels », selon la sidérables. formule de Pascal Lamy, décidés non pas simplement à ajuster leurs intérêts et à régler …. Sur le plan juridique, l'inégalité persistante leurs différends mais à agir ensemble, une fois des membres de l'Union devant les exigences pour toutes, sur la base d'un transfert fédéral effectives, et non pas simplement nominales, de compétences au profit d'institutions com- de l'État de droit porterait un coup d'arrêt peut- munes. …… être définitif au développement de l'espace commun de liberté, de sécurité et de justice. …..Ce sont deux choses fort différentes, en Fondé sur la mise en œuvre d'un principe de effet, que celles qui consistent, d’un côté, à reconnaissance mutuelle des différents construire l'union des Européens et, de l’autre, systèmes juridiques nationaux, un tel espace à participer à une alliance internationale de est inconcevable s'il n'y a pas entre les États type classique, comme l'Otan ou le Pacte de membres un socle commun de principes, de Bagdad, associant des États potentiellement procédures et de garanties. Économiquement, menacés par un adversaire commun…. enfin, il sera longtemps illusoire de prétendre ….Pour les Européens d'aujourd'hui, le choix intégrer la Turquie à la zone euro sans s'ex- est clair : tout dépend de ce qu'ils veulent faire poser à des chocs asymétriques majeurs et ensemble. S'ils veulent organiser une fédéra- répétés. tion de peuples et d'États destinée à exprimer, par-delà les rivalités politiques d'hier, leur Ce reflux général des politiques communes, identité commune et à s'imposer plus qu'au- dont on ne contestera pas qu'il est voulu par jourd'hui comme acteur à part entière dans un plus d'un État membre, Royaume-Uni en tête, monde multipolaire, il leur est nécessaire de tendrait à faire de l'Union la variante interna- s'en tenir autant que possible au cadre territo- tionale du célèbre « couteau sans lame auquel rial que leur a légué l'histoire. S'ils entendent, il manque le manche ». … Ainsi vidée de l'es- en revanche, poursuivre un simple objectif de sentiel de sa substance, l'Union élargie réconciliation et de rapprochement entre des risquerait fort de ne pas être beaucoup plus peuples traditionnellement hostiles, s'il ne

NO. 10 / OCTOBER 2004 | 95 que l'Union douanière dont la Turquie est déjà géographiquement atrophiée mais politique- membre et qui ne paraît pas lui suffire. ment aussi impuissante que la grande. L'Eu- rope élargie qu'on nous propose est, en réalité, …..L'appauvrissement général des contenus une Europe désincarnée, condamnée par un de l'Union se doublerait d'un profond dé- universalisme à gaz pauvre à laisser aux autres phasage de son système institutionnel. Celui- le soin d'assumer la défense et la promotion de ci se révélerait à l'épreuve des faits tout à la ce qu'ils ont de particulier et d'irréductible au fois surdimensionné et dénaturé. Surdimen- sein de la communauté humaine. Les autres, sionné parce qu'avec son Parlement élu au c'est-à-dire à l'extérieur les grandes puissances suffrage universel et son autorité exécutive mondiales et à l'intérieur les États nationaux, démocratiquement investie et politiquement dépositaires souverains de leurs particularités responsable devant les élus des peuples, l'Un- respectives et manipulateurs sournois d'une ion dispose déjà d'institutions caractéristiques Union européenne réduite à l'antique et stérile d'une fédération politique d'États. Réduite à concert des nations. une double fonction de concertation entre États souverains et de régulation juridique en- Rien n'est à cet égard plus faux que d'imaginer tre partenaires économiques, elle n'aurait nul que l'élargissement de l'Union à la Turquie besoin de tout l'appareil institutionnel et puisse lui permettre de jouer un rôle actif de procédural que lui ont accordé les Traités suc- médiateur dans les affaires Nord-Sud et de cessifs. L'Union deviendrait alors le seul cas contribuer à désamorcer la guerre annoncée connu de zone de libre-échange gérée par un des civilisations. Pour atteindre un tel but, il quasi-État fédéral. À l'inverse de la formule n'est en réalité que deux approches théorique- traditionnelle, elle ferait figure de Vespa ment possibles : soit la création d'un instru- équipée d'un moteur de porte-avions ! ment efficace de régulation planétaire, c'est-à- dire une ONU réformée et renforcée ; soit l'é- Cette contradiction est, en fait, ingérable. mergence d'un acteur géopolitique nouveau, ….L'indétermination des frontières finales de disposant de la volonté et des moyens de faire l'Union frappe le projet européen d'une prévaloir sur la violence et la confrontation faiblesse essentielle. La question n'est pas de l'action multilatérale, la règle de droit et la savoir ce que dans la foulée de l'adhésion coopération Nord-Sud. L'Union élargie devrait turque il adviendra des candidatures poten- perdre ici sur les deux tableaux : ses limites tielles ou déclarées de l'Arménie, d'Israël ou géographiques, fussent-elles arbitraires et du Maroc et, derrière elles, de celles des États transitoires, l'empêcheraient d'être autre chose de Transcaucasie, du Levant et du Maghreb. qu'un ensemble régional confronté à d'autres L'embarras est d'une autre nature. Il tient au ensembles régionaux. Elle serait d'autant fait qu'une fois la Turquie admise dans l'Un- moins capable d'être un arbitre respecté que sa ion, il n'y aura plus de différences entre l'Eu- nouvelle frontière sud traverserait un Moyen- rope et la non-Europe, l'intégration de l'altérité Orient en feu et la contraindrait à s'engager turque détruisant l'identité historico-culturelle dans l'ensemble des contentieux de la zone — de l'Union et ruinant toute idée d'un marqueur avenir du Kurdistan irakien, bataille pour le significatif entre celle-ci et ce qui l'entoure. contrôle de l'eau, relations avec Israël et la Syrie — moins en qualité d'honnête courtier Avec la frontière disparaît pour l'Europe la impartial que de partie directement intéressée possibilité d'être un acteur à part entière de la au règlement des conflits. Par ailleurs, la di- communauté internationale. Là encore, la mension kantienne de l'Union, fortement question n'est pas de savoir si la Turquie est stimulée par sa transformation en communauté plus ou moins inféodée à Washington, mais multiculturelle fondée sur le droit et non sur plus essentiellement si l'Union européenne a l'histoire, l'empêcherait plus encore qu'au- vocation à exister en qualité de membre eu- jourd'hui de s'assumer en tant que puissance à ropéen de la communauté internationale, dé- part entière, capable de défendre ses intérêts positaire de valeurs, d'intérêts et d’approches spécifiques et de faire prévaloir sa propre vi- spécifiques à cette partie du monde ou si elle sion du monde. Par une dernière ruse de l'his- doit s'imaginer comme un instrument de régu- toire, la Turquie apporterait à l'Europe les mo- lation internationale offert à tous ceux qui yens militaires d'une puissance accrue tout en veulent s'y soumettre, une sorte de petite ONU la rendant incapable de placer cette force nou-

96 | TURKEY IN EUROPE MONITOR velle au service d'une identité devenue imagi- Maastricht avait simultanément ouvert la voie naire et d'une volonté commune introuvable. à une Europe fédérale et à une Europe intergouvernementale. La première exclut la C'est au bout du compte Michel Rocard, Turquie et la seconde l'autorise. Depuis lors, champion désenchanté de la cause d'Ankara, la préférence implicite des dirigeants na- qui dit les choses avec le plus de netteté. Son tionaux s’est manifestée à divers signes : ad- plaidoyer sans enthousiasme « pour une hésions dénuées du moindre contenu politique Europe sans âme » a le mérite de ne rien dis- explicite, intergouvernementalisation ram- simuler à l'opinion des deux implications fon- pante des institutions, déchirement des gou- damentales de l'adhésion potentielle de la vernements sur le conflit irakien, et enfin Turquie : l’engagement de l’Union dans un marche résolue de l’Union vers la candidature processus indéfini d’élargissement et le renon- turque. Cette dernière option confirme toutes cement à ce que l’ancien premier ministre les autres. Par l'ouverture imminente de négo- nomme « une Europe capable non seulement ciations d'adhésion avec la Turquie, c'est bien de défendre mais d’exporter vers d’autres con- l'impuissance conjointe des États dans une tinents son modèle social, et capable aussi de Europe sans frontières que l’on inscrit à peser fortement sur les affaires mondiales ; l'ordre du jour. bref, d’être une puissance ». Depuis quinze ans, les dirigeants européens refusent de choisir entre ces deux conceptions de l'Eu- rope.

NO. 10 / OCTOBER 2004 | 97

TURKISH BUSINESS PERSPECTIVES nomic conditions leading to a sustainable sta- by bility. As an outcome of constantly ameliorat- TÜSIAD ing economic performance in the last two TURKISH INDUSTRY & BUSINESS years, Turkey has stepped into the “low infla- ASSOCIATION tion-high growth” era. In Turkey, investments have risen even with the volatile exter- www.tusiad.org nal and internal prices. Cooperation between Turkey and IMF continues to lead the country 2005 day by day to a better economic condition. TURKEY AT THE EDGE OF A NEW According to IMF, macroeconomic conditions ERA: in Turkey are at their best in decades. THE EU AND NEW TURKISH LIRA The economic growth in Turkey will be em- On the 6th of October the European Com- powered by the launch of New Turkish Lira mission will unveil the Regular Progress Re- (YTL). YTL will be in circulation from Janu- port and The Impact Assessment for Tur- ary 1, 2005. Conversion rate will be: key. In addition, the Commission is required to provide the European Council 1 YTL = 1.000.000 TL with a recommendation on whether or not Sub-unit of YTL will be KURUS (YKr), the to launch the accession negotiations with equivalent of cents in Euro. Turkey. On the verge of these reports and 1 YTL = 100 YKr the recommendation, the intuition of the European political and financial circles The composition of denominations for YTL about the outcome is rather positive. Such a banknotes will be 1, 5, 10, 20, 50 and 100. feeling might be the result of encouraging The denominations for the coins will be and clear messages conveyed by the 1,5,10,25,50 YKr and 1 YTL. The YTL and Enlargement Commissioner, Günter Ver- old Turkish Lira will co-exist during 2005 and heugen following his monitoring visit to at the end of the year old Turkish Lira will be Turkey and his meeting with Prime Minis- withdrawn from circulation. ter R.Tayyıp Erdoğan in Brussels. Coupling the ongoing hard work to drive in- Positive prospects regarding Turkey’s EU bid flation down to single digit with the introduc- increases the level of market confidence for tion of YTL, the Central Bank aims at restor- the Turkish economy. Recently, Standard & ing Turkish citizens’ confidence to their own Poor’s has raised Turkey’s long-term foreign currency as well as improving Turkish cur- currency sovereign credit rating from B-plus rency’s reputation in the world markets. Re- to BB-minus and long-term local currency 1 moving zeros from the currency will also sovereign credit rating from BB-minus to BB . eradicate the technical and operational problems caused in the past by multiple zeros in Likewise, Fitch Ratings raised the outlook for currency. Turkey’s long-term foreign and local currency sovereign credit rating of B-plus to positive 2 As the Central Bank authorities proclaim, the from stable. New Turkish Lira is the symbol and the evidence of Turkey’s determination to drive Progress in EU – Turkey relations has re- inflation down and move forward towards flected positively to the Turkish macroeco- EU membership.

1http://quote.bloomberg.com/apps/news?pid=1000 0085&sid=arw.AoL1Ro3Q&refer=europe 2http://www.fitchratings.com/corporate/ratings/issu er_content.cfm?issr_id=80442217

CEPS Turkey in Europe Monitor No. 11, November 2004

Introductory Note from CEPS

This issue of CEPS Turkey in Europe Monitor Turkey’s role in the context of EU reliance on presents a long extract of the Working Paper Russia as its largest single supplier of gas. It titled “The Turkish Gate: Energy Transit and deals with the existing and potential pipeline Security Issues”, prepared by John Roberts infrastructure for gas supplies to Europe via within the scope of the joint CEPS-EFPF Pro- Turkey and discusses what role the EU is al- ject, “Strategy for Turkey and the EU in the ready playing, and might be expected to play Pre-Accession Period”. CEPS and EFPF in the future, with regard to ensuring its en- gratefully acknowledge financial support for ergy security by means of pipeline develop- this project from the Open Society Institute of ment to carry gas to EU market via Turkey. Istanbul, Akbank, Coca Cola, Dogus Holding Gas is the prime focus of the paper. Although and Finansbank. CEPS acknowledges the kind oil security is of obvious importance to the EU support for the production of the Turkey in and Turkey is a major transit country for oil Europe Monitor provided by EU Information supplies, essentially the problem of ensuring Group of Turkey (ABIG). oil security for the EU is, in geographical The paper sets out Turkey’s current and poten- terms, argued to be a global one due to the tial role in the supply of gas to Europe, start- fungibility of oil. Oil issues are therefore cov- ing with the EU’s need for gas, the geography ered in an appendix available with the full text of global gas disposition and Turkey’s impor- of the Working Paper at www.ceps.be. tance as a natural funnel through which the EU can access gas from many of the world’s leading gas suppliers. It also places Michael Emerson and Senem Aydın

The Turkish Gate: Energy Transit and A net energy importer, and itself a major mar- Security Issues ket for regional producers, Turkey’s importance lies in its ability and willingness to de- by velop major transit systems for gas as well as John Roberts1 oil, thus enabling hydrocarbon resources to access European markets by pipeline from Introduction such diverse regions as the Caspian, Central Turkey’s role as a gateway through which gas Asia, the Gulf, and the eastern Mediterranean. can enter the European Community is becoming increasingly important as the European Regional Gas Disposition Union grapples with the interrelated problems Turkey lies adjacent to countries or regions of ensuring energy security and the provision possessing some 71.8% of the world’s proven of energy supplies from multiple sources at gas reserves and some 72.7% of the world’s competitive prices. proven oil reserves2. But such figures are

somewhat misleading, essentially for two rea- 1 John Roberts is a specialist on the geopolitics of sons. Firstly, gas is a very different commodity energy with the Platts energy group, serving as 2 Senior Editor with the group and focusing on en- According to the BP Statistical Review of World ergy security. Energy, June 2003.

| 98 NO. 11 / NOVEMBER 2004 | 99 compared to oil; secondly, some producers, The International Energy Agency (IEA) esti- notably Russia, have comparatively little in- mates that the EU’s primary gas demand is terest in utilising Turkey as a transit country. expected to grow by 2.9% per year from 2000 In this context, the most relevant element to 2010 and by 1.6% from 2010 to 2030. It might be that as many as 10 current producers, anticipates that demand will increase in all collectively possessing 35.5% of global end-use sectors, but most dramatically so in proven gas reserves, either have, or might rea- power generation.3 In this case, it appears to be sonably be expected to have, an interest in di- defining the EU as meaning the EU-15, the 15 recting exports to Europe via Turkey. members of the Union prior to its enlargement on 1 May 2004. In contrast, various other pro- Perhaps surprisingly, Turkey’s current or po- jections for the EU are based on an EU-30, tential role in oil transportation is considerably which includes all the current EU member less important than its current or potential role states plus the three current candidate states of in gas transit. There is no doubt that oil pipe- Romania, Bulgaria and Turkey and two other lines across Turkey do play, and will play, a countries observing EU energy principles, major role in the global energy market but Norway and Switzerland. their role can best be defined as useful and important rather than vital. Oil is essentially a According to recent projections, the EU-30 are fungible commodity; it is more flexibly trans- expected to consume almost 700 bcm/y of gas ported than gas (notably by sea) and Turkey’s by 2030.4 The International Energy Agency role in this context is one that concerns the acknowledges a massive dependence on im- global energy supply system rather than that of ports. It envisages imports rising from 187 the European Union alone. Gas, however, is a bcm in 2000 to 632 bcm in 2030, a 449-bcm/y different matter: it is more complex and, in a increase (see Tables 1 and 2). strictly EU context, Turkey’s role, both current These tables slightly overstate Europe’s reli- and potential, is much greater. ance on imports, since Norway, which in 2000 accounted for one quarter of EU imports and Gas Transit Issues which is still expected to account for 17% of The European Union is already the world’s European imports in 2030, is firmly listed as biggest gas import market while it is also one an import source. In this context, however, the of the world’s fastest-growing energy markets. EU’s supplies from Norway should more It possesses a variety of energy import sources properly be considered as part of EU domestic – notably Russia and Algeria – but is naturally production, in view of Norway’s membership seeking to diversify supplies. Turkey’s role is of the European Economic Area and its con- potentially extremely important in that it fur- version of the EU’s gas directive into domestic nishes a natural corridor through which gas legislation. Indeed, the text of the European from a wide variety of suppliers in an arc from Green Paper of 2002, in asserting that Russia the Caspian through the Middle East and the and Algeria occupy the two leading places as Gulf to Egypt can access the growing EU external suppliers of gas to the EU, effectively market by pipeline. With the EU already in acknowledges Norway as an internal supplier. receipt of large volumes of gas from three Even so, this still means that the EU will remain sources – Russia, the North Sea and main considerably dependent on imports. In a North Africa – Turkey’s goal is to become recent presentation, the IEA’s chief economist, Europe’s fourth main artery. Dr Fatih Birol, anticipated that the growth in

The EU’s Gas Balance to 2030 The European Union is already looking to Turkey as a potential import route, while Tur- key is very much looking to the EU as a mar- 3 International Energy Agency, World Energy Out- ket for gas transiting through Turkey. This look 2002, Paris, 2002, p. 189. relationship is fuelled by Europe’s prospective 4 Presentation by Dr Fatih Birol, Chief Economist demand for gas imports and the availability of for the International Energy Agency, to the seminar supplies to meet much of this demand in coun- on Natural Gas in South East Europe: Investment, tries adjacent or close to Turkey. Transit and Trade, in Istanbul, 5-6 May 2004.

100 | TURKEY IN EUROPE MONITOR imports to 2030 would likely be covered as Table 3. EU gas import distribution, 2000 and 2030 5 follows: 2000 2030 • An extra 79 bcm from Russia; Africa 33.5% 28% • An extra 51 bcm from Central Asia; Norway 25% 17% • An extra 157 bcm from the Middle East, Transition 41% 33% • An extra 136 bcm from West and North economies Africa; and Middle East Neg. 17% • An extra 18 bcm from the Americas Latin Amer- Neg. 5% (mainly Trinidad & Tobago). ica Other 1% Neg. This totals 441 bcm/y, possibly indicating a Source: IEA, World Energy Outlook, 2002. slight reduction in the IEA’s anticipated import requirements. In terms of distribution, the In terms of import flexibility, it should be IEA has produced this assessment concerning noted that Libya is due to be directly con- the distribution of gas imports into the EU – or nected to Italy by the ‘Green Stream’ pipeline at least the EU-15 – for 2000 and 2030. (with first flows currently scheduled for early Table 1. EU-15 and EU-30 gas import depend- 2006), adding to the variety of low-cost gas ence, 1998-2030 (%) imports from North Africa. In addition, LNG is also becoming increasingly important in the 1998 2010 2020 2030 EU gas mix, with the IEA arguing that “LNG EU-15 49 54 62 71 would become especially important if there Europe-30 36 42 51 60 turned out to be less Russian gas than expected.”6 LNG is already a significant factor in Source: European Commission (2000), Green Paper on a the energy mix of countries with Mediterra- European Strategy for the Security of Energy Supply, nean or Atlantic coastlines, but has yet to November. make a significant mark in northern and central Europe.

Table 2. EU-15 gas balance, 1998-2030 (in bcm) Transport and Geography 1998 2002 2030 Turkey’s proximity to gas producers is much Production 202.3 208.8 153 more directly relevant to the question of EU Consumption 349.1 385.6 506 energy security – and to the terms under which Balance to be the EU can expect to secure gas from other covered by 147.2 177.2 359 producers, notably Russia. Gas is essentially imports transported by two methods: by pipeline and Import de- 46.0 as liquefied natural gas (LNG). In the Turkey- 42.2% 71% pendency % EU context, pipelines are the more important issue, but their importance is obviously af- Source: For 1998 and 2002 figures, BP Statistical Review of fected by the ability or willingness of the EU World Energy 2003; Projections for 2030 derived from per- to increase LNG imports. centages cited in European Commission (2000), Green Paper on a European Strategy for the Security of Energy Supply, Because Russia has its own direct pipeline sys- November. Note the BP figures for 1998 reduce the apparent tems serving the EU market, it is not particu- level of import dependence to 42.2% when set against the 49% level cited in the European Commission Green Paper, larly interested in routes through Turkey, 2000. which it is likely to view in an essentially competitive context, even though the EU might argue that routes through Turkey are intended to complement, rather than compete with, Russian pipeline supplies. But Turkey is located close to a number of other gas produc- 5 Presentation to seminar on Natural Gas in South East Europe: Investment Transit Trade. Held in 6 International Energy Agency, World Energy Out- Istanbul, 5-6 May 2004. look 2002, Paris, 2002.

NO. 11 / NOVEMBER 2004 | 101 ers which have had, or may have, an interest in cerning the pricing of gas delivered through assessing the prospect of accessing European the line. However, periodically there have markets by means of pipelines through Tur- been various Russian suggestions that the Blue key. Countries currently studying prospects for Stream line, or fresh connections through the delivery of their gas through Europe include Caucasus, might be used to supply Israel with Azerbaijan, Kazakhstan, Iran, and Egypt. Russian gas via Turkey. Countries with gas reserves that have previously considered the issue, and might reasona- The Challenge from LNG bly be expected to do so again include Turk- Pipeline is the more normal transportation menistan, Iraq and Qatar. In addition, Uzbeki- method for gas but LNG offers an increasingly stan, Saudi Arabia and Syria have potential competitive alternative particularly over dis- interests in tacking on their output to networks tances of 3,000 kms or more. Although it re- developed to serve their neighbours’ exports. quires provision of expensive liquefaction These ten countries collectively possess 55.34 plants, to convert the gas to liquid form so that tcm in proven gas reserves, equivalent to it can be transported by sea, and the availabil- 35.5% of the world’s total reserves of 155.78 ity of purpose-built tankers, in some cases it tcm. may even prove competitive with pipelines at distances of 1,000 kms. Egyptian plans for Table 4. Reserve estimates for Turkey’s gas- developing gas exports by means of LNG cur- producing neighbours (in trillions of cubic metres – tcm) rently appear to be more advanced than recently revived plans for an extension of the Caspian/Central Asia 6.57 recently constructed Egypt-Jordan gas line Azerbaijan 0.85 (now being extended to Syria and Lebanon) Kazakhstan 1.84 into Southern Turkey. Qatar has already in- Turkmenistan 2.01 vested heavily in LNG projects and while it Uzbekistan 1.87 did consider proposals for piped exports to Middle East 47.11 Europe via Turkey in the 1980s, it is only likely to revive such proposals seriously if it Iran 23.00 becomes convinced that Turkey is indeed cre- Iraq 3.11 ating a new artery; that Iraq can offer a stable Qatar 14.40 interconnection between the Gulf and Turkey, Saudi Arabia 6.36 and that gas shipments to new European mar- Syria 0.24 kets will not prove counterproductive to its Northeast Africa 1.66 existing LNG trade. At present, repeated at- Egypt 1.66 tacks on Iraq’s northern oil pipeline to Turkey Russia 47.57 make it highly unlikely that anyone will move to develop a parallel gas pipeline in the imme- World 155.78 diate future, although the issue is kept under Source: BP, Statistical Review of World Energy, London, constant technical review in Ankara. June 2003. The focus which Qatar, Abu Dhabi and Oman With regard to Russia, Turkey is mainly, so far are placing on development of LNG exports as transit is concerned, a competitor rather almost certainly ensures that while Gulf re- than a conduit. However there is one major gas serves remain key to the global gas balance, line from Russia to Turkey that appears to the prospect of major Gulf exports to Europe have been built with at least a possible view to via Turkey is very much a second stage pros- onward transfer of Russian gas to markets be- pect. Iran furnishes an obvious exception to yond Turkey. This is the 16 bcm/y Blue this in that it is actively seeking to export gas Stream line under the Black Sea opened in to the EU via Turkey. But whether its 2002 and which, in simple supply terms, could neighbours on the Arab side of the Gulf will be used to ship gas to markets elsewhere in follow suit will depend very much on the ini- Europe. As of mid-2004, Gazprom has refused tial success of such projects as the Turkey- to entertain such ideas, although Turkey has Greece gas line and the Nabucco project (see raised the issue in repeated negotiations con- below).

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Incoming Pipelines to Turkey Turkey Turkmenistan 20-30 bcm Azerbaijan/ None Whether Turkey can become the EU’s ‘fourth Turkey Turkmenistan 30-36 bcm Iran/Turkey Limited artery’ very much depends on the completion connections** or implementation of various projects designed Uzbekistan 5-10 bcm Turkmenistan/ None to bring gas to Turkey, to transport it from Azer/Turkey Turkey, and to increase Turkey’s own * This would be additional to the 10-12 bcm potential throughput capacity. delivery before 2015. ** Turkmenistan’s Caspian shore gas fields are already This is certainly Turkey’s goal and, indeed linked into the Iranian network via the 12 bcm/y capacity Turkey already has one major important pipeline from Korpedzhe to Kurt-Kui, but there are no sig- line which might, in time, be used to ferry gas nificant connections to Iran from Turkmenistan’s main to European markets beyond Turkey itself: the central and southeastern gas fields. 20 bcm/y capacity Tabriz-Erzurum line which opened in December 2001 and which now car- c. Potential gas pipelines from Turkey to (other) ries Iranian gas to Ankara and other parts of EU countries Turkey. In addition, in conjunction with BP, Route Initial LT capac- Comments Statoil and other developers of Azerbaijan’s ity Turkey- 0.75bcm 3-11 bcm Due to open giant Shakh Deniz field, it is committed to Greece 2006 building the $1bn South Caucasus Gas Pipe- Greece Italy 22 bcm 22 bcm Under study. line from Baku to a connection with its own Interconnec- Possible East-West Main Trunk Pipeline at Erzurum. tor opening The Baku-Erzurum line will initially have a 2008 Turkey- 3-5 bcm 20-25 bcm Under study. capacity of around 7-8 bcm/y but is designed Austria Possible for expansion up to at least 16 bcm/y. (Nabucco) opening 2009 But Turkey’s ability is to import gas from its Greece- ?? 10-20 Preliminary neighbours, particularly with regard to subse- Western bcm?? proposal quent transit of that gas to markets in Europe, Balkans- is not limited to Iran and Azerbaijan alone (see Austria Table 5). Source: IEA, Methinks.

Table 5. Potential Eurasian gas suppliers to the EU market (by pipeline) The South Caucasus Pipeline a. Supply potential as of 2010 Construction of the new Baku-Tbilisi-Erzurum Country Volume Transit Potential by Existing line, officially called the South Caucasus Pipe- country 2015 system line (SCP), is officially due to be completed in Iran 10 bcm Turkey 20-30bcm 3-10 bcm 7 Turkmeni- 13 bcm Iran/ 30 bcm 13 bcm September 2006 at a cost of $953m. Curi- stan Turkey ously, whether construction work on this pro- Turkmeni- 34-80 Russia 80 bcm 50 bcm ject has yet started remains a moot point. Be- stan bcm Turkmeni- 10-36 Russia/ 36 bcm 36 bcm cause the sections of this line in Azerbaijan stan bcm Ukraine and Georgia use the same right of way as the Azerbaijan 7 bcm Turkey 20 bcm 6-20 bcm* better known 1.0 mb/d Baku-Tbilisi-Ceyhan Iraq 10 bcm Turkey 10 bcm None Egypt 4 bcm Jordan/ 10-12 bcm Link oil pipeline, basic groundbreaking and site Syria to Jordan** preparation work, particularly in difficult ter- * SCP system under construction, due to open 2006. rain, is being carried out for both lines simultaneously. With a similar stakeholding in the * * Egypt-Jordan gas line has reached Syrian border. two lines, and with BP as operator of both systems, coordination of the two projects meant b. Additional supply potential post-2015 that as of mid-2004, the emphasis was on lay- Country Volume Transit country Existing ing oil pipe. But as pipe laying for BTC ends system Qatar 20-30 bcm Kuwait/Iraq/ None in the second half of the year, pipe laying Turkey work on the gas line was expected to start in Egypt 10-12 bcm Jordan/Syria Link to Syria* earnest. Saudi Arabia 10-20 bcm Jordan/Syria/ None Turkey 7 Mejid Kerimov, Azerbaijani Minister of Fuel and Kazakhstan 10-20 bcm Azerbaijan/ None Energy, Istanbul, January 2004.

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The SCP will initially have a capacity of velop gas fields in northern Iraq and bring around 7-8 bcm/y, but documentation pro- some 10 bcm/y into the Turkish system, again duced by BP in March 2004 showed an even- with a view to forwarding some of this gas to tual planned capacity level of 20 bcm/y. This other European markets.9 But while Turkish now appears to be the general long-term target officials say they have current backing for this for Azeri gas exports, the marketing of which project, which was first mooted in 1996, from is now being carried out by one of the major the Iraqi Ministry of Energy and from private partner’s in both SCP and Azerbaijan’s giant Turkish companies, this is a project that can- Shakh Deniz gas field, Norway’s Statoil.8 not be undertaken until there is a substantial improvement in security conditions in Iraq. The official timetable for delivery of Azeri gas to Turkey, which may well slip, envisages a Turkish officials are also continuing discus- starting rate of 2.0 bcm/y in 2006, rising to 3 sions with Egypt. But although Egypt is cur- bcm/y the following year, to 5.0 bcm/y in rently extending its gas system northwards 2008, and then reaching its initial plateau level though Jordan to Syria, so that it would easily of 6.6 bcm/y in 2009. Although the initial be able to affect deliveries to southern Turkey 2001 sale and purchase agreement were appar- by building a few hundred kilometres of extra ently based on projected Turkish domestic us- pipeline, whether there is a market has yet to age of this gas, it is now clear that much or all be ascertained. The pipeline could obviously of it will go straight to Greece. Norway’s Sta- supply gas to the industrial and petrochemical toil, which is responsible for securing export markets of Iskenderun and southern Turkey, contracts for Azeri gas via the South Caucasus but Turkish officials remain uncertain as to Pipeline, is actively assessing various Euro- whether local demand justifies such an exten- pean markets, starting with Greece. sion to the Egypt-Jordan-Syria line. What does seem clear is that in due course this line will Other Connections reach the northern Syrian city of Aleppo, for which Iskenderun was long the traditional Turkey is also pursuing discussions with vari- port. There is therefore a real prospect that a ous other potential suppliers. The most impor- relatively small-scale local trans-border con- tant of these is, probably, Iran, since Tehran nection between Aleppo and Iskenderun might has already been discussing eventual deliveries eventually form the basis of a more substantial of gas to Greece via Turkey, whilst EU offi- connection. In considering whether this might cials have spoken of Iran as a long-term gas happen, several factors have to be borne in supplier to EU member states. Current agree- mind. One is Egypt’s own desire for new ex- ments provide for Iranian deliveries to Turkey port markets. A small-scale entry into the to plateau at 9.56 bcm/y in 2007, but as the Turkish market could prove the precursor of line has the potential to handle double this greater export sales – so long as these are volume, and as Turkey’s own gas demand pro- competitive with Egypt’s obvious alternatives: jections remain unclear, it seems likely that at pipeline deliveries to Europe via a proposed least part of the line’s capacity will be used to connection to Libya and the Libya-Italy supply gas to the Turkish system that will sub- “Green Stream” line, and development of sequently be forwarded to other European LNG export facilities. markets. In addition, it is worth noting that Syria itself As mentioned previously, Turkish officials possesses significant gas reserves. But the also continue to discuss with their Iraqi coun- most important factor of all is the fact that terparts what they call the ‘Iraq Integrated Saudi Arabia possesses major gas reserves in Natural Gas Pipeline Project’ by which they the northeast of the Kingdom, which could hope to see a Turkish-Iraqi consortium, em- easily be connected to the Egypt-Jordan-Syria- bracing both the public and private sector, de- Turkey line. Saudi Arabia is not publicly con- templating raw gas exports but the existence of 8 Azerbaijan’s Kerimov, speaking in Istanbul in January 2004, said Shakh Deniz has a large capacity “so we must set up more pipelines to reach 9 “Turkish companies are ready to realise gas pro- northern Europe and the Balkan countries.” He jects in Iraq which will help substantially the re- added: “I’m sure the gas reserve will yield 20 construction efforts in that country.” Hakki Akil, bcm/y.” Istanbul, February 2004.

104 | TURKEY IN EUROPE MONITOR a proven export route, albeit one which would The Nabucco Project need considerable expansion to serve Saudi The extent of detailed planning and, in particu- interests, could prove highly advantageous as lar, its development by prospective gas im- and when the Saudi authorities decide to re- porters makes it look increasingly probable visit the gas export issue. that the next few years will see the develop- As for Turkmenistan, Turkey continues to ment of at least one major pipeline system for consider that it has an effective sale and pur- delivery of Eurasian gas to Europe via Turkey: chase agreement with Ashgabat (it signed a the Nabucco project. As much as 20-30 bcm/y framework agreement for gas deliveries in Oc- would flow northwards to markets in central, tober 1998) under which Turkmenistan would northern and western Europe by means of this ultimately deliver as much as 20 bcm/y to the project, currently being developed by Aus- Turkish market. But since the Turkmens effec- tria’s OMV in partnership with Turkey’s state tively decided in 2001 to reject a serious pipe- pipeline company, Botas, Hungary’s MOL line project that would have brought this gas to Transmission plc, Bulgaria’s Bulgargas and Turkey via Azerbaijan, the concept of large- Romania’s Transgaz. scale Turkmen gas sales to Europe has, de Johann Gallistl, manager for international af- facto, been in abeyance. Essentially, Turk- fairs at Austria’s OMV Erdgas, argues that the menistan President Saparmurat Niyazov does 3,400 km line, €4.4 bn, Nabucco project offers not wish to see his gas pass through the terrain a serious prospect for delivering Middle East- of a neighbouring state, Azerbaijan, which is ern and Caspian gas to major European mar- both a rival gas producer in its own right and kets. The line is planned to have a capacity of with which he has a serious maritime border 25-30 bcm/y as it crosses Turkey. The transit dispute concerning a cluster of oilfields in the countries would themselves take around 8-10 south-central Caspian. Although at least one bcm/y, so deliveries to Baumgarten would be Turkish official argues that, in time, the South around 17-22 bcm/y. The partners in the pro- Caucasus Pipeline from Baku to Erzurum ject have all agreed to meet at least part of “may also constitute the first part of the Turk- their own domestic demand by means of menistan-European route,” accomplishment of Nabucco.12 such a goal will almost certainly have to await the post-Niyazov era in Turkmenistan.10 In mid-2004, a new Vienna-based venture set up to coordinate the project, the Nabucco Company Pipeline Study GMBH, was incor- Outgoing Pipelines from Turkey porated, with gas companies in Austria, Tur- Turkish Energy Minister Hilmi Guler, recently key, Hungary, Romania and Bulgaria each declared that Turkey’s objective “is to make holding a 20% stake – and with France’s Ga- sure that the oil and gas resources of the region sunie showing interest in becoming a mem- are transferred to the European market via this ber.. The new venture, he added, began on 5 country.” May the technical process for choosing a fi- Such thinking underpins both the 285-km Tur- nancial adviser. By the end of the year it key-Greece pipeline, through which the Azeri would receive the final drafts of both a full or Turkmen gas should start to flow in late feasibility study and a financial assessment by 2006, and the much larger Nabucco project, by the end of 2004 or around the start of 2005. which gas from a variety of sources could start These studies, Gallistl said, will present the flowing to the Balkans as early as 2009, and group with “a complete basis for decision of eventually to Austria and the EU’s main con- our management to go ahead with this project sumer markets in central, northern and western Europe.11

10 Direct communication to the author, Ankara, February 2004. Foreign Ministry, Istanbul February 2004. Kilic also said the SCP will constitute the first leg of the 11 “In 2006, the Shakh Deniz project will start into Caspian-Turkish-European pipeline system. life and the Shakh Deniz gas will start flowing to 12 Turkey, Greece, Europe and the Southern Ring.” Johan Gallistl, comments made to Istanbul semi- Alev Kilic, deputy undersecretary at the Turkish nar May 2004 and interview with the author.

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– and we are very confident that this will hap- ject.15 Moreover, there was no feeling that pen.”13 proponents of the Turkey-Greece-Italy Inter- connector were in competition with backers of Nabucco’s principals said in May that prelimi- the Nabucco project to carry gas from Turkey nary talks had been held “with Iran and some through Bulgaria, Romania and Hungary to other interested parties” with a view to supply- Austria’s major gas terminal at Baumgarten. ing gas for the system, but that formal negotia- The two projects target quite different regional tions with shippers would not start until the markets: Italy for the interconnector from new joint venture had elaborated a general Greece and Central and Western Europe for transportation contract. They added that work Nabucco. There was a widespread view at the on formulating such a contract had already seminar that not only were producer countries begun. providing an obvious push factor for such As of early May, the joint venture and its lines, but that the pull factor from consumers backers were awaiting an interim study on in Europe was becoming increasingly appar- possible usage of existing grids along the pipe- ent. Since the development of pipelines from line route, part of an overall feasibility study Turkey to the EU is overwhelmingly demand being conducted by the Boston Consulting driven and since the costs of such pipelines Group. The current timeframe for the project is have to be spread between several potential for a detailed technical design and an envi- purchasers, the development of gas importer ronmental assessment study to be started in consortia becomes crucial. In their own sum- 2005 and ready by mid-2006. The construction mary of the Istanbul seminar, the IEA and phase would last from mid-2006 to end-2009. ECS clearly look forward to the creation of The start of operations would be in 2009. such consortia: Contractual conditions between suppliers and As the development of gas routes is demand buyers will be crucial. The International En- driven and requires significant investment and ergy Agency (IEA) and the Energy Charter financial capacities, the involvement of major Secretariat (ECS) noted that what they termed European gas companies and new operators in non-price differentiation may be a key element buying and distributing the gas is essential. in developing competition with existing The transformation of isolated national mar- sources. By this they meant structuring con- kets operated by public monopolies toward an tracts in new ways that are more attractive to internal EU gas market with multiple opera- buyers, such as short- to medium-term con- tors will have a major impact on the gas im- tracts and the introduction of price indexation port scene. Gas distribution companies, which systems that are not dependent on oil prices. will have to face increasing competition, will Non-price differentiation, the IEA and ECS most probably create consortium(s) to secure said in their summary of their recent seminar import supplies and share the costs and the on Natural Gas in South East Europe: Invest- risks. All these elements combined will im- ment, Transit, Trade in Istanbul, “may be a pact on the development and the implementa- determinant in attracting and securing gas im- tion calendar of transit routes across South porters which are increasingly evolving in East Europe, at the earliest from 2006-2007. volatile and competitive gas markets.”14 At the Istanbul seminar, it was clear that the The Turkey-Greece-Italy Interconnector IEA’s estimates for prospective EU gas import On 23 December, 2003, Turkey’s state pipe- requirements served as an encouraging back- line company Botas, currently still in posses- ground for presentations concerning lines in- sion of monopoly gas import powers, signed volving Greece and the major project to carry an agreement with its Greek counterpart, gas to the heart of Europe, the Nabucco pro- DEPA, concerning the commercial terms for a

planned new 286-km gas pipeline between the 13 Interview with Johan Gallistl, Istanbul 5 May two countries. Construction of the 36-inch line 2004. See Platts International Gas Report, forth- from Karacabey to Komotimi, costed at Euros coming. 14Proceedings on 15Proceedings on http://www.iea.org/Textbase/subjectqueries/nmc/eu http://www.iea.org/Textbase/subjectqueries/nmc/eu rope.asp. See Para 51. rope.asp. See Para 57.

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250m and including 17kms under water, is due The West Balkans Pipeline Proposal to start later this year, with the line itself due In considering the Turkey-Greece-Italy inter- to open at the end of 2006. The line will ini- connector in Istanbul, DEPA also said that a tially deliver 0.75 bcm/y but will then climb to plan for a West Balkans line was “under con- 3 bcm/y. As and when further pipelines to sideration but is not mature yet.” An agree- carry gas beyond Greece become available, it ment to study such the evolution and imple- 16 will be able to carry up to 11 bcm/y. mentation of such a line was signed on 8 April A feasibility study concerning a further inter- 2003 between DEPA and Botas and the gas connector, a 280-km line (with 224 kms off- authorities of the Former Yugoslav Republic shore) between the southern Italian port of of Macedonia, Albania, Yugoslavia, Bosnia- Otranto and a Greek terminal at Stavrilimenas, Herzegovina, Croatia and Slovenia. A study was due to be ready in September 2004. The by the Observatoire Méditerranéen de study should disclose the investment cost l’Énergie (OME), carried out for the European (within a range of plus or minus 20%); the in- Commission’s Synergy Programme and pre- vestment requirements for the Turkish grid; a sented in Istanbul, compared the Nabucco and preliminary survey of the route; and the engi- West Balkans options with the Greece-Italy neering of selected pipeline configurations. interconnector. It concluded that “projects to This project has long enjoyed EU backing, connect Turkey to Austria either through Bul- with the then EU External Relations Commis- garia, Romania and Hungary, or through Ma- sioner Chris Patten providing early vocal sup- cedonia, Bosnia-Herzegovina, Croatia, Serbia port and the Commission itself financing ini- and Slovenia (or possibly both) are more likely tial studies. The very concept of an intercon- to see the light, but would still require substan- 17 nector is strategic, in that the line, as envis- tial political backing.” However, these coun- aged, would be able to carry gas from Italy to tries – with the notable exceptions of Romania Greece and Turkey, or from Turkey to Greece and Croatia – have small gas markets. More- and Italy. In other words, it would serve as a over, they suffer from political and regulatory link between two main supply systems, in- uncertainties and are mountainous. This pro- creasing flexibility of supply. posal has therefore not attracted a real commercial interest and looks more like a long- The Karacabey-Komotimi line’s capacity is term project. In terms of regional gas supply, also being designed so that it will eventually such a line would play a significant role. But it be capable of transporting a potential 8 bcm/y is not of major concern with regard to overall onwards to Italy, via the extension to Otranto, European gas security unless it is specifically or northwards to the western Balkans. To this developed as a complementary system to the end, according to Nadir Biyikoglu, Deputy Nabucco project, linking Turkey not only with General Manager of Turkey’s Botas pipeline the Balkans, but with a major European hub, company, 6 compressor stations will be in such as Baumgarten. place on the Komotimi line by 2010. Hakki Akil, deputy director general of the Turkey’s Pipeline Infrastructure Turkish Foreign Ministry, described the Kara- None of the various plans for Turkey to serve cabey-Komotimi line as “the first step in as a new major transit system for European reaching European markets”. He also called gas deliveries can work unless Turkey’s own the project “an important building block of the pipeline network can handle the relevant vol- East-West Energy Corridor” saying it “will umes. Turkish officials appear bullish on the likely turn into the Interconnector Turkey- subject. Botas chief Biyikoglu has said: “Our Greece-Italy in the near future.” East-West line is capable of carrying from Iran back to the West around 22 bcm/y. This may

17 Observatoire Méditerranéen de l’Énergie (OME), Medsupply: Development of energy supplies to 16 “This project will be ready in 2006 when the first Europe from the Southern and Eastern Mediterra- phase of Shakh Deniz will be completed,” Vassil- nean Countries, Chapter 2, “Transit role of the ios Tsombopoulos, director for strategy and plan- Mediterranean region for hydrocarbons coming ning at DEPA, the Greek gas authority, told the from the Gulf and Caspian regions”, Final Report, IEA/ECS Istanbul seminar in May. June 2003.

NO. 11 / NOVEMBER 2004 | 107 be increased by looping.”18 However, there is parties to determine how they can best serve as yet no concrete proposal for constructing a each other’s requirements. On 30 October new parallel pipe to the existing line and little 2000, following a summit meeting between the indication as to how such a project might be EU and Russia in Paris, the Putin-Prodi initia- financed. Turkish officials have noted that, tive was launched. The EU said it had started under Law 4646, anyone can construct trans- work on developing an energy partnership, mission pipelines in Turkey. One official said: noting Russia’s statement at the end of the “The Iranians are thinking of constructing a summit that “it was prepared to work towards pipeline to Europe themselves. EMRA (the improving the Union’s long term security of Energy Markets Regulatory Authority) has energy supply and, as President Putin stated, to told them anyone who wants to construct a put the emphasis on balance in relation to pipeline, after getting a license from EMRA, prices and quantities.”20 The EU added that, in can do so.” However, the official added, there turn, it was prepared to mobilise European might be question marks concerning Iran’s technical assistance to facilitate European inability to raise the capital for such a project. vestments in transport and energy sector production. “Specific measures should be care- There may well be a role for the EU in gen- fully studied whether they concern a precise eral, and the European Investment Bank in legal framework for investments in the energy particular, in financing construction of such a sector, questions relating to taxation or a guar- key element of the infrastructure required if antee mechanism for investments. These Turkey is indeed to become Europe’s fourth measures should be finalised within the gas artery. framework of a cooperation and partnership agreement between the European Union and The Commercial Environment and Implica- Russia,” the Green Paper said.21 tions: The Role of Gazprom Such an agreement has yet to be concluded. The EU, Turkey and potential suppliers of gas One reason for the delay would appear to be to Europe by way of Turkey are not the only the failure by Russia to sign the Energy Char- elements whose actions have to be taken into ter’s projected Transit Protocol, an agreement account. intended to ensure the smooth transit of oil and Looming over the whole debate of European gas both between and across countries, essen- energy supply and security is Gazprom. It has tially in accordance with open access princi- been suggested that, should it so choose, “on a ples. The protocol, if signed and implemented purely commercial basis, Gazprom is in a po- by Russia, would have helped considerably to sition to saturate the Balkans market and shut open up access for Caspian producers to the off any potential competitor.”19 In a technical Gazprom-controlled Russian pipeline system. sense, this is true. But it is a move with conse- Russia’s reluctance – refusal might be a better quences that even Gazprom would have to word – to sign the agreement despite years of consider. prolonged negotiation, means that the environment within which EU-Russian negotia- There are two main background elements to be tions on cooperation in energy in general and considered in this regard: the overall state of gas in particular have changed. the EU-Russian energy dialogue and Russia’s own requirements for foreign investment, par- In terms of where Turkey fits into this equa- ticularly in gas. tion, it should be noted that Gazprom has not merely pursued a policy of eschewing involvement in the Energy Charter Transit pro- The EU Energy Dialogue tocol, but has actively developed a broad strat- The fact that the European Union, the world’s egy which appears to be aimed at reducing the second biggest gas consumer, is located next EU’s ability to import gas from third countries door to Russia, the world’s biggest gas pro- without securing Gazprom’s approval. ducer, makes it eminently sensible for the two

20 Green Paper, Towards a European Strategy for 18 Guler & Biyikoglu: Interviews with the author, the Security of Energy Supply. The European Istanbul, February 2004. Commission. Brussels, November 2000. p. 74. 19 OME, Medsupply. Chapter 2, op. cit. 21 Ibid.

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Gazprom has, in practise, developed a broad third of cumulative investment will be in pro- control strategy along the gas chain which di- jects for export to OECD countries.” The IEA rectly conflicts with diversification routes in report also notes that Russia’s own national four main ways: energy strategy postulates an investment requirement of between $170 billion and $200 • Construction or control of cut-off routes. billion for the period 2003 to 2020, with spe- The most notable example of this is the cific investment levels ranging from $9.4 bil- Blue Stream project, which opened in 2003 lion to $11.1 billion a year.23 The UK Gov- and is due to deliver 16 bcm/y of gas to ernment, in its 2003 White Paper, Our Energy Turkey in around 2008. The West Balkans Future, appears to have been drawing on such line to Turkey can also be viewed in this figures when it cited estimates that “invest- light as can Gazprom’s proposal for a gas ments of US$170 billion may be required to export system to Bulgaria and Italy. develop gas production in Russia alone to • Trading. There are concerns at the way in 2020” – in effect, around $10bn a year.24 which Russian companies, such as Itera and Yet Russia is currently securing much less Eural Trans Gas, established offshore than this. Total foreign direct investment (FDI) schemes in Hungary, Poland and Slovakia in Russia between 1995 and 2003 amounted to ahead of their accession to the EU. Trans- just $26.13bn, while total investment in the parency in gas sales is jeopardised. Both It- country over this period amounted to just era and Eural Trans Gas, the latter a some- $57bn. And although actual FDI has grown what obscure company trading offshore, steadily on an annual basis throughout this are scarcely renowned for their transpar- period, so that it totalled $6.781bn in 2003, the ency, whether in terms of their ownership overall levels of investment fall well below or their activities. Russian requirements.25 Moreover, other core • Acquisitions. Gazprom has purchased tran- sectors, notably oil and a range of potential sit lines in various European countries, no- non-energy industries and projects, are also tably in Poland, Belarus, Ukraine and Slo- looking to secure both local and foreign in- vakia. vestment. Thus Gazprom looks to face an up- hill task in securing the investment in requires • Distribution. Gazprom and other Russian if it is to meet expectations in full concerning companies have purchased distribution its own expansion and increased supplies to companies in Georgia, Turkey and Bul- foreign markets. In strictly financial terms, this garia. may help explain why Gazprom is seeking to The net impact is that Gazprom and other Rus- lock up long term contracts for the import of sian gas trading companies (such as Itera, Central Asian gas at relatively low prices whose relationship to Gazprom still remains whilst simultaneously holding out for much unclear) is already well-placed to use existing higher prices with regard to its own sales to infrastructure to thwart deliveries by non- European customers (see Issues concerning Russian suppliers, or to direct gas supplies Caspian producers below). from Caspian suppliers to European markets Indeed, while Gazprom itself enjoyed in- on terms essentially set out by Gazprom and/or creased revenues from high oil prices in the Itera or Eural Trans Gas. first half of 2004, it was still suffering from major structural problems. Russia’s investment requirements From an EU perspective, this means that one The International Energy Agency, in its World cannot assume that Gazprom will seek to jeop- Energy Investment Outlook, considers that ardise the flow of external investment in order “cumulative investment needs in the Russian 23 gas sector are projected to total just over $330 Ibid. billion, or $11 billion per year, over the period 24 UK Energy White Paper: Our Energy Future – 2001-2030.”22 Of this, the IEA adds, “one Creating a Low Carbon Economy. From Chapter 6: “Energy Reliability”, London, HMSO, 2003. 22 World Energy Investment Outlook: 2003 In- 25 The source for Russian investment figures is sights, International Energy Agency, Paris, No- Boyko Nitzov, Senior Expert with the Energy vember 2003. Charter Secretariat.

NO. 11 / NOVEMBER 2004 | 109 to pre-empt non-Russian access to the Balkan additional pipelines so that it can export gas to market. Indeed, it can be argued that the risk Iran, but at present these play only a limited of otherwise jeopardising external investment role in reducing the country’s reliance on Rus- may yet play a significant role in inducing sian routes. The biggest line, a 200-km, 12 Gazprom to understand that it may have to bcm/y capacity line from Korpedzhe to Kurt- operate in an increasingly competitive com- Kui, only serves the smaller gas fields on the mercial environment inasmuch as its exports Caspian in western Turkmenistan, rather than to the EU are concerned. the main gas basins on central and south- central Turkmenistan. Some smaller direct The Cost Issue connections to Iran have also been declared, but these appear to be purely local connections Supply costs to Europe vary considerably. The with no substantial export potential. International Energy Agency, assessing likely import costs in around 2010-15, includes a Most of the region remains fundamentally reliant range that starts at around one dollar per mil- on the Soviet-era network of pipelines that tie its lion Btu for Algerian gas deliveries to Spain to exports to Russian control of export prices. For both the Caspian and the European Union, one key just over $3 per million Btu for projected Rus- question is whether the EU will help the Caspian sian gas supplies from the Barents Sea via a countries as a group by using its near- projected new Baltic and North Sea pipeline to monopsonist position to secure a better deal Germany and Britain. for Caspian gas transiting the Russian system. In between come a variety of potential sup- For example, at present Turkmenistan suppos- plies to Turkey, with gas from Turkmenistan, edly receives $44 per thousand cubic metres Iran and Azerbaijan all costed at just over ($44/tcm) for gas delivered into the Gazprom- $1.50/Mbtu and gas from Iraq at about controlled pipeline stem at the Turkmen- $1.10/Mbtu. In this context, however, it should Uzbek border. This is gas destined for be noted that these are costs to Turkey’s de Ukraine, to be paid for half in hard cash and facto gas hub in Ankara. By this stage (2010- half in barter. US sources estimate that the bar- 2015), Turkey may or may not be en route to ter component being so poor, in practice becoming a member of the EU, but it will by Turkmenistan is receiving the equivalent of then be a part of the EU’s own South East just $29/tcm in real terms. Moreover, the use Europe energy market and thus observing EU by Gazprom of the somewhat obscure Eural regulations (see Table 6). Trans Gas has raised concerns of overcharge for customers as well as transparency issues. Issues Concerning Caspian Producers Contrast this with Russian earnings at point of For one Caspian, producer, Azerbaijan, the delivery. Turkish officials acknowledge that issue is simply whether Statoil, currently in the country’s state pipeline company, Botas, charge of securing export markets for gas pro- has routinely paid some $130/tcm for Russian duced from the Shakh Deniz gas field, can gas supplied via the western, Balkan route successfully utilise transit deliveries through while one prominent Turkish analyst, Necdet Turkey to access new markets in southern and Pamir, has calculated the true figure for this 26 Central Europe. The supplies are there, the gas as totalling $133/tcm in 2001. In an age infrastructure to get its gas market is being in which Europe can be expected to receive developed as construction of the South Cauca- gas from a variety of sources, such a striking sus Gas pipeline linking Baku, Tbilisi and Er- disparity in prices shows both the strengths zurum unfolds (see previous section). and consequences of Russia’s virtual monopoly in terms of export pipelines from the coun- However, for the three gas producers on the tries on or near the Caspian’s eastern shore – eastern side of the Caspian – Turkmenistan, and the advantages that Azerbaijan should be Kazakhstan and Uzbekistan – the issues are able to reap by virtue of its direct gas connec- very different. All three remain dependent on tion to Turkey. This logic underpinned the existing Soviet-era pipelines which convey PSG/Shell venture to construct a TransCaspian their gas to markets in or beyond Russia under terms controlled by Russia (which, effectively, 26 “Blue Stream and the Economic Dimension”, means Gazprom). Turkmenistan does possess Private paper circulated by Mr Pamir in August 2003.

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Pipeline from Turkmenistan and across Azer- consumption is expected to rise to no less than baijan and Georgia to Turkey. Turkey still has 82.8 bcm/y. a valid 1999 sale and purchase agreement to “To end of 2009, we face no surplus that take delivery of up to 14 bcm/y of gas for its would disturb us,” says one of Turkey’s most own use and to transport 16 bcm/y of gas to senior energy officials. “After 2011, we’ll be European markets by virtue of such a line. But in a minus position – we’ll need gas.”29 This is Turkmenistan President Saparmurat Turkmen- because in that year the first of Turkey’s major bashi effectively scuttled the project by de- gas import contracts, by which it imports some manding an upfront payment, variously put at 6 bcm/y from Russia’s GazExport, comes to $300m and $500m.27 an end. In this context, the official added, Tur- key was working on the theoretical assumption Turkey’s Own Energy Balance that the GazExport contract would not be re- Turkey’s drive to promote its role as a transit newed and that Turkey would turn to Azerbai- corridor dates back to the early 1990s. But in jan instead to make up the 6.0 bcm. But in terms of gas it received a great boost as a re- practice, the official added, he would be look- sult of the country’s own over-eagerness to ing to renew the existing GazExport contract – sign import contracts that in the opening years and that Turkey would then sell the gas from of the Century have caused Turkey to be sig- Azerbaijan on to other European customers. nificantly over committed. Although Turkey has signed agreements under The ‘Onselling’ Issue which it might be expected to import consid- This comment reflects a key issue in the de- erably more gas than it is currently expected to bate over Turkish reactions to possible over consume, Turkish officials appear to be taking supply. The Azerbaijani gas purchase agree- a surprisingly relaxed attitude to the problem. ment allows for onward resale of Azeri gas to They argue that Turkey is no longer facing a other markets; whereas agreements for the significant over supply problem since the vol- purchase of Russian and Iranian gas lack re- ume of gas imports actually covered by take- sale clauses. or-pay agreements is lower than the agreed This might not prove too much of a problem delivery volumes.28 Indeed, the official focus with regard to eventual onward selling of Ira- is still on ensuring that Turkey does not face a nian gas, since Tehran is eager to see its gas supply shortage, with the government looking enter European markets via Turkey. But Rus- to assure itself of both the gas supplies re- sia has its own direct gas export routes to quired to feed a burgeoning power market and Europe and would be expected to object vocif- of the power stations required to provide the erously to the idea that Turkey might resell electricity. This is a problem that has bedev- Russian gas into markets that GazExport, Tu- illed the Turkish energy sector for at least a rusGaz and Gazprom, the three companies that decade, particularly as Turkey has sought to currently supply Russian gas to Turkey via the secure an almost exponential increase in gas western lines and Blue Stream, could access supplies by signing contracts with Russia, Al- directly. geria, Nigeria, Iran and Azerbaijan for deliveries set to reach 58 bcm by 2009, against actual In the summer of 2004, Turkey’s Botas held consumption in 2003 of just under 22.5 bcm negotiations with Gazprom on consolidating and projected demand this year of at least 24.0 the various prices paid for Russian gas through bcm. Botas is currently preparing revised fig- the western and Blue Stream pipelines into a ures for Turkish demand, but its existing pro- single tariff and in these discussions Turkey jections, on which various government state- also raised the onselling issue. As of August ments are based, argue that whereas Turkey 2004, there were some indications that Gaz- consumed some 15.6 bcm in 2002, by 2020 prom was showing a greater interest in the po-

tential onselling of Russian gas to other coun- 27 Both figures have been cited by corporate tries in Europe via Turkey, but the terms and sources in private discussion with the author. conditions for such transit trade remain very 28 “Contract values are higher than take-or-pay lim- much in doubt. its; that’s usual,” one senior Turkish energy official told the author. 29 Interview with the author; Ankara, April 2004.

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Much will depend on whether negotiations on sion Vice President Loyola de Palacio said in prospective Turkish entry into the EU are ini- January 2004 that the Commission was par- tiated in the near future, and on how quickly ticularly pleased at the outcome of the Turkish any such negotiations might lead to Turkey’s Greek commercial negotiations, saying these de facto adoption of the EU gas directive. “will not only bolster peace and stability in the Should Turkey become incorporated in a region but will also make it possible to supply common gas market with the EU – even if it new gas resources from the Caspian Basin and has not attained full EU membership by then – Iran to the internal gas market of the enlarged Gazprom would have to live with the prospect European Union, and to the Balkans, thus im- that some of the Russian gas supplied to Tur- proving security of supply for all stakeholders key might be passed through to other Euro- concerned by this infrastructure." pean countries. In such a case, Gazprom might seek to change its strategy and opt to make Conclusion: What can the EU do? deliberate use of Turkey as a transit state. In considering whether to open entry negotia- Regardless, if Gazprom dreams of supplying tions with Turkey, the issue of EU gas security gas to Israel via Turkey ever come to fruition, is clearly relevant, A Turkey that lies within there may come a day when, the Russians the EU (and from early on is effectively a might be happy to ease the terms on which member of a common European gas market) they sell gas to Turkey. But for the moment, brings with it a variety of means by which Turkey is thinking more about a pipeline that fresh sources of gas can be tapped and brought would bring Egyptian gas north to Turkey than t market within the heart of the EU. the occasionally floated Russian ideas for a gas line that would head in the opposite direc- The EU’s Green Paper, with its emphasis on tion to Israel. diversity of supply, is relevant in this context. So is the question as to whether Gazprom itself might require diversity of competition in EU energy security order to improve its own competitiveness in a The EU’s own Green Paper on Energy Secu- non-monopolistic manner. The Energy Charter rity, published in 2000, anticipates a 45% in- process and the efforts to develop a transit pro- crease in gas demand for the EU’s current 15 tocol in particular, have the same goal as the member states between 1998 and 2030. With EU, namely diversity of supply, but although 1998 gas demand touching 349 bcm in 1998, the EU was a participant in the early stages of this would indicate a surge to around 506 bcm the Charter process, its support for Charter in 2030. Turkish officials, citing the Green activities appears to have waned in recent Paper and their own discussions with Brussels, years. routinely talk of the EU requiring an additional At least one major gas analyst, Jonathan Stern, 100 bcm of gas by 2020 in justification of pro- Director of Gas Research at the Oxford Insti- posals for their country to serve as a transit tute of Energy Studies, argues that there may route for EU gas imports. yet come a time when monopolistic activities The Green Paper specifically anticipates that by Russian gas suppliers or traders with access the current 15 members of the EU will be im- to monopoly supplies and transit systems porting some 71% of their gas by 2030. And might come into conflict with the EU, and the even if Norway were factored into the equa- EU seeks to establish an effective, regulated tion – as the EU does by postulating an “EU- gas market in a 27-, 28- or 30-nation Europe. 30” group to include all the current confirmed At such a point, Stern believes, the EU might new members, together with all the current feel compelled to turn to the Energy Charter applicant states and Norway and Switzerland process and the Transit protocol in particular as well – Europe would still remain dependent as the basis for resolving outstanding issues – on external supplies for some 60% of its gas. even though Russia has continued to oppose signing the transit protocol.30 The EU is clearly looking for multiple supply sources and routes, and both EU and Turkish officials see an obvious synergy between them in this regard. Commenting on the Turkey- 30 Jonathan Stern, address to the Third Annual Con- Greece pipeline, the then European Commis- ference on the Geopolitics of Energy, Florence, 8-9

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At the same time, it should be noted that while • In geographical terms, Turkey is clearly Gazprom accounts for well over 95% of Rus- increasingly well placed to serve as a cen- sian gas exports because of its monopoly of tral transit supplier for the anticipated ma- the Russian pipeline system, it only accounts jor increases in European demand. for around 70% of Russian gas production. Actions that would serve to put Gazprom into • A range of gas companies in central, south- a more competitive environment would also ern and southeastern Europe are actively help to improve prospects for other Russian working on ways to bring gas from the gas producers, most of whom are found in the Caspian and the Middle East to European country’s main oil companies. markets through fully commercial pipeline systems transiting Turkey and the Balkans. The development of transit lines through Tur- key represents the obvious way by which Gaz- • For the EU, development of Turkey as a prom could face at least a degree of competi- transit route helps promote energy security tive challenge. There would be no idea of through diversification of gas supply wholesale replacement of Russian gas imports routes. with those via Turkey, merely of complement- • As Turkey’s importance as a gateway ing them – and of presenting Gazprom with a grows, so it further increases European en- more competitive environment. ergy security by ensuring increased access In this context the EU should certainly look at to Caspian reserves on a commercial basis, the various Turkish-transit related pipeline as well as offering Middle East producers projects under development and consider the option of transporting gas to Europe by which of them might serve its energy security pipeline as well as by LNG. purposes and whether it might even wish to • The greater the volume of gas supplies de- help fund infrastructure development. For such livered to Europe via Turkey, the greater pipelines constitute strategic, as well as com- the pressure on Russia’s Gazprom to oper- mercial, infrastructure. As mentioned earlier, ate on a commercial basis, rather than as a this may well offer opportunities for the EU in monopoly, in its dealings with the Euro- general, and the European Investment Bank in pean Union. Indeed, by offering a competi- particular. This is particularly relevant in con- tive challenge to Gazprom, the promotion sidering the proposed West Balkans Pipeline. of increased flows of gas through Turkey For while its immediate market, the states of may yet prove to be one of the most effec- the southern Balkans, are in a gas context of tive ways of promoting gas market reform only limited concern with regard to overall in Russia. In this context, with Russia al- European gas security, were they to be con- ways likely to prove a very major supplier nected not only to Turkey but to a major Euro- indeed of gas to the European Union, the pean hub, such as Baumgarten, then the line placement of Russian gas development on a would be able to function as a complementary sound basis that is both commercial and system to the Nabucco pipeline. competitive would go a long way to ensur- Turkey very much wants to be at the centre of ing European energy security. European efforts to develop alternative ways Overall, however, whether Turkey will actu- of accessing Caspian and Middle Eastern gas ally become Europe’s fourth artery will de- supplies. The sheer scale of Europe's drive for pend on a number of factors, both economic – increased and diversified suppliers drives it on, since demand pulls gas lines; and political – in even if Turkish officials are not quite sure how view of the importance of government and far their country can go in meeting European donor support in developing commercially expectations. supported projects. As the EU ponders the is- Several factors favour attainment of such a sues of its own energy security and of opening goal: entry negotiations with Turkey, it has a win- dow of opportunity. The next several months will see detailed financial and economic assessments of such projects as the Nabucco line

July 2004. Author’s notes. Dr Stern’s paper has yet and the Turkey-Greece-Italy interconnector. to be published. These may prove financial viable in their own

NO. 11 / NOVEMBER 2004 | 113 right, but, at the very least, the EU would do ture is required to ensure overall project com- well to scrutinise these projects carefully in the merciality. event that a strategic investment in infrastruc-

TURKISH BUSINESS PERSPECTIVES In reality the European Union’s enlargement by should be perceived as its expansion to a new TÜSIAD land. This should also be seen as a triumph of TURKISH INDUSTRY & BUSINESS the European values, ideals, law, policies and ASSOCIATION economy. When Turkey joins the EU, this would mean that it is in compliance with these www.tusiad.org values, ideals, law, policies and economy.

DECEMBER 17TH, A TEST FOR THE EU The main tasks towards membership are to TO INVIGORATE ITS POLITICAL transform Turkey’s potential into political, CREDIBILITY economic, social and cultural assets for Europe’s future. Turkey’s accession will con- The forces of progress in Turkey have spent tribute to Europe’s global competitiveness. several decades in struggling for democracy, Full integration of Turkey will bring a fresh human rights, a constructive foreign policy impetus to the internal market with its dyna- also regarding Cyprus, radical economic re- mism, large market demand, entrepreneurial forms and social development. Recently, Tur- culture and trade creation potential. As Turkey key has been very successful in achieving engaged in the accession process, the human these challenges and in integrating itself to the capital will be upgraded to meet Europe’s EU. standards and needs. Young, dynamic and qualified human resource of Turkey will be the On its own side, the European Union took social insurance of Europe. clear commitments vis-à-vis Turkey: Today, the historical responsibility for both the 1. The Commission’s Progress Report and EU and Turkey is to launch, as soon as possi- recommendations are clear enough to ble, the accession negotiations. And an avoid- show the sequel of the process. Thus, the able responsibility for the EU leaders is to negotiations should start without delay communicate better with their respective pub- during the first months of 2005 as it is lic opinion on the realities and challenges promised by the EU Copenhagen summit about Turkey. in 2002. A delay for the purposes of the referendums on the EU Constitution is a Turkish business community has firmly sup- wrong and insincere argument. ported Turkey’s EU membership perspective and never regrets to articulate its credence that 2. As emphasised by the Helsinki Summit in Turkey is ready to start the accession negotia- 1999, Turkey should be treated equally tions. We, the Turkish business community with the other candidate countries. There- believe that democracy will be shaping the fore, no mention of any outcome of nego- Europe’s future; not the demagogy. tiations other than the full membership of Turkey is acceptable. Now, it is time for the EU to prove its sincerity regarding Turkey’s membership and act as a The EU is a unique example of integration credible international player: pacta sund ser- between sovereign member states going far vanda. beyond intergovernmental cooperation. Tur- key aspires to join this community of common values. Turkey also strongly supports the adoption of a Constitutional Treaty which is a unique opportunity for the common future of people believing in human dignity, democracy, liberty, justice, equality, the rule of law, respect for human rights and peace.

CEPS Turkey in Europe Monitor No. 12, December 2004

Introductory Note from CEPS It is thus found that if Turkey loses the membership perspective, the EU may end up hav- This issue of CEPS Turkey in Europe Monitor ing more immigrants than under a free move- presents a long extract of the Working Paper ment of labour regime with a prosperous EU titled “Growth and Immigration Scenarios for member Turkey. Moreover, the composition of Turkey and the EU”, prepared by Refik Erzan, this migration is expected to be less conducive Umut Kuzubaş and Nilüfer Yıldız from Boga- for the EU labour markets – and – for integra- zici University, Istanbul. tion into host societies. The experiences of Spain, Greece and Portugal are seen as indi- The paper argues that the current debates cators of the strong relationship between a about Turkish EU membership and free successful accession period and the gradual movement of labour often overlook that the elimination of migration pressures. The full EU cannot exercise a zero migration policy text of the Working Paper is accessible at even if permanent safeguards were used, since www.ceps.be. even under the currently prevailing strict regime, there is an annual net migration from This issue of the Monitor also provides the Turkey to the EU-15 in the order of 35 000 sections of the Presidency Conclusions of the people. The authors highlight that any slow- Brussels European Council, 16-17 December down or suspension in Turkey’s accession 2004, on Turkey and the Framework for Ne- process; resulting in lower growth, higher gotiations. The full text of the Presidency unemployment and a possible slowdown in or Conclusions is accessible at a reversal of the reform process would mean http://www.europa.eu.int/comm/councils/bx20 drastically higher number of potential mi- 041216/index_en.htm. grants as a considerable proportion of them would be finding their way into the EU, de- Michael Emerson and Senem Aydın spite the legal barriers.

GROWTH AND IMMIGRATION SCENARIOS: TURKEY - EU 1 Refik Erzan, Umut Kuzubaş, Nilüfer Yıldız Bogazici University, Istanbul

The purpose of the study is to estimate the eventual immigration from Turkey to the EU when Tur- key becomes a full member and restrictions on labour mobility are removed. Alternative methods and scenarios are scrutinized in forecasting probable magnitudes for the period 2004 to 2030. The analyses are essentially based on the experience of countries that joined the EU. The estimation methods are those used in recent studies that analyze the membership consequences of the Central and East European countries. Special attention was paid to the experience of the southern “cohesion” countries – Greece, Portugal and Spain. Finally, forecasts were also made based primarily on the Turkish emigration record.

1 This study has been presented at the conference “Immigration Issues in EU-Turkish Relations: Determinants of Immigration and Integration” held at Bogazici University, 8-9 October 2004. It is based on the findings of the “twin projects” - employment and immigration, at Bogazici University, Center for Economics and Econo- metrics (www.cee.boun.edu.tr) and Center for European Studies (www.ces.boun.edu.tr), sponsored by Open Society Institute Assistance Foundation (OSIAF). The authors are grateful to Nalan Basturk, Gunes Erturk and Engin Evrenos for important contributions in the research.

| 114 NO. 12 / DECEMBER 2004 | 115

Occasionally, sensational news articles on the REFERENCE GROUP: 1967-2001 scary magnitude of potential migrants from IMMIGRATION FROM ALL EUROPE Turkey take the headlines in EU media. Care- At the first stage of analysis, we followed the less interpretation of casual opinion polls can method of the EU Commission report by put the number up to 25%of a population of Brücker, Alvarez-Plata and Siliverstovs about 70 million. Magnitudes that emerge (2003) used in estimating potential migration from serious research work are a fraction of from Central and Eastern Europe. Using an that. The survey of this literature undertaken econometric model, the study estimates mi- by the 2004 “Impact Study” of the EU Com- grant stocks in Germany originating from 19 mission has reported that forecasts of immi- source countries (Austria, Belgium, Denmark, gration from Turkey to the EU-15 until 2030 Finland, France, Greece, Holland, Iceland, range between 0.5 and 4.4 million, assuming Ireland, Italy, Luxembourg, Norway, Portugal, free mobility of labour in about a dozen years Sweden, Switzerland, Spain, Turkey, UK, and from now. The Impact Study also underlines (former) Yugoslavia). Germany was chosen as that to arrive at the higher end estimates the host country because of the size of the mi- (about 4 million), the studies have to torture grant communities in this country and the the data and the methodology. availability of robust time series data dating As a result of the literature survey that we back to 1967. have undertaken in the framework of this We used the specification that yielded the best study and our contacts with the relevant re- overall result in the EU Commission study.1 search centres in the EU (see the references), As explanatory variables; income level in the we have not come across any net migration country of origin (w ) captures the cost of forecasts from Turkey to the EU that exceeds ht the probable magnitudes reported in the Im- migration, employment rates (eft),(eht), the pact Study. probability of finding jobs, and, income dif- Analytical studies follow two alternative ferences between the home and host countries methods in making immigration forecasts. The (wft/wht), the material return to migration. To first one is statistical inferences based on sci- these, the lagged migrant stocks (mfh,t-1 entifically designed surveys. The second one ),(m ) were added to measure the impact is econometric methods. The latter draws on fh,t-2 the pre and post EU membership experiences of “networking” among immigrants. of emigration countries. Quantifiable determi- Introduction of free labour mobility in EU nants of immigration - pull and push factors - members was captured by the FREE dummy are identified and their joint impact on immi- variable while GUEST denoted the 1967-1973 gration is estimated. These estimates are then period when “guest worker” agreements were used to forecast eventual migration from “to be” members. 1 mfht = αh + β1mfh,t-1 + β2mfh,t-2 + β3 Our simulation results for net migration from ln(w /w ) + β ln(w ) + β ln(e ) + β ln(e ) Turkey to EU-15 in the period 2004-2030 is ft ht 4 ht 5 ft 6 ht between 1 and 2.1 million, foreseeing a suc- + ufht cessful accession period with high growth and mfht: The share of migrants from country h free labour mobility starting 2015 - a rather residing in country f (Germany) as a per- optimistic assumption to explore the upper cent of home population bound of the immigration potential. On the w: Wage (income, proxied by GDP-PPP per other hand, if Turkey’s membership process is capita) endangered and high growth cannot be sus- e: Employment rate (1-unemployment rate) tained, 2.7 million people may be penetrating h, f, t: Home, foreign country and year, respec- the EU-15 despite the prevailing strict restric- tively. tions on labour mobility. Population data from World Development Indica- tors (2003), migrant stock data from the Federal German Statistical Office, per capita GDP from Maddison (2002) and Groningen Growth and De- velopment Centre, employment rates, from OECD Economic Outlook.

116 | TURKEY IN EUROPE MONITOR operational. To correct for the jumps in immi- MIGRATION FORECASTS FOR gration due to refugees and asylum seekers, TURKEY: 2004-2030 WAR in (former) Yugoslavia and The coefficients obtained from the estimations INTERVENTION (1980 military) and for migration into Germany from the “all INSURGENCY (1990-94 terror) in Turkey Europe” sample of 19 source countries (in- were used. Table 1 gives the estimation results cluding Turkey) for the 1967-2001 period for the 1967-2001 period indicating the coef- were used to make simulations for emigration ficients of the explanatory factors and their from Turkey. Following similar studies, Ger- significance levels.2 man per capita GDP was assumed to grow 2% It was observed that all the estimated coeffi- annually and the employment rate stay at the cients were significant and the overall ex- 1991-2001 average level. Income and em- planatory power of the model (the fit) was ployment projections for Turkey were adopted very high. However, the small values of the from our ongoing study scrutinizing alterna- coefficients indicated that income and em- tive growth scenarios for Turkey, analysing ployment rate differences did not have power- demographic developments, urban and rural ful effects in determining inter-European mi- growth and productivity, internal migration gration during the period under consideration.3 (urbanization) and unemployment.4 The main scenario used here foresees a suc- Table 1. Regression Results - “All Europe” cessful EU accession with sustained high Sample, 1967-2001 growth and gradually declining unemployment (Table 2). UN population projections Independent Coefficients S.E P-value were adopted in all computations. Variables

M(-1) 1.23 0.019 0.000 Table 2. High Growth Scenario for Turkey, M(-2) -0.37 0.018 0.000 2005-2030 (annual values) Urban GDP Growth 0.065 Ln(Wf/Wh) 0.05 0.006 0.000 Urban Productivity Growth 0.03 Ln(Wh) 0.07 0.006 0.000 Rural GDP Growth 0.02 Ln(ef) 0.34 0.033 0.000 Unemployment – 2015 Urban 0.13 Average 0.09 Ln(eh) -0.10 0.008 0.000 Unemployment – 2030 Urban 0.05 FREE 0.01 0.001 0.000 Average 0.04 GUEST 0.11 0.003 0.000 Under these assumptions, projections were INTERVENTION 0.15 0.033 0.000 made for immigration from Turkey to Ger- INSURGENCY 0.10 0.019 0.000 many.5 According to latest available data covering the EU-15 area, Germany hosted 76%of 2 Adjusted R = 0.99 all immigrants in the EU originating from 6 Turkey. Using this share as a benchmark,

4 See, “Growth, Employment and Active Policies”, Bogazici University, June 2004, 2 The model is estimated using SUR. This method www.cee.boun.edu.tr. was chosen because of its superior performance 5 The iterations include the decline in unemploy- with large databases in the EU Commission study. ment in Turkey (about 1 percentage point) result- Common slopes were assumed for all countries but ing from migration to the EU. intercepts were allowed to be country specific. 6 The migrant stock data used in the simulations do 3 As the estimation is semi-logarithmic, a coeffi- not cover those who were naturalized in Germany. cient with an absolute value of 1 implies that a Data on naturalization of EU citizens were not change in this variable would affect the dependent available for Germany. Therefore naturalized im- variable at the same rate of change. Values smaller migrants could not be included in the estimations than 1 imply smaller impacts. covering all European source countries. Data on

NO. 12 / DECEMBER 2004 | 117 immigration estimates for Germany were in- net migration barely reached 1.1 million by flated to represent the total for the EU-15 2030 (Table 3). area.7 Instead of relying on the actual experience of Two scenarios were simulated with these pa- the EU members with free labour mobility, rameters. Both assumed that restrictions on when we emulated (and repeated) the guest labour mobility would be largely abolished in worker episodes for Turkey in 2015, we ob- 2015. This rather optimistic assumption was served a jump in migration, reaching moderate adopted to arrive at an upper bound for immi- levels around 2020 (figure 2). Even under this gration numbers. inferior scenario, the total immigration projection to EU-15 from Turkey until 2030 was not The first simulation emulates for Turkey the drastic, about 1.8 million (Table 3). This infe- actual experience of EU countries with free rior scenario depicts an accession process not movement of labour (using the FREE properly utilized for structural adjustment and dummy). This involves a considerable integra- integration. tion of these economies during the accession periods. The authentic free movement of labour scenario (the first scenario) incorporated the so- The second simulation emulates – repeats cioeconomic improvements in the accession Turkey the experience of these countries (in- countries. These improvements relieved the cluding Turkey) with guest worker agreements migration pressures. Restrictions on labour until 1973 (using the GUEST dummy). The became much less binding, hence, as they purpose of simulating this inferior scenario is, were removed, there was no major rush. again, to explore an upper bound for the migration potential. It should be emphasized that socioeconomic improvements were not simply higher in- When the actual membership cum free labour comes and more jobs. Otherwise the coeffi- mobility experience of the EU countries - an cients for these basic economic variables experience that Turkey has yet to live through would have been much larger in the estima- - was taken as the benchmark, immigration tions. The improvements in accession coun- forecasts from Turkey exhibited a rather tries covered dimensions such as social secu- smooth curve (Figure 1). The small hike of rity, health, education and regional disparities. 2015 transformed into a declining flow. Total

naturalized immigrants originating from Turkey were available. This factor could be incorporated in forecasts based solely on the Turkish experience - reported further on in this study. Although naturalization entailed considerable numbers in the last decade, it did not affect the immigration projections significantly. 7 This assumes that all other EU-15 countries that host immigrants have the same “pull” effects as Germany.

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Figure 1. Simulation of Free Movement of Labour

Migrant Stock (in millions) and Net Change Stock (in thousands)

4.0 100 3.5 90 80 3.0 70 2.5 60 2.0 50 1.5 40 30 1.0 20 0.5 10 0.0 0

2 4 6 8 0 2 4 6 8 0 2 4 6 8 0 00 00 00 0 01 01 01 01 02 02 02 02 03 2 2 2 20 2 2 2 201 2 2 2 202 2 2 2 MIGRANT STOCK NET CHANGE IN MIGRANT STOCK

Figure 2. Simulation of Guest Worker Scenario

Migrant Stock (in millions) and Net Change Stock (in thousands) 5.0 300 4.5 250 4.0 3.5 200 3.0 2.5 150 2.0 100 1.5 1.0 50 0.5 0.0 0

8 2 0 0 1 3 004 006 010 014 018 022 026 028 2002 2 2 20 2 20 2 2016 2 2020 2 2024 2 2 20

MIGRANT STOCK NET CHANGE IN MIGRANT STOCK

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Table 3. Comparison of the Two Scenarios Net Change in the Turkish 2004-2015 2015-2030 Total Migrant Stock Scenario FREE 460.000 613.000 1.073.000 Scenario GUEST 564.000 1.274.000 1.838.000 Turkish Migrant Stock 2004 2015 2030 Scenario FREE 2.675.000 3.140.000 3.750.000 Scenario GUEST 2.700.000 3.250.000 4.500.000

REFERENCE GROUP: 1967-2001 SPAIN, resembling Turkey at the time of their acces- PORTUGAL AND GREECE sion. We have verified the methodological accuracy Figure 3 depicts the immigration episodes of our estimations reported above (Tables 1 from these countries and Turkey to Germany. and 3) by comparing them with the findings of To adjust for differences in country sizes, the research conducted for the EU Commission on net immigration figures were given as per- Central and Eastern Europe. We have also centage of their respective populations. There exchanged notes with these researchers at the were major flows from all these countries dur- October 2004 Istanbul conference where this ing the guest worker agreements. As restric- paper was originally presented. Nevertheless, tions on labour mobility were lifted, the de- to test for sensitivity of sample selection, we creasing Spanish migrant stock continued its repeated our parameter estimations by exclud- tendency. In Greece and Portugal there was a ing rich countries such as Austria and Den- modest hike in the number of migrants but it mark. We confined our sample to the southern smoothened shortly after. In the more recent “cohesion” countries - Greece, Portugal and years, the stock was declining, indicating re- Spain (and Turkey) - that had characteristics verse net migration.

Figure 3. Migrants in Germany as % of Source Country Population 5 4.5 Guest Worker 4 Agreements 3.5 3 2.5 2 Free Movement Accession Date 1.5 1 0.5 0

1967 1969 1971 1973 1975 1977 1979 1981 1983 1985 1987 1989 1991 1993 1995 1997 1999 2001

GREECE PORTUGAL SPAIN TURKEY

Note: The apparent decline in the Turkish migrant stock stemmed from naturalization. Number of migrants from Turkey who were naturalized in Germany was less than a thousand per year until 1984. 1984-1990 this annual figure reached 2 thousand. There was a steep climb during the 1990s. For 1990-2003, the annual figures were, respectively, 2, 4, 7, 13, 20, 32, 46, 42, 60, 104, 83, 77, 65, 56 (000).

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MIGRATION FORECASTS FOR variables denoting income and employment TURKEY BASED ON SOUTHERN differences were again significant. So were the EUROPE: 2004-2030 INTERVENTION and INSURGENCY dum- mies. The absolute values of the income and Estimates for the “determinants” of migration employment parameters were considerably were obtained using similar specification as greater than those obtained in estimations with with “all Europe” for the period 1967-2001. the “all Europe” and “Southern Europe” sam- Using these parameters, again the two simula- ples. This was expected since Turkey has not tion exercises were repeated - the FREE and had yet the socioeconomic transition that the GUEST scenarios. In both simulations, Tur- current EU members have accomplished dur- key was assumed to be on its baseline high ing their accession periods. growth path (Table 2). 2015 was retained as the regime switching date. Computations for Using the parameters obtained from these es- Germany were adjusted for EU-15 in the same timations, migration projections were made way as in the previous exercises. for the 2004-2030 period, and they were adjusted upward for EU-15. Obviously, these The picture that emerged (Figure 4) closely parameter estimates and projections, unlike resembled that with “all Europe” sample. the previous ones, did not contain any infor- When the free labour mobility experience of mation on actual EU membership or free la- Greece, Portugal and Spain was emulated for bour mobility experience. The only labour Turkey, a small hike occurred in migration mobility Turkey had in accordance with an that stabilized promptly at a low level. In this agreement was the guest worker episode of the scenario, total net migration forecast until 1960s until 1973. 2030 was not exceeding 1 million (Table 4). The experiment using the Southern Europe HIGH GROWTH, EU MEMBERSHIP sample but mimicking the guest worker syn- AND FREE MOVEMENT OF LABOUR: drome led to a major jump that normalized in FORECAST 2004-2030 due course (Figure 5). The total net migration estimate approached 2 million, doubling the In our first simulation with the Turkish record previous forecast based on the actual member- as the only benchmark, we retained our base- ship experience of these countries. Neverthe- line high growth scenario as depicted in Table less, even this inflated figure was considerably 2. Following a successful accession period, below sensational projections. Turkey becomes an EU member and free labour mobility is introduced in 2015. Given that Turkey’s only experience with a labour TURKEY’S OWN EXPERIENCE 1967- arrangement was the guest worker episode, 2001 AS THE ONLY REFERENCE free movement of labour could only be intro- How to inflate further the migration forecasts? duced in the forecast as the repetition of this “Turkey is not any other South European experience. Country”, “unlike Greece, Portugal and Spain, The resulting projection exhibited a major Turkey has a nomadic tradition”. If these jump in migration that moderated gradually prejudices are taken for granted, Turkey’s own (Figure 6). The forecast for total net migration experience would be the only benchmark. until 2030 reached 2.1 millions. This some- The model was estimated for the period 1967- what exceeded the higher scenario based on 2001 for immigration from only Turkey to the South European experience (Table 5). Germany. The coefficients of the explanatory

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Figure 4. Simulation of Free Movement of Labour

Migrant Stocks (in millions) and Net Change in Migrant Stock (in thousands) 5.0 300

4.5 250 4.0 3.5 200 3.0 2.5 150 2.0 100 1.5

1.0 50 0.5 0.0 0

0 2 02 08 1 12 14 20 2 24 26 28 0 0 20 2004 2006 20 20 2 20 2016 2018 20 20 2 20 20 2030 MIGRANT STOCK NET CHANGE IN MIGRANT STOCK

Figure 5. Simulation of Guest Worker Scenario

Migrant Stocks (in millions) and Net Change in Migrant Stock (in thousands) 4.0 300

3.5 250

3.0

200 2.5

2.0 150

1.5 100

1.0

50 0.5

0.0 0

8 2 4 8 0 02 22 26 28 0 00 01 01 01 02 0 024 0 0 030 2 2004 2006 2 2010 2 2 2016 2 2 2 2 2 2 2 MIGRANT STOCK NET CHANGE IN MIGRANT STOCK

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Table 4. Comparison of the Two Scenarios

Net Change in the Turkish 2004-2015 2015-2030 Total Migrant Stock Scenario FREE 320.000 640.000 960.000 Scenario GUEST 440.000 1.480.000 1.920.000

Turkish Migrant Stock 2004 2015 2030 Scenario FREE 2.755.000 3.075.000 3.715.000 Scenario GUEST 2.755.000 3.195.000 4.677.000

Table 5. Comparison of the Two Scenarios

Net Change in the Turkish Migrant Stock 2004-2015 2015-2030 Total

High Growth – Membership – Free Move- 246.000 1.888.000 2.134.000 ment of Labour Lower Growth - No Membership – No Free 760.000 1.974.000 2.734.000 Movement of Labour

Turkish Migrant Stock 2004 2015 2030

High Growth – Membership – Free Move- 2.499.000 2.745.000 4.633.000 ment of Labour Lower Growth - No Membership – No Free 2.506.000 3.267.000 5.241.000 Movement of Labour

Figure 6. EU Membership Emulating the Turkish Guest Worker Episode

Turkish Migrant Stock (In million) and Net Change Stock (In thousand)

5.0 300 4.5 250 4.0 3.5 200 3.0 150 2.5 2.0 100

1.5 50 1.0 0 0.5 0.0 -50

2 4 6 8 0 0 0 0 0 1 12 14 16 18 20 22 0 0 0 0 0 0 0 0 0 0 0 2 2 2 2 2 2 2 2 2 2 2 2024 2026 2028 2030

MIGRANT STOCK NET CHANGE IN MIGRANT STOCK

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SUSPENDED EU ACCESSION, LOWER gross inflow figure.83) Most of them come GROWTH AND NO FREE MOBILITY with family unification and family formation. OF LABOUR: FORECAST 2004-2030 In the presence of a very large Turkish migrant community in the EU of about 3 million Our last simulation depicts a scenario where (with major trade, investment, tourism and Turkey’s EU accession is suspended. High educational links), all conceivable tight door growth cannot be sustained and unemploy- policies short of totalitarian rules would be ment climbs. More specifically, the urban porous. A relative deterioration in Turkey GDP grows at 4%annually with would certainly increase this inflow consid- 1.5%productivity increase and rural GDP erably and reduce return migration. stagnates. Unemployment approaches to 20 %.81 Finally, it should be noted that the eventuality of political turmoil was not incorporated in the In this scenario, the prevailing EU visa regula- projections. With the lost EU perspective and tions are retained. This obviously curtails ma- climbing unemployment, this is more than a jor jumps in migration. However, the slow slim possibility. Estimations based on past pace in income growth and the deterioration in record show that political and security prob- the labour market increase migration pressures lems lead to waves of migration.84 Add that considerably. An increasing number of the on top of the 2.7 million forecast! potential migrants penetrate the EU (Figure 7). The forecast for total net migration until 2030 in this scenario exceeded 2.7 million. The re- IMPACT OF THE AGING OF TURKISH sult is a warning that if the membership per- POPULATION ON MIGRATION spective is lost, EU may end up having more In the current study, as the estimations were immigrants from Turkey despite strict restric- based on past population structures, the impact tions on labour mobility. This paradoxical of the changes in the age composition of Turk- scenario is indeed realistic for three reasons. ish population was not specifically taken into 85 Firstly, Turkey’s growth record clearly shows consideration. However, the propensity to very high rates can be achieved but cannot be migrate differs among age groups considera- sustained without political stability and inflow bly and the very young Turkish population is of foreign savings. Without the EU anchor bound to age. provided by the membership perspective, a A regional survey conducted in Turkey by growth performance that will cope with un- Hacettepe University, Ankara, jointly with the employment is not feasible. Netherlands Interdisciplinary Demographic Secondly, unlike successful accession scenar- Institute (NIDI) and Eurostat (2000) revealed ios, not only growth in Turkey would be that the migration tendency of people aged 55 86 slower and unemployment higher, but also and above was extremely low. sensitivity of migration to income and unem- 82 ployment differences would be greater. 83 We have crosschecked stock and flow data (OECD, Thirdly, the prevailing restrictive visa system SOPEMI) for current Turkish migrant inflow to EU- of the EU and the absence of labour mobility 15. Due to missing data, we do not have exact figures. provisions cannot stop immigration. EU cur- We infer that the gross inflow can be 60,000 to 90,000 rently receives about 70,000 (gross) migrants and the gross outflow 30,000 to 40,000. from Turkey, annually. (Because of return 84 As reported in the first section of the study, in the migration, net migration is about half of this estimations covering 1967-2001, dummy variables INTERVENTION (1980) and INSURGENCY (1990- 81 In this lower growth scenario, average (urban + ru- 94) were highly significant and improved the fit con- ral) unemployment reaches 17 % in 2015 and 22 % in siderably. 2030. Migration to the EU reduces these figures to 16 85 The estimations based on 1967-2001 data do implic- % and 19 %, respectively. itly incorporate the aging experienced in the sample 82 Coefficients for income and employment differ- countries. However, the projections implicitly assume ences have considerably higher values in the estima- the same average population structure as in the past. tions with the “Turkish experience only” compared 86 The regional coverage of this study was not repre- with that of the “all Europe” and “South European” sentative for Turkey as a whole. Therefore, the age samples. The reason is lesser convergence of the Turk- configuration of propensity to migrate was not for- ish socioeconomic system. mally incorporated in our projections.

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Figure 7. No Membership and No Free Movement of Labour

Turkish Migrant Stock (In million) and Net Change Stock (In thousand) 6.0 300

5.0 250

200 4.0 150 3.0 100 2.0 50

1.0 MIGRANT STOCK 0 NET CHANGE IN MIGRANT STOCK 0.0 -50

8 12 18 24 28 02 006 022 20 2004 2 200 2010 20 2014 2016 20 2020 2 20 2026 20 2030

Hubert Krieger’s (2004) study based on Euro- slowdown or suspension in Turkey’s acces- barometer surveys corroborated these results. sion process. The economic impact of such an Turkish population is aging. According to the eventuality is lower growth and climbing un- UN projections, the share of people aged 55 employment in Turkey. and above in Turkey will nearly double by The political impact would be a slowdown or 2030 (Figure 8). When this demographic de- reversal of the reform process. The outcome velopment was crudely incorporated in our of the two would yield a drastically higher projections, it was found that total migration number of potential migrants. A considerable forecasts until 2030 had to be scaled down by proportion of them would be finding their way about 300,000. into the EU. If Turkey loses the membership perspective, the EU may end up having more CONCLUSION immigrants than a free movement of labour regime with Turkey. And the composition of As Turkey becomes an EU member and en- this migration would be less conducive for the joys free movement of labour, the net inflow EU labour markets - and - for integration in of migrants will most likely be in the direction the host societies. to the EU-15 in the foreseeable future. The projections for potential Turkish migration The experiences of Greece, Portugal and based on the experiences of various groups of Spain indicate that a successful accession pe- countries differed. However, the magnitudes riod with high growth and effective imple- involved were by no means sensational, de- mentation of the reforms reduces and gradu- spite the fact that we wishfully assumed that ally eliminates the migration pressures. There free movement of labour would be introduced is no a priori reason why Turkey would not go as early as 2015. through a similar experience. It should be emphasized that the EU cannot exercise a zero migration policy. Even under the currently prevailing strict regime, there is an annual net migration from Turkey to the EU-15 in the order of 35,000 people. What should be scared of are the consequences of a

NO. 12 / DECEMBER 2004 | 125

Figure 8. Share of Age Groups in Total Population

60%

50%

40%

30%

20%

10%

0% 2000 2005 2010 2015 2020 2025 2030 20- 55+ 20-55 Log. (20-) Log. (55+) Log. (20-55)

REFERENCES CPB (Netherlands Bureau for Economic Policy Analysis) Document No: 56, The Alvarez-Plata, Patricia, Herbert Brücker and Hague. Boris Siliverstovs (2003), Potential Mi- gration from Central and Eastern Oztas-Ayhan, H., B. Akadli-Ergocmen, A. Europe into the EU-15 - An Update, Hancioglu, A. Icduygu, I. Koc, A. DIW, Berlin. Toros, A. Sinan-Turkyilmaz, T. Unalan, S. Uner, and E. Kurtulus-Yigit, (2000) Boeri, Tito and Herbet Brücker (2001), The Push and Pull Factors of International Impact of Eastern Enlargement on Em- Migration: Country Report - Turkey, ployment and Labour Markets in the Hacettepe University, Ankara and the EU Member States, European Commis- Netherlands Interdisciplinary Demo- sion. graphic Institute (NIDI), Eurostat Flam, Harry (2003), Turkey and the EU: Poli- Working Papers: 3/2000/E/no.8, Lux- tics and Economics of Accession, Insti- embourg. tute for International Economic Studies, Stockholm. Krieger, Hubert (2004), Migration Trends in an Enlarged Europe, European Founda- tion for the Improvement of Living and BRUSSELS EUROPEAN COUNCIL Working Conditions, Dublin. 16/17 DECEMBER 2004 Krieger, Hubert and Bertrand Maitre (2004), Migration Trends in an Enlarging PRESIDENCY CONCLUSIONS European Union, European Foundation for the Improvement of Living and I. ENLARGEMENT Working Conditions, and ESRI, Dublin (paper presented for the international General conference of Bogazici University on ‘Immigration Issues in EU-Turkish Re- 4. The European Council welcomed the find- lations’ Istanbul, 8-9 October 2004). ings and recommendations presented by the Commission on 6 October 2004 to the Council Lejour, A.M., De Mooij, R.A., Capel, C.H. and the European Parliament in its Regular (2004), Assessing the Economic Impli- Reports on Bulgaria, Romania and Turkey, cations of Turkish Accession to the EU, Strategy Paper on Bulgaria, Romania and

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Croatia, Recommendation on Turkey and 19. The European Council welcomed Turkey's document on Issues Arising from Turkey's decision to sign the Protocol regarding the Membership Perspective. adaptation of the Ankara Agreement, taking account of the accession of the ten new Mem- 5. With the accession of ten new Member ber States. In this light, it welcomed the decla- States to the European Union successfully ac- ration of Turkey that "the Turkish Govern- complished, the European Council expressed ment confirms that it is ready to sign the Pro- its determination to continue the process it has tocol on the adaptation of the Ankara Agree- engaged in with the candidate countries, thus ment prior to the actual start of accession ne- contributing to Europe's prosperity, stability, gotiations and after reaching agreement on security and unity. In this connection, it re- and finalising the adaptations which are nec- called that the Union's capacity to absorb new essary in view of the current membership of members, while maintaining the momentum the European Union". of European integration, is an important consideration in the general interest of both the 20. The European Council, while underlining Union and the candidate countries. the need for unequivocal commitment to good neighbourly relations welcomed the improvement in Turkey's relations with its neighbours Turkey and its readiness to continue to work with the 17. The European Council recalled its previ- concerned Member States towards resolution ous conclusions regarding Turkey, in which, of outstanding border disputes in conformity at Helsinki, it agreed that Turkey was a candi- with the principle of peaceful settlement of date state destined to join the Union on the disputes in accordance with the United Na- basis of the same criteria as applied to the tions Charter. In accordance with its previous other candidate states and, subsequently, con- conclusions, notably those of Helsinki on this cluded that, if it were to decide at its Decem- matter, the European Council reviewed the ber 2004 meeting, on the basis of a report and situation relating to outstanding disputes and recommendation from the Commission, that welcomed the exploratory contacts to this end. Turkey fulfils the Copenhagen political crite- In this connection it reaffirmed its view that ria, the European Union will open accession unresolved disputes having repercussions on negotiations with Turkey without delay. the accession process, should if necessary be brought to the International Court of Justice 18. The European Council welcomed the deci- for settlement. The European Council will be sive progress made by Turkey in its far- kept informed of progress achieved which it reaching reform process and expressed its will review as appropriate. confidence that Turkey will sustain that process of reform. Furthermore, it expects Turkey 21. The European Council noted the resolution to actively pursue its efforts to bring into force adopted by the European Parliament on 15 the six specific items of legislation identified December 2004. by the Commission. To ensure the irreversibil- 22. The European Council welcomed the ity of the political reform process and its full, adoption of the six pieces of legislation identi- effective and comprehensive implementation, fied by the Commission. It decided that, in the notably with regard to fundamental freedoms light of the above and of the Commission re- and to full respect of human rights, that proc- port and recommendation, Turkey sufficiently ess will continue to be closely monitored by fulfils the Copenhagen political criteria to the Commission, which is invited to continue open accession negotiations provided that it to report regularly on it to the Council, ad- brings into force these specific pieces of legis- dressing all points of concern identified in the lation. It invited the Commission to present to Commission's 2004 report and recommenda- the Council a proposal for a framework for tion, including the implementation of the zero- negotiations with Turkey, on the basis set out tolerance policy relating to torture and ill- in paragraph 23. It requested the Council to treatment. The European Union will continue agree on that framework with a view to open- to monitor closely progress of the political ing negotiations on 3 October 2005. reforms on the basis of an Accession Partner- ship setting out priorities for the reform process.

NO. 12 / DECEMBER 2004 | 127

Framework for negotiations • The financial aspects of accession of a candidate state must be allowed for in the ap- 23. The European Council agreed that acces- plicable Financial Framework. Hence, ac- sion negotiations with individual candidate cession negotiations yet to be opened with states will be based on a framework for nego- candidates whose accession could have tiations. Each framework, which will be estab- substantial financial consequences can only lished by the Council on a proposal by the be concluded after the establishment of the Commission, taking account of the experience Financial Framework for the period from of the fifth 2014 together with possible consequential enlargement process and of the evolving ac- financial reforms. quis, will address the following elements, ac- • The shared objective of the negotiations is cording to own merits and specific situations accession. These negotiations are an open- and characteristics of each candidate state: ended process, the outcome of which can- • As in previous negotiations, the substance not be guaranteed beforehand. While taking of the negotiations, which will be con- account of all Copenhagen criteria, if the ducted in an Intergovernmental Conference Candidate State is not in a position to as- with the participation of all Member States sume in full all the obligations of member- on the one hand and the candidate State ship it must be ensured that the Candidate concerned on the other, where decisions re- State concerned is fully anchored in the quire unanimity, will be broken down into a European structures through the strongest number of chapters, each covering a spe- possible bond. cific policy area. The Council, acting by • In the case of a serious and persistent unanimity on a proposal by the Commis- breach in a candidate state of the principles sion, will lay down benchmarks for the of liberty, democracy, respect for human provisional closure and, where appropriate, rights and fundamental freedoms and the for the opening of each chapter; depending rule of law on which the Union is founded, on the chapter concerned, these benchmarks the Commission will, on its own initiative will refer to legislative alignment and a sat- or on the request of one third of the Mem- isfactory track record of implementation of ber States, recommend the suspension of the acquis as well as obligations deriving negotiations and propose the conditions for from contractual relations with the Euro- eventual resumption. The Council will de- pean Union. cide by qualified majority on such a rec- • Long transition periods, derogations, spe- ommendation, after having heard the candi- cific arrangements or permanent safeguard date state, whether to suspend the negotia- clauses, i.e. clauses which are permanently tions and on the conditions for their re- available as a basis for safeguard measures, sumption. The Member States will act in may be considered. The Commission will the IGC in accordance with the Council de- include these, as appropriate, in its propos- cision, without prejudice to the general re- als for each framework, for areas such as quirement for unanimity in the IGC. The freedom of movement of persons, structural European Parliament will be informed. policies or agriculture. Furthermore, the de- • Parallel to accession negotiations, the Un- cision-taking process regarding the eventual ion will engage with every candidate state establishment of freedom of movement of in an intensive political and cultural dia- persons should allow for a maximum role logue. With the aim of enhancing mutual of individual Member States. Transitional understanding by bringing people together, arrangements or safeguards should be re- this inclusive dialogue also will involve viewed regarding their impact on competi- civil society. tion or the functioning of the internal market.

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TURKISH BUSINESS PERSPECTIVES To this end, the EU established a more balanced by stance by discarding the Southern Cyprus govern- TÜSIAD ment’s condition to be recognised by Turkey in or- TURKISH INDUSTRY & BUSINESS ASSOCIATION der to give a green light to the launch of accession negotiations and by agreeing that the declaration of www.tusiad.org Turkey stating its readiness to sign the protocol which adapts the Ankara Agreement for new mem- TURKEY HAS STEPPED INTO ber states would be sufficient. TÜSIAD believes A HISTORICAL DECADE that the European Council’s decision to end the isolation of Turkish Cypriots should be put into force and consequently, the related regulations on “Direct With the conclusion of the EU Council Summit on Trade” and “Financial Aid” should be adopted December 17, 2004 a historical era has opened be- without further delay with the aim of compelling fore Turkey. As a consequence of Turkish govern- the Southern Cyprus government to come to the ment’s successfully accomplished reform agenda negotiation table. and vigorously conducted diplomacy, EU has de- Cyprus issue is a source of instability in the context cided to launch the accession negotiations with of Turkey –EU relations. At this stage TÜSIAD Turkey on October 3, 2005. TÜSIAD as a civil so- expects the Turkish government to initiate a new ciety organization has attained one of the main diplomatic effort to bring the two sides back to the milestones of its mission. From now on it is cru- negotiation table to achieve a breakthrough for a cially important that Turkey pursues the accession final settlement based on the “Annan Plan”. How- negotiation process with a realistic and rationalistic ever, it is equally important that Turkey’s efforts approach. are accompanied with the goodwill and support of In the forthcoming period, the main issues that the EU by mastering the political resources and could influence the EU accession negotiations pressure needed to bring the Greek Cypriots back to process are as follows: negotiations, despite the fact that they clearly rejected the U.N. Plan in April 2004 1. Turkey’s approach to the accession negotiation process should embody comprehensive reforms In the coming period it is crucial to deal with the and reconciliatory bureaucratic culture; difficult issues, both the ones that are stated in the Presidency Conclusions of the EU Council and oth- 2. It is necessary to launch capacity building ef- ers which are not included in the Conclusions but forts in terms of human resources with the aim may be brought into discussion in the future, with a of educating the staff required to analyze the reconciliatory and constructive approach. It is im- EU acquis and policies as well as the political portant to have the political will that struggles to balances among the Member States; solve problems instead of living with them. In addi- 3. Turkey should take into consideration the EU’s tion, the accession negotiations should be pursued global economic competitiveness targets (Lis- within a structural discipline by the setting of in- bon Strategy) and political efforts to deepen its termediary targets to avoid possible progress fa- integration. (EU Constitution). tigue. TÜSİAD considers that the outcome of the Euro- pean Summit on December 16-17, 2004 will have a valuable contribution to the endeavours to obtain a comprehensive solution regarding the Cyprus issue.

CEPS Turkey in Europe Monitor No. 13, January 2005

Introductory Note from CEPS The paper concludes that if Constitutional Treaty voting rules come into effect, Turkey’s This issue of CEPS Turkey in Europe Monitor membership will only have a negligible effect presents a Working Paper titled “The Impact on EU’s capacity to act. As far as power con- of Turkey’s EU Membership on EU Voting”, cerned, it is found that Turkey will have a big prepared by Richard Baldwin from the Gradu- impact. Under either the Nice or Constitu- ate Institute of International Studies, Switzer- tional Treaty rules, Turkey will be the second land and Mika Widgren from the Turku School most powerful member of the EU29. Under the of Economics, Finland. Constitutional Treaty Rules, Turkey will be substantially more powerful than France, Italy The paper evaluates the impact of Turkey’s and Britain, while under the Nice rules the membership on EU voting structures. The as- power differences among the 50 – million – pects that are discussed are decision making plus members will be small. This is expected to efficiency and the distribution of power in the have impacts on the acceptability of the Con- EU’s leading decision making body, the Coun- stitutional Treaty and\or Turkey’s EU mem- cil of Ministers, under two alternative voting bership. rules: those accepted in the Treaty of Nice and implemented by the Accession Treaty of the 10 The Working Paper will also be available on entrants in 2004 and the rules that are laid the CEPS website, www.ceps.be. down in the Constitutional Treaty.

Michael Emerson and Senem Aydın

THE IMPACT OF TURKEY’S acceptance of the Constitutional Treaty rules was achieved in Brussels summit in June MEMBERSHIP ON EU VOTING 2004. Soon after in November 2004 the Nice 1 Richard Baldwin, Mika Widgren rules came into effect in November 2004. The changes made in the Constitutional Treaty 1. Introduction were postponed by five years and even that The Treaty of Nice in 2001 and the Constitu- requires that the Constitution is ratified in all tional Treaty in 2004 radically reformed the 25 member states. The next enlargement is Council of Ministers’ voting rules.2 Political scheduled for 2007 when Bulgaria and Roma- nia are expected to enter. Thus, they will enter

under the current Nice rules but the next new 1 Richard Baldwin is from the Graduate Institute of members are likely to join under the rules of International Studies, Geneva, Switzerland, and the Constitutional Treaty. CEPR. Mika Widgren is from Turku School of Economics, Turku, Finland, and CEPR. 2 Legally, the Accession Treaty of 10 new member rules of the Constitutional Treaty come into force states in 2004 implemented the voting system on 1 November 2009 if the Constitution is ratified . agreed politically in the Nice Treaty. The voting in all member states

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In this paper, we evaluate the impact of Tur- 55% EU members and 65% of the EU popula- key’s membership on EU voting. The aspects tion. A last-minute Summit compromise in- that we discuss are decision making efficiency serted the requirement at least 15 members and the distribution of power in the EU’s lead- vote ‘yes’, but this is irrelevant; 15 members ing decision making body, the Council of of 25 is 60% and thus greater than 55%, but Ministers. We compare two alternative Coun- by the time these rules take effect, the EU cil voting rules: those accepted in the Treaty should have 27 members and 55% of 27 is 15 of Nice and implemented by the Accession (Bulgaria and Romania are pencilled in for Treaty of ten 2004 entrants and the rules that membership in 2007). The 15 member rule are laid down in the Constitutional Treaty. will be redundant when it takes effect. Tur- key’s and Croatia’s membership will, in any case, materialise after that date. 2. Council of Minister voting reforms To come into force, the CT rules need the rati- The Constitutional Treaty explicitly sets out fication of all member states. The fall-back two sets of Council’s voting procedure and position is the Nice-rules, which makes it pos- implicitly recognises the current system set up sible that Turkey and Croatia enter under the by the Accession Treaty (Article 24): Nice rules. Therefore, in the following we evaluate these two rules in the EU-25 and EU- Up to 31 October 2004 29 and compare especially the impact of Tur- The pre-Treaty of Nice rules apply, i.e. quali- key’s membership on the countries of EU-25 fied majority voting with weighted votes and who have the most substantial say in the rati- the old majority threshold of 71% to win. The fication process of the Constitution. numbers of votes for the incumbent 15 are unchanged; those for the 10 newcomers are a simple interpolation of EU - 15 votes as speci- 3. Our tools of assessment fied in the Accession Treaty. Capacity to act

From 1 November 2004 to 31 October 2009 ‘Capacity to act’ and ‘decision-making efficiency’ are slippery concepts. There is, how- The Nice Treaty rules apply (as per the “Draft ever, a quantitative tool in voting game theory Council Decision relating to the implementa- that helps make things more precise. The so- tion of Article I-24”). The Nice rules maintain called ‘passage probability’ gauges how likely the basic ‘qualified majority voting’ frame- it is that the Council would approve a ran- work, but add two extra criteria concerning domly selected issue – random in the sense the number of yes-voters and the population that each EU member would be equally likely they represent. Specifically, the vote threshold to vote for or against it. The best way to de- is 72.2% of the Council votes (232 of the 321 scribe this measure is to explain how it is cal- votes), the member threshold is 50% of mem- culated. bers (13 members), and the population threshold is 62% of the EU population.3 First, the computer calculates all possible coalitions among EU members, namely every From 1 November 2009 onwards possible combination of yes- and no-votes by EU members (there are 134 million possible The Constitutional Treaty (CT) rules apply, so coalitions in the EU27). Then the computer weighted voting is out and double majority is checks each coalition to see if it is a winning in. A winning coalition must represent at least coalition under the Nice voting system; this is done using each member’s actual weight on

3 The rules that take effect in November 2004 are the three criteria (votes, members, population) not those agreed at the Nice Summit, December and the three thresholds. The passage prob- 2000. The deal struck at 4 a.m. at the end of the ability tells us what fraction of these coalitions longest EU Summit in history was a political are winning coalitions. It is called the passage commitment. The legally binding changes are in probability because it is the likelihood that a the Accession Treaty. Since EU leaders eventually random proposal would attract a winning coa- realised how inefficient the Nice rules were, they lition, assuming all coalitions are equally improved efficiency by lowering the vote threshold likely (random in the sense that member states from the 74% mentioned in the Nice Treaty.

NO. 13 / JANUARY 2005 | 131 do not know what their stance would be). To make our way to approach political power Admittedly, this is a crude measure, but it is more transparent let us illustrate how it works objective, precise and its strengths and short- with the following simple example. Consider a comings are clear. simple three person voting body, like the Council of Ministers, with voters labelled with Even if the exact passage probability is mean- A, B and C. Suppose that A has four votes, B ingless (the Commission does not put forth has 2 votes and C has one vote. The total random proposals), Figure 1 shows that the number of votes is seven. Let us assume that Nice Treaty fails on efficiency grounds since five votes are needed to pass proposals. Here, it implies a level of efficiency that is far, far we have three winning coalitions: below that of the EU15. Indeed, the Nice reforms actually made matters worse. Admitting AB, AC, ABC 12 new members without any reform would where the actors that are able to “break” a have cut the passage probability to a third of winning coalition are underlined. Now, A has its already low level, namely to 2.5%. With three breaking positions, B has 2 and C only the Nice reforms, the figure drops even further one. The number of breaking positions is six, to 2.1%. We note that the main source of the which means that the NBI of A is 1/2, whereas lower efficiency is the high threshold of the the NBIs of B and C are 1/3 and 1/6 respectively. Nice rules for Council votes. A second, cruder but more transparent efficiency-measuring The SSI tries to capture a different abstract tool – i.e. blocking-minority analysis – con- voting model. It assumes that voters have dif- firms these efficiency findings. ferent intensities to accept or reject a proposal. Suppose that these intensities can be ex- As with the ability to act, there can be no per- pressed on a line having the extremes of more fect measure of power, but even imperfect spending and less spending. For instance when measures are useful when considering com- the issue is the support for hillside farmers it plex voting rules since a voting scheme’s po- may be that A is the most reluctant to increase litical acceptability turns almost completely on spending, then B leaving C as the most faits power implications. vourable to increase support for this purpose. The measures we use are called the Normal- On the other day, the issue might be the inclu- ised Banzhaf Index (NBI) and the Shapley- sion of reindeer meet in the CAP’s price sup- Shubik index (SSI). In plain English, they port mechanism, This time we might get a gauge how likely it is that a nation finds itself different order of preferences. 4 in a position to “break” a winning coalition In general, one can think that after considering on a randomly selected issue. Thus, the NBI a big enough number of issues all preference and SSI tell us how influential a country is orders of A, B and C are equally likely. In our likely to be on a randomly chosen issue. More numerical example we get six orderings as concretely, the NBI assumes that each possi- follows: ble coalition has the same probability of oc- currence. This makes all winning coalitions ABC ACB BAC BCA CAB CBA equally likely too and the measurement of where the critical voter is underlined. A criti- power is simply counting the score of break- cal voter exerts power as (s)he is able to break ing positions for each player. To get a relative a winning coalition. In the first order ABC, B measure of power this is then divided by the can do that by breaking a winning coalition total number of scores. Of course, on particu- AB. Voter A favours more spending on this lar issues various countries may be much more issue than B. Therefore A is not critical. or much less powerful – especially if they are Should voter A try to break the winning coali- part of a like-minded group (see Baldwin, tion AB by voting against spending, voter B Berglof, Giavazzi and Widgren 2001 for de- would have already broken that as (s)he is less tails and simple numerical examples), but the eagerly in favour of spending. In the example, NBI has recently proved its worth especially voter A has four pivotal positions, voters B as an un-bribable tool in assessing and design- and C one each. In relative terms we get 2/3 ing voting rules. for A and 1/6 for both B and C. If SSI is a

4 In the literature, the term ‘swing’ is quite often meaningful estimate for power and if power used instead of ‘break’. politics is able to explain EU budget these

132 | TURKEY IN EUROPE MONITOR should be A’s, B’s and C’s budget shares re- As usual, the Nice rules – which are essen- spectively. tially unworkable even in the EU27 – become even less viable in an EU29. The vote thresh- Clearly, these measures of power do not pro- olds that are used in calculations are extrapo- vide a detailed description of real-world vot- lations of the current Nice/Accession Treaty ing procedures. For instance they lack all stra- threshold. In EU-29, it is 276 out of total 381 tegic aspects, like who makes the proposal to votes plus the two additional criteria: at least be voted on or the sequence of moves. They 15 member states and 62 per cent of popula- both contain, however, some information of tion. In EU-27, it is 250 out of total 345 votes voters’ preferences understood as intensities plus the two additional criteria: at least 14 of holding a favourable position. On the other member states and 62 per cent of population. hand, the measures consider all possible orderings of intensities (SSI) or presume equal like- As usual, the Nice rules – which are essen- lihood of all coalitions (NBI), which makes tially unworkable even in the EU27 – become them a very long-term concept. For a general even less viable in an EU29. The same does evaluation of voting rules this is a desirable not hold for the Constitutional Treaty’s voting property. rules. The passage probability jumps drastically from the Nice rules low levels up to the The example above demonstrates that the NBI level of EU-12 and even higher. Surprisingly, and SSI can have very different values. Which under the Constitutional Treaty’s rules the one we should then choose? There is no clear EU’s ability to act is improving when its answer to that but as a rough distinction if one membership expands from 25 to 27 or 29. is interested in voting rules as such, the NBI is There is only a slight drop from EU-27 to EU- more advantageous; but if one is more inter- 29 from 12.9 to 12.2 per cent.6 ested in decision-making and bargaining under certain rules knowing that actors communi- In sum, the passage probability calculations cate, then the SSI is far more suitable tool.5 demonstrate that Turkey’s membership does not deteriorate EU’s ability to act. Under the Constitutional Treaty’s rules, the effect of 4. Turkey’s impact Croatia and Turkey together is significantly 4.1 Implications on EU’s capacity to act smaller – one percentage point – than Tur- key’s alone. The most important impact on Turkey’s membership would have only mod- EU’s capacity to act is due to the switch from erate implications for the passage probabilities the Nice rules to the Constitutional Treaty’s as Figure 1 shows. This is not surprising since rules. moving from 27 members to 29 does not change much. Although Croatia increases the number of small nations in the EU Turkey’s large population means that there is little dam- age in efficiency. (Efficiency, if not legitimacy, tends to be higher when a large share of power is in the hands of just a few nations.)

6 Note that in EU-28 (EU-27 + Turkey), the passage probability is 11.2 per cent, hence lower than it is in EU-29 (see Baldwin and Widgrén 2003b). That is because the membership quota - 55 per cent 5 See e.g. Laruelle and Widgrén (1998), Widgrén of membership – is 16 in both EU-28 and EU-29. (1994) and Laruelle and Valenciano (2004). A re- It is thus closer to 55 per cent in EU-29 than in cent empirical application of the SSI is Kauppi and EU-28 the exact numbers being 55.2 and 57.1 per Widgrén (2004). cent respectively.

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Figure 1. Passage probabilities in the EU Council 1957-2004 and after the entry of Bulgaria, Romania Croatia and Turkey

10 Passage probability Passage

0 EU6 EU9 EU10 EU12 EU15 EU25 EU27 EU29

Historical 21.9 14.7 13.7 9.8 7.8 Status quo: May 04 to Nov 04 2.8 Nice rules: Nov 04 to Nov 09 3.6 2.8 2.3 CT rules: Nov 09 onwards 10.1 12.9 12.2

Notes: The figure shows the passage probability which measures the likelihood of that randomly selected issue would pass in the Council of Ministers. Source: Authors’ calculations.

4.2 The impact on the distribution of power After Turkey’s entry the biggest nations gain more from the CT rules than in EU-25. This The Constitutional Treaty and the Nice rules holds for both power measures. For the small- have substantial differences in power evalua- est countries the effect is ambiguous: the NBI tion as well. Figure 2 shows the difference of shows gains for Latvia and smaller nations these rules in terms of the NBI and SSI in EU- whereas the SSI shows small losses. Other- 25 and Figure 3 the respective numbers in EU- wise both indices show consistent results. 29. The difference is measured in percentage points. Figure 4 makes an explicit comparison of the Nice and CT rules. The figure shows the NBI- Figure 2 shows that before Turkey’s entry the values under both rules. The message of the CT rules favour the four biggest nations and figure is very clear. The countries that gain the the six smallest, i.e. Latvia and smaller, if the most from the CT rules are the biggest nations comparison is made using the SSI. Based on Germany and Turkey. The biggest losers are the NBI the conclusion is somewhat different: Spain and Poland but also the medium-sized then Germany and Slovakia and smaller coun- countries from the Netherlands to Austria. tries would gain from the CT rules compared That might affect these countries’ attitude ei- to the Nice rules. Note that this result differs ther towards the ratification of Constitution or from what was obtained in Baldwin and Turkey’s membership. An interested reader Widgrén (2004b) for EU-27 where the NBI can find both index-values in EU-25 and EU- showed exactly the same pattern as the SSI 29 in Appendix. here.

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Figure 2. Change in power in EU-25, Nice to CT rules, %-points

Malta Luxemburg Cyprus Estonia Slovenia Latvia Lithuania Ireland Croatia Finland Denmark Slovakia Austria Bulgaria Sw eden Portugal Hungary Belgium Czech Republic Greece Netherlands Romania Poland Spain Italy France UK Turkey Germany

-0.04 -0.03 -0.02 -0.01 0.00 0.01 0.02 0.03 0.04 0.05 0.06 0.07

NBI SSI

Source: Authors’ calculations.

Figure 3. The power difference between the CT and Nice rules in EU-29, %-points

-0.02 -0.01 0.00 0.01 0.02 0.03 0.04 0.05 0.06 0.07

NBI SSI

Source: Authors’ calculations.

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Figure 4. The NBI-values under the Nice and CT voting rules in EU-29

0.12

0.10

0.08

CT 0.06 NBI Nice

0.04

0.02

0.00 UK Italy Malta Spain Latvia Ireland Poland Turkey Finland Croatia France Estonia Cyprus Austria Greece Portugal Bulgaria Slovakia Belgium Slovenia Romania Hungary Sweden Denmark Lithuania Germany Luxemburg Netherlands Czech Republic Member s tate

Source: Authors’ calculations.

Enlargement’s impact on incumbent’s In Figure 6, the result is more interesting. power When evaluated by the NBI, the expansion from EU-25 to EU-29 benefits France and the Figures 5 and 6 evaluate the impact of the UK.93 The losses of other big countries are enlargement from EU-25 to EU-29 in terms of very small (the Netherlands and larger na- both power indices. In Nice, the countries’ tions). For the countries smaller than Roma- power losses are proportional to their sizes. nia, the losses are slightly increasing towards Germany, the biggest country, loses most the smallest nations. The SSI gives, however, while the smaller nations lose less. The rela- a somewhat different picture. The most nota- tive losses are of the same magnitude. This ble exceptions are the biggest countries, espe- reflects the fact that in weighted voting power cially Germany. The power loss of the Nether- indices tend to converge to voting weights if lands remains small. the number of actors increases and if the voting weights have relatively small variance.

93 This phenomenon is often referred to as the paradox of new members.

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Figure 5. Enlargement’s impact on EU25 power, %-points, Nice rules

Malta Luxemburg Cyprus Es tonia Slovenia Latvia Lithuania Ireland Croatia Finland Denmark Slovakia Austria Bulgaria Sw eden Portugal Hungary Belgium Czech Republic Greece Netherlands Romania Poland Spain Italy France UK Turkey Germany

-0.016 -0.014 -0.012 -0.010 -0.008 -0.006 -0.004 -0.002 0.000

NBI SSI

Source: Authors’ calculations.

Figure 6. Enlargement’s impact on EU25 power, %-points, CT rules

Malta Luxemburg Cy prus Es tonia Slovenia Latvia Lithuania Ireland Croatia Finland Denmark Slovakia Austria Bulgaria Sw eden Portugal Hungary Belgium Czech Republic Greece Netherlands Romania Poland Spain Italy France UK Turkey Germany

-0.025 -0.020 -0.015 -0.010 -0.005 0.000 0.005

NBI SSI

Source: Authors’ calculations

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5. Conclusions References This paper investigates the decision-making Baldwin, Richard, Erik Berglöf, Francesco impact of expanding the EU from 25 to 29 via Giavazzi, and Mika Widgrén (2001): new memberships for Bulgaria, Romania, Nice Try: Should the Treaty of Nice Be Turkey and Croatia. We focus on a measure of Ratified? Monitoring European Inte- the EU’s capacity to act – the passage prob- gration 11. London: Centre for Eco- ability – and the power distribution among nomic Policy Research. members. Baldwin, R. and Widgrén, M. (2003a): Deci- As far as the capacity to act is concerned, the sion-Making and the Constitutional enlargement is projected to have relatively Treaty: Will the IGC discard Giscard?, little impact, as long as the CT voting rules CEPS Policy Brief No.37. come into effect. In particular, Turkey’s Baldwin, R. and Widgrén, M. (2003b): The membership has only a negligible effect on draft Constitutional Treaty's voting re- EU’s capacity to act. The answer, however, is form dilemma?, CEPS Policy Brief quite different if the CT is rejected and the No.44. Nice Treaty rules remain in place. Under the Nice voting rules, the 25-to-29 enlargement Baldwin, R. and Widgrén, M. (2004a): Win- would substantially lower the EU25’s ability ners and Losers under Various Dual to act. Thus, our findings confirm that the Majority Rules for the EU Council of enlarged EU cannot function well under the Ministers, in Wiberg, M. (ed.): Rea- Nice Treaty rules. It also suggests that if the soned Choices - Essays in Honor of CT is rejected, the Nice voting rules must be Academy Professor Hannu Nurmi on reformed before further enlargement. the Occasion of His 60th Birthday, Hel- sinki: Finnish Political Science Associa- As far as power is concerned, we find that tion. Turkey will have a big impact. Under either the Nice or CT rules, Turkey would be the Baldwin, R. and Widgrén, M. (2004b): Coun- second most powerful member of the EU29. cil Voting in the Constitutional Treaty: Under the CT rules, Turkey would be substan- Devil in the Details, CEPS, Policy Brief tially more powerful than France, Italy and No.53. Britain, while under the Nice rules the power Banzhaf, John (1965): Weighted Voting Does differences among the 50-million-plus mem- Not Work: A Mathematical Analysis, bers would be small. Plainly, this might de- Rutgers Law Review 19: 317-343. crease the acceptability of the Constitutional Treaty and/or Turkey’s membership. Kauppi, H. and Widgrén, M. (2004): What determines EU decision-making: needs, The 25-to-29 enlargement’s impact on the vot- power or both, Economic Policy 39, ing power of EU incumbents depends heavily 221-266. upon the rules. Under the CT rules, the enlargement lowers the power of all incum- Laruelle, A. & Widgrén, M. (1998): Is the al- bents on a fairly even basis with the marked location of voting power among EU exception of Germany; Germany loses more states fair?, Public Choice 94: 3-4, 317- than twice as much as any other member. Un- 339. der the Nice rules, the power loss is more Laruelle, A. and Valenciano, F. (2004) Bar- heavily skewed towards big incumbents. gaining in Committees of Representa- Again, all incumbents are projected to lose tives: the Optimal Voting Rule, mimeo. power, but power loss increases progressively with member size. For example, the power Widgrén, M. (1994): Voting Power in the EU loss to France under the Nice rules is some- and the Consequences of Two Different thing like 7 times larger than the power loss to Enlargements. European Economic Re- Malta. view 38, 1153-70.

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Appendix

Table A1. Power indices under CT rules Member state NBI_EU29 NBI_EU25 SSI_EU29 SSI_EU25 Germany 0.10203 0.10407 0.13556 0.15816 Turkey 0.09960 0.13152 UK 0.07644 0.07614 0.09389 0.10332 France 0.07611 0.07587 0.09339 0.10278 Italy 0.07469 0.07475 0.09121 0.10041 Spain 0.05491 0.05670 0.06313 0.06798 Poland 0.05429 0.05602 0.06203 0.06694 Romania 0.03786 0.03664 Netherlands 0.03052 0.03715 0.02701 0.03440 Greece 0.02495 0.03304 0.01991 0.02721 Czech Republic 0.02474 0.03287 0.01964 0.02693 Belgium 0.02463 0.03279 0.01950 0.02680 Hungary 0.02453 0.03271 0.01936 0.02666 Portugal 0.02442 0.03262 0.01922 0.02651 Sweden 0.02314 0.03162 0.01758 0.02489 Bulgaria 0.02250 0.01676 Austria 0.02239 0.03103 0.01663 0.02403 Slovakia 0.01940 0.02870 0.01288 0.02000 Denmark 0.01940 0.02870 0.01288 0.02000 Finland 0.01918 0.02854 0.01261 0.01975 Croatia 0.01886 0.01221 Ireland 0.01768 0.02737 0.01077 0.01785 Lithuania 0.01768 0.02737 0.01077 0.01785 Latvia 0.01628 0.02630 0.00905 0.01631 Slovenia 0.01585 0.02598 0.00853 0.01568 Estonia 0.01521 0.02547 0.00774 0.01487 Cyprus 0.01445 0.02490 0.00680 0.01384 Luxemburg 0.01413 0.02465 0.00641 0.01342 Malta 0.01413 0.02465 0.00641 0.01342 Source: Authors’ calculations

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Table A2. Power indices under Nice rules Member state NBI_EU29 NBI_EU25 SSI_EU29 SSI_EU25 Germany 0.07189 0.08630 0.07814 0.09292 Turkey 0.07189 0.07814 UK 0.07189 0.08630 0.07814 0.09292 France 0.07189 0.08630 0.07814 0.09292 Italy 0.07189 0.08630 0.07814 0.09292 Spain 0.06821 0.08159 0.07237 0.08613 Poland 0.06821 0.08159 0.07237 0.08613 Romania 0.03832 0.03615 Netherlands 0.03565 0.04195 0.03340 0.03983 Greece 0.03305 0.03881 0.03082 0.03648 Czech Republic 0.03305 0.03881 0.03082 0.03648 Belgium 0.03305 0.03881 0.03082 0.03648 Hungary 0.03305 0.03881 0.03082 0.03648 Portugal 0.03305 0.03881 0.03082 0.03648 Sweden 0.02771 0.03246 0.02560 0.03024 Bulgaria 0.02771 0.02560 Austria 0.02771 0.03246 0.02560 0.03024 Slovakia 0.01954 0.02291 0.01777 0.02099 Denmark 0.01954 0.02291 0.01777 0.02099 Finland 0.01954 0.02291 0.01777 0.02099 Croatia 0.01954 0.01777 Ireland 0.01954 0.02291 0.01777 0.02099 Lithuania 0.01954 0.02291 0.01777 0.02099 Latvia 0.01124 0.01324 0.00999 0.01190 Slovenia 0.01124 0.01324 0.00999 0.01190 Estonia 0.01124 0.01324 0.00999 0.01190 Cyprus 0.01124 0.01324 0.00999 0.01190 Luxemburg 0.01124 0.01324 0.00999 0.01190 Malta 0.00841 0.00998 0.00755 0.00895 Source: Authors’ calculations

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TURKISH BUSINESS PERSPECTIVES To this end, the EU established a more bal- by anced stance by discarding the Southern Cy- TÜSIAD prus government’s condition to be recognised TURKISH INDUSTRY & BUSINESS by Turkey in order to give a green light to the ASSOCIATION launch of accession negotiations and by agreeing that the declaration of Turkey stating its www.tusiad.org readiness to sign the protocol which adapts the Ankara Agreement for new member states TURKEY HAS STEPPED INTO A would be sufficient. TÜSIAD believes that the HISTORICAL DECADE European Council’s decision to end the isolation of Turkish Cypriots should be put into force and consequently, the related regulations With the conclusion of the EU Council Sum- on “Direct Trade” and “Financial Aid” should mit on December 17, 2004 a historical era has be adopted without further delay with the aim opened before Turkey. As a consequence of of compelling the Southern Cyprus govern- Turkish government’s successfully accom- ment to come to the negotiation table. plished reform agenda and vigorously con- Cyprus issue is a source of instability in the ducted diplomacy, EU has decided to launch context of Turkey –EU relations. At this stage the accession negotiations with Turkey on Oc- TÜSIAD expects the Turkish government to tober 3, 2005. TÜSIAD as a civil society or- initiate a new diplomatic effort to bring the ganization has attained one of the main mile- two sides back to the negotiation table to stones of its mission. From now on it is cru- achieve a breakthrough for a final settlement cially important that Turkey pursues the acces- based on the “Annan Plan”. However, it is sion negotiation process with a realistic and equally important that Turkey’s efforts are ac- rationalistic approach. companied with the goodwill and support of In the forthcoming period, the main issues that the EU by mastering the political resources could influence the EU accession negotiations and pressure needed to bring the Greek Cypri- process are as follows: ots back to negotiations, despite the fact that they clearly rejected the U.N. Plan in April 1. Turkey’s approach to the accession nego- 2004 tiation process should embody comprehensive reforms and reconciliatory bureau- In the coming period it is crucial to deal with cratic culture; the difficult issues, both the ones that are stated in the Presidency Conclusions of the EU 2. It is necessary to launch capacity building Council and others which are not included in efforts in terms of human resources with the Conclusions but may be brought into dis- the aim of educating the staff required to cussion in the future, with a reconciliatory and analyze the EU acquis and policies as well constructive approach. It is important to have as the political balances among the Mem- the political will that struggles to solve prob- ber States; lems instead of living with them. In addition, 3. Turkey should take into consideration the the accession negotiations should be pursued EU’s global economic competitiveness within a structural discipline by the setting of targets (Lisbon Strategy) and political ef- intermediary targets to avoid possible progress forts to deepen its integration. (EU Consti- fatigue. tution). TÜSİAD considers that the outcome of the European Summit on December 16-17, 2004 will have a valuable contribution to the endeavours to obtain a comprehensive solution regarding the Cyprus issue.

CEPS Turkey in Europe Monitor No. 14, February 2005

Introductory Note from CEPS Second, taking Turkey’s accession to the Un- This issue of CEPS Turkey in Europe Monitor ion in 2015 as a working hypothesis, the con- presents the executive summary of the Re- sequences of accession for both Turkey and search Report titled ‘Turkey in the EU: Con- the EU are explored on the basis of the infor- sequences for Agriculture, Food, Rural Areas mation assembled and discussed in the over- and Structural Policy’, prepared by Arie Os- view. kam and Alison Burrell from Wageningen The main focus of the overview is on the eco- University, Siemen van Berkum from the Agri- nomic and policy issues relating to agricul- cultural Economics and Research Institute ture, food and rural areas. In evaluating these (LEI), and Tuğrul Temel, Natasha Longworth issues and discussing future perspectives, and Irene Molina Vilchez from the Agricul- long-term processes and institutional devel- tural Economics and Rural Policy Group opments are emphasised. (AEP). The full text of the Report is accessible at The report aims to provide a comprehensible http://www.socialsciences.wur.nl/aae/projects/ overview of Turkey’s agriculture and food Turkey/totaal-including%20cover.pdf for a sectors, and the situation in its rural areas, limited period. A revised version will shortly which is then used to examine potential con- be published by CABI entitled Turkey in the sequences of Turkey’s EU accession. European Union: Implications for Agricul- The report first describes recent and current ture, Food and Structural Policy, edited by trends in agricultural production and resource Burrell and Oskam. use, the structure and performance of the agrifood chain, foreign trade in agricultural and food products, the environmental impacts of Michael Emerson and Senem Aydın agriculture, and veterinary and plant health conditions.

Turkey in the European Union: Consequences for Agriculture, Food, Rural Areas and Structural Policy by Arie Oskam, Alison Burrell, Tuğrul Temel, Siemen van Berkum, Natasha Longworth and Irene Molina Vilchez94

Overview of the Turkish Agricultural Sector

Turkey’s economy is about half the size of the total for all the new member states of the EU, but per capita GDP is much lower and, after correcting for purchasing power differences, is just 25 per cent of the average for EU-15. Turkey’s long-term economic growth rate is relatively low and has been heavily influenced by negative growth in years of economic crisis.

94 This report was commissioned by the Dutch Ministry of Agriculture, Nature and Food Quality.

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The distribution of income is very unequal impact regulations are still weak and not ade- between Turkish households. In addition, Tur- quately enforced. key has much higher regional income inequality compared to other large EU countries. Re- In Turkey’s food safety and quality legisla- ducing these regional income gaps will be tion, 93 per cent of Turkish standards are now very difficult because of the dependence of based on European and international stan- low-income regions on agriculture, which we dards, while over 90 per cent of EU standards argue will come under increased economic have been adopted as Turkish standards. Here pressure within the single market of the EU. too, however, enforcement constitutes a challenge, not least because of the fragmented and The foundations of Turkey’s formal institu- dual nature of the whole Turkish agrifood sys- tions derive from the guiding principles of tem. Atatürk’s ideology, as enshrined in the Consti- tution of 1923. Turkey is a secular sovereign The duality of the primary production sector state, whose economy (except for agriculture) means that commercial farms and export- is largely open to foreign competition. How- oriented chains for individual products co- ever, some key economic organisations are exist with subsistence or semi-subsistence still partly state-owned or state controlled. farming. Similar duality is observed in the Moreover, various important institutions that processing and retail sectors, with modern affect economic performance and social out- production facilities and supermarket outlets comes are weak relative to EU standards. accounting for a considerable share of activity whilst many small-scale facilities and informal For example, the benefits of the social security market outlets characterise the remainder. and pension system are mainly limited to those working in the ‘formal’ economy, which Agriculture accounts for 12 per cent of Tur- covers about 50 per cent of economic activity. key’s GDP, 34 per cent of employment and 11 The education system offers 8 years of com- per cent of merchandise exports. About 7 mil- pulsory schooling. However, quality is vari- lion people work in Turkish agriculture, able, and enrolment rates are well below 100 roughly the same number of agricultural per cent, particularly for girls. Spending on workers as in the entire EU-15. Total agricul- education tural area was somewhere between 35 and 41 and levels of educational attainment in Turkey million hectares in 2001, of which about 27 are low, relative to virtually all OECD and million hectares was cultivated or fallow, the EU-25 countries. With respect to agriculture, rest being pasture land. the national farm extension system has per- formed inadequately for several decades. The value of Turkey’s agricultural production in 2002 was EUR 29 billion (one tenth of EU- In recent years, there has been rapid progress 15 output value). The crop sector in Turkey in aligning key economic legislation more accounts for a much larger share of output closely with that of the EU. value (77 per cent) than in the EU (55 per However, many important differences remain, cent). Fruit and vegetables together account and our research has found recurrent concerns for 43 per cent of total output value in Turkey, about the current administrative capacity and but only 15 per cent in the EU. Field crops resolve to enforce the existing legislation ef- have the largest share (35 per cent) of Tur- fectively. For example, competition legislation key’s agricultural output. Livestock products dating from the late 1990s is partly compatible are less than 25 per cent, although livestock with that of the EU, but needs to be applied output may be under-recorded in the official with more rigour. Land property rights are statistics by up to 30 per cent. well recognised in principle but are not always well defined in practice. Land surveys and Cereals account for 60 per cent of field crop land registration are incomplete, although they area, with rain fed yields constant at around 2 now cover over 75 per cent of agricultural tons per hectare for some years. Fruit produc- land. Institutional arrangements concerning tion has increased by 55 per cent since 1980 labour and farming contracts, water use rights, while grazing livestock numbers have been land purchase/sale rules and environmental falling for two decades, and red meat produc-

NO. 14 / FEBRUARY 2005 | 143 tion has remained constant. Poultry numbers (which is more common in agriculture) counts have increased by over 300 per cent in the as employment. same period. The 15-24-year-old age group comprises 20 Turkey has little agro-ecological potential for per cent of the population. Unemployment increasing total cultivated land area, but there among well educated individuals in this age is scope for extending irrigation and for in- group is much higher than for the adult labour creasing the productivity of existing force as a whole, although it tends to be lower farming systems. in rural areas. This probably indicates an out- migration of well educated young people from Producer prices for most commodities in Tur- rural areas, rather than better job provision for key are higher than in the EU, with the excep- this category of worker. tion of sheep meat, milk, sugar, tobacco and cotton. However, wholesale prices for dairy The rate of illiteracy is 18 per cent among ag- products are higher than in the EU, indicating ricultural workers (28 per cent for female ag- an inefficient dairy processing sector. ricultural workers). Beyond primary school (which ends at age 11), school enrolment rates Average income per employed household are lower in rural areas (particularly for girls) member in Turkish agriculture is less than 40 than in urban areas. A number of disincentives per cent of the level for non-agricultural for rural children to obtain education have workers. Labour productivity in agriculture is been identified. low. Gross Value Added (GVA) in agriculture per person is one eighth of the average EU-15 There are large differences in quality of life level, lower than the averages for the NMS indicators between urban and rural areas, and and Bulgaria, but higher than in Romania. Be- between ‘west’ and ‘east’. Poverty is inversely cause of the more land-intensive nature of the correlated with education level. Even within fruit and vegetable sectors, land productivity each level of education, however, rates of is relatively better than labour productivity. poverty are much higher in rural areas. Most GVA per hectare is 45 per cent below the EU- agricultural workers have no social security 15 average, but higher than in the NMS, Bul- coverage. garia and Romania. The industries upstream of farming are either In 2003, Turkey exported EUR 4.3 billion of dominated by a few large enterprises, or char- agricultural and food products and imported acterised by many smaller firms, or public EUR 3.7 billion. Turkey regularly has a trade sector-dominated with an increasing private surplus in agricultural products. Fruit and sector involvement. The Agricultural Bank of vegetables are the major export categories. Turkey, although still publicly owned, now EU-15 member states are the destination for operates according to commercial banking about 45 per cent of Turkey’s agricultural ex- guidelines. Agricultural credit subsidies have ports. ceased, and credit to agriculture has declined since 2001. The government had a dominant About 40 per cent (27.3 million persons) of role in the agricultural cooperatives, which Turkey’s civilian population is classified as purchase, process and sell major agricultural rural (living outside larger towns and cities). commodities. The co-operatives are now being Agricultural workers live mainly in areas clas- transformed into fully independent organisa- sified as rural, and represent 34 per cent of the tions that have to compete with private traders total work force. in the marketing of agricultural commodities.

Relative to urban areas, rural areas have a high The wholesale market system for fresh prod- labour force participation rate, low unem- ucts is still dominated by government- ployment levels, and high rates of unpaid fam- appointed commissioners and its efficiency ily labour, particularly amongst females. seems low. The system hinders the develop- These urban-rural contrasts are partly due to ment of quality standards and low economic the way employment is measured, whereby transparency limits opportunities for tracing part-time work of even a few hours per week products in the food chain.

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organisations and other independent NGOs. The Turkish food industry contributes 5 per The countervailing power of consumers and cent of GNP, and accounts for 20 per cent of taxpayers in the agricultural policy process has total manufacturing output. Its share in manu- been very limited. facturing industry export is 5-6 per cent and is in slight decline. There are over 100 thousand The Agriculture Reform Implementation Pro- registered workers in the food sector, whereas ject (ARIP) of 2001-2005 is a radical change the number of unregistered workers is un- of direction for agricultural policy, and brings known. Turkey more in line with the EU. Price support has been reduced, subsidies have been In general, the food industry suffers from removed and direct income support for farm- over-capacity. Although generally fragmented, ers, in the form of a system of flat-rate pay- there is marked concentration in a number of ments per hectare of area (capped at 50 hec- branches. Market power does not seem to exist tares), has been introduced. Many products, but hard evidence to verify this is not avail- however, still enjoy high levels of trade pro- able. tection. Since these changes, a short term production fall of 4 per cent has been observed. Food retailers offer relatively low quality standards, given low consumer demand for The institutional reform of State Economic quality. As the economy grows and more con- Enterprises and state-controlled Agricultural sumers become quality aware, the agrifood Sales Co-operatives, however, is proving more sector will face the challenge of meeting de- difficult. Steps are being taken, but up to now mand for higher quality standards all along the there is no clear indication that a competitive chain. Failure to meet consumer requirements private sector has emerged. may result in further import penetration. The share of supermarkets in the food retail sector Food policy in Turkey mainly consists of is growing rapidly, at the expense of tradi- measures to impose international food safety tional stores. Modern food stores had a market standards. Domestic demand for higher stan- share of 42 per cent in 2003. Foreign invest- dards of food safety and quality is low. The ment in the retail sector is rather limited. The private sector in Turkey has just begun its in- new law on foreign direct investment, ratified volvement in the food safety standards of in 2003, may encourage more investment from EUREPGAP in the fruit and vegetable sector. abroad in the food sector. Processors purchase most agricultural commodities on the whole- Rural development policy in Turkey is more sale market. Supermarkets, on the other hand, focused on large-scale investments in areas are moving towards the use of more integrated such as irrigation. Structural policy would be a channels in order to purchase guaranteed new concept for Turkey. quantities and quality against competitive prices. With the exception of agriculture, the Turkish economy is relatively open to foreign trade. In For many years, agricultural policy formation 2003, total imports and exports of goods were has been dominated by political vote-seeking, 29 and 20 per cent of GNP, respectively. The at the expense of longer-term aims such as EU is Turkey’s main trade partner. Agricul- improving efficiency and adjusting to social tural products accounted for 11 per cent of needs and expectations. The main players Turkey’s merchandise exports in 2002, and 4 have been the government, state-owned pur- per cent of imports. Since 1989, agricultural chasing, processing and/or trading companies, trade volumes have fluctuated around a con- the many government-influenced product- stant level; the agricultural terms of trade im- specific agricultural sales co-operatives and, proved in the later 1990s, but are now close to more recently and indirectly, external organi- the level of the early 1990s. sations such as the World Bank and IMF. Fruit and vegetables represent over half of Farmers’ representation by semi-public Turkey’s agricultural exports, whereas the ‘Chambers of Agriculture’ is weak, although composition of agricultural imports is more there are also a few genuine farmer-controlled diverse. One third of agricultural imports are

NO. 14 / FEBRUARY 2005 | 145 intermediate goods (textile fibres, hides/skins, tic animal production would shrink. Consum- tobacco, animal feed ingredients). ers’ welfare gain would be greater than producers’ welfare loss. Turkey could do much to A customs union between the European Union improve its net trade position in agriculture and Turkey came into force in January 1996. and food products even without trade har- Agricultural products have remained outside monisation with the EU, by internal restructur- the customs union, although (asymmetric) ing and raising the efficiency of supply chains. trade preferences operate for agricultural product flows in each direction. Since the EU Turkey’s current pattern of self-sufficiency had already accorded trade preference to many levels is the result of trade and market distor- of Turkey’s agricultural exports, the customs tions, and in particular an over-protected live- union had no discernible impact on Turkey’s stock sector, to the possible detriment of hu- exports to the EU. Turkey has a strong posi- man nutrition. tive balance on agricultural trade with the EU. The main environmental impacts of agricul- Turkey also has developing country status in ture in Turkey are water and soil degradation, the WTO. It is a party to various regional trade due to the overuse of water and chemicals. co-operation agreements. Turkey retains some Fertiliser and pesticide use has decreased very high tariff bindings for agricultural and slightly in the last few years. However, the food products. The tariff structure for these expansion of irrigated areas may stimulate categories exhibits tariff escalation. Turkey excessive use of water, leading to more nutri- has no allowance for domestic support expen- ent run-off and salination. diture under the Uruguay Round Agreement, all domestic support having been declared as In the last 10 years, Turkey has adopted much de minimis support (i.e. not exceeding 5% of new environmental legislation. The implemen- the value of each relevant output). Currently, tation of global and regional conventions, par- export subsidies are used for a number of ticipation in international environmental fora products. and the goal of joining the EU have been major driving forces behind these reforms. How- At the WTO, Turkey has faced three formal ever, institutions dealing with agri- complaints about using sanitary and phyto- environmental issues are still poorly coordi- sanitary (SPS) regulations for protectionist nated and there is a lack of effective imple- purposes and with insufficient scientific justi- mentation at local level. Regulations are the fication, two of which appear to be unre- main policy tool and there are few economic solved. In particular, Turkey’s 8-year ban on instruments. There are few incentives for imports of red meat has been repeatedly chal- farmers to use environmentally friendly prac- lenged as an illegal use of SPS measures for tices. Turkey has only just started to include protectionist purposes. Other complaints about environmental concerns in its agriculture and the lack of transparency in Turkey’s import rural development policies, and there is still regulations for agricultural products concern ample scope for further regulation and im- frequent unnotified changes in import regula- provements to existing regulations. Although tions, and cumbersome bureaucracy. public opinion gives low priority to the environment, civil society in Turkey is becoming In the Doha Development Round, Turkey fol- more involved in environmental policy mak- lows the EU negotiating position as regards ing. Non-governmental organisations have an non-agricultural products, whereas for agricul- important role to play in increasing environ- ture, its position is close to that of the “G-20” mental awareness and public participation, and developing countries, who insist on large rein advancing governmental policy. Recent ductions in export subsidies and support by changes facilitate registration and financing of developed countries as a condition for further non-governmental organisations and their pro- tariff reductions. jects in the field of the environment.

With full harmonisation of agricultural trade Typically, environmental investment is fi- between Turkey and the EU, livestock prices nanced by government out of scarce budget in Turkey would fall significantly and domes- resources. Bank lending for environmental

146 | TURKEY IN EUROPE MONITOR projects is limited. Funding for these projects There has been progress towards harmonisa- is mostly provided by international develop- tion with EU veterinary legislation. However, ment agencies and other international donors. enforcement capacity is still underdeveloped, Most of these projects are scattered and of as is bio-security awareness at every level of small scale. the livestock production chain. Even with effective implementation of the acquis, it will be Organic farming has developed rapidly since many years before Turkey reaches full dis- the mid-1980s, but still covers less than 0.5 ease-free status for all the most infectious dis- per cent of the cultivated area. Production is eases. Until this is achieved, a single market in export-driven and the sector offers potential animal products with the rest of the EU will be for further growth. Both the government and problematic. Zoning might be used to allow nongovernmental actors are making efforts to the country to acquire disease-free status on a develop the domestic market for organic prod- region by region basis. ucts. Turkey is very rich in biodiversity. Many species and habitats are, however, at risk due The lower level of concern about plant health to factors such as agricultural intensification, relative to animal health reflects the fact that agricultural land abandonment and the con- the scope for catastrophic consequences fol- struction of large infrastructure projects. lowing an outbreak of plant disease or infesta- tion is much smaller and more easily con- Turkey’s plant health situation gives relatively tained, and not that the incidence of plant little cause for concern. Export quality fruit health problems is low. Many plant diseases, and vegetable products are already accepted weeds and insects of an economically damag- on the EU market and around the world with- ing nature have been reported in cultivated out difficulty. For livestock, however, where crops in Turkey. Typically, phytosanitary the most infectious diseases are more destruc- chemical use has been the main line of de- tive physiologically and economically, it is fence, but biological control programmes are likely to take years to achieve standards that now starting to be developed for various open permit Turkey’s participation in a single mar- field and greenhouse crops. New plant quaran- ket for all animal products. tine legislation to bring Turkey more in line with the EU has been adopted. Turkey faces major challenges with respect to animal health. Some highly infectious animal Consequences of Turkey’s Hypothetical diseases that have been virtually eradicated in Accession to the EU western and northern Europe remain endemic in Turkey. The situation is complicated by the Following this overview, the report focuses on fragmentation of the livestock sector, Turkey’s the consequences of Turkey’s hypothetical geographical location and its porous borders to accession to the EU in 2015. In order to dis- the south and east. Other relevant factors in- cuss the likely impacts, and especially in order clude operational shortcomings that limit the to provide estimates of budget costs, assump- efficiency of the veterinary services, the extent tions are needed regarding economic growth of political commitment to pursue effective rates in Turkey and in EU member countries, control and eradication, and the availability of population growth, and the exchange rate be- resources to do so. tween the euro and the Turkish lira at the mo- Three highly infectious diseases (foot and ment of accession. In addition, assumptions mouth disease, peste des petits ruminants and about prevailing policies, both within the EU sheep and goat pox) have occurred in virtually and as a result of the WTO Doha Develop- every year since 1996. Turkey is also prone to ment Round, are needed. These assumptions outbreaks of anthrax and brucellosis. Turkey are summarised at the beginning of the analy- has had no registered case of BSE, but the sis. BSE risk has been classified as not negligible. The most important zoonoses recorded in hu- As an EU member, Turkey has to align its in- mans are anthrax, brucellosis, leishmaniasis formal and formal institutions with EU norms and salmonellosis. and expectations. Informal institutions are more difficult to change and slower to adapt than formal institutions. The report acknowl-

NO. 14 / FEBRUARY 2005 | 147 edges Turkey’s on-going progress in adapting considerable ground to cover if Turkey is to the institutional framework for agriculture, adopt fully the environmental acquis by 2015. and the various steps being taken, on a broad On accession, Turkish farmers would also be front, to bring Turkey’s formal institutions and subject to the cross compliance conditions institutional bodies closer into line with the linked to direct income payments. This would acquis. offer an opportunity to improve agriculture’s environmental performance, but will require Regarding economy wide institutions, tax col- good quality extension services and monitor- lection, the functioning of the judicial system, ing expertise, which has to be in place by the and the credibility and time-consistency of time of accession. public policies are identified as key areas still to be improved. In 2015, market and price support, and direct income payments to Turkish farmers, would As regards the agricultural and food sectors, amount to EUR 3.6 billion respectively (at the visible progress in adopting legislation and 2004 value of the euro). Rural development formal rules is typically accompanied by con- expenditure would be EUR 1.6 billion. Budget cerns expressed about implementation. More- payments arising from structural and cohesion over, although some structural change is being policy would be between EUR 9.5 and 16.6 driven by private sector developments up- billion (2004 values). Turkey’s budget contri- stream and downstream from agriculture, a bution would be EUR 5.4 billion. Net receipts stronger and more competitive food supply by Turkey from the EU budget are estimated chain also requires restructuring of the farm- at EUR 11-18 billion (2004 values). An im- ing sector, the pace of which will be too slow portant challenge is to design programmes for if it is left to market forces and economic structural and cohesion spending that address pressures. The implementation of ARIP has some of Turkey’s specific weaknesses, such as been an important step towards alignment of low levels of human capital, poor opportuni- agricultural policies with the CAP, but con- ties for non-agricultural employment in rural tains no direct incentives for structural change areas, and low levels of health and quality of within the farm sector. life in rural areas. As an EU member, Turkey would adopt the common external tariff of the EU for agricul- Improving the provision, quality, access and tural products. Given current tariff structures, attainment levels in education must become a agricultural trade harmonisation between the top priority for Turkey in the coming years, EU and Turkey by 2015 will for the most part together with improved access to the labour mean tariff reductions in Turkey. The largest market for educated young people. Increases downward tariff adjustments would be ex- in education spending should directly target pected in the livestock sector. the rural population in Turkey. The performance of Turkey as an EU member, and the The greatest challenge for Turkey on the ex- success of its economy within a competitive ternal trade front does not, however, concern single market, depend crucially on the human policies. It is in fact to develop the infrastruc- capital of young Turkish people. However, ture, administrative capacity and commitment because the acquis focuses more on regula- necessary for effective control of external bor- tions to support the single market and to im- ders by the time of accession. It is unlikely pose EU level policies, there is a danger that that by 2015 a single market in all animal the attention of Turkey’s policy makers in a products, without internal SPS border controls pre-accession phase may be drawn away from between Turkey and the rest of the Union, can national education policy as a top priority be operated. area.

Limited progress has been recorded in the The adjustment of the agricultural sector to the adoption of the environmental acquis. The single market will put pressure on a large Environmental Impact Assessment regulation socio-economic group with little social protec- has been adopted but so far implementation tion. The creation of non-agricultural has been rare and poor, and there appears to be

148 | TURKEY IN EUROPE MONITOR jobs in both rural and urban areas is needed, from the structural fund component, and de- accompanied by liberalisation of the labour pends on the absorption rate of structural market and extension of the social security spending. The upper limit corresponds to an system to act as a genuine safety net. Turkish absorption capacity of 3.5 per cent of GDP. accession could mean that EU budget spend- These estimates are somewhat lower than the ing cannot be re-oriented more towards meas- numbers in other published studies. ures to support and increase competition, or to enhance growth by stimulating knowledge- From the perspective of the agricultural and intensive industries, but instead remains food sectors, and rural areas, the main oppor- dominated by redistributive transfers aimed at tunities for the EU from Turkish accession are, supporting first, an increase in profitable opportunities for agriculture and rural development. companies in EU-27 to export products, technology and capital to Turkey, and second, the At the same time, the evidence available in the long-term benefits that the EU’s environ- literature suggests that the boost to macroeco- mental protection legislation would bring to nomic growth in EU-27 from Turkish acces- the eastern Mediterranean area when imple- sion would be low and could be cancelled out mented by Turkey. Although the Turkish gov- by high budget transfers from EU-27 to Tur- ernment is currently very welcoming to for- key. eign direct investment (FDI) in general, concerns about Turkey’s economic stability con- Turkey’s accession would add to the number tinue to inhibit FDI. Moreover, the high level of EU member countries that have difficulties of trade protection for Turkey’s agricultural in implementing EU requirements with respect markets, even within the EU-Turkey customs to food safety, environmental, veterinary and union, reduces opportunities for agrifood ex- phytosanitary standards, and would reduce ports to Turkey. These conditions would average levels of governance and transpar- change upon, or even before, the moment of ency. The accession of Turkey to the EU will accession. On the environmental front, Turkey lead to a large increase in the EU’s external has a lower level of rural environmental prob- borders. The initial and permanent costs of lems than a number of existing member states, controlling these borders are huge. It is not yet and the opportunity to apply environmental clear how feasible it is to establish correct and legislation more in a preventive than a correc- effective controls on these borders. tive capacity is attractive.

During and after accession, Turkey would be An additional, more general and long-term, an interesting and growing market for the food opportunity is the geo-political strengthening industry and retailing companies of EU-27, for of the Union in its southeastern corner. In the both exports and FDI. short term, however, the large increase in the EU’s borders in this part of the world could Because of Turkey’s low per capita income, bring particular problems for the agrifood sec- Turkish accession would automatically pro- tor in its attempts to impose sanitary and phy- duce a reduction in annual average EU per tosanitary controls, and other border inspec- capita income by about EUR 2520 (at 2004 tions required by the acquis, unless effective values). This would lower the threshold below border controls can be implemented from the which regions qualify for structural aids. With moment of accession. Turkish entry to the EU, new regions with a combined population of 79 million people will The report identifies various potential threats be eligible for structural funds at the top rate. to EU common interests in the areas of agri- However, regions in EU-27 with about 33 mil- culture, food and rural development. These lion inhabitants would no longer be eligible include the possibility that levels of food for this funding. safety and quality are diluted or become more difficult to enforce, that average standards of The total annual budget cost for the EU-27 of governance are reduced by the incorporation Turkey’s accession in 2015 is likely to be of a country with very different institutions EUR 11-18 billion (in 2004 prices). The un- and a poor record in this respect, and that the certainty of these estimates comes mostly risk of animal disease outbreaks in the EU as a

NO. 14 / FEBRUARY 2005 | 149 whole may increase – or may be perceived as Turkey’s accession whenever it occurs, these having increased, which also has negative challenges should be given heavy weight in consequences in trade terms. designing pre-accession and accession strategies. The third challenge is to harness the The possibility of increased migration from value-creating potential of Turkey’s growing, Turkey to other parts of the EU after accession active population. This challenge involves a is seen by some as a potential threat, by others whole set of inter-related issues, including the as an opportunity. The report does not cover need for labour mobility, more job creation in the migration issue per se. However, it docu- the formal economy, and greater opportunities ments the low incomes, poor living conditions for female employment. Appropriate strategies and low levels of human capital that currently for meeting these challenges would need to go characterise many rural areas in Turkey. We beyond what has been done in previous conclude that agriculture and rural areas are enlargements and be tailored specifically to likely to bear the main brunt of post-accession meet the particular case of Turkey. adjustment. Whether or not this results in increased migration within the country or across national frontiers, large pockets of poor, un- educated and unemployed people anywhere in the Union can be seen as a threat in both economic and social terms, and pose a problem for policy makers. Large-scale rural and structural development programmes will be needed in order to reduce these consequences.

In considering whether the large budget transfers that would go to Turkey represent a negative consequence for the EU as a whole, it is important to consider their opportunity cost in terms of other initiatives and benefits that would be foregone by the Union. Relevant questions are whether the size of the economic multiplier of this expenditure, in the countries that would forego it, is larger or smaller than its multiplier in Turkey, and whether under existing rules the transfers would be spent in a way most appropriate to Turkey’s current needs, and with the best long-term benefit. From the evidence we have been able to gather, a definitive answer either way to these questions is not possible. Amongst the many challenges that Turkey’s accession would provide for the EU as a whole, our analysis of the agricultural and food sectors, and rural areas, leads us to single out three major issues. The first challenge concerns the need to adapt and strengthen the formal and informal institutions necessary for implementing the acquis and for allowing Turkey to perform within the EU on an equal footing with other member states. The second challenge relates to the large educational defi- cit that characterises the Turkish population in general, including younger age groups, and particularly in rural areas and in agriculture. In order to optimise the potential arising from

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TURKISH BUSINESS PERSPECTIVES With her mild climate conditions, fertile and by unpolluted soils, Turkey is very suitable to TÜSIAD raise different industrial crops and plants. TURKISH INDUSTRY & BUSINESS With 70 million inhabitants, Turkey herself is ASSOCIATION a large market for food and agricultural products. www.tusiad.org Besides, Turkey is at the crossroads of Euro- pean, Asian, Caucasus and the Middle Eastern A Prelude to FDI to be a part of food and markets. Among all, it is worthwhile to men- agriculture sectors of Turkey tion that, fertile Turkish soils are very suitable for organic farming and there is a huge growth Food industry and agriculture are among the potential in that export oriented sector. st strategic sectors in the 21 century. Apart Between 2001-2005, the launch of the “Agri- from being a vital necessity, contribution of cultural Reform Implementation Project” in- these sectors to the economy is indispensable. fluenced the agricultural reform in Turkey in a In this respect, current conditions of food and positive way. Price support to farmers had agricultural sectors in Turkey need to be up- been reduced, subsidies had been removed, graded. In order to achieve such improvement, and instead of these instruments direct income innovative, progressive programmes should be support to the farmers has been introduced. carried out, international technology and knowledge transfer should be available for As the EU process takes off, Turkey aims to these sectors to better tackle and overcome the reinforce social cohesion in the rural area by actual structural problems. increasing the income level of the people in the area. Developing human resources, pro- Due to its share in total exports and industrial tecting the rural heritage and environment are production capacity, food sector is known as also some other challenges before Turkey. one of the most important sectors in Turkey. Modernisation of agriculture and food proc- 5% of GDP is derived from food sector in essing facilities are essential to attain Euro- Turkey and it accounts for 20% of total manu- pean standards. Within this clear perspective, facturing output. The amount of domestic in- the foreign direct investment would always be vestment is also high in this sector. It is also welcome to contribute to Turkey’s success. one of the most flexible sectors with its dynamic structure. Turkey is the world’s third largest exporter of For more information: http://www.tusiad.org fruit and vegetables. The share of fruits and and vegetables in total agricultural production is http://www.sls.wau.nl/aae/projects/Turkey/ 43% whereas in the EU it is amount to 15%. description.html In the segment of the organic food production, Turkey has also the potential to be a world leader. However, the food and agriculture sector in Turkey have not been successful in attracting foreign direct investment. It is expected that, EU membership process will accelerate the adaptation of the EU institutional framework for agriculture and environment. In a few years time Turkey will meeting the European standards. The momentum to invest in Tur- key’s food sector, both in the agricultural and industrial production, is strong.