Turkey one step ahead due to 2001 crisis experience

Başak Kale
Being an immediate neighbour to Turkey, the economic crisis that Greece is experiencing raises significant concerns in Turkey both at the public level as well as at the governmental level. The official visit of Prime Minister Recep Tayyip Erdoğan to Greece on 14-15 May 2010 demonstrates the importance given to this issue by Turkey.[1] The general debate in Turkey relating to the Greek economic crisis centres on its potential impact on the economic situation within the EU while having prospective implications on the Turkish economy or its accession to the EU. Although the global financial crisis affected Turkey within a relatively limited scope due to Turkey’s reformed financial and banking regulations after Turkey’s 2001 financial crisis,[2] it is still feared that the Greek economic crisis may have a negative influence on Turkey’s prospective membership. It is argued that, with significant financial and economic concerns at the top of the EU’s agenda, both issues relating to enlargement and to Turkey’s membership may loose priority on the EU’s agenda. The finance package for Greece discussed outside the formal agenda of the European Council on 25/26 March 2010[3] received moderate attention in Turkey. Prime Minister Erdoğan’s visit to Greece raised attention with respect to developing prospective approaches on enhancing economic relations between Greece and Turkey.[4]
The Greek financial and economic crisis clearly demonstrates the importance of economic stability to sustain growth in the EU member states and Turkey.[5] The lessons drawn from the Greek case for the reform of the Stability and Growth Pact can be listed as follows: European economies are getting increasingly interconnected and crisis in one economy has inevitable consequences on all EU member states.[6] This shows the importance of developing an overall stability and growth strategy with stronger financial control mechanisms and discipline at the EU level. The reform of the Stability and Growth Pact, with the ultimate target of financial discipline, a mechanism of long-term financial sustainability, and a focus on public finance quality and debt ratios rather than budgetary deficits, strengthens the pact’s economic logic.[7]
The idea of “a strong coordination of economic policies in Europe” is perceived positively by the business community in Turkey. A solid cooperation of economic policies in Europe can be an indicator of a strengthened EU economy. It is perceived that, with a strong economy at home, the EU and the EU member states can focus their attention on deepening issues such as the EU constitution and EU enlargement, which have close correlation with Turkey’s accession to the EU. The issue of competitiveness in the EU markets has prior importance for Turkey. While the EU is going through these difficult times, it is accepted that Turkey should utilise the opportunities that this period brings.[8]
The Europe 2020 Strategy and its key elements received minor interest from the Turkish public and modest coverage from the Turkish media.[9] This modest interest directly corresponds with the loss of momentum on Turkey’s accession process to the EU, and the Turkish public’s indifference to issues relating to the EU’s future. Issues and debates directly corresponding to the EU’s future or the EU’s prospective agenda are considered to be topics relating to the EU’s internal policy. These subjects are perceived as not having a direct impact on the EU’s relations with Turkey. Therefore, these questions constitute secondary importance on public and media agendas. In general, this is a matter of perception that is effective in shaping EU related public debate in Turkey. The target for high employment levels was the key element of the Europe 2020 Strategy prioritised by different policy sectors within Turkish public debate.[10]

[1] Outkou Kırlı Ntokme: Prime Minister Erdoğan’s visit to Greece under the shadow of the Greek Economic Crisis, available at: (last access: 20 May 2010); Everybody talks about the Financial Crisis in Greece, available at: (last access: 20 May 2010); Mehmet Ali Birand: Turkey should stay cold to the EU, available at: (last access: 18 May, 2010).

[2] Kanalturk: Turkey is laughing at the EU, available at: (last access: 9 May 2010).

[3] European Council: European Council 25/26 March 2010. Conclusions, Doc. EUCO 7/10, available at: (last access: 19 May 2010).

[4] Beril Dedeoğlu: Breaking the Vicious Circle, available at: (last access: 18 May 2010).

[5] EU will reconsider national budgets, available at: (last access: 18 May 2010).

[6] Budgetary debt discussion within the EU, available at: (last access: 10 May 2010).

[7] Durukan Payzanoğlu: Stability and Growth Pact Rules: Will it let Turkey’s Debt Continuity?, available at: (last access: 20 May 2010).

[8] Bahadır Kaleağası: Economy is not going well, available at: (18 May 2010).

[9] Undersecretary of Foreign Trade, available at: (last access: 18 May 2010).

[10] See: (last access: 18 May 2010); (last access: 18 May 2010); (last access: 18 May 2010).