Transmittal Memo

|TO: |Jacques Santer – President of the EU Commission |
|From: |Joseph Donyo |
|Re: |Turkey's admission in the EU |
|Date: |6 May 1998 |

In December 1997, members of the European Union (EU) met in Luxembourg, for a European Council summit, to talk about countries being considered for future EU membership. Among these countries, there was one remarkable absence: Turkey. Since it was excluded from this enlargement process for the foreseeable future, relations between the EU and Turkey have been very cold. Turkish Prime Minister, Mesut Yilmaz, has given the EU until the next European Council meeting in June to include Turkey in the pre-accession group of applicant countries. Otherwise, it has threatened to withdraw Turkey's application for membership. Even if such threats are unlikely to have an impact on the EU, they point out a major clash in the EU-Turkey relations.

At this stage of my research, my point is not to argue whether Turkey should enter the EU or not. My research project is meant to find out whether it has the ability to meet European requirements, on a political and economic basis. However, I want to make sure that you understand the importance of this research.

Turkey has been waiting since 1963 to enter the European Union. Today, the country is split between a strong religious party (the RP) and a majority of secular western-oriented people. Continuing to refuse Turkey might throw it in the hands of the islamists who are totally against any form of connection with Europe, and who would rather return to the old Ottoman times. Those who support admission into the EU argue that it would prevent Turkey from religious extremism, which can be seen in Iran or Afghanistan. Thus, the question of the integration into the EU has never been so important.

Turkey's case is a complicated one, and therefore it needs to be given more attention than the other applicants. Turkey is actually the oldest applicant among the group of countries that are now willing to join the EU. Moreover, it has a strong historical background with the EU, and is tightly linked to it in trade relationships. Besides, Turkey is the major ally (together with Israel) of the West in the Middle East area. Because of its location, it has a tremendous strategic importance.

I understand that my research costs money to the Commission, and I am aware that the members of the EU already want to reduce the Commission's budget. In spite of that, I would like to point out that delaying this project might only increase the gap already existing between the EU and Turkey.

Once again, thank you for your time and consideration. Do not hesitate to contact me concerning any aspect of this project.

Research Problem

"We are not forming coalitions between States, but union among people." (Jean Monnet)
This statement was made more than 50 years ago, by one of the "fathers of Europe", and set the goal of a Community of European countries: to link people together, and help the States to provide their citizens the conditions for economical and social development.

Turkey is still looking forward to joining this community. It has been now 33 years since Turkey signed an association agreement with the EU. However, since 1987, three countries preceded Turkey in joining the European Community (Finland, Austria, and Sweden) and the Turks now find themselves behind a queue of 10 states in Central and Eastern Europe, as well as Cyprus.

Today, Turkey feels excluded and has partially frozen its relations with the EU. The question of its admission seems to be as much political as economic. The real issue for the EU is not whether Turkey's economy is able to fit with the requirements of the EU. The main problem is the series of political troubles related to Turkey. The poor human rights record, the weaknesses of democracy, the war with Kurdish terrorists, the problems with Greece regarding territorial disputes, and so forth, do not even give Turkey the chance to focus on improving its dynamic economy.

The issue of admitting Turkey in the EU raises several questions. How is Turkey’s economy doing in relation to other applicants or members of the EU? Is it possible to accept a new member according to only economical data, regardless of political considerations? And is Europe ready to welcome a non-Christian country?

Background

To understand the current situation between the EU and Turkey, one has to take into consideration a small amount of history. Modern Turkish politics have been shaped by two major events: the foundation by Mustafa Kemal of a Republic in 1923; and the establishment of a multiparty democratic regime in 1945 ("Turkey: basic data", 1998). In addition, the Cyprus issue is an entire part of the historical background of tensed relationship with Greece.

The Republic of Turkey was established in 1923 on the ruins of the Ottoman Empire. Mustafa Kemal ("Atatürk"), a general who had fought into a resistance nationalist movement during the Greek occupation, defeated the Greeks in 1922 and ended the sultanate. This opened the way to the Treaty of Lausanne, where the Republic was decreed, to be secular and unified. Ankara was its capital and Mustafa Kemal its president. He presided over a single-party state, and started to modernize deeply the country. He introduced secularism, broke with former Islamic identity, and led the country toward industrialization. After his death in 1938, Turkey remained neutral during World War II, and the single-party era was abolished. The first free election was held in 1950. Close relationship with Europe started in 1952, when territorial threats from the Soviet Union made Turkey enter NATO.

The history of Turkey after this date consists of periods of economic growth, political trouble, and military takeovers. The army intervened three times to restore order: in 1960, 1971, and 1980. Each time, after the takeover, the army ruled during a couple of years and finally organized general elections. The power of the army in Turkey should not be misunderstood or compared to other countries. The takeovers are not meant to lead some generals to rule the country in a kind of dictatorship. The military operate as the guardian of the "kemalist" spirit of the State: secular, republican, and democratic. Although a military coup can be seen as the exact opposite of a democratic act, one needs to understand that the army has always done it for the good of Turkey.

In the 1995 general election, the pro-Islamic Refah Party (RP) received the largest share of the vote (21.4 %). This resulted in the first Islamic-led government in Turkey since the birth of the Republic in 1923. The Prime Minister, Mr. Erbakan, governed for 11 months a coalition supported by a center-right party (DYP). Gradually, tensions developed between the RP and the military, who did not appreciate the Islamic oriented policy of the government, because it was far from the secularism wanted by Atatürk. After the National Security Council held in February, Mr. Erbakan was given a list of demands that aimed to maintain and strengthen the secular nature of the state. Because he did not show any will to obey these recommendations, Mr. Erbakan resigned in June under strong military pressure, and was replaced by a mixed coalition of center parties, led by Mesut Yilmaz as Prime Minister. This "soft coup" proved, 17 years after the last takeover of the army, that the military still had a powerful voice in Turkey. On the one hand, it preserved Turkish secular Republic. On the other hand, it sent a very negative message to Western countries, which saw in this intervention of the army the proof that Turkey still had to improve a very awkward democracy.

The Customs Union (CU) established between with the EU since 1996 was presented as the best way to fight the ascension of Islamists in politics. Unfortunately, it did not have the expected positive results. Even if it increased trade between both parties, many Turks suffer from the inflation the CU has imposed on basic products. Turkey is supposed to be now in the bottom of the J-curve this CU is causing (Harrison, Rutherford, Tarr, 1997). Still, it is a hard step to pass through since Turkey does not benefit from the financial support the EU automatically grants new members of the Union, in order to help them raise their economy and face new competition.

Besides, Turkey still has an unstable economy. The inflation rate remains “one of the worst, if not the worst, inflation records in the world” (Finance Minister Zekeriya Temizel, October 1997). Always close to a 90 % rate, the inflation is the main target of the Yilmaz cabinet. A program was set up to “lower wholesale inflation to 3 % by the end of 2000, compared with a targeted 50 % in the draft 1998 budget” (Bodgener, 1997, p. 2).

It would also be hard to understand the current tensions between Europe and Turkey if the problem of Cyprus was not mentioned. Today, the small island is divided in two separate countries. The southern part of the island, the Greek part, is recognized by the world to be the only Cyprus. The northern part is a self declared "Turkish Republic of Cyprus", established after Turkish army invaded the north of the island in 1974 in response to a Greek Cypriot coup sponsored by Athens dictatorship. In addition to this problem, Turkey and Greece are regularly arguing over borders in the Aegean sea. These disputes do not help Turkey, because many decisions in the EU are taken over unanimously, therefore giving Greece a veto on any issue regarding Turkey.

Preliminary Findings

Turkish Prime Minister, Mesut Yilmaz, complains about a “new cultural Berlin wall” that is being erected between Christian Europe and Muslim Turkey ("Not so fast: Turkey and the EU", 1997). This statement shows that not only Greece is opposed to Turkey entering Europe, but also Germany. The Netherlands also disapprove of it, but in a more discrete way. According to the analysts of the Economist Intelligence Unit (EIU), “Relations with the EU will remain cool following the European Council’s decision to exclude Turkey from the enlargement process” ("Turkey:1st quarter 1998", p. 4).

Turkey could also be less willing to join the EU after seeing the disparate effects of the CU, especially the negative effects on poor people. In spite of this, there are still people in Turkey who push for the admission, because they are convinced that a full admission would bring much more than a simple Customs Union. The TUSIAD (Turkish Industrialists’ and Businessmen’s Association) thinks that “the process of Turkey’s integration to the EU should be conducted by both sides with more political vision, economic rationality, and historical responsibility.” ("TUSIAD statement on EU-Turkey relations", 1997).

Recommendations

Turkey still seems to have a long way before being able to enter the EU. Its economy has to be more stable. Inflation is still the first thing to fight, because solving it should help lift many Turks out of poverty, thereby keeping them from supporting religious extremism. Besides this, Turkey obviously needs to upgrade its human rights records to be able to fit with European standards. Finally, negotiating Cyprus and border issues with Greece would be a good way to walk toward a full European integration.

References

Bodgener, J. (1997, November 14). Turkey knuckles down to fight inflation battle. Middle East Economic Digest, p. 2.

Harrison, G. L., Rutherford, T. F., & Tarr, D. G. (April 1997). Economic implications for Turkey of a customs union with the European Union. European Economic Review, 41, pp. 861-870.

Not so fast: Turkey and the EU. (1997, December 20). The Economist, p. 74.

Turkey: 1st quarter 1998. (1998). Country reports: Western Europe. The Economist Intelligence Unit.

Turkey: Basic data 97/98. (1998). Country reports: Western Europe. The Economist Intelligence Unit.

TUSIAD statement on EU-Turkey relations. (1997, April 7). The Reuter European Community Report.

Working Bibliography

Primary sources

Turkey: Basic data 97/98. (1998). Country reports: Western Europe. The Economist Intelligence Unit. Political background, economy, economic infrastructure, production, and external sector.

Bodgener, J. (1997, November 14). Turkey knuckles down to fight inflation battle. Middle East Economic Digest, p. 2. Overview of Turkey's situation when Mesut Yilmaz became Prime Minister.

Harrison, G. L., Rutherford, T. F., Tarr, D. G. (April 1997). Economic implications for Turkey of a customs union with the European Union. European Economic Review, 41, pp. 861-870. The authors try to quantify the impact of the agreement between Turkey and the European Union, through various scenarios.

Turkey: 1st quarter 1998. (1998). Country reports: Western Europe. The Economist Intelligence Unit. Political structure, economic structure, political scene, economic policy, and outlook for 1998-99.

The 1997 Guide to Turkey. (1997, August). Euromoney Research Guides. Development in economic structure, recent economic developments, impact of the Customs Union, and prospects for the Turkish economy.

TUSIAD statement on EU-Turkey relations. (1997, April 7). The Reuter European Community Report. Recommendations from the association of Turkish businessmen and industrials to achieve a European integration.

In the waiting room. (1996, June 8). The Economist, p. 17. Small article regarding Turkey's situation with the EU after it received no invitation to attend the conference for the enlargement.

Mesut Yilmaz, ambivalent Turk. (1998, March 14). The Economist, p. 60. Turkish Prime Minister hopes to bring Turkey closer to Europe, but he was insulted when his country was placed at the end of the line for consideration for EU membership.

Barber, L. (1997, June). A vital interest for the EU. Europe, pp. 25-7. Turkey is a vital interest for the EU, because of its position between the volatile Balkans, the energy-rich central Asia, Iran and Iraq, Russia, and the tense eastern Mediterranean.

Verrier, M.(1996, June). Espoirs d'Ankara et fantasmes européens. Le Monde Diplomatique, p. 18. The problems of democracy in Turkey will not help joining the Union.

Secondary sources

Turkey: 4th quarter 1997. (1997). Country reports: Western Europe. The Economist Intelligence Unit. Economic policy and outlook for 1998-99.

Turkey's business world wants democracy. (1997, April 1). Swiss Review of World Affairs. The document criticizes the failure to democratize, warned of the country's isolation and called for a fundamental revision of the constitution.

France pleads Turkey's EU membership on eve of European summit. (1998, March 11 18:00 GMT). International news. Agence France Presse. France sends a set of signals to Turkey and its European partners, in order to ease tensions ahead of European's summit in London.

Content of the Custom Union decision taken by the EC-Turkey Association Council. (1995). The Union's policies – External relations. Available: http://europa.eu.int/

Burt, R. (1997, June 17). Are we losing Turkey? The Wall Street Journal, p. A18. As the West turns a cold shoulder, Muslim extremists gain a hearing.

Deveney, P. J. (1997, December 17). Turkey considers embargo against EU companies. The Wall Street Journal, p. A16.

Buchan, D. (1997, November 29). PM in warning to Turkey. The Financial Times, p. 2. Greek prime minister opposes Turkish membership of conference for possible European entrants if Turkey does not cooperate on Cyprus.

Not so fast: Turkey and the EU. (1997, December 20). The Economist, p. 74. The contradictions that lie in Turkey' being a member of NATO and not of EU.

Just not our sort: Turkey and Europe. (1997, March 15). The Economist, p. 50. Intervention of the army in Turkey's politics.

Two-faced: Turkey. (1996, October 26). The Economist, p. 65. The influence the Islamists Government on Turkey's relations with the EU.

Customs pact with the EU. (1995, March 17). Middle East Economic Digest (MEED), p. 32. Turkey's prime minister states that the establishment of a Customs Union with the EU in the first step to a full integration.