Turkey: A muddled message from an embattled new government

Date: 12/04/03

It is becoming unclear exactly what sort of country Turkey's prime minister, Tayyip Erdogan, hopes to build or how he wants to set about it

ONLY five months ago, millions of Turkish voters, fed up with the corruption and inefficiency of Turkey's old guard of aged politicians, gave the country its first single-party government in 15 years, under the aegis of a brand-new outfit, the Justice and Development Party. The markets were enthusiastic. The main index of Istanbul's battered stockmarket shot up, while interest rates fell below 50% for the first time in nearly a decade. Here at last, it seemed, was a strong government that could push through long-delayed economic and democratic reforms, settle the Cyprus problem and give Turkey a decisive shove towards joining the European Union.

But how fast things have changed - for the worse. Confidence in the party, better known by its Turkish initials AK, has begun to wear thin. The economy again looks wobbly, a UN-sponsored peace plan to reunite the Turkish and Greek bits of Cyprus is back on the shelf and, should the war in neighbouring Iraq drag on, its effects on Turkey could worsen sharply.

For all of this, AK, which has never tasted power before, should not take the whole blame. The war is badly hurting Turkey's multi-billion-dollar tourism industry, which, together with exports, earns most of Turkey's foreign exchange. It had been hoped that holiday-makers would bring in some $13 billion this year. “Small chance of that now,” groans Turkey's habitually cheery foreign minister, Abdullah Gul. Turkey's largest tour operator, Oger, which caters mainly for Germans, says that 90% of reservations for this season have been cancelled. In Turkey's impoverished Kurdish provinces in the south-east, trade with Iraq, the mainstay for thousands of families, has dried up.

True, ripostes AK's swelling army of detractors. But had Tayyip Erdogan, the AK leader who became prime minister only last month, managed to get parliament to push through a bill to let American troops attack Iraq from Turkish soil, the country's finances would have been in far better shape. When the AK-dominated parliament failed by just three votes to approve the bill, Turkey forfeited loans and grants from the United States worth $24 billion.

Now, in exchange for belatedly opening airspace to aircraft of the American-led coalition, a decision that rescued American-Turkish relations from breaking down altogether, the country may settle for $8 billion. Moreover, things could still go badly wrong, if Turkey's generals decided to invade northern Iraq to stop the Kurds grabbing oilfields near Kirkuk. The Americans have told the Turks not to, as the Kurds have promised they would fight back.

Turkey can ill afford another bust-up with George Bush's administration, whose support remains essential if the IMF is to continue to help. The country has to roll over total debt repayments due this year worth $93.5 billion, of which some $80 billion is short-term domestic debt. With inflation creeping back up (to nearly 30% at the latest annualised monthly rate) and interest rates on the rise once again too, “the main concern now”, says Atif Cezairli, head of research in Istanbul for ING, a Dutch bank, “is whether the government can continue to service its debt by successfully lowering real interest rates.”

That in turn depends on whether the government can restore confidence in the markets. They, however, fell precipitously earlier this year, when, in a bout of populism, the government raised civil-service pensions and wages without explaining where the money to pay for them would come from. It also failed to explain how it would pay for fresh subsidies pledged to sugarbeet producers and for 15,000km (9,325 miles) of new motorways.

Still, with less American cash on offer than before, the government may have regained a new sense of fiscal prudence and has now promised to cut spending and raise taxes. As a result, the IMF has agreed to disburse a loan of $1.6 billion as part of a stand-by deal worth $16 billion. But instead of releasing the money in one go, as it normally does, the Fund will do so bit by bit to ensure that the government sticks to its word.

More hopeful are AK's continuing efforts to make Turkey more democratic. Last month's banning of Hadep, the country's largest pro-Kurdish party, on the flimsy charge that it was acting as a front for the Kurdistan Workers' Party (PKK), the main separatist guerrilla group in Turkey, hardly seems to bear that out, but that case against Hadep was in fact launched under a previous government. In contrast, the new parliament has approved a clutch of sweeping constitutional reforms that will make it much harder to shut down parties and easier to prosecute torturers.

Gone, too, is a much-ridiculed ban on the use of the letter W, which exists in the Kurdish alphabet but not the Turkish one - and landed many a Kurdish publisher in court. Parliament is also expected to pass a bill to scrap reduced jail sentences for “honour crimes”, which usually involve men murdering unmarried female relations, sometimes even for such “offences” as going to the cinema with a member of the opposite sex. Parliament is also likely to soften laws on broadcasting in Kurdish.

It will be much harder, however, to reduce the lingering influence of Turkey's generals on politics. They still tell the minister of defence what to do. They even - when it comes to Cyprus - appear to give orders to the prime minister.

Mr Erdogan deserves credit for trying, before he became prime minister last month, to persuade the Turkish-Cypriot leader, Rauf Denktash, to sign the latest peace plan proposed by the UN. The generals, who cherish the island's Turkish part as a strategic asset, promptly slapped him down. On this point, the country's president, Ahmet Necdet Sezer, who sees the generals as the guarantor of Turkey's secular system, is their sturdy ally. Moreover, Mr Sezer has used his power to delay a number of appointments of AK nominees to senior posts in the civil service, on the ground that they are not qualified. More likely, it is because their association with Mr Erdogan dates back to the days when he was a member of an overtly Islamist party banned on charges that it sought to overturn the secular order.

It is plainly hard for Mr Erdogan to decide where his loyalties ultimately lie. The religious conservatives who have backed him already accuse him of betraying his Islamist ideals. On the other hand, though his own wife and those of half his cabinet cover their heads with scarves in the traditional Muslim manner, Mr Erdogan says that the symbolic issue of whether the headscarf may be worn in public places, long a touchstone for secularists who abhor the practice, is not especially important to his government. As the AK continues to muddle along in government, many Turks are puzzled. They wonder just what are its priorities - and Mr Erdogan's.