Erdogan, the IMF and Turkey’s victory

Ceylan Ozbudak

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I remember seeing the Blue Mosque for the first time. I understood the name only after I entered the mosque. It was beautiful. It was magnificent. I knew the mosque was among the finest examples of Istanbul's imperial Ottoman architecture. What I did not understand was why it was so special to the all-magnificent Ottoman Empire. I didn’t know the history of the mosque, I didn’t know the story of the building process, I didn’t know the secrets of the building, and I didn’t know what made it THE Blue Mosque. I didn’t know the genius of the architect.

Similarly, something happened this week in Turkey that requires understanding the broader political architecture of this country.

We can look with pride at the picture of Turkey extending before us. While the economic situation in Turkey is by no means perfect and the work is not yet complete, the changes made since the election of the AKP government are phenomenal.

Ceylan Ozbudak

This week, Turkey made the final payment of its loan to the IMF and Prime Minister Erdoğan became the first Turkish Prime Minister to travel to the United States with no IMF debt to mention. The last time Turkey owed no debt to the IMF fund was in 1994 during the leadership of Prime Minister Tansu Çiller. Turkey has, in fact, evolved from a borrower into a lender, offering the IMF fund $5 billion in June of 2012 to assist with the European economic crisis. How did the AKP manage such an economic success when the world is being rocked by a global crisis? What is the architecture behind Turkey’s economic success?

The first IMF loan was taken out by the government of President Cemal Gürsel under a stand-by agreement in 1961. From 1961 until today, 19 stand-by agreements were made. Total principal debts of 56.5 billion US dollars were incurred. Turkey’s debts to the IMF reached a record level after 2001. When the AKP came to power, IMF delegations were visiting Turkey every month, and their investigations occupied much of the public agenda. The business world, markets, small traders, farmers, and everyday citizens all determined their positions on the basis of meetings with IMF delegations. All governments before the AKP were asked to make major concessions and promises of reform regarding domestic policy in order to borrow further from the IMF. Eight presidents and 38 governments witnessed the spiraling IMF debts over 52 years. Turkey was among the 3 countries making the highest number of agreements with the IMF.

A different chapter of this story began to unfold after the election of Prime Minister Erdoğan and the AKP. Turkey gradually privatized the entire state sector and worked to resolve problems of corruption within the newly privatized enterprises. Prime Minister Erdoğan introduced Turkey to a new economic model in which the newly created private sector would not be a burden on the state and the state would not over-regulate the private sector in return. Public infrastructure investments were made possible without burdening the Treasury, through the ‘build-manage-transfer’ privatization method, increasing productivity very significantly, while income distribution in the economy was adjusted. This model helped create an equality of opportunity among low-income groups in the Turkish economy. One of the best decisions that Prime Minister Erdoğan made was to reduce military spending as a percentage of GDP, despite the Middle East being a place of threat and conflict, and devote more government resources toward infrastructure, healthcare, and education. The AK Party also abolished the visa requirements with more than 70 countries and lifted passport requirements with two countries, measures that made a great contribution to the creation of a free market with these nations. Yes, these are important building blocks of the architecture. But we would be mistaken to forget the architects and their contribution.

Reform initiatives

Political and economic reforms were attempted before the AKP government, but these were brought to an end by the right wing governments being toppled, attacks on prime ministers and even the hanging Prime Minister Adnan Menderes in 1961.

Adnan Menderes’ reform initiatives came before their time. Turkey’s intellectual space was not ripe for his policies and ideas. The architects had not finished their work yet. There was no social-intellectual infrastructure to respond to the Marxist philosophy that was so widespread in Turkey as a whole. A single magazine criticizing the one-party government could explode like a bomb and trigger a process ending in a coup. Remember the time of the government of Necmettin Erbakan. Prime Minister Erbakan took steps that would quickly have a positive impact on the economy. But just at the point when he wanted to change the banking system, certain groups that triggered the February 28 process became agitated and tried to stop him as soon as possible.

If we only consider the success of the AKP government in terms of the economy or politics, we will be ignoring the real cement behind this architectural triumph. There is another very important factor, in addition to flexible policies, which has strengthened the hand of Prime Minister Erdoğan’s government. This factor is the ideological strengthening of the right in all Turkish cities. The anti-materialist struggle waged by opinion formers and civil society organizations has not just broken the back of Marxist terror in Turkey but allowed for free market economics to prosper. The current government is being supported with record percentages of the vote which has strengthened Erdoğan’s hand and allowed AKP leaders to implement widespread economic policies and reforms.

We can look with pride at the picture of Turkey extending before us. While the economic situation in Turkey is by no means perfect and the work is not yet complete, the changes made since the election of the AKP government are phenomenal and have been positive more often than not. It is difficult to grasp the scope of this success without considering all those factors involved in this giant picture and all the artists who have contributed. Yes, Turkey has sharply risen in power, making huge strides in the last 10 years in particular, and become a bright star in the Middle East. In order to be able to reflect that success to other countries, we must honor the true architects in a detailed analysis of that success.

While the economic reforms and political steps taken by the AK Party government were similar to the beautiful turquoise tiles and 6 minarets of the Blue Mosque, the intellectual struggle which weakened the left in Turkey was the genius of the architect who chose the high hill and built the foundations on which this magnificence was built.

Ceylan Ozbudak is a Turkish political analyst, television presenter, and executive director of Building Bridges, an Istanbul-based NGO. She can be followed on Twitter via @ceylanozbudak

Disclaimer: Views expressed by writers in this section are their own and do not reflect Al Arabiya English's point-of-view.
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