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The trouble with Turkey

By Richard Adams
THE GUARDIAN, LONDON
Friday, Oct 08, 2004, Page 9

ILLUSTRATION: MOUNTAIN PEOPLE

The debate over Turkey's membership of the EU has so far focused on how the EU will cope with allowing in a largely Muslim country. But much of that analysis has missed the point: one of the biggest barriers to Turkey's entry to the EU is not that it is Muslim, but that it is poor.

Given that the EU is an economic union before anything else, the economic arguments for and against Turkish entry may be much more relevant than its adherence to Islam. For all the talk of a "clash of civilizations," what is being overlooked is a clash of economic interests, between a lower-middle income economy, with a substantial rural economy, and the wealthy industrialized nations of western Europe.

The extent of Turkey's poverty can be illustrated on a chart showing Turkey's national income per head compared with that of recent entrants to the EU, such as Poland and the Czech Republic, with the Turkish figure of US$2,790 almost half that of Poland's US$5,270, and only a tenth of UK national income which stands at US$28,530 to Germany's US$25,250 and France's US$24,770.

`Those in favor of Turkish entry simply assume that the possibility of EU entry will magically transform the Turkish economy into a modern industrial state sometime in the next decade.'

While the figures show how far Turkey's economy lags behind other members of the European club, the central problem is more than that: not only is Turkey poor, compared with the rest of the EU, but it is large. With nearly 71 million people, Turkey would be the second largest EU member state after Germany. The union can easily afford to encompass relatively low-income states such as Latvia (national income per head US$4,040), with its population of a little more than 2 million out of an EU of 450 million. But the entry of a country of 71 million is on another scale entirely.

To put Turkey's size into context, the 71 million inhabitants of the country have a combined national income of US$176 billion. Tiny Denmark, which has a population of just 5.4 million, manages to produce a national income of US$182 billion a year.

Much of the same argument applies to two of the other countries seeking EU membership, Romania and Bulgaria. Both have lower national income per head than Turkey -- US$2,130 for Romania and US$2,310 for Bulgaria. But the pair have a combined population of fewer than 30 million.

Turkey's sheer size means that its economic weaknesses cannot be airily dismissed. Nor can those in favor of Turkish entry simply assume that the possibility of EU entry will magically transform the Turkish economy into a modern industrial state sometime in the next decade. There is as much chance that the strenuous changes Turkey will have to go through in order to be ready may have the opposite effect, of recession, unemployment and instability. And there is a danger that an ill-timed and underprepared Turkish EU entry could be disastrous for the country itself.

None of this means that Turkey's entry into the EU should be counted out on economic grounds alone. What it does mean is that the EU will have to monitor Turkey's economic performance carefully before making a final decision on entry, and it should take a more active role in offering economic assistance over the 10 to 20 years it may need to prepare.

The need for sensitive handling is highlighted by Turkey's recent economic history. Between 2000 and 2001 Turkey suffered a financial convulsion and severe currency depreciation after removing capital controls, with its economy contracting by nearly 10 percent. The IMF moved in with a multibillion-dollar bail-out, and for most of the pg another bumper year of growth this year.

While that bodes well for Turkey's prospects, it cannot be said that Turkey necessarily has pent-up growth waiting to be unleashed. The country already has a robust record for growth, at an average of 4.2 percent a year since 1990 -- not one of the highest growth rates in the developing world, but not bad. Britain over the same period grew at 2.1 percent a year.

Yet Turkey still has a long way to go, even if it can sustain relatively high rates of growth. According to World Bank figures, a surprising proportion of Turkey's population lives in relative poverty: 10 percent are said to live on just US$2 a day. The percentage of its population over the age of 15 able to read and write is 87 percent -- below the world average for its income level, and far below countries such as Bulgaria, which has 99 percent literacy (the legacy of the old Soviet bloc's emphasis on investing in infrastructure and education).

Similarly, Turkey's record in terms of infant mortality is also disappointing: 41 deaths per 1,000 births, a rate twice as bad as either Bulgaria or Romania, and far higher than recent EU entrants such as Poland (nine per 1,000) and Slovenia (five per 1,000).

Turkey's economy also remains heavily devoted to agriculture. While agriculture is responsible for just 3 percent of Poland's economic output, in Turkey agriculture makes up 13 percent. Elsewhere, foreign investment remains low and concentrated in the wealthier western regions.

As we have seen from the case of Poland, EU entry does not mean a wave of migrant workers to the wealthier EU countries. Given its size and relative poverty, the bigger danger of EU entry is that the Turkish economy is vulnerable to being washed away by exposure to the full force of the single market. If not properly prepared, Turkey's entry could do it more harm than good. Rather than fear Islam, we should worry at the impact on Turkey's poor.
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