Turkey: A European Secular State
By Valerie Pelton - If asked which European country has the 16th largest economy in the world, the 2nd largest army in NATO, employs a German-Swiss legal system, serves as a gateway to Central Asia and the Balkans and is among the top European countries in production of ceramics, tires, agricultural products and automotive parts and has a rapidly expanding cellular telecommunications market, most people would not think the answer would be Turkey. As Co-Chair of the Europe, Russia and NIS Subcommittee, I had the opportunity to represent NVTC at a series of meetings and conferences sponsored by the Turkish - U.S. Business Council ("TUSBC") American Turkish Council, the Aegean Free Zone Development and Operating Company ("ESBAS") and the Turkish Foreign Economic Relations Board ("DEIK") which were held in Turkey in the cities of Istanbul, Ankara and Izmir.

While in Turkey, DEIK arranged for meetings with leading business people such as Mr. Cuneyt Turktan, General Manager of Turkcell, one of the largest cellular communications companies in Turkey, Mr. Huseyin Erkan, Executive Vice Chairman of the Istanbul Stock Exchange, Mr. Sedat Birol, General Manager of Eczacibasi, a large conglomerate which includes pharmaceuticals and ceramics divisions, Ms. Hande Ascili, Project Group Head of the Privatization Administration, the government agency charged with privatizing government controlled monopolies, Mr. Ahmet Izer, Assistant Manager for International Relations and Agreements for Turkish Airlines, the national commercial carrier which will be privatized by the Privatization Administration, Mr. Oktay Onderer, Deputy General Manager of TEKEL, the national monopoly for alcoholic beverages, salt and tobacco products which will also be privatized by the Privatization Administration, and Mr. Akin Evren, Secretary General of the Turkish Informatics Foundation. These individuals offered frank insights not only into their companies, agencies and organizations, but also into the business realities of Turkey including the current financial and economic situation.

While many Americans are aware of Turkey as a tourism destination offering miles of pristine beaches, archaeological wonders such as Ephesus and architectural marvels such as Hagia Sophia, few are aware of the critical role Turkey plays in the Eastern Mediterranean, Central Asian states, the NIS/FSU and the Balkans. In the developing countries which are found within Central Asia such as Azerbaijan, Uzbekistan and Turkmenistan, as well as NIS/FSU states such as Georgia and the Balkan states such as Albania and Bulgaria, Turkey plays a rather interesting role.

One role which Turkey plays is as a model of a European secular state which is organized as a republican democracy. In a region where religion and politics are closely intertwined, religion is kept at arms length from the business of government. Reforms fostered by Mustafa Kemal, Ataturk ("father of the Turks"), almost 70 years ago such as making Sunday (as in the West) rather than Friday (as in the Middle East) the day of rest, implementing the Roman alphabet rather than continuing the use of the Arabic alphabet and granting women equal status under the law and the right to vote (1933) all distinguish the path of modern Turkey and serve as an example to emerging nations in the region, many of which have large Moslem populations.

Another role which Turkey plays is as a point of market entry for businesses seeking entrée into the telecommunications, pharmaceuticals, wood products, automotive, petroleum and consumer goods markets within Central Asia, the NIS/FSU and the Balkans. For U.S. and European companies interested in entering these markets, partnering or entering into joint ventures with Turkish companies may make business sense. Many Turkish companies export goods and services to, have established business relationships in and understand the cultural nuances of the region. Partnering with or entering into joint ventures with Turkish companies may also afford U.S. and European companies the added security of having an operational base in a relatively stable European country where access to courts and enforcement of contractual rights and contractual remedies is much more certain.

An additional spur to U.S. and European investment is the scale of privatization in diverse sectors such as telecommunications, investment banking, commercial aviation, tobacco, salt and alcoholic beverages. The Privatization Administration is aggressively pursuing the privatization of its state-owned monopolies in these sectors. Acquisition of ownership interests in these monopolies as they are spun off to private industry presents unique opportunities for companies to gain market share in a region with a growing consumer base.

Another reason to look at Turkish companies as potential investment partners is the level of English fluency. In the business and legal world, fluency in English is widespread. Many business people have studied in the U.S. or in Western Europe and send their children to study abroad. According to Ms. Sibel Ertekin, Esq., a private attorney engaged in the practice of business and corporate law who served as corporate counsel for Coca Cola for a number of years, lawyers are required to learn German as part of their legal education as the legal system is based on hybridized German-Swiss laws. Most lawyers also learn English as it is the language of international business and contracts with international businesses are normally drafted in English.

During the course of my meetings in Istanbul, Ankara and Izmir, I was reminded of its resemblance to Spain in the late 1980s and early 1990s, prior to the economic acceleration made possible by billions of dollars of investment being channeled into Spain after it attained full EU accession. I kept thinking that Turkey, a country larger than Texas or roughly the size of France and Germany combined, had the potential for a similar economic boom once it achieves full EU accession.

On the negative side of the investment equation, there are some significant drawbacks. First and foremost among these is the free fall of the Turkish lira and the current economic crisis. While in Turkey, the exchange rate was roughly 1,500,000 TL for every US$1.00. This makes Turkish goods very cheap, but American goods very expensive. For Turkish companies to pay U.S. companies in U.S. dollars for goods and services, can be difficult and costly given the daily fluctuations in the exchange rate. To correct the problem, Mr. Kemal Dervish, State Minister, outlined an aggressive reform program for the country's economic and financial recovery during a luncheon with members of TUSBC and DEIK. He likened the program to surgery. Some of the measures which Mr. Dervish plans to implement include shrinking the size of Turkey's civil service through early retirements, linking civil service pay to performance, cutting bureaucratic red tape, implementing use of international accounting standards by the end of 2002, revaluing the national currency, continuing implementation of banking reforms and other actions designed to curb the current 80% rate of inflation.

Valerie Pelton is a lawyer and visited Turkey recently. She had represented NVTC at a series of meetings and conferences sponsored by the Turkish - U.S. Business Council ("TUSBC") American Turkish Council, the Aegean Free Zone Development and Operating Company ("ESBAS") and the Turkish Foreign Economic Relations Board ("DEIK") which were held in Turkey in Istanbul, Ankara and Izmir.

An Islamic Society with a Secular State
By Somini Sengupta, New York Times, Dec. 16, 2001, ISTANBUL - WHAT strikes the first-time visitor to Turkey is not the evidence of a great imperial and religious past, the millennia of Byzantine and Ottoman rule. Rather, it is the face of Mustafa Kemal Ataturk, the man who in 1923 created the Republic of Turkey.

The bushy-browed general is everywhere: somberly staring from the walls of every official chamber, or pictured soberly drinking coffee at the impishly named Fez Café (Ataturk banned the fez and other traditional items of clothing). His visage is carved into the hillside of a Turkish Army base in the badlands of the Southeast, and his bust stares at passersby from bank windows. Many Turks say they hardly see him anymore since they can never remember not seeing him.

"Like any icon, it reminds you of your faith," observed Hakan Yilmaz, a political scientist at Bosporus University here. "If you have any doubts, if you have any potential to deviate, you look at it and it reminds you."

The cult of Ataturk arose from his determination to make Turkey - a majority Muslim country - a secular state, one whose citizens would regard themselves primarily as Turks, not Muslims, and who would look toward Europe for cultural and political guidance.

To achieve this goal, Ataturk abolished the Caliphate, which made the Ottoman sultan, as Caliph, not just the ruler of an empire but the protector of the entire Islamic community, or umma. He then exiled the last Caliph and replaced theocracy with his own charismatic brand of nationalism, telling the ethnically diverse groups of his fledgling country that only a modern, secular, democratic society could give them a viable state.

More than 75 years later, Turkish law and politics remain suffused with a deep-seated fear of Islam as a political force.

"What racism is for America, political Islam is for Turkey," Mr. Yilmaz said. "Racism challenges the fabric, the design of American society. Political Islam challenges the design of Turkish society."

It is against the law, for instance, to wear a head- scarf in a government building or a public university. A provision of the penal code makes it a crime to use ethnic or religious symbolism for political purposes, provisions that have been used to shut down Islamist political parties.

Turkey still regards Europe, not the Middle East, as its natural ally, though it has never quite been accepted into that club. Oddly enough, its candidacy for membership in the European Union has been stalled by criticism over its restrictions on religion. And in the paradox that is Turkey, some of its Islamists have come to regard the West as the protector of their religious liberties, with one Islamist party supporting joining the European Union.

Naturally, many Turkish officials bristle at the European criticism of religious restriction. Howard Eisenstat, an instructor at Koc University in Istanbul, who is writing his doctoral dissertation on Turkish nationalism at the University of California at Los Angeles, describes Turkey's anxiety this way: "If you want us to democratize by giving rights to people who aren't truly democratic, what is the guarantee that these people are going to play by the rules? "

Turkey would like to think that it is a model for other Islamic nations, a notion not well received in most of the Islamic world, where Turkey is often regarded as trying too hard to turn itself into a European nation. Nonetheless, urban intellectuals, particularly those who have traveled in the Islamic world, are eager to enlighten an American visitor about their singularity. Sure, they say, some people observe the Ramadan fast. But they also point out the people lunching at high noon and drinking raki at

night, not to mention the men and women strolling the streets together, taking in everything from Anatolian ballads to electronica. In all of this, Ataturk, who died in 1938, is a constant presence, though not an unchanging one. Forty years ago, he was likely to be depicted in military gear or in the formal attire of state occasions. Today, he is likely to be nattily dressed, a picture of urbane, ambitious modernity. Through it all, however, he has remained the measure of all things Turkish, and in a vehement argument, both parties are likely to exclaim, "If Ataturk were alive!"

STILL, Turkey remains to some extent a religious society, with a population that is overwhelmingly Muslim - and the government takes an active role in monitoring and regulating how Islam is preached and practiced.

The government's Religious Affairs Division hires all the imams (occasionally, some of them are taken to court if their behavior contravenes government regulations), issues permits for mosques (occasionally, they are discovered to have been erected illegally) and runs the seminaries (Turkey had been financing the construction of a seminary in Mazar-i-Sharif).

The religion agency proofreads all Korans published in the country and teaches butchers how to slaughter animals in the Islamic way. Schoolchildren are taught about Islam in class (though they are allowed to opt out).

In an interview, the head of Religious Affairs, Mehmet Nuri Yilmaz, said the agency was the brainchild of Ataturk. "It is very dangerous to teach a religion in the wrong way," Mr. Yilmaz said. "In order to achieve progress, you have to teach religion in its proper form."

Islam, which has waxed and waned as a political force over the years, has recently been in decline; the Islamist parties did poorly in the 1999 election. Still, earlier this year, the state shut down the main Islamist party. Perhaps, Turkey has nothing to fear anymore, said Hakan Yilmaz, the political scientist. But old anxieties are hard to stifle.

Cypriot Leaders Face Tough Task Rebuilding State
By Ralph Boulton, NICOSIA, Dec 5 (Reuters) - Rival Turkish and Greek Cypriot leaders are closer than ever to ending a bitter division that threatens Ankara's EU hopes and eats at NATO's volatile southern flank.

For the first time, they have acknowledged some urgency in finding a permanent solution for Cyprus which split in two 27 years ago.

Turkish Cypriot leader Rauf Denktas, 77, and Greek Cypriot President Glafcos Clerides, 82, rivals since Cyprus was a British colony in the 1950s, held rare face-to-face talks on Tuesday and agreed to unconditional direct talks.

They met near Nicosia Airport which has been mouldering away for nearly three decades in the bleak no-man's land dividing the east Mediterranean isle.

Turkish Foreign Minister Ismail Cem warned against expecting "miracles" in tackling a schism that has defied generations of well-meaning diplomats.

But there was an undeniable optimism on the unusually rain-sodden island. Halkin Sesi daily declared "May the Evil Eye Stay From You" above pictures of the two. Even the glum leftist daily Avrupa offered "Cheers!"

Denktas softened his line, dropping demands for full recognition of his breakaway state, which has a per capita income less than a third of that in the south. Clerides yielded ground too.

"Denktas has for the first time opened up an avenue that has been blocked," one government source in Ankara said. "But if there is to be a solution it must be done by Denktas and Clerides. No politician after them can solve the problem."

Northern Cyprus has operated independently of the south since Turkish troops [intervened] in 1974 in response to an Athens-backed coup aimed at union with Greece. But the international community recognises only the Greek Cypriot administration as sovereign over the whole island.

Property Looms as Key Issue
Pressure to reach a solution is reinforced by the European Union's likely decision in June to open the door to Cyprus's membership.

EU entry without a settlement, would pitch Turkey, which has threatened to annex the north, into confrontation with the EU, which it also seeks to join, and would raise tensions with NATO partner Greece.

Young people already leaving the north in large numbers would be denied the fruits of EU membership enjoyed south of the "Green Line" which divides the island. Continuing international sanctions would cripple a floundering economy.

Denktas's adviser Mumtaz Soysal smiled when asked if a solution could be negotiated by the two leaders before June.

"It might take longer," he said, adding he was pleased the talks would take place on the island itself.

The U.N. will in effect play a lesser role than during previous laborious and fruitless "proximity talks" when U.N. officials plied between the two leaders holed up in Geneva or New York.

"Taking place in Cyprus, this will shut out the interference from other sides...Cypriots can solve the issue," Soysal said.

Soysal and leftwing opposition leader Mehmet Ali Talat agree the biggest issue will be property. "It's the essence," Soysal said.

Talat was more blunt. "Questions of government, judiciary and (zonal) borders can be more easily resolved, but property is difficult because it involves the ambitions of individuals.

"If it can't be settled, then it becomes a candidate (potential source) for severe clashes between the communities."

Fears of Ethnic Tensions
Turks see the 1974 invasion [TT's note: the 'intervention' was in full accordance with 1960 London and Zurich treaties] and partition as safeguarding the Turkish minority after decades of communal bloodshed. But the property issue it left behind is a legal and emotional minefield.

Consider a Turk who in 1974 fled the south, leaving behind coastal farmland since developed into a lucrative beach resort; the Greek who abandoned in the north a hotel, a home, a factory.

The northern harbour town of Kyrenia, heartland now of Turkish northern Cyprus, was a largely Greek town.

Soysal argues for a "global exchange" of property on the basis of two zones -- one Turkish, occupying much of the territory of present-day northern Cyprus and a second, Greek Cypriot.

Claims on each side would be totted up, with the Turks paying off the balance in what would amount to a lump sum.

Greek Cypriots seek restitution of property to original owners, many wishing to return to family homes.

"I think in the end there will be some kind of mix of global compensation and restitution," said Talat.

The EU has signalled it would accept special exemptions to Unin rules for Cyprus. Movement of Greeks back to the north for instance could be limited for an interim period, perhaps 15 years, to allay Turkish fears. Greek acceptance of this is far from certain.

Two zones might indeed emerge, the north ceding some land to the Greek south, reducing its share from 37 to, some suggest, 29 percent. The autonomy each zone would have and the powers of a central administration would be a subject of hard negotiation.

"We might have not ethnically 'clean' areas, but zones in which one or the other population will dominate," Talat said.

Denktas said he and Clerides had joked that neither was getting any younger. "The years go by. This is a new process... Perhaps, as some say, it is the last tango. We cannot waste it."

There are those, to be sure, who still entertain the idea the tango is little more than a grotesque cabaret put on for the EU. Both need to be able to tell the EU next June that they tried for a solution, that the other was after all to blame.