Opinions & Papers

SEMINAR REPORTS

SEMINAR REPORTS 2010

Boğaziçi Üniversitesi-TÜSİAD Dış Politika Forumu

Boğaziçi University-TÜSİAD Foreign Policy Forum

Table of Contents

1. Changing Turkish Policies towards Israel and the Middle East : 3

The View from Israel

2. Crisis in Greece: Economic, Social, and Political Dimensions : 15

3. The State of European Integration and EU-Turkey Relations : 27

Where Do We Go From Here?

Changing Turkish Policies towards Israel and the Middle East:

The View from Israel

22 October 2010

SEMINAR REPORT

Changing Turkish Policies towards Israel and the Middle East:

The View from Israel

DPF 2010-SR 01

Speakers

Prof. Dr. Amikam Nachmani (Professor, Bar-Ilan University, Department of Political

Studies; Research Associate, The Begin-Sadat Centre for Strategic Studies)

Prof. Dr. Shlomo Avineri (Professor, Hebrew University, Department of Political Science;

former Director-General, Israel Ministry of Foreign Affairs)

Mr. Aluf Benn (Editor-at-large, Haaretz newspaper)

Panel Chair and Moderator

Gün Kut (Professor, Department of Political Science and International Relations,

Boğaziçi University)

The conference entitled “Changing Turkish Policies towards Israel and the Middle East:

The View from Israel,” took place on 22 October 2010 at the TÜSİAD Conference Room.

The conference was conducted in English.

We have organized this one-day seminar to explore current developments in Turkish Israeli relations, with a particular focus on Israeli perspectives towards Turkey’s new

regional policies in the Middle East. Our main goal was to give Turkish actors an

understanding of how Israeli academics, opinion leaders, and decision-makers are

evaluating the recent rift in Israeli-Turkish relations, focusing on the political, economic,

military, and psychological dimensions.

Özet

Türkiye-İsrail ortaklığı yıllar boyunca hem Ortadoğu’da barış ve istikrarın korunması hem de Batılı devletler için güvenilir ve güçlü müttefikler sağlaması açısından stratejik önemi olan bir ortaklık olagelmiştir. Ancak, iki devlet arasındaki ilişkiler Türkiye başbakanı Tayyip Erdoğan’ın 2009 Davos Dünya Ekonomik Forumu esnasında İsrail devlet başkanı Şimon Peres’i Hamas’a yönelik saldırılarla ilgili açıkça suçlamasıyla birlikte bozulmaya başlamış; İsrail güvenlik güçlerinin Gaza'ya insani yardım götüren Mavi Marmara gemisine uluslararası sularda saldırması ve dokuz Türk vatandaşını öldürmesiyle birlikte ikili siyasi ilişkiler bir çıkmaza girmiştir.

22 Ekim 2010 tarihinde Boğaziçi Üniversitesi TÜSİAD Dış Politika Forumu tarafından Türkiye-İsrail İlişkilerinde son gelinen noktayı tartışmak amacıyla bir seminer düzenlenmiştir. “Türkiye’nin İsrail ve Ortadoğu Politikasına İsrail’den Bakış” isimli seminer Türkiye’nin değişen Ortadoğu politikalarının İsrail tarafından nasıl değerlendirildiğini ve İsrailli akademisyenlerin, kanaat önderlerinin ve karar alıcıların Türkiye-İsrail ilişkilerindeki sorunlara ilişkin bakış açılarını tartışmayı amaçlamıştır.

Seminere Prof Dr. Amikam Nachmani (Bar-İlan Üniversitesi Siyaset Bilimi Bölümü ve Begin-Sadat Stratejik Araştırmalar Merkezi), Prof. Dr. Shlomo Avineri (İbrani Üniversitesi Siyaset Bilimi Bölümü/ İsrail Dışişleri Bakanlığı eski müsteşarı) ve Aluf Benn (Haaretz Gazetesi editörü) konuşmacı olarak katılmıştır.

Seminerde ana hatlarıyla Türkiye hükümetinin yeni Ortadoğu politikalarının ve İsrail’e karşı artan muhalefetinin, Türkiye’nin demokratikleşme sürecinin, iç çekişmelerinin, bölgesel lider olma hedeflerinin ve Batı ile ilişkilerinde yaşadığı sorunların bir yansıması olarak algılanması gerektiğinin üzerinde durulmuştur. Türkiye ile İsrail’in ortak kaygılara ve özellikle Batılı devletler ile ilişkilerinde benzer politikalara sahip olduğunun altı çizilmiş, iki devletin kamuoyları arasındaki giderek artan gerginliğin çözüme kavuşturulmasının yolları tartışılmıştır. İsrail ve Türkiye ilişkilerinde popülist yöntemlere başvurmadan geliştirilecek olan ilişkilerin var olan sorunları aşmak açısından çok önemli olduğu vurgulanmıştır. İlişkilerin barışçıl, diyaloga ve diplomasiye dayanan bir şekilde yeniden şekillendirilmesi sadece iki ülke arasında daha güçlü ve kalıcı bir ortaklığın oluşmasını sağlamakla kalmayacak, Orta Doğu bölgesinin siyasi istikrar ve ekonomik refahına da olumlu yönde katkı sağlayacaktır.

Executive Summary

Israeli-Turkish partnership has provided the Middle East with a certain amount of stability and the West with two reliable and militarily strong allies for several decades. However, the situation changed in the beginning of 2009 when Turkish Prime Minister Erdoğan criticized Israeli President Shimon Peres during the World Economic Summit in Davos for Israel’s military campaign in Gaza. Relations further deteriorated with the Mavi Marmara incident, in which a Turkish flotilla attempted to enter Israeli waters to deliver humanitarian help to the people in Gaza. The flotilla was stormed by the Israeli soldiers resulting in the killing of nine civilians.

On October 22, 2010 the Boğaziçi University-TÜSİAD Foreign Policy Forum initiated a oneday seminar on the current state of affairs between Turkey and Israel. Entitled “Changing Turkish Policies towards Israel and the Middle East: The View from Israel” the meeting aimed at debating the Israeli perspectives on Turkey’s new regional policies in the Middle East. The main goal of this one-day-event was to give Turkish actors an understanding of how Israeli academics, opinion leaders and decision makers evaluate the recent problems in the Israeli-Turkish relations, focusing on political, economic, military and psychological dimensions. The seminar included three distinguished speakers from Israel, Prof. Dr. Amikam Nachmani (Prof. Dr., Bar-Ilan University Department for

Political Studies/Research Associate, The Begin-Sadat Centre for Strategic Studies), Prof. Dr. Shlomo Avineri (Prof. Dr., Hebrew University Department of Political Science/former Director-General, Israel Ministry of Foreign Affairs), Aluf Benn (Editor-at-large, Haaretz Newspaper) as well as 30 participants from the Turkish academia, private sector and the media.

The main arguments that were made during the course of this event were that the Turkish government’s new policy in the Middle East and its critical stance vis-{-vis Israel must be seen in light of the Turkish democratization process, Turkey's domestic conflicts and cleavages, its aspirations for regional leadership, as well as its worsening relations with the USA and the EU. While Israel and Turkey are sharing many commonalities, such as a fear of cultural dissolution, the weight of history, as well as a Western orientation, there are deep misunderstandings between the two publics. A fresh new start to the partnership between Turkey and Israel may only be possible without excessive media reporting and public scrutiny, namely within the framework of a non-populist agenda. A re-initiation of relations on a more diplomatic level and the establishment of a dialogue between the openminded academic, cultural and business elites of the two countries may not only lead to a more mature partnership but likewise could positively affect the situation in the region and establish Turkey as a mediator that does not take sides and as a trustworthy broker in the tense environment that the Middle East is.

CHANGING TURKISH POLICIES TOWARDS ISRAEL AND THE MIDDLE EAST:

THE VIEW FROM ISRAEL

The Boğaziçi University-TÜSİAD Foreign Policy Forum organized the first event after its reestablishment in April 2010 on October 22 of that same year. Entitled “Changing Turkish Policies towards Israel and the Middle East: The View from Israel,” the seminar aimed to catalyze debate over Israeli perspectives on Turkey’s new regional policies in the Middle East. The main goal of this one-day seminar was to give Turkish actors an understanding of how Israeli academics, opinion leaders, and decision-makers are evaluating the recent problems in Israeli-Turkish relations, focusing on political, economic, military and psychological dimensions.

The seminar featured three distinguished speakers from Israel, Amikam Nachmani (Professor, Bar-Ilan University, Department of Political Studies; Research Associate, The Begin-Sadat Centre for Strategic Studies), Shlomo Avineri (Professor, Hebrew University, Department of Political Science; former Director-General, Israel Ministry of Foreign Affairs), Aluf Benn (Editor-at-large, Haaretz newspaper) as well as 35 participants from the academia, the private sector, and the media in Turkey.

Amikam Nachmani, the first presenter, focused on how the current situation is a novel one within the history of relations between Turkey and Israel. According to Nachmani, this marks the first time that Israel, which seems to have lost its ties with its non-Arab neighbors, no longer has an ally in the region. The Bar-Ilan University professor held that while cooperation between Turkey and Israel had been a stabilizing factor in the Middle East, Israel now faces verbal as well as actual hostility. Nachmani criticized and questioned the Turkish government’s new aspirations in the region as well as its attitude towards Israel. He blamed the Turkish government for expecting Israel to do what it will not do itself: While Turkish Prime Minister Erdoğan does not hold back in denouncing Israeli aggression towards Palestinians, it has failed to resolve the Kurdish issue in Turkey. Likewise, Erdoğan calls on the Netanyahu government to give back land to the Palestinians while refusing to allow Greek Cypriots to return to the Turkish Republic of Northern Cyprus.

Nachmani also underlined that it is the first time since World War I that a country in the region has tried to claim the mantle of leadership. This aspiration, unfortunately, has led to the loss of several victims’ lives. For the first time since the Korean War, Turkish citizens were killed in an international conflict during the Mavi Marmara incident, in which a Turkish flotilla trying to deliver aid to Gaza made an attempt to enter Israeli waters without permission. Nachmani contextualized the Turkish-Israeli dispute in reference to Turkey’s relations with the West. He interpreted the Turkish government’s empathy towards Hamas as a move directed against the US and the flotilla incident as an attempt to embarrass Israel in front of the international community.

Nachmani contended that, as a result of the flotilla incident, Turkey, for the first time since the collapse of the Ottoman Empire, has established good relations with its Arab neighbors. While positive views towards Turkey have increased in several Arab countries, the AKP government itself has adapted a pro-Arab discourse that emphasizes shared cultural ties. This actual and discursive shift has led to the idea among some analysts that Erdoğan is trying to emulate Gamar Abdel Nasser, the former Egyptian president who had claimed Pan-Arabian leadership. According to Nachmani, this will unavoidably affect Turkish-Iranian relations, which constitute another important dimension of Turkey’s new regional policies. Leadership aspirations on the part of both countries, however, may lead to conflict in the long-run.Returning to the heart of the matter – Turkish-Palestinian and Turkish-Israeli relations –Nachmani claimed that positive sentiment towards Palestinians has increased in Turkey to the extent that it exceeds concern over the Kurdish and Armenian issues. On the other hand, this has led to a weakening of ties with Israel. For the first time, both states are antagonistic towards one another. Accordingly, while the Turkish public sympathizes with the Palestinians, their image of Israel has been further diminished.Nachmani lastly portrayed the negative consequences the Justice and Development Party’s (AKP) new strategy could entail: First of all, the Jewish lobby is no longer likely to support Turkey’s efforts to block the passage of a bill recognizing the Armenian genocide by the US Congress. Secondly, Turkey risks disrupting the relative stability of the Middle East by abandoning one of its most stabilizing factors, the Israeli-Turkish partnership. Thirdly, if Turkey really wants to become an honest broker and mediator in the region, it is impeding this aspiration by clearly positioning itself against one party while supporting another.

Nachmani ended his presentation by reminding the audience that, despite the current conflict, Turkey and Israel still have much in common: Both are countries in the Middle East that identify with the West, both were built by great leaders, and, in both states religion plays a decisive role. Furthermore, both countries have unresolved chapters in their history they must now confront. Until the 1990s, Turkish-Israeli cooperation remained outside the public discourse. Nachmani predicted that cooperation would once again resume on a diplomatic level removed from the public discussion.

Shlomo Avineri made it clear in his presentation that he sees Turkey’s new aspirations and policies as a sort of “coming of age,” and thus linked Turkey’s internal issues, such as the decline of the Kemalist ideology, with its new foreign policy. The former DirectorGeneral of the Israel Ministry of Foreign Affairs noted that Turkey’s internal composition, as a highly heterogeneous state both ethnically and culturally, necessarily affects the government’s attitude towards its neighbors. The country faces domestic threats stemming from its ethnic composition and external threats arising from its conflict-ridden neighborhood. Avineri held that the Turkish government wants to ameliorate this troublesome situation with its “zero problem” policy in the Middle East. While the country advances its relations with the Arab world, it is also trying to stabilize relations between the Turkish majority and the Kurdish minority by playing on the common denominator: religion. The problem Avineri sees, however, is that this zero problem approach, if taken too far, will likely produce the exact result it seeks to avoid: While its stated aim is to avoid conflict, the policy may actually foster it because of the Turkish government’s reluctance to oppose Iran, a clear violator of international law, or Hamas, a terrorist organization.

The government may be failing to consider these unintended consequences in their calculations. The Hebrew University professor noted that while the country has been trying to diffuse conflict by engaging in dialogue with Tehran and seeking rapprochement with Syria, it has inadvertently created a new set of crises for itself. In a conflict-ridden region occupied by several mutually hostile states, it is unlikely that the Turkish government can maintain good neighborly ties with any one state without upsetting another. This dilemma is further aggravated by the fact that Turkey turned its back on the USA at the Security Council deliberations to impose sanctions on Iran and, in addition, by the fact that Prime Minister Erdoğan employed a rather aggressive tone in denouncing Israel both prior to and following the flotilla incident.

Avineri supplemented Nachmani by noting that while Erdoğan may be becoming more popular on the Arab street as a result of these new policies, he is not necessarily among the more moderate Arab leaders of Egypt, Jordan, and Saudi Arabia, who are all proWestern and oppose Hamas and Ahmadinejad. These leaders are irritated by Erdoğan’s new pan-Muslim discourse, which may threaten their relative domestic stability and incite their own populations’ anger against Israel in particular and the West in general. Avineri further asserted that even moderate Palestinians are not that delighted by Turkey’s defiant attitude, since it may impede the Israeli-Palestinian peace process and undermine the authority of Mahmoud Abbas vis-{-vis Hamas. But why does the AKP insist on this benevolent stance toward Hamas? Avineri saw the reason for this in the AKP’s misperception: the AKP has evolved and weakened its ties to its Islamic roots and, thus, believes the same could happen for Hamas. The significant difference between the two governments, however, is that Hamas is openly anti-Semitic and favors violence. A normalization process is, therefore, highly unlikely.

By looking at these facts, it seems that Turkey may have actually achieved the exact opposite of what it had intended: more crises and more instability permeate the region. Turkey’s pro-Iran and pro-Hamas attitude has alienated the European Union and fed into anti-Turkish and anti-Islamic resentments amongst European populations. Avineri maintained, however, that Turkey can and should criticize Israel for its actions. In line with Nachmani, though, he argued that if the Turkish government is truly interested inbeing an honest broker for the region, it should not demonize the Israelis but instead try to establish a dialogue and an environment in which every state in the Middle East can feel secure.

Aluf Benn presented his outlook on how Turkey is today being depicted in the Israeli media. He began his presentation by remarking that, despite the current Turkish-Israeli crisis, Israelis have no problems coming to Turkey and that it has not become any more dangerous for Israelis to visit the country. On the other hand, however, he noted that it might be more difficult nowadays for a Turkish citizen to visit Israel. The reason for this is that the Mavi Marmara incident has been depicted in the Israeli media in a way that labels Turks as terrorists, thereby fostering a view among the Israeli population that the AKP government is the Turkish equivalent of Hamas.

The Haaretz editor-at-large urged the Turkish population to understand that while their country is currently experiencing a democratic opening and a turn away from the old Kemalist regime, Israel has not undergone any significant political or social changes recently. The crisis with Turkey is, therefore, particularly shocking and worrisome for the Israeli people. But how can this long-standing alliance be so easily shattered? Benn underlined that cooperation has always been limited to small groups within both countries. Among the general publics, neither the Turkish image in Israel nor the Israeli image in Turkey had been very positive before, but the Kemalist elites, businessmen, and military had, nonetheless, been able to sustain good relations with their Israeli counterparts. Today, however, Turkey is a different country, the military has been considerably weakened, and the emalist elites have been pushed out of the center and towards the margins of society. The natural consequence of this for Israel is that the basis for a strategic alliance has been destabilized. However, Benn also tried to show how relations could be revitalized or at least normalized again, pointing to FrenchIsraeli relationship: In the 1950s the French state gave considerable support to Israel and its nuclear option. Today, this cooperation at the state-level has ended, but cooperation in the realms of trade, tourism, education, and culture still continues, so why is the same not possible with Turkey?

The journalist again pointed out that the two countries are very similar to each other: both are overwhelmed by their own history, both are experiencing a clash between secular and religious forces, in both countries the secular population feels that it is being governed by its “religious others,” and lastly both countries are Middle Eastern states with a Western orientation and, thus, exceptions in the region. Benn questioned why this cannot be the basis for cooperation among the small groups of secular and like-minded elites in both countries to work together to foster a new kind of civil relationship between Turkey and Israel, bypassing the state-level dispute and helping to deconstruct stereotypes on both sides.

Comments/Discussions

In a discussion following the three analyses, which reflected the concerns and frustrations of the Israelis regarding Turkey, the intentions of the AKP government under Prime Minister Erdoğan were addressed. One interpretation of the new attitude is that the government is not interested in becoming more “Eastern” for its own sake, but is pursuing a strategy of realpolitik and acting in accordance with its concrete interests. The Turkish public and political establishment have always perceived Europe and the USA to be strong, self-interested actors that modify their foreign policy in line with “profit-maximization.” Turkey is attempting to do the same and will continue to cooperate with Hamas if this serves its interests.

While Turkish-Israeli relations may be at a historical low-point on a sociopolitical level, economic relations remain relatively intact. This may open the door to a reestablishment of relations, as Nachmani and Benn suggested, removed from the public discussion on an economic, strategic, and diplomatic level. Most participants agreed that too much publicity, with the Israeli media depicting Turkey as a terrorist state and the flotilla as terrorist attack, and the Turkish media demonizing Israel, will worsen relations, and that discrete mediation by a disinterested third-party is urgently needed.

On the other hand, Turkey should retain close ties with Israel, but not at the expense of its relations with its Arab neighbors. In other words, the zero problem policy that Avineri aptly declared to have gone out of control must be revised. For this to happen, however, a more centrist and unbiased Turkish leadership, one that does not oppose Israel solely for domestic reasons or to win the next election, is needed. On the other hand, it should neither bother nor surprise Israel and the West that Turkey has been trying to reshape its foreign policy since the Cold War has ended. Power balances and interests have changed rapidly over the last twenty years, and policies have some catching up to do. Turkey and Israel had very close relations in the 1990s, but today are becoming more and more distant. The solution to this may possibly lie somewhere in the middle, where the countries would maintain a more balanced relationship.

Furthermore, the similarities between the two states should be subject to an in-depth debate: Besides the points the speakers already made regarding this issue, both groups of state leaders (Erdoğan-Gül-Davutoğlu and Netanyahu-Liebermann) were never part of the bureaucratic state apparatus but instead come from religious-nationalist and traditional segments of society. Thus, their coming to power has weakened the statist tradition in both countries. While each has experienced change, however, Turkey may be witnessing a faster and more significant transformation. Despite these changes, though, both continue to exist under the constant threat of being dissolved, and it is this shared vulnerability that may serve as the basis for a mutual understanding.

Crisis in Greece: Economic, Social, and Political Dimensions

26 November 2010

SEMINAR REPORT

Crisis in Greece: Economic, Social, and Political Dimensions

DPF 2010-SR 02

Speakers

Aristeidis Doxiadis (Investment Professional, Economic Sociologist)

Vassilis Pesmazoglou (Assistant Prof. Dr., University of Peloponnese, Department of Political Science and International Relations)

Georgios Pagoulatos (Assoc. Prof. Dr., Athens University of Economics and Business,

Department of International Relations and European Economic Studies)

Panel Chair and Moderator

Hakan Yılmaz (Professor, Department of Political Science and International Relations,

Boğaziçi University)

The conference entitled “Crisis in Greece: Economic, Social, and Political Dimensions,” took place on 26 November 2010 in the Boğaziçi University. The conference was conducted in English.

This one-day seminar has been organized to better understand the current crisis unfolding in Greece, with a focus not only on the economic, but also on the social, political, and cultural causes and consequences of this event. Our main goal was to give Turkish society an understanding of the current state of affairs in Greece as well as what impact the Greek crisis will have on the European Union. The meeting was conducted under Chatham House Rules.

Özet

2010 yılı, Avrupa Birliği’nin en çetin finansal ve siyasal krizlerinden birini yaşadığı bir yıl olmuştur. Yunanistan, İrlanda, Portekiz, İspanya’da art arda patlak veren krizler Avrupa Birliği’nin kurumsal sorunlarını ve iç çelişkilerini gün yüzüne çıkarmıştır.

26 Kasım 2010 tarihinde Boğaziçi Üniversitesi-TÜSİAD Dış Politika Forumu tarafından Yunanistan krizinin ve etkilerinin değerlendirildiği bir seminer düzenlenmiştir. “Yunanistan’ın Krizi: Politik, Sosyal ve Ekonomik Boyutlar” isimli seminerde krizin ulusal ve uluslararası nedenleri ve Avrupa Birliği açısından doğurduğu sonuçlar, özellikle Avrupa Birliği’nin kurumsal eksiklikleri ve bunların nasıl çözülebileceğine ilişkin öneriler tartışılmıştır. Seminere konuşmacı olarak Atina İktisat ve İşletme Üniversitesi’nden Doç. Dr. Georgios Pagoulatos, Peloponez Üniversitesi’nden Yard. Doç. Dr. Vassilis Pesmazoglou ve yatırım uzmanı ve ekonomik sosyolog Aristeidis Doxiadis katılmıştır.

Seminerde genel hatlarıyla Yunanistan’ın ekonomik yapısı incelenmiş, küçük sermaye sahipleri, düzensiz vergi politikaları, yoğun siyasi rantlar ve hiyerarşik yapıların düzensizliğinin Yunan ekonomisinin belirleyici özellikleri olduğu vurgulanmıştır. 1990’larda Yunanistan’ın Avrupa Birliği üyeliğiyle birlikte gelen görece yüksek büyümeoranlarının kamu borçlarının ödenmesinde kullanılmadığı, hatta düşen faiz oranlarının borçlanmayı arttırdığının üzerinde durulmuş ve bu durumun da finansal krizi tetiklediği belirtilmiştir. Avrupa Birliği’nin bir üye ülkenin yanlış ekonomi politikalarını denetleme konusundaki eksikliği ve Ortak Para Politikası'ndaki aksaklıklar da Yunanistan ekonomisini krize götüren süreçte etkili olmuştur. Küresel finans piyasalarının dengesizleşmesinin ve 2008'de başlayan küresel krizin etkisinin de gözardı edilemeyeceğine değinilmiştir. Seminerde benzer krizlerin engellenmesi için Avrupa Birliği’nin kurumsallaşmış önlemler almasının gerekliliğinin altı çizilmiş; piyasaların İrlanda örneğinde görüldüğü gibi aşırı liberalleşmesinin veya Yunanistan örneğindeki gibi popülist devletçi politikalarla piyasa dengelerinin çarpıtılmasının krizlere zemin hazırladığı vurgulanmıştır.

Executive Summary

In 2010 many EU member states experienced a severe fiscal crisis. With the financial breakdown of Greece and the impending crises in Ireland, Portugal and Spain, the Union had to come to grips with its institutional shortcomings and internal contradictions.

On November 26, 2010 the Boğaziçi University-TÜSİAD Foreign Policy Forum initiated a one-day seminar on the Greek fiscal crisis of 2010 and its repercussions. Entitled “Crisis in Greece: Economic, Social, and Political Dimensions” the event aimed at debating the domestic and international roots of the crisis and its consequences for the European Union. In this one-day meeting participants discussed the issues of what the Greek crisis could tell us about the institutional weaknesses of the Union in general and what possible solutions might lie ahead. The speakers from Greece were Assoc. Prof. Dr. Georgios Pagoulatosfrom the Athens University of Economics and Business, Assistant Prof. Dr. Vassilis Pesmazoglou from the University of Peleponnese, and Mr. Aristeidis Doxiadis, Investment Professional and Economic Sociologist.

The main points that were raised during the speeches and discussions related to Greece’s internal economic make-up with small companies, economic actors seeking political rents, a lack of consistent system of taxation, as well as a general absence of stable hierarchical structures. When Greece joined the European Monetary Union what happened was a kind of a ‘free rider syndrome’: interest rates for borrowing money suddenly dropped and the Greek economy grew considerably in the 1990s with an annual rate of 4-5 percent. This growth, however, was not used to pay back the piling public debt. The result was a relatively large public sector and high public debt, paving the way for an eventual fiscal breakdown.

The reason that the European Monetary Union could not easily and adequately respond to its members' financial mismanagement is the asymmetrical relationship that governs it with some countries paying in and others producing deficits year after year. The structural problems of Greece, the financialization of global capitalism, the subsequent emergence of edgy markets, as well as the unbalanced and insufficient institutional make-up of the EMU all worked to the disadvantage of the weaker EU member states and consequently to the disadvantage of the EU as such. An institutionalization of the EU’s rather ad-hoc responses to crises as well as a responsible financial management by the individual member states, that avoids two extremes −excessive laissez-faire policies (that have lead to the Irish crisis) and over-regulating domestic markets− have been identified as the key principles to stick to for the prevention of future fiscal breakdowns.

CRISIS IN GREECE: ECONOMIC, SOCIAL, AND POLITICAL DIMENSIONS

The Boğaziçi University-TÜSİAD Foreign Policy Forum conducted a seminar on 26 November 2010 at Boğaziçi University, concerning the political and social consequences of the 2010 Greek financial crisis. Entitled “Crisis in Greece: Economic, Social, and Political Dimensions,” the event was intended to generate discussion over the domestic and international roots of the crisis and its impact on the European Union. Throughout the day-long seminar, questions regarding what the Greek crisis can tell us about the institutional weaknesses of the Union as well as what possible solutions exist emerged as the central focus of the debates.

Three distinguished speakers from Greece as well as 35 participants from the academia, the media, the private sector, and civil society in Turkey took part in the workshop. The following issues were discussed during the seminar.

The Roots of the 2010 Crisis in Greece

One cannot properly identify the roots of the crisis in Greece without first addressing the causes of the global financial crisis of 2008, which resulted in declining growth rates and destabilized markets throughout the globe, especially within the credit and banking sectors. Triggered by the US subprime mortgage crisis of 2007, the anxiety that reverberated throughout world markets has led most recently to fears of a sovereign debt crisis, reinforced by events witnessed in Ireland and Greece in 2010.

The starting point for gaining a deeper understanding of what happened in Greece, therefore, is naturally to focus on the roots of the crisis. Most of the participants in the seminar agreed that the crisis was an outcome of a complex set of domestic factors, the shortcomings of the European Monetary Union (EMU), and the highly fragile state of global markets.

When Greece entered the Eurozone in 2001, it was already highly in debt. The new currency allowed the government to borrow at very low interest rates, thereby lowering considerably the risks of both inflation and devaluation. Greece benefited from this disappearance of currency risk, and country risk was not considered in Greece’s borrowing. The net result was that huge sums of hot money started pouring into Greece. What was not taken into account was the possibility that continuously increasing the public debt would, over the long-term, lead to a financial breakdown that would not only affect the country but the Eurozone as a whole. The growing anxiety in the markets stemming from the global financial crisis of 2008 obstructed the flow of hot money into Greece, resulting in severe external account imbalances. The major mistake of the government was that it did not attempt to curtail public debt when the economic growth rate was high (in the 1990s, for example, the annual growth rate was 4-5 percent). Instead, Greece turned out to be one of the Eurozone’s “free riders,” benefiting from the shared fiscal burden but not significantly contributing to the currency’s stability.

Why was the Greek government unable to perceive that this would not lead to any longterm solutions for the economy? The conference discussants emphasized that without considering the dynamics of Greek history and society, it would be impossible to contextualize this crisis properly. They also underlined the fact that the combination of certain structural and cultural factors has at least contributed to the emergence of this crisis: the Greek economy has few large companies and mainly consists of small businesses – around half of the workforce is employed or self-employed at firms with less than ten employees. The reasons for this structural outcome may be both historical and cultural: Greece – in contrast to most of its European neighbors – was never a feudal state and thus never experienced a system of strong hierarchical relations. Greece was, so to speak, a “democracy from the beginning,” meaning that small landowners had never been deprived of their property in the past. The country’s history has been marked by the continual overthrow of established orders, ranging from the Catholic Church to the Ottoman Empire. Widespread resistance to a wage system and central authority is also evidenced by recent protests as well as the increasingly high demands of the population vis-{-vis the state. Greek public discourse, however, more strongly condemns the (abstract idea of the) failure of global markets rather than the country’s own shortcomings.

However, when viewed from a different perspective, these societal and historical structures may have actually worked to Greece’s advantage, because small land ownership and the availability of rents as an additional source of household income serve to prevent people from sliding into serious poverty and deprivation. Thus, these structures help to preserve social equality and provide hope for the post-crisis recovery of Greece’s economy and society.

The problem with small-scale entrepreneurship in Greece is that, while it has largely been able to avoid excessive taxation, it has been characterized by fragmented ownership based on family ties and protectionism. The wealth acquired by entrepreneurs is to a large extent invested in infrastructure as well as in education for the younger generation, who often continue the family business after graduating from university. This lack of taxation, on the other hand, means that an important source of revenue for the Greek state is absent. This structure has also discouraged foreign investment since small-scale firms are not usually competitive internationally.

Another problematic issue is that, as in many countries of the Balkans, rent-seeking behavior in Greece is extremely prevalent. The pension age is low and the majority of Greek families derive some portion of their income in the form of rents, which supports their livelihood but in no way contributes to economic growth. This opportunistic economic behavior has made cooperation, the formation of large companies, for example, difficult and rendered the development of an economy based on efficiency and institution-building all but impossible.

Despite the fact that an agreement may be reached on the internal shortcomings that led to the financial crisis of 2010, it must not be forgotten that Greece has also been negatively impacted by the global recession as well as by the malfunctioning of the European Monetary Union, root causes that are clearly beyond the control of the Greek state. In addition, the asymmetric structure of the EMU is a problem that must be solved independently of Greece: while some countries, such as Ireland, Portugal, and Greece, have been increasing their public debt year after year, others, in particular Germany, are always net contributors. The fact that structural or cultural factors alone could not have caused the Greek crisis is evident when looking at the other three candidates for financial meltdown: Ireland, Portugal, and Spain. The very low public debt in Spain and the market failure in Ireland did not result from an oversized state apparatus or from protectionism, as in Greece, but, on the contrary, from an unregulated private sector. The multifarious origins of the 2010 crises in Europe make it evident that the architecture of the Eurozone is inefficient and that, in addition to a failing state apparatus, the doctrine of laissez-faire itself must be questioned.

Sociopolitical Repercussions of the Greek Crisis

Having identified at least a few of the origins of the Greek crisis, the political consequences that followed and will follow in the future must be evaluated: Greece today is witnessing the era of the “Third Republic,” which began in 1974. In the years 1974-81, the Greek economy was largely directed at democratic consolidation under a conservative government. What followed throughout the 1980s was a sort of socialist experimentation under the Panhellenic Socialist Movement (PASOK), marked by a phase of severe fiscal mismanagement in the first half of the decade and a more pragmatic attempt to join the single market in the second half. The 1990s were a decade of adjustment, characterized by low interest rates, low inflation, and ongoing borrowing by the public sector. This led to large increases in the public debt. Not surprisingly, Greece entered the Eurozone in 2001 with a public debt at 100 percent of GDP, while the limit for the EMU was 60 percent. The statistics being provided turned out to be incorrect, and even Greek ministers at the time were often unaware of the exact levels of debt held by the institutions under their authority.

Politically, a two-party system has existed in Greece since the 1980s, comprised by PASOK and the New Democracy Party. While the parties were highly polarized at first, the reformist segments in both parties consolidated in the 1990s due to the positive effects of economic growth. Today, however, with the worst economic crisis in recent Greek memory, once again political parties and society are becoming more polarized as extremist forces gain greater traction and visibility. Though PASOK is still able to maintain the upper hand, support is declining and the government is experiencing severe difficulties in introducing reforms while under constant pressure from opposition groups. Nevertheless, the declining support of PASOK should not be overemphasized given that almost all parties have seen declines in popularity due to the crisis. While several politicians have built splinter groups from the two major parties targeting both the extreme right and the extreme left segments of society, neither has been successful in gaining the trust of the Greek public to the extent necessary to bring down PASOK. However, this may change in the future: many Greeks are disappointed with the political system as such. In this tense political environment, new cleavages are emerging that endanger the credibility of the relatively stable, at least until recently, two-party system. Extra-party protests by anarchic groups as well as the rise of the extreme right might translate into Euroscepticism. Another cleavage is that between the pro-memorandum and anti-memorandum groups, the former including the governmentand the latter mainly consisting of radical splinter groups of PASOK and the New Democracy Party. In conclusion, the whole Greek sociopolitical system is in flux, and this poses major challenges.

The Way Forward

These challenges, however, can be transformed into opportunities if the right reforms are enacted and both Greece and the European Union are able to tackle the roots of the problem. A rescue of the Greek state would be based on the solidarity article in the Maastricht Treaty, which says that if an economic crisis is the results of factors beyond an individual country’s control, the other EU member states will support it in its recovery. Since, as was already discussed, the Greek crisis resulted from a complex set of internal and external factors, it is hotly debated whether the country is eligible to benefit from the solidarity clause. The problem, however, reaches well beyond the Greek case: the so-called “cohesion funds” will subsequently have to be used to bailout Ireland, Portugal, and Spain. If another EU member state’s economy takes a turn for the worse, these cohesion funds may not be sufficient to resuscitate it. Thus, a long-term solution for such cases has to be found and institutionalized by the EMU. One of the problems that should be raised in this framework is the hegemonic, asymmetrical structure of the EMU, with strong states not only bailing out but, to a certain extent, controlling and patronizing weaker ones. This will ring especially true if the new proposal by France and Germany regarding the EMU is passed. Whether this can be communicated to the populations of these weaker states without provoking resentment and Euroscepticism is doubtful. One of the more general shortcomings of the EU is that it functions in a rather ad hoc manner and seeks solutions to problems only after a crisis has already occurred. In the long run, the Greek crisis is only a minor problem when compared with the overall debt of the Eurozone. This is a much more substantial problem that can only be solved with the support of the European Central Bank.

Greece must rebuild its economic structure by either attracting foreign capital and to reorient towards exports or to allow for inflation to rise, which would be a burdensharing exercise for all EU member states. The flexibility of Greek entrepreneurs may actually prove to be an asset for implementing reforms: while the drawbacks to having such an extensive number of small-scale businesses are evident, this might also support a rather quick reorientation. The Greek workforce is self-confident and flexible enough to restructure; however, for this asset to hold any real value, impediments to cooperation must be overcome. Some initial and more obvious problems are the low and uncontrolled taxation and the kind (rather than the level) of public spending, which has aimed at expanding the public sector rather than reducing debt. The goal, therefore, must be to achieve qualitative growth. In particular, the tourism and shipping sectors are particularly strong in Greece and could be further developed.

On a societal level, it is crucial to overcome the resentful attitude of the population and to construct a public discourse that the crisis can be used as an opportunity to overcome some of Greece's long-standing economic bottlenecks. Otherwise, any proposed reforms will not find enough support from the electorate and might also push moderates in the leading political parties to adopt more populist strategies. Furthermore, it is important not to reduce the causes of the crisis solely to cultural factors, since this would mean that change is rather unlikely: cultures change over time, and critical junctures (insofar as we may conceptualize this crisis as a juncture) can alter the direction of policies as well as shape public opinion. On a political level, it is unlikely that the authorities that are at least partially responsible for the irrational spending will be held responsible. Although the political system is, to a certain extent, destabilized, the changes that will occur in the aftermath of this crisis are more likely to be seen in the private sector than in the political structure.

One final crucial question concerns what the Greek economy will look like over the following decade, in other words: how will it change or be forced to adapt to circumstances resulting from the crisis? Another main concern is whether the EMU will treat these numerous crises as an opportunity to seek not only superficial and shortterm solutions, but to rethink its own architecture and identify the mistakes of the past.

The State of European Integration and EU-Turkey Relations:

Where Do We Go From Here?

17 December 2010

SEMINAR REPORT

The State of European Integration and EU-Turkey Relations:

Where Do We Go From Here?

DPF 2010-SR 03

Speakers

Axel Sotiris Wallden (Head of the Enlargement Strategy Unit, Directorate General for

Enlargement, European Commission)

Gerald Knaus (Chairman, European Stability Initiative; Visiting Fellow, Carr Center for

Human Rights Policy, Harvard Kennedy School)

Panel Chair and Moderator

Kemal Kirişci (Professor, Department of Political Science and International Relations, Boğaziçi University)

The conference entitled “The State of European Integration and EU-Turkey Relations:

Where Do We Go From Here?,” took place on 17 December 2010 at the TÜSİAD Conference Room. The event was conducted in English.

We have organized this one-day seminar to explore current developments in EU-Turkey relations within the larger context of European integration. We have brought together three experts from the EU member states and Turkey to exchange their experiences and thoughts on the current state of affairs and future prospects of EU-Turkey relations and European integration. The meeting was conducted under Chatham House Rules.

Özet

Türk Dış Politikası’nın temel hedeflerinden biri Avrupa Birliği’ne tam üyeliktir. 2004 yılında Türkiye’nin AB’ye tam üyelik için aday ülke olarak ilan edilmesinin ardından müzakere sürecinde aksaklıkların meydana gelmesi ve siyasi gündemin de AB hedefinden kaymasıyla, kamuoyunun Avrupa Birliği’ne üyelik hevesi sönümlenmiş ve yerini güçlü bir Avrupa-şüpheciliğine bırakmıştır.

“Türkiye-AB İlişkileri: Kim Kime Sırtını Dönüyor?” başlıklı toplantı, Avrupa Birliği Genişleme Komisyonu üyesi Axel Sotiris Wallden ve Avrupa İstikrar Girişimi’nden Gerald Knaus’ın yanı sıra sivil toplumdan, medyadan, akademi ve özel sektörden önemli temsilcilerin katılımıyla 17 Aralık 2010 tarihinde Boğaziçi-TÜSİAD Dış Politika Forumu’nun düzenleyiciliğinde gerçekleştirilmiştir.

Toplantıda katılım müzakerelerin sekiz başlıkta askıya alınmasına neden olan Kıbrıs Sorunu’nun çözüme kavuşturulmasının ve Türkiye-Yunanistan yakınlaşmasının Türkiye’nin üyeliğinin önündeki engellerin aşılması için gerekli olduğu güçlü bir şekilde vurgulanmıştır. Türkiye’nin üyeliği önündeki esas engelin Kopenhag kriterlerinden daha çok dini, kültürel ve coğrafi nedenlerden kaynaklanan anlaşmazlık ve uyuşmazlıklar olduğu argümanları çerçevesinde ortak bir Avrupa kimliğinden söz edilip edilemeyeceği ve Türkiye’nin bu haritadaki yeri tartışılmış, Türkiye’nin atacağı en stratejik adımın Avrupa kamuoyunun taşıdığı önyargıları yıkmak yönünde politika geliştirmek olduğu belirtilmiştir. Tartışmalar sonucunda Türkiye’nin üyelik sürecinin devam etmesinin hem Türkiye’nin demokratikleşme sürecine, hem de Avrupa Birliği’nin çoğulculuğa ve hümanizme dayalı kurucu değerlerinin derinleştirilmesine katkıda bulunacağının altı çizilmiştir.

Executive Summary

Turkey-EU relations seem to be going nowhere. The euphoria of the early 2000s has been replaced by a growing Euroskepticism in Turkey and a deepening Turcoskepticism in Europe.

With the participation of Axel Soitris Wallden from the EU Enlargement Commission, Gerald Knaus, Founding Chairman and lead analyst of the European Stability Initiative, and around 40 distinguished guests from the Turkish academia, media, civil society and the private sector, the Boğaziçi University-TÜSİAD Foreign Policy Forum put together a oneday seminar on December 17, 2010 entitled “The State of European Integration and EUTurkey Relations: Where Do We Go From Here?, with the purpose of exploring the roots of the depressive state of affairs between the EU and Turkey and discussing possible ways out of the current impasse.

During the speeches and the debate the following issues were strongly emphasized. Firstly, the role of the Cyprus conflict should not be understated – this unresolved problem is a severe obstacle to the further development of the EU-Turkey relations. Secondly, GreekTurkish rapprochement should continue, and the parties should cooperate form a solution to the Cyprus and other questions. Thirdly, The perception that Turkey challenges the idea of an allegedly coherent European identity continues to shape a great part of the European public opinion with regard to Turkey. Turkey’s main problem, from this exclusionary perspective, is not political, as expressed in the Copenhagen criteria, but cultural, involving its religion, history and geographical location. Hence, a strategically beneficial step would be for individual Turkish intellectuals, artists, academics, and civic activists to actively take part in the European forums and debates about culture and identity. In conclusion most participants agreed that the negotiation process between Turkey and the European Union should be kept in motion even if it does not result in full membership in the near future. Both parties are benefiting and learning from each other. Turkey took significant steps towards democratization and it needs the Union in order to maintain its scope and pace in the turbulent times of transition. The EU, on its part, needs Turkey to further democratize itself, to rethink its notion of self and others, and to reassume its pluralistic and humanistic founding ideals.

THE STATE OF EUROPEAN INTEGRATION AND EU-TURKEY RELATIONS:

WHERE DO WE GO FROM HERE?

The Boğaziçi University-TÜSİAD Foreign Policy Forum conducted a seminar on the current state of affairs and future prospects for Turkey and EU relations on 17 December 2010 at the TÜSİAD Conference Room. Entitled “The State of European Integration and EU-Turkey Relations: Where Do We Go From Here?”, the seminar aimed to discuss problems and obstacles facing relations between Turkey and the EU as well as possible ways to resolve these issues. Two distinguished speakers with expertise on Turkey-EU relations together with participants from academia, the media, civil society organizations, and business attended the seminar. The following points and arguments were discussed during the meeting.

The problems that persist in the Turkish accession process to the EU, which has been obstructed many times due to Turkish disputes with Greece and Cyprus, should not only be evaluated within the framework of bilateral relations from the 1960s onwards. Greek-Turkish rapprochement should be supported for the benefit of both parties, and the problems Turkey is experiencing with the EU should be analyzed in a broader sense that considers not only issues related to Turkey, but the identity issues of the European Union itself. The real issue at stake is that of European identity, and its future either with or without Turkey.

The heart of the matter, therefore, does not only concern the will or capacity of Turkey to meet the Copenhagen criteria. Yet, fully meeting the Copenhagen criteria, especially with respect to democracy and human rights, is the sine qua non for Turkey independent of its potential for EU accession. On the other hand, a democratic, reform oriented, secular, and economically powerful Turkey neighboring the Union on its Eastern border is also in the best interests of the EU. Turkey may benefit from such a credible European perspective by strengthening its democracy, which may help it to overcome some cleavages that threaten its democracy.

Rising European public opposition to Turkish accession, even in countries whose governments had supported Turkey’s membership bid from the beginning, is a vital point to be evaluated. In the era of globalization, economic and social crises, and Euroskepticism, life is becoming more difficult for EU citizens, a trend that is translating into opposition towards enlargement in general and Turkish accession in particular. This reaction has led to the blossoming of Islamophobia, xenophobia, protectionism, and regressive nationalism by extreme rightwing populist policies that revive old and hostile images of Turks. In fact, behind this apparent opposition lie migration pressures, which generate problems of integration of groups possessing a diverse set of cultural backgrounds and identities. The impacts of the last round of enlargement and the prospect of Turkish accession combined with the immigration problem are the subjects of an intense debate that has translated into xenophobia and Islam phobia.

Changes in public opinion in Germany are a clear manifestation of this phenomenon. Germany was the driving force supporting Turkish accession from 1998 onwards. This attitude changed, however, in 2005, when the Christian Democrats came to power. Public opposition was triggered by the writings of some intellectuals such as Thilo Sarrazin and Necla Kelek. In the writings of these intellectuals, Turkey and “Turks” are attributed a backward, religious, and patriarchal identity in an essentialist manner that provokes the sentiment that Turks cannot be integrated into the EU. Furthermore, these depictions trigger arguments such as German society is becoming less intelligent Because of intra-family marriages, which are frequent among Turks. The debate about Turks in Germany demonstrates that the Turk is recognized as an actor undermining German well-being. The goal of these Islamophobic intellectuals is to attribute certain characteristics to Muslims and then to present them as a threat to European values. Some politicians, such as Angela Merkel and Christian Wulff, have not jumped onto this train of populism, realizing that the Turkish diaspora constitutes an important segment of the electorate. Instead, they take positions defending the Turkish minority in Germany. President Christian Wulff has declared that Islam is part of Germany and that the country is slowly getting used to it. More mosques are being built and, starting this year, imams will be trained at German universities.

Turkey may be able to overcome these widespread prejudices by instituting certain measures at home. For example, inviting Greeks, and not only the descendants of GreekTurkish families, to live in Turkey can help to build bridges and refute popular prejudices. Visa liberalization can also be used to increase the popularity of Turkey in Europe. Moreover, increasing the number of female members of parliament may be helpful in destroying the image of patriarchy often associated with Turkey. A stronger role for women, a solution to dress inequality, measures against domestic violence, reforms in minority rights, a strengthening of relations with Greece, and the drafting of a new constitution are counted among the steps Turkey can take to overcome these prejudices.

Opposition based on economic arguments also dominates the public discussion over Turkey’s membership to the EU. The accession of a country that would arguably require large financial transfers is understandably unpopular in a time of budgetary austerity and reluctance to forfeit sovereignty over to EU institutions. Although Turkey’s economic dynamism promises hope for the future, this for the time being does not seem sufficient to refute these arguments. Turkish accession is acceptable only if EU transfers to the member states are adjusted downwards, a move that is certainly going to be opposed by the economically weaker member states. Proponents of the Common Foreign and Security Policy would consider Turkey’s membership an asset, especially in terms of bringing greater stability to the Middle East and Southern Caucasus, even though the possibility of the EU sharing a border with Iran and Syria poses a huge challenge.

The eventuality of Turkey’s accession is not only about Turkey, but is part of a much broader debate over the essence of societal models and the future of the EU, debates which dominate the EU’s agenda. The decision on Turkey’s accession is unlikely to be agreed upon in the EU as long as the Union’s existential struggle continues. A federal union with a strong component of cohesion and solidarity and a robust role in world affairs may be more likely and able to assimilate Turkey.

The fulfillment of the Copenhagen criteria must be perceived as a modernization track rather than a to-do list for accession. These reforms may deprive opponents of valid arguments against Turkish membership. Moreover, Turkey must alter its language from an accusatory to a reconciliatory discourse, which would be more appropriate for a future member state that aims to influence the state of affairs within the Union. Keeping the process on track and preventing a “train collision” is in the interest of both parties, at least in the short-run.

The participants of the seminar, however, deemed the possibility of a train wreck to be unlikely. Instead, the analogy of a “catholic marriage” may be used to more accurately depict the nature of EU-Turkey relations. Divorce is unlikely because, on the EU side, suspension of accession negotiations would require too many votes, and it is unlikely on the Turkish side because Turkey did not walk away from the Council of Europe even when it was accused of serious human rights violations in the 1990s. Walking away from the negotiating table would mean defeat, an undesirable outcome for Turkey. Despite the financial crisis, opposition voiced by Angela Merkel and Nicolas Sarkozy, rising Islamophobia, and the existence of blocked chapters, the process continues. Turkey has continuously made advances in the negotiation process. What Turkey should do at this stage is to continue steadily implementing reforms, despite the setbacks stemming from the EU side.

However, from the Turkish angle, the issue is a more problematic. Given the inevitability and problematic nature of the accession negotiations, the rhetoric of modernization is insufficient to sustain public support. Modernization is a function of conditionality, and conditionality has to be credible in order to generate enthusiasm for modernization. In accession negotiations, there is no positive impetus, no credible reward for Turkey’s effort. In this sense, Turkey serves as a glaring example.

Recent debates on the shift of axis in Turkey’s foreign policy are fed from this lack of positive impetus on Turkey’s EU journey. This position is manifest even in the maps that place Turkey in Eurasia. Previously, maps depicted Europe in the center and ended with Turkey at the right-hand corner of the page, but, nowadays, maps that place Turkey at the center of the page are being drawn, reflecting new ambitions in Turkey’s foreign policy. In terms of trade and economic relations, the proportion derived from the EU slightly declined as Turkey’s focus shifts towards different regions. In terms of travel/migration, between 2000 and 2009, 152 million foreign nationals came to Turkey. Around 35-40 percent were from European countries and only 11 percent were from Middle East, more than half of those being from Israel. Yet, the contention is that this distribution will reverse rapidly due to the visa liberalizations enacted between Turkey and several Middle Eastern states. Because of this new image of Turkey, even though the projections do not reflect reality, Turkey desperately needs the EU for reasons of economics, the geopolitics of its neighborhood, as well as its own internal politics. In the context of the new projections of the government to establish some kind of “Ottoman Commonwealth,” an interesting dimension of the EU-Turkish relationship has come to surface. Middle Eastern states do not want a patronizing Turkey, and they perceive the EU anchor as a guarantee in their relations with Turkey. Ironically, Turkey needs the EU because of its new image in the East: the Arab world is increasingly insecure about Turkey’s intentions. If Turkey turns its back to Europe, this would endanger both its geopolitical strength and popularity. Turkey’s neighborhood wants a Europeanized Turkey; it sees the EU as a guarantor against a patronizing Turkey.

Among the economic factors, visa obligations played an important role in pushing Turkey to create alternative markets in its neighborhood as well as in Africa and to accompany them with visa liberalizations facilitating trade. Anatolian tigers are uncomfortable with the Schengen visa procedures when they are trading with EU countries, whereas their European counterparts do not have such obligations. The unequal nature of trade in terms of visa obligations are disturbing to businessmen, so they are putting pressure on the government to open up and create new markets. Turkey’s trade within its neighborhood, however, lacks balance, and this feature cannot endure for very long. Yet, trade between Turkey and the EU is balanced and founded on a more compatible and equal relationship. In order to clarify this with an analogy, “Turkey is selling trucks to Europe, and buying trucks from Europe,” and this relationship is more sustainable when compared with newer markets. In terms of internal political reasons, accession to the EU should be among the top foreign policy priorities not only for the aim of modernization, but because it still remains the best democracy in Turkey’s neighborhood despite recent backlashes. Considering the authoritarian tendencies that Turkish democracy has experienced, especially over the last few years, manifest in the government’s reaction against student demonstrations, the EU anchor appears to be the best model to help Turkey regain its pluralist democracy credentials and counter the Islamist challenge.On the other hand, Turkey can also lend a hand to reinforcing pluralist democracy in Europe. Statistics from the International Affairs Institute in Rome reveal a negative tendency for EU democracies. Schengen visas granted to European neighbors of the EU increased by 188 percent in 2003-2009, whereas the number granted to Maghreb countries (Morocco, Tunisia, Libya, and Algeria) remained constant, and for Lebanon, Syria, and Jordan, it only increased by 14 percent. The EU needs Turkey in order to overcome this disparity not only in economic relations, but also in terms of democratic equality.

The discussions in the seminar made it clear that, no matter what the current state of affairs, keeping the EU-Turkey negotiation on track, if not accelerating it, will benefit both parties. The EU is still the best foreign policy option for Turkey, and the recent changes taking place within the EU reveal that Turkey is an important partner and ally in helping to address the growing xenophobia within the Union.