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Brief as it was, the failed military coup last Friday will likely be seen in the retrospect of history as having had special significance for Turkey. I believe this because it is turning what previously was a gradual, stepwise move away from the secularist, liberal democracy Ataturk sought to establish when he re-invented Turkey into a headlong rush for a religion-driven autocracy. Rather than weakening the openly and arrogantly authoritarian President Erdogan, the botched putsch has given him fresh legitimacy and has helped him cement his already potent political position. Erdogan quite openly called last weekend’s events “a gift from God” and it is in many ways a victory for political Islam, giving a huge impetus to his counter-secularist movement, which will soon be in overdrive. The consequences will prove to be unpalatable not only for any true democrat in Turkey but also for the European Union and the United States. The Turkish economy is likely to take a hit as long-promised reforms are further delayed and as foreign investment flags.
 
      It was not hard to foresee that the military uprising would end in failure. To be sure, since modern Turkey was founded in 1923 the men in uniform have successfully toppled governments four times. But the last time was 35 years ago and, soon after President Recep Tayyip Erdogan’s Justice and Development Party (AKP) came to power in 2000, his regime unleashed several waves of “cleansing” and forced retirements among the top brass that destroyed the old cliques. Moreover, even the roughly half of the population that dislikes Erdogan and the direction in which he is taking the nation did not want to see his power broken by a return to military rule. Leaders of all political parties, even those who bitterly oppose Erdogan and the AKP, promptly condemned the attempt.
 
      So, Mr. Erdogan succeeded by commanding the airwaves and calling on the Turkish people to take to the streets and defend his government. He sent a text message to every mobile telephone in the country. He appealed to religious sentiments. He had clerics issue calls to prayer at times when these were understood to be calls to action. Tens of thousands responded and with people power, the police and sections of the armed forces that had remained loyal the badly planned and haphazardly executed coup attempt was quickly crushed. Democracy triumphed, or so it may have seemed. International leaders congratulated Erdogan. But they will hardly be happy with what has since transpired and what will now continue on an accelerating path.
 
      Newly strengthened and having successfully appealed to religious sentiments in the country, President Erdogan will redouble his drive to knock down the remaining barriers toward the one-man rule of the executive presidency he envisions, and to turn Turkey, which the military is sworn to preserve as a secularist republic, into an Islamic state. Already prior to the ill-starred coup he had replaced a cautiously independent Prime Minister with an unquestioning loyalist. He had caused some 900 journalists to lose their jobs in the opening months of this year (33 were arrested), had prosecutors launch more than 1,800 cases against people suspected of having insulted him, and persuaded parliament to lift the immunity of its members to open the way for most of the representatives of the Kurdish Peoples Democratic Party to face prosecution (generally, it appears, on trumped-up charges). The proposal was carefully worded to make sure that senior AKP members named in a 2013 corruption probe retain their immunity.
 
Since the coup attempt, Erdogan has had the security forces detain nearly 9,000 people on claims that they played a role in it. This includes close to 6,300 soldiers, among them one-third of the country’s 358 generals and admirals. Erdogan also had almost 23,000 teachers and administrators fired from their jobs, including university professors and deans. And he suspended the governors of 30 of Turkey’s 81 provinces. That the lists from which the names of those affected were drawn had been available already in the waning hours of the putsch would seem to suggest strongly that they had been prepared some time ago, to be used at the first opportunity offering itself.
 
      Perhaps this explains the “gift from God” remark. Now, even though calm has been restored, Erdogan has imposed a state of emergency that permits him and the Cabinet to bypass parliament in making laws. This may well include constitutional amendments which ordinarily his ruling AKP does not have the majority votes to pass. The opportunity may be used to move much of the Prime Minister’s powers and authority over to the Presidency. Moreover, Faced with demands from some of his supporters that he reintroduce the death penalty with retroactive effect, which would require a change in the constitution, Erdogan said that he could not ignore this demand. “Why should I house them (the coup plotters) and keep them in prisons for years to come,” was his unapologetic reply.
 
      The man who had a “saray” or presidential palace built for himself at a reported cost of USD 615 million is now swimming with the stream. Pro-Erdogan sentiments are running high. What is worrisome, though, is that among the supporters who rushed to follow his call and surged into the streets to defy the putschists were not just plain-vanilla AKP members but also sizeable numbers of avowed Islamists and jihadists who formed mobs that beat captured soldiers and even beheaded some of them ISIS-style. According to a recent poll by the Pew Research Center, 27% of all Turks do not view ISIS unfavorably. Mr. Erdogan may envision his religion-based “presidential democracy” as a new sultanate of sorts, but there are people claiming to be his backers who have rather different ideas.
 
      For Turkish relations with the United States these trends do not bode well. Turkey is a vital member of NATO and the US has a strong interest in the use of the Incirlik Air Base in Southeastern Turkey, which, as a military asset, is central to the US presence and strategy in the Middle East.
But US officials have been complaining for some time that Turkey was becoming increasingly difficult to work with, not only when it comes to fighting ISIS but even in matters concerning NATO. Given the uncertainties that now bedevil the Turkish military, the intelligence and security services and the country as a whole, there can be no doubt that the tensions will rise further.
 
An additional source of conflict will be the insistence of Erdogan’s regime that the Obama Administration immediately extradite the cleric Fethullah Gulen, who since 1999 has lived in self-imposed exile in the Poconos in Pennsylvania. Gulen was once a close friend and supporter of Erdogan, but he is now being blamed for maintaining a “hidden, parallel state” designed to undermine Erdogan and to have masterminded the failed putsch. Erdogan’s clique wants him to be sent to Turkey to “go through the judicial process there.” Unfortunately, this “process” is hardly one evoking confidence in its fairness. Besides, the US Secretary of State has been trying to make it clear that Washington has procedures to follow and requires credible evidence for any extradition request, but Ankara views this as unfriendly “stalling.”
 
      For Europe, Turkey is a bridge to Asia and also a bulwark. But there, too, relations have been rather tense of late. European nations need Turkey’s cooperation in slowing the flood of refugees entering from war-torn areas of the Middle East and beyond. Only recently Turkey agreed to take back illegal migrants crossing to Europe in exchange for visa-free travel to the bloc for Turks, the resumption of its long-stalled accession talks to join the EU, and 6 billion euros in financial aid. Negotiations have been so difficult, though, that last month Ambassador Hansjoerg Haber, a German appointed less than a year ago, resigned. He made it clear that this was over issues “having to do with Turkey,” not for personal reasons.
 
As of now, Brussels is still withholding visa-free travel from Turkey because Ankara still has not met the EU’s final seven conditions, which include the issuance of biometric passports, cracking down on corruption, being more cooperative in answering extradition requests and reining in the wide net of anti-terror laws that are being used to harass journalists, academics and politicians. In fact, the country has been sliding backwards in many respects, such as freedom of speech, women’s rights, the rule of law, and the peace process with the Kurds.
 
Obviously, a reinstatement of the death penalty would put an end to any chances of Turkey joining the EU. But many in Turkey are no longer nearly as  interested in becoming part of the European Union as they once were, and Brexit has put a further dent into such desires. Indeed, with growing ardor isolationists in the AKP have been telling the people that the “European model” is not suitable for Turkey and that the nation ought to pursue one rejecting liberal democracy as an ideal. Erdogan, on and off, has given approving nods to such notions.
 
None of this will be good for the Turkish economy. The coup attempt has added uncertainty to that of an already tumultuous year that has seen two general elections, the ouster of a widely trusted Prime Minister and a wave of terror attacks that have been blamed on Kurdish terrorists and ISIS. This uncertainty is not good for tourism, shipping, and above all investment. Multinational companies with business in Turkey have generally reacted calmly and have not reported major disruptions, although some have pulled out employees and drawn up contingency plans. But they are now likely to hold back on many fresh commitments until the political outlook is clearer, and Turkish companies are likely to become more circumspect as well.
 
The weakness of local equities and of the lira’s exchange market performance show that investors are troubled. Real gross domestic product increased by 4.8% in January-March over the first quarter of 2015, which spells a marked deceleration from the 5.7% clocked in last year’s final three months. It was still a fairly strong performance when compared with the 4.0% rise attained in all of 2015, but a breakdown shows that the advance was powered entirely by consumer spending and by massive outlays from the public till, while investment stalled. Tourism revenues have declined every month so far this year. In May they were down 23%.
 
Tourism is hard to uphold when travelers fear being massacred at the airport. Investment stays away where socio-political conditions are combustible and strict adherence to the rule of law is not guaranteed. Above all, Turkey’s Achilles heel is a persistent and large current-account balance-of-payments deficit that needs to be bridged with reliable inflows of capital from abroad. Moody’s has issued a warning that it may downgrade the country’s credit rating to junk status. The Central Bank has cut one of its key interest rates despite the lira’s plunge, raising questions about its continued independence. The CB’s bias is expected to remain dovish, which will help to undermine the lira further. And there is a risk that an escalation in capital outflows may lead to serious strains on the BoP.