Investment Climate in Turkey

Dear Colleagues,

Today, On June 10th 2005 Friday evening, I participated to a conference as prepared by a reputable local economic and strategic studies foundation for an highly intellectual local audience of more than 100 distinguished guests in Ankara at about 1900 hours.

Speaker was a senior Foreign Service Officer of a Western Embassy in Ankara in charge of Economic and Energy affairs. He started the presentation with his broken Turkish as courtesy to local culture but continued to speak in that manner as if he was checking our nerves. It is good to have foreigners speaking our language, as a courtesy for short period time, but one should warn them that we are not so comfortable to witness someone to play with our holy language so terribly.

Anyhow we are so polite as usual, and we stand firm that situation. Normally if one would do the same with English language, nobody would listen to him/her.

Speaker repeated the same latest energy situation, although we all know the details very well. Anyhow he intelligently pronounced the same energy issues as if they were new. All good news, BTC pipeline, El-Paso offshore , and Chevron inland oil explorations. All were nothing new. However he slightly, and brilliantly but clearly stated that existing investment conditions are not favourable for international investors. There are arbitration disputes in energy projects (BOT, TOR etc) ongoing, corruption is still on, there is less transparency. Local Laws are ever changing etc., and not reliable for longterm investment. All true.

As an experienced foreign diplomat working for the Embassy Economy Section, he said that the Caspian resources, which are crucially important for the world and the region, are exagerated.

He said that the Caspian is not El Dorado and that it will not be a solution for the energy needs of some countries. He reported that the Caspian has a total of 33 billion barrels in oil reserves and that this figure is equal to the oil reserves in the North Sea and the US.

We all thank to him, however the followup questions were so simple or odd that there was no point to continue. So our polite moderator stopped the event and then he invited the guests to the open buffet cocktail at the roof. We were on 10th floor of the prestigious building next to TOBB in Kizilay.

In our one-to-one personal conversation, I asked our speaker why International investors are not coming to Turkey anymore. He clearly stated that there is less interest in investing in Turkey since there are many other countries to invest and get more return.

I also expressed my wish that the ambassadors would be more commercial oriented rather than political. I asked him if it was because of the nearby war and the indifference at this end, and invader expectations were not returned. He noted positively. I also advised him that Turkish companies are handling all logistics of Iraq, paying high cost of human sacrifice. Moreover Turkish companies are handling the reconstruction activities in Iraq although there is high risk of terrorism.

Our guest speaker was not so interested in continuing that conversation, since he explained all his feelings to the highly influencial local audience towards ever cooling mutual cooperation expectations in future.

It is my feeling that we should all understand that it is too distant to expect anything for investment or further cooperation opportunities from the others, and we should work hard, and depend and trust ourselves in order to stand firm, and survive at this very difficult geography.

Your comments are always welcome!!

COMMENTS

I can guess which ambassador you're talking about.
Denying the U.S. passage during the Iraq operation was a big strategic and tactical mistake for which they will make you pay through the nose in the coming years. The fickle U.S. foreign policy has now shifted to alliance with the Kurds and the new satellite states in the area, and is aiming at downgrading Turkey's strategic and economic importance. A U.S.-backed Independent Kurdistan is a virtual reality. You have played into the hands of the game designed by, you know who.

Transforming Turkey from a secular state into a controllable, moderate Islamic Republic was an idea hatched in Washington 15 years ago. This is now being successfully used as an excuse both by Europe and the U.S. to further the plans of creating Europe's Mexico, a buffer state betwen The West and the Islamic World, a second-class client at the whim and the mercy of The West. Yes, you are now too Islamic to be European, and too anti-American to deserve consideration as an investment haven. Islam, a deified form of Medieval Communism, is incompatible with the West's capitalistic values. Islamic countries are doomed to economic extinction unless they have a resource that can be exploited by the West. As we all know, Saudi Arabia's GNP would be zilch if they did not have oil, and who would ever invest in an Islamic desert kingdom?

Americans have traditionally invested in countries where political stability is guarded under the force of arms if necessary, and they don't really expect foreigners to fall for their own rhetoric about democracy, etc. A reliable military government is always preferable for them to a wishy washy democracy, especially one where the fundamental national consensus has not been achieved.

Even a few weeks before the Iraqi operation your diplomats did not believe the U.S. would invade Iraq. That's a serious lack of foresight. They had no idea how the Americans think. The same can be said for the U.S., but they hold the cards. You have no professional political lobby in Washington to speak of, and no economic lobby at all. The Bush Dynasty takes loyalty very seriously, and they take things personally, but decision making in Washington is still a complex process. Things can change, but it takes salesmanship, a word that Turks generally do not understand. That's your biggest problem. Best Regards
Ata Guven, Vancouver, Canada