by Sine Ozkarasahin
The first month of the year was marked by the anticipation of the new minimum wage reform announcement – which was set to increase the minimum wage by 15% – from 2.029,59 TL (net) to 2.334 TL (net) (corresponds to an increase of roughly 325 USD to 374 USD). The size of the increase fuelled outrage within the lower and middle-income class, especially amongst the workers belonging to the blue-collar category. However, the state of economic well-being of Turkish citizens rests upon a much deeper phenomenon that has been haunting the country since the 1950s and continues to do so.
The Rise and Continuation of Neoliberalism
Since the election of the neoliberal leader Celal Bayar in 1950, Turkey has been on a trajectory towards Western dependency. Both on economic and political terms, the country’s increasing alliance with the United States was correlated with decreasing sovereignty for Turkey and its people, which prompted student mobilisation against neoliberalism and resistance in the 1960s. Regardless, under the Justice and Development Party (AKP) rule, this approach for unregulated foreign direct investment, tax exemptions for big companies and increasing foreign control on Turkish infrastructure, agriculture and production became the norm for the country’s international relations strategy.
This reform is most evident in agriculture. The period in question was marked by the replacement of Turkish produced goods, such as wheat, with imported varieties. Despite the country being able to produce 95% of the legumes it needs using local products, around half of the products in stores are imported. This is a result of the aforementioned Western-oriented reforms which included a decrease in investment in small-scale farming industry and land available for farming, instead focusing on easing the barriers of entry for foreign companies. Consequently, the small-scale farming industry has become more costly than profitable, which transformed the industry into a net-importer of food products. To have avoided this, a better approach may have been training and small-scale, consistent investments, which could have kept small-scale farmers more competitive.
This policy is seen throughout other domains too. In domains such as infrastructure and real estate, the government has been selling domestic assets to finance the account deficits, which has adversely impacted the population’s poverty rate. While around 15% of the population lives in poverty, projects such as Kanal Istanbul (a new, artificial waterway which will create a new path of trade via the Istanbul Bosphorus) continue to be undertaken, taking a significant share of public investment which could be spent on the human capital instead.
The Problem with Neoliberalism: Sustaining the Top-Down Approach
These reforms in the aforementioned domains are the result of a top-down approach, that disregards the emphasis on community-strengthening as advocated by a bottom-up approach. In Turkey, this approach dominates numerous sectors, ranging from education to production and agriculture, reinforced by Turkey’s elite and the youth’s mindset.
That is to say, while the Turks are busy criticising the insufficiency of the increases in the minimum wage, a bigger problem may be the rent-seeking behaviour of the elites and a lack of collective alliance, which in the past has been a predominant force that engenders reform. In Turkey, there is no current opposition nor an established, strong trade union resisting this growing dependency on the West and the declining national control on the means of production. In numerous domains, ranging from agriculture to infrastructure, the political elites have been one of the most prevalent tools to enforce this dependency on the West. As it still continues today under the current minister of economy, Berat Albayrak, the politicians in charge have repeatedly said that they can be relied on and that everything will be fine by increasingly assisting export-dependency and neglecting the small-scale producers. Additionally, they have supported the West’s soft power for decades, creating a sense of perception that looks up to the West and present buying Western products and producing for Western markets as the best option for development.
However, this elitist approach is not the only thing sustaining this trend. There is a second, a non-institutionalised factor that plays into this phenomenon: the society’s (especially the youth’s) mindset. The Turkish youth is in favour of the idea of consuming Western products despite their increasing price against the weakening Turkish lira. Even in times of economic crisis, many studies have found that especially for clothing, the Turkish youth demonstrate a strong preference for foreign brands and shopping malls that are mainly dominated by foreign-owned stores such as Zara, Nike and Mango, as they have an ‘international recognition’. Many young people in Turkey still prefer to consume imported products than to donate to a cooperation that supports small-scale Turkish farmers and production, as they usually think that a Western product is automatically higher in quality.
Alongside these economic explanations, the mindset of the Turkish youth can also be explained by the declining prospects of job opportunities, the restricted availability of quality local products in the market and the increasing political freedoms. This is coupled with the high barriers of entry to the market that prevents the local producers from reaching the population. Combined, these play to the detriment of domestic industries.
Despite this, according to research done by EuroMed Youth III Programme, around 74% of the Turkish youth feel a belonging to their country. Further, around 50% find that the government investment in the production opportunities in regions outside of Istanbul, Ankara and Izmir are not sufficient. Therefore, the majority of the youth surveyed agree with the argument that despite the rural regions’ (such as Anatolia and the Southeast) potential to grow and produce, it has been neglected by the government. This portrays that whilst a Western-oriented mindset prevails, nationalistic ties still exist.
How to Address the Shortcomings: A Bottom-Up Approach
The way to solve this vicious cycle may be through investing in projects that support community-based approaches and increase opportunities for small producers/farmers and grassroots organisations. Diplomacy and advocacy in favour of increasing trade competitiveness via investing in the domestic labour force and production facilities is crucial. The Turkish investors and entrepreneurs should strive for advertisement strategies that would utilise Turkey’s biggest category of consumers: youth. Following this strategy, the economic respectability of Turkey may have the potential to return. When these factors merge, they reinforce each other to produce positive outcomes for the topic in question, allowing for the potential of a more self-sufficient future for Turkey.