1 turkey and eu turkey and eu presentation for tasno 19 august 2005 dr. uğur aker

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Turkey and EUTurkey and EU

Presentation for TASNOPresentation for TASNO19 August 200519 August 2005Dr. Uğur AkerDr. Uğur Aker

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OutlineOutline

Short HistoryShort HistoryEconomic EffectsEconomic Effects

Single marketSingle market Institutional reformInstitutional reformExpected Migration from Turkey to EUExpected Migration from Turkey to EU

Cultural FactorCultural Factor

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Short HistoryShort History

European Coal and Steel Community European Coal and Steel Community (1951) - cooperation between six (1951) - cooperation between six countries.countries.

Treaty of Rome - EEC Treaty(1957) - Treaty of Rome - EEC Treaty(1957) - formation of customs union.formation of customs union.

Turkey applied for associate membership in 1959.

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Turkey signed an association agreement Turkey signed an association agreement with EEC (first step to membership) in with EEC (first step to membership) in 1963.1963.Czech Republic signed an association Czech Republic signed an association

agreement in 1993.agreement in 1993.Turkey submitted a formal application for Turkey submitted a formal application for

membership in 1987.membership in 1987.Poland and Hungary applied in 1994.Poland and Hungary applied in 1994.

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EU granted financial assistance and EU granted financial assistance and preferential tariffs initially but during the preferential tariffs initially but during the 70s and early 80s gradual, mutual 70s and early 80s gradual, mutual reductions in tariffs and non-tariff barriers reductions in tariffs and non-tariff barriers were suspended.were suspended.

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Customs Union started in Customs Union started in 1996 and completed in 1996 and completed in 2001.2001. Industrial goods between Industrial goods between

Turkey and EU are free from Turkey and EU are free from tariffs and quantitative tariffs and quantitative restrictions.restrictions.

Turkey has aligned its trade Turkey has aligned its trade policies with the EU.policies with the EU.

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The agreement with Turkey goes beyond a The agreement with Turkey goes beyond a normal Customs Union. It also covers the normal Customs Union. It also covers the harmonization of technical legislation, the harmonization of technical legislation, the elimination of monopolies and the protection of elimination of monopolies and the protection of intellectual property. intellectual property.

Negotiations continue on the mutual opening of Negotiations continue on the mutual opening of public procurement markets, liberalization of public procurement markets, liberalization of trade in services, and the abolition of restrictions trade in services, and the abolition of restrictions on the freedom of establishment.on the freedom of establishment.

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In Helsinki (1999) Turkey became the only In Helsinki (1999) Turkey became the only candidate for membership without a candidate for membership without a timetable.timetable.Cooperation for adopting the legal framework Cooperation for adopting the legal framework

((acquis communautaireacquis communautaire).). In Nice (2000) a revision of vote In Nice (2000) a revision of vote

distribution excluded Turkey implying that distribution excluded Turkey implying that EU-15 did not plan for Turkey to become a EU-15 did not plan for Turkey to become a member in the foreseeable future.member in the foreseeable future.

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The Progress Report in 2002 stated that The Progress Report in 2002 stated that Turkey did not fulfill the Copenhagen Turkey did not fulfill the Copenhagen (1993) criteria of political and human (1993) criteria of political and human rights.rights.Political and human rights: “stability of Political and human rights: “stability of

institutions guaranteeing democracy, the rule institutions guaranteeing democracy, the rule of law, human rights and respect for and of law, human rights and respect for and protection of minorities.”protection of minorities.”

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Copenhagen CriteriaCopenhagen Criteria Economic criteria declared to Economic criteria declared to

be fulfilled in 2003 Progress be fulfilled in 2003 Progress Report: harmonizing with EU Report: harmonizing with EU in terms of electricity, in terms of electricity, financial services, agriculture financial services, agriculture and telecommunications. and telecommunications.

Progress Report in October Progress Report in October 2004 acknowledged 2004 acknowledged fulfillment of the political and fulfillment of the political and human rights criteria.human rights criteria.

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““Major political Major political developments in the developments in the country led to the country led to the decision to open decision to open accession accession negotiations at the negotiations at the December 2004 December 2004 European Council European Council summit.” summit.” ROMANO PRODI, THE

PRESIDENT OF THE EUROPEAN COMMISSION, Ankara, 14 January 2004

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EU ObjectionsEU Objections

““Turkey is too big; it will be the most Turkey is too big; it will be the most populous country in EU.”populous country in EU.”

““Turkey is too poor.”Turkey is too poor.” ““Turks will flood Europe.”Turks will flood Europe.” ““Turks are a different culture.”Turks are a different culture.”

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Economic EffectsEconomic Effects

Budget burdenBudget burdenBecoming a single marketBecoming a single market Institutional reformsInstitutional reformsMigrationMigration

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EU Budget BurdenEU Budget Burden

Current framework: 2000-2006 (EU-15)Current framework: 2000-2006 (EU-15)2007-2013 Framework (EU-25)2007-2013 Framework (EU-25)2014-2020 Framework (EU-27/28)2014-2020 Framework (EU-27/28)The optimistic date for Turkey’s accession The optimistic date for Turkey’s accession

is 2015 under rules determined by EU-is 2015 under rules determined by EU-27/28.27/28.

Full budgetary support will not be Full budgetary support will not be implemented before 2020.implemented before 2020.

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Daniel Gros, Director of Center for Daniel Gros, Director of Center for European Policy Studies, estimates that European Policy Studies, estimates that Structural Funds (Structural Funds (for regions with a GDP per capita at PPP below 75% of the EU average) contribution to Turkey in 2015 contribution to Turkey in 2015 would be about 0.16% of EU-28 GDP would be about 0.16% of EU-28 GDP under the current rules, assuming that under the current rules, assuming that Turkish GDP reaches 4% of EU-28 by Turkish GDP reaches 4% of EU-28 by 2015.2015.

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AgricultureAgriculture In 2001, agriculture comprised 14.2% of value In 2001, agriculture comprised 14.2% of value

added in the Turkish economy. This share was added in the Turkish economy. This share was smaller than that for Bulgaria (28.2%) and Romania smaller than that for Bulgaria (28.2%) and Romania (19.3). It was much larger, however, than in the (19.3). It was much larger, however, than in the CEEC-10 (6.9%), and the EU-15 (2.5%).CEEC-10 (6.9%), and the EU-15 (2.5%). 5% of GDP transferred to farmers. 5% of GDP transferred to farmers. guaranteed output prices, guaranteed output prices, import protection, import protection, export subsidies, export subsidies, subsidized services to farmers subsidized services to farmers

Agricultural policy is being gradually reformed, Agricultural policy is being gradually reformed, eliminating market interventions in favor of direct eliminating market interventions in favor of direct paymentspayments..

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Assuming that Turkish agriculture will Assuming that Turkish agriculture will comprise 10% of Turkish GDP in 2015 (it comprise 10% of Turkish GDP in 2015 (it is 12% today), and the CAP support will is 12% today), and the CAP support will still be 20% of agricultural income, the EU still be 20% of agricultural income, the EU CAP burden will be (0.2*0.1*0.04) 0.08% CAP burden will be (0.2*0.1*0.04) 0.08% of EU GDP.of EU GDP.

But Turkey will be required to contribute But Turkey will be required to contribute 1.2% of its GDP to EU Budget.1.2% of its GDP to EU Budget.

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Maximum budgetary cost, full membershipTurkey 2015 in an enlargedEU (in % of EU GDP)

Structural Funds 0.16CAP receipts 0.08Total receipts 0.25Contributions to EU budget 0.05(Max) Net receipts for Turkey 0.20

According to Michaele Schreyer, Commissioner responsible for the Budget, the cost of CEEC-10 will be 0.08% of EU-15. (Brussels, 18 April 2002). Yet, the European Commission estimates that the long-run effect will be positive 0.4% of GDP for EU-15.

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Trade liberalization of Turkey integrated her Trade liberalization of Turkey integrated her more to the rest of the world.more to the rest of the world.

The sum of imports and exports as a share of The sum of imports and exports as a share of GDP was only 18% in 1980; it increased to GDP was only 18% in 1980; it increased to almost 50% in 1999, and 54% in 2004.almost 50% in 1999, and 54% in 2004.

A relatively low degree of openness implies that A relatively low degree of openness implies that a trade increase due to the single market has a trade increase due to the single market has less effect on the total economy than for less effect on the total economy than for countries with a higher degree of openness.countries with a higher degree of openness.

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Membership Means MoreMembership Means MoreCustoms Union has not catapulted Turkish standard of living as much as membership did for the other comparable countries.

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Economic EffectsEconomic Effects Accession to the internal market may increase trade Accession to the internal market may increase trade

for at least three reasons. for at least three reasons. Administrative barriers to trade will be eliminated or at Administrative barriers to trade will be eliminated or at

least reduced to levels comparable to those between least reduced to levels comparable to those between current EU members: less time delays, less formalities at current EU members: less time delays, less formalities at the border. the border.

Reduction in technical barriers to trade. Mutual Reduction in technical barriers to trade. Mutual recognition of different technical regulations, minimum recognition of different technical regulations, minimum requirements and harmonization of rules and regulations. requirements and harmonization of rules and regulations.

Risk and uncertainty will be mitigated. Especially political Risk and uncertainty will be mitigated. Especially political risks and macroeconomic instability may reduce risks and macroeconomic instability may reduce substantially.substantially.

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According to Lejour & De Mooij, aggregate According to Lejour & De Mooij, aggregate trade with the EU can rise by 34% if trade with the EU can rise by 34% if Turkey were full member of the EU, as Turkey were full member of the EU, as compared to the situation in 2001.compared to the situation in 2001.

WorldScan simulations yield 20.3% WorldScan simulations yield 20.3% increase (8.1% exports and 12.2% increase (8.1% exports and 12.2% imports).imports).

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Institutional ReformInstitutional Reform

Turkey has to conform to all EU legislation and Turkey has to conform to all EU legislation and enforcement by the European Court of Justice. enforcement by the European Court of Justice.

Turkey will regularly be assessed by the Turkey will regularly be assessed by the European Commission and other Member European Commission and other Member countries on its economic policies. countries on its economic policies.

EU-membership can thus trigger institutional EU-membership can thus trigger institutional reform in Turkey and reduce corruption. reform in Turkey and reduce corruption.

Internationally Turkey ranks low on the Internationally Turkey ranks low on the corruption index.corruption index.

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Turkey’s rank in 2004 was 77th with a score of 3.2.

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Institutional ReformInstitutional Reform

If by improving institutions and obtaining If by improving institutions and obtaining more discipline within bureaucracies, the more discipline within bureaucracies, the TI Corruption Perceptions Index of Turkey TI Corruption Perceptions Index of Turkey would rise from 3.2 to 6.3 (Portugal’s would rise from 3.2 to 6.3 (Portugal’s rank), aggregate trade of Turkey would rank), aggregate trade of Turkey would rise by 57%.rise by 57%.

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MigrationMigration

Most migration predictions useMost migration predictions useProximityProximity Income differencesIncome differencesJob opportunitiesJob opportunities ““Kinship” connectionsKinship” connections

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ProductivityProductivity

These productivity comparisons show that the Turkish economy is not only on average ‘more developed’ than the economies of Romania and Bulgaria, but Turkish productivity outside agriculture is close to, or in some cases even higher than what we observe in the new member countries.

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•The experiences of Greece, Portugal and Spain indicate that a successful accession period with high growth and effective implementation of the reforms reduces and gradually eliminates the migration pressures.

•EU-15 labor markets closed up to 7 years after accession. •Full mobility of Turkish workers in 18-25 years. EU labor markets in 2025 •ageing of the population (not only among the EU-15, but also the new members) •there might be labor shortages, instead of the widespread unemployment. •If Turkey grows according to its potential, it might no longer be so attractive for Turkish workers to emigrate.

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Slower Growth More MigrationSlower Growth More MigrationDeutsche Bank suggests three possible scenarios for Turkey over the next 15 years. In the first, Turkey pursues the economic and political reforms needed to converge with the EU; in the second, it drifts back to the weak governments of the 1990s, but with less economic volatility; and in the third, it is destabilized by geopolitical uncertainty, kept at bay by the EU and polarized by tensions between secular and religious forces. The long-term annual growth rates associated with these scenarios are, respectively, 4.1%, 3.1% and 1.9%

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MigrationMigration

Keeping GDP per capita at 31% of EU-15 Keeping GDP per capita at 31% of EU-15 average but including demographic average but including demographic changes into their calculations, Lejour and changes into their calculations, Lejour and De Mooij forecast migration from Turkey to De Mooij forecast migration from Turkey to the EU of 2.7 million people by 2025. This the EU of 2.7 million people by 2025. This equals 4% of the current Turkish equals 4% of the current Turkish population, or another 0.7% of the current population, or another 0.7% of the current population in the EU-15.population in the EU-15.

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Why?Why? Economic calculations yield positive results Economic calculations yield positive results

for EU and for Turkey. for EU and for Turkey. Turks overwhelmingly want to become a Turks overwhelmingly want to become a

member country. member country. But why is there such a visceral objection to But why is there such a visceral objection to

Turkey’s membership?Turkey’s membership? What is the “cultural” difference?What is the “cultural” difference?

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Turkey Is Knocking, but EU Is Hesitating Since when do you toss a rotten apple into the barrel to improve the diversity of the pippins and macintoshes? Europe is planning its own cultural demise by aquiescing to the demands of Turkey to be admitted to the EU, which will allow the free flow of Turkish Muslims throughout Europe. Officials are aware of the dangers, but are willing to plunge ahead anyway, despite all the recent Muslim violence and the chasm of culture. In Turkey, the practice of "honor killing" continues, and dozens of girls and women are murdered annually for affronts to impossibly rigid gender behavior codes. As is increasingly the case in modern "democracies," multiculturalism-brainwashed elites in government are ignoring the polls which show their citizens reject the scheme. Seventy percent of Germans believe that Islamic culture does not fit in the west, and 55 percent are against Turkey's EU entry, as are 67 percent of the French. The BBC believes Turkey's EU inclusion will "disprove the theory of a clash of civilisations between Islam and the West" — as if a political union could end the tribal nature of human psychology or obliterate a thousand years of enmity.

http://www.limitstogrowth.org/WEB-text/archive-dec04.html

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Thousands took to the streets in Milan Dec. 19 to protest Turkey's accession to the EU, calling it a "Muslim invasion." In a statement, leader of the Northern League Umberto Bossi said, "Without our history we are dead, our history is not up for sale." Organizers estimated that 50,000 took part in the demonstrations. Justice Minister Roberto Castelli spoke to the crowd gathered around Milan's gothic cathedral and asked, "What will happen when 80 million Islamists with a high birth rate have

the right to settle on our land?"

http://www.limitstogrowth.org/WEB-text/archive-dec04.html

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Valerie Giscard D’EstaingValerie Giscard D’Estaing

””It would be “the It would be “the end” of the EU if end” of the EU if Turkey were ever Turkey were ever actually to get in. actually to get in. Turkey is by Turkey is by definition definition unacceptable as unacceptable as an EU member.”an EU member.”

Another fear-mongering site: http://www.e- grammes.gr/ turkman.htm

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Voices of ReasonVoices of Reason

European Union is, above all, a community of shared values based on the principles of liberty, democracy, human rights, fundamental freedoms and the rule of law. All these values are enshrined in the Charter of Fundamental Rights of the European Union. SPEECH OF ROMANO PRODI, THE PRESIDENT OF THE

EUROPEAN COMMISSION, AT THE TURKISH GRAND NATIONAL ASSEMBLY. Ankara, 14 January 2004

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Voices of ReasonVoices of Reason

The proposition that Europe can be defined by religion is a false one, not to say dangerous. In many ways, the European Union is a reaction against the idea that we can define ourselves by religion or ethnicity — and thus define others as beyond consideration. Chris Patten,

EU Commissioner for External Affairs (From his May 2004 speech)

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Two Perceptions of CultureTwo Perceptions of Culture

Pre-political: ascriptive - identity and Pre-political: ascriptive - identity and collective unity based on common collective unity based on common descent, religion, race, ethnicity etc. descent, religion, race, ethnicity etc.

Political: centered on the civic aspect of Political: centered on the civic aspect of one’s identity and collective unity based on one’s identity and collective unity based on citizenship. citizenship.

In the construction of modern Europe, In the construction of modern Europe, ascriptive culture has been the problem ascriptive culture has been the problem and civic culture the solution.and civic culture the solution.

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Voices of ReasonVoices of Reason What is common to the modern Europe of What is common to the modern Europe of

nation-states is precisely a civic culture nation-states is precisely a civic culture embedded in a secular, democratic and embedded in a secular, democratic and constitutional concept of citizenship equipped constitutional concept of citizenship equipped with individual rights and responsibilities. This is with individual rights and responsibilities. This is the achievement of the European nation-states the achievement of the European nation-states against the background of a painful history of against the background of a painful history of wars, massacres, and expulsions that were wars, massacres, and expulsions that were inflamed by differences of religion, sect, race inflamed by differences of religion, sect, race and ethnicity. Whereas ascriptive cultures divide and ethnicity. Whereas ascriptive cultures divide Europe, it is the achievement of civic culture that Europe, it is the achievement of civic culture that unites them. unites them. Prof. Ilkay SunarProf. Ilkay Sunar

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Turkey and EUTurkey and EU

Turkey as a potential member needs to Turkey as a potential member needs to be judged by not the ascriptive criterion of be judged by not the ascriptive criterion of culture but by civic standards, and not by culture but by civic standards, and not by its history but by its commitment to the its history but by its commitment to the same democratic culture practiced by same democratic culture practiced by other members of the EU. other members of the EU.

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"As a GERMAN NATIONALIST, I am against Turks' being accepted into the EU." "And as a TURKISH NATIONALIST, I am against Turkey's entering the EU."

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Turkey’s IthacaTurkey’s Ithaca

Even if the extremists Even if the extremists were to win and Turkey is were to win and Turkey is denied membership, as denied membership, as long as the next ten years long as the next ten years establish the institutional establish the institutional reforms for a society that reforms for a society that respects the rule of law, respects the rule of law, rights of minorities, and rights of minorities, and democratic processes, democratic processes, Turkey’s journey would Turkey’s journey would have been worth it.have been worth it.

1 turkey and eu turkey and eu presentation for tasno 19 august 2005 dr. uğur aker

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