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Writing in his column dated 7 December 2005, Economics correspondent for best-selling daily Hurriyet Ertuđrul Özkök sees no reason to be pessimistic about the Turkish economy in 2006. Translated from Turkish by Tim Drayton.

Will next year be worse?

ERTUĐRUL ÖZKÖK

Looking at the large companies’ year-end analyses, sentiment in Istanbul business circles is that:

‘2006 will be a bad year’.

Should we take this as read?

* * *

Whoever I speak to says:

’Turkey has seen four consecutive years of good growth. Until now two or three consecutive years of growth have always been followed by a slowdown. That’s what will happen this time.’

When I ask why this will happen, the only answers I get are the negative experiences of the recent past.

And my question is:

Should we base our 2006 analysis on past precedent?

Or should we create a new paradigm geared towards the future?

I see compelling reasons to be optimistic about the future.

Every country that has started accession talks with the European Union has achieved at least three years of stable growth as of that date.

Moreover, those countries had less well developed market economies than ours.

Even so those countries attracted a significant inflow of foreign capital and investment once negotiations started.

If they were able to do it, why can’t we?

* * *

We have to break through this psychological barrier.

We all know very well that these expectations about the future that we call psychology affect the investment environment and economic outlook.

When future expectations turn negative, this impacts negatively on consumer behaviour and investment.

The economy’s natural reflexes put it on the defensive.

When in fact there is currently no reason for us to adopt negative expectations.

They talk of a degree of stagnation in the retail market.

Well, there is.

But we cannot escape the fact that at a time of high petrol prices we are witnessing unprecedented levels of traffic congestion.

This does not apply to Istanbul alone.

The same complaints are even heard in small towns.

In other words, citizens are continuing to use private vehicles.

Road haulage is still operating at a high capacity.

So the wheels of the economy are turning.

* * *

If the economy is on track why is this not reflected in the citizens’ pocket I hear you asking.

There is undoubtedly a certain amount of truth to this.

The citizen has still to reap the full benefits of growth in the economy.

But do not forget that in 2001 we underwent a very serious economic crisis.

We have yet to shake off the effects of that crisis.

Aged couples in the United States of America have still not forgotten the crisis of 1929. Even if they had no first hand experience of this crisis, the experiences of their grandfathers have been handed down from generation to generation.

* * *

Turkey is currently bandaging its past economic wounds.

It will continue to bandage them for a while longer.

But all of us know one thing well.

Ordinary people are living better now than they were four or five years ago.

Per capita income has risen to five thousand dollars.

On a purchasing parity basis, this is equivalent to seven or eight thousand dollars.

Per capita income of ten dollars is no longer an idle dream.

It may even soon become true.

Nobody should have any doubts that our children will live better lives than ourselves.

* * *

So what could upset this positive outlook?

In the first place, terrorism.

Then matters like the alcohol ban and headscarves that could harm Turkey’s image.

And these would undoubtedly strain our relations with the EU.

I believe Prime-Minister Tayyip Erdođan possesses sufficient intelligence and common sense to be aware of these possibilities.

Archive of Turkish press translations by Tim Drayton