TURKISH FOREIGN MINISTER ALI BABACAN TO YEMEN TIMES: "BUILDING CONFIDENCE IS KEY TO A COUNTRY’S DEVELOPMENT"

Yemen Times
mp;p=report&a=2
Feb 23 2009
Yemen

Ali Babacan was born in Ankara in 1967. He graduated first in the
Class of 1985 from TED Ankara High School. In 1989, he received a
Bachelor of Science Degree (BS) in Industrial Engineering from the
Middle East Technical University in Ankara, where he ranked first
among the graduates of that year.

In 1990, he was awarded a Fulbright Scholarship and attended the
Kellogg School of Management at Northwestern University in Evanston,
Illinois, where he received his Master of Business Administration
(MBA) in Marketing, Organizational Behavior, and International Business
in 1992.

>From 1992 to 1994, he worked at a Chicago-based company providing
financial consulting services to top executives of major banks in
the United States.

Subsequently, he returned to Ankara to run his family business from
1994 until 2002.

In 2001, he became a Founding Member and Board Member of the Justice
and Development Party (AKP).

During the general elections held in November 2002, he was elected
to Parliament and was appointed as the Minister of State in charge
of Economy, a cabinet position he retained throughout the 58th and
59th Governments of the Republic of Turkey until August 2007.

In addition to his tenure as Minister of State in charge of Economy,
on June 3, 2005, he was appointed as Chief Negotiator in Turkey’s
accession negotiations with the European Union. At the general
elections held on July 22, 2007 he was re-elected to the Parliament. On
August 29, 2007, he was appointed as the Minister of Foreign Affairs
of the 60th Government of the Republic of Turkey. He is married with
two children.

Nadia Al-sakkaf interviewed Babacan on his visit to Yemen.

Turkey’s economy has been growing rapidly, making it the sixth
European economic power and predicted in 2009 to become the 15th
largest globally. How did this happen? And how can Yemen learn from
Turkey’s economic success story?

I [Ali Babacan] was the minister of finance in the years between 2002
and 2007, and so I can tell you candidly that it was a difficult
mission. In the early years of this millennium Turkey had large
public debts and the banking sector was weak. We have very little
oil and no gas, so we realized that we had to grow the industrial
and service sectors.

First, we made large economic reforms in public finance, in the
banking sector, and most importantly, we made Turkey an easy place to
invest. We simplified the rules, but we applied them all. Gradually
confidence started to build, and we doubled our foreign direct
investments from one billion US dollars in 2002 to two billion in
2003. In 2005 the FDI grew to 10 billion; it grew to 20 billion in
2006, and 22 billion in 2007.

You can see that by making our investment environment friendly we
built long term confidence in the country’s economic environment,
and today companies from all around the world come to invest in
Turkey. Building confidence is key to a country’s development.

Second, we worked on developing the industrial sector. We focused
on manufacturing and while in 2002 our exports value was 36 billion
dollars, mostly raw materials and agricultural produce, in 2008 it
reached 132 billion and included heavy machinery, vehicles, technical
equipments, and the like.

Consequently, the GDP grew from 230 billion US dollars in 2002 to
750 billion in 2008.

If there is a straightforward formula on to how to build a strong
economy, I would say there are three factors: political stability,
a focus on macro economy, and the creation of an easy business
environment for investors.

How has the global financial crises affected Turkey’s economy?

Turkey and Spain were the only two countries in Europe that did not
need to support its banking sector in order for it to survive. The
large scale reforms we conducted between 2003 and 2005 in Turkey’s
banking sector years proved very useful and you could say they
made our banking sector stronger and more capable of surviving the
economic blows.

Our ambition is to make Turkey among the top ten world economic powers
by 2023, and we have persistently created steps to reach this goal.

Relations with Yemen

We have excellent relations with Yemen and they are getting
stronger. There is mutual respect and good feeling between the Turkish
and Yemeni people, and this is a very important base upon which we can
increase our political dialogue, trade exchange, cross investments,
technical exchange, and other relations in other fields.

During my visit we discussed bilateral and regional issues, especially
Gaza. We do realize the appreciation of many Arab and Islamic countries
for our role in the Palestinian-Israeli conflict. And Erdogan’s
stance in Davos is understood because we believe that military might
is no solution. Over 1300 people were killed in the Gaza crisis,
yet nothing has changed. The only way to solve the issue is through
political dialogue.

This is my first visit to Yemen, although many Yemeni and Turkish
high level officials have exchanged visits in the last few years.

We should have more regular visits and have frequent consultations
on regional and bilateral issues.

Yemen is an influential country in the region, and has a lot to offer
the Arab world.

How do you see Yemen developing into an economic power?

Yemen has much potential that it should invest in. The location is
very strategic and can be used to improve Yemen’s economic conditions
significantly. Additionally, Yemen has a huge base of human resources
which should be invested in. I also think that Yemen should invest in
its noble culture; there is an element of trust in the Yemeni people
that is kind and hard to find.

It is very important to simplify rules, especially for investment. Not
only that, but it is important to have written rules for the practice
of investment. In other words, in order to create confidence in any
country’s system, what is written must be implemented and what is
implemented must be written.

Turkey has recently been very active in the Islamic world and the
Middle East, sometimes even overshadowing countries such as Egypt,
Syria, and Iran. Is this the new direction for Turkey – leading the
Islamic world rather than being part of the European Union?

Turkey is a part of NATO and is a country listed for European Union
candidacy. It is also a Mediterranean country and our aim is to build
closer relations with our neighboring countries. Turkey’s foreign
policy is to talk to all and to open communication channels for peace
and mutual interest.

Our intention is not to overshadow any other country; in fact, we work
with all. With regards to the Syrian-Israeli conflict, we have played
a mediation role. We also hold talks with all the Palestinian groups.

The ruling party of Turkey, a secular country, is one whose ideology
is defined as through Islamism and economic liberalism. Is there
a conflict here? How does an Islamic party, the AK party, lead a
secular country?

The AK party has a conservative democratic ideology. It is sensitive
about ethnicities and vocal about these concepts. Turkey’s secular
system means that the state is at equal distance from all religions
and all sects. It allows for religious freedoms. We built a system
that respects all faiths of the people. And as a political party we
have our own fundamentals which are respected. Candidates are voted
for by the people; we are a political party elected by the people and
so we are in power because the majority of the Turkish people chose us.

What about the claims that although Turkey defines itself as a
democratic country, it oppresses its Armenian and Kurdish minorities?

I cannot deny that we had problems five or six years ago as you
mentioned, but we worked on these issues. We even changed the
constitution to allow more freedom and more representations of all
sects in Turkish society. Years ago it was forbidden to have songs
or even CDs in the Kurdish language, but now there is a Kurdish
TV channel. Today we have more than 400 TV stations and 1100 radio
channels, so today you can see the extent of freedom of expression
we developed.

Throughout the last few years we carried out huge reforms, not just
in our economy but political reforms in developing democracy and
implementing the law for all without discrimination.

The municipality elections are set for March 29. How does the AK Party
reply to accusations of corruption by Deniz Baykal of the Republican
People’s Party (CH Party)?

Polls so far show good results for us, and if the elections were to
take place today I could tell you that we will win, but the thing
with politics is that you can never take anything for granted.

You must realize that this is a time of political campaigning so such
accusations are expected. My response to this is that we have courts
in Turkey and if anyone has evidence of any of those accusations they
can easily file a case in court. In Turkey, even mayors do not have
immunity from the law and courts are independent of any political
influence.

But of course those who accuse the AK party of such misdeeds will not
use the legal channels because their accusations are baseless. If there
was any truth to this we would be the first people to take action,
but then again my response is that the courts are there to put such
accusations in perspective.