It is the Economy, Stupid!

Lately, problems about Syria seem to have monopolized our attention.

Instead of speculation and sectarian gambling in the MidEast, let me distract you towards some bread and butter issues, my dear readers…

Recently, one of the largest business associations in Turkey called MUSIAD had its annual convention in Istanbul.

Popularly, MUSIAD is known as the ‘Muslim’ Industrialists & Businessmen Association in Turkey, even though the ‘M’ in their acronym stands for ‘Independent’ in Turkish.

The Uber-Prime Minister Erdogan gave a speech at the MUSIAD Convention. The highlight of his speech:

Lamentably low commercial ties among the world's Muslims.

According to the Turkish Prime Minister, the Muslims in the world should wake up and realize that they form a whooping 22% of the world population! Subsequently, they should circle their wagons and start buying and selling from each other.

Now, isn’t that grand? How come no one came up with this brilliant idea until Tayyip-the-Nuevo-Leader-of-World-Muslims uttered it?

After the Prime Minister’s speech calling for the “Muslims of the World, Unite!” the head of MUSIAD obviously got the message.

In his speech, MUSIAD President Olpak happily announced that the trade volume of Turkey with the European Union (yep, the one Turkey is a candidate to join since 1999) was going down.

No doubt with the help of God Almighty, the trade volume of Turkey with the Middle East and other Muslim countries in Asia and Africa was on the rise!

The Head of MUSIAD is not cooking up these numbers. The import-export trends in recent years clearly show that Turkish economy is gradually decoupling from Europe. For the first time last year, the trade volume with the EU fell below 50%. Russia, Asia and MENA countries are inching their way up, gradually becoming more important trade partners for Turkey.

Should we worry about this? 

Yes...Here is why:

We have a saying in Turkey: Tell me who your friends are, and I’ll tell you who you are.

This principle is applicable to imports and exports: Tell me who your export partners are, and I’ll tell you how advanced your economy is. 

When Turkey exports to Europe, or to any other advanced economy (Australia, Canada, etc), that means those Turkish products that reach these markets, meet higher standards. Almost always the EU has higher consumer, environmental, and quality standards than say India, China, Saudi Arabia or Pakistan.

Hence, when Turkish economy performs in order to meet the EU standards, it is compelled to improve itself. The target market inevitably creates a progressive dynamic for the Turkish economy.

Let’s look at our fellow Muslims, who after all form 22% of the world population and grow more rapidly than anyone else.

Last time I checked, none of the majority Muslim countries had established advanced industrial economies, including the oil-rich, taxis-are-all-Mercedes city-states of the Gulf.

Worse, many of them, such as Yemen, are at the bottom of the Human Development Index. This means, their populations are poorer, less educated and live shorter. The state of women in these countries is not what you’d call decent.

Here is an example of what economic delinking from the West and cozying up to our fellow Muslims would look like in practice:

Instead of producing TV screens, electronic components, car parts, sophisticated pharmaceuticals, and organic fruit for Germany, France or Italy, Turkish economy would produce electric blankets, aspirin, carpets and furniture for Libya, Iraq, Pakistan and Syria (assuming things there calm down soon).

You don’t have to be a rocket scientist to realize that the products aimed for the EU markets have higher technology components to them. Consequently, they have higher profit margins, greater potentials for R & D, innovation and advancement. You can be only so sophisticated and innovative, while making carpets and furniture.

This is only one problem about steering Turkish economy away from advanced economies, towards lesser-developed ones.

Here are two more:

What would the Prime-Minister & Co-Chair of Dialogue Among Civilizations think, if the US President called for solidarity among the Christian economies in the world??

Imagine Obama saying: “My fellow Christians. Today, let’s forget our differences as Protestants, Catholics and Orthodox. We are more than 2 billion people. Let us combine our economic forces into a single global Christian economic community!”

Sounds weird, does’t it.  

According to the Pew Research Center, 2.18 billion Christians make up almost 1/3 of world population. That’s a pretty sizable market. But you never hear any sensible political leader calling for economic cooperation based on religion.

Even Hugo Chavez has more common sense. Across Latin America, which shares common Iberian and Catholic ties, Chavez advocates unity based on Bolivarianism and socialism, that is, ideology not religion.

Why?

Because, this is the 21^st Century! Hello??? It is discriminatory and wrong to advocate your cause -let alone call for economic integration- based on religion.  

Finally, there is the World Trade Organization.

WTO is a free trade organization among nations. It guarantees that the members play according to the logic of free trade, which means being rational actors.

As such, WTO prevents favoritism and discrimination among countries in their economic affairs. In short, it tells that if you’re a member, you cannot discriminate the Australians because of their funny accents, nor can you favor the Italians, oh because they’re so hot! :))

Back to serious business:

Turkey signed the treaty and became a member of WTO in 1995.

Erdogan’s suggestion of favoring Muslim countries in foreign trade is ultimately a violation of the treaty obligations that Turkey signed onto. As the head of executive, and an advocate of market economy, he should know better. 

Below is an excerpt is from the WTO mission statement.

“Through these agreements, WTO members operate a non-discriminatory trading system that spells out their rights and their obligations. Each country receives guarantees that its exports will be treated fairly and consistently in other countries’ markets. Each promises to do the same for imports into its own market.”

I'm not suggesting we should turn our backs to any economy that is worse off than Turkey. 

But this shouldn't come at the expense of economic rationality, and undermine long-term development capacity of the country. Nor should primordial ties like religion, ethnicity or race be the basis of economic solidarity. 

Wishing you all rational and non-discriminatory economic decisions,

The bread & butter advocate, Academic Mommy