new perspectives on turkey

Transkript

NEW
PERSPECTIVES
ON TURKEY
No. 47 | Fall 2012
5
Editor’s Introduction: Turkey’s Experience with
Neoliberal Policies and Globalization since 1980
211 Unearthing the Ottoman Present
Ali Sipahi
Şevket Pamuk
221 Anti-, Non-, or Post-Saidian?: The Challenge of
Articles
Discussing German Orientalism
11 Turkey’s Experience with Neoliberal Policies since
Malte Fuhrmann
1980 in Retrospect and Prospect
Fikret Şenses
33 Rushing toward Currency Convertibility
Kurtuluş Gemici
Book Reviews
229 Tuncay Zorlu. Innovation and Empire in Turkey: Sultan
Selim III and the Modernization of the Ottoman Navy. London:
IB Tauris, 2008.
Gelina Harlaftis
57 Economic Institutions and Institutional Change in
Turkey during the Neoliberal Era
232 Hannes Grandits, Nathalie Clayer, and Robert
İzak Atiyas
Pichler, eds. Conflicting Loyalties in the Balkans: The Great
Powers, the Ottoman Empire and Nation-Building. London:
I.B. Tauris, 2011.
83 Marching to the Beat of a Late Drummer: Turkey’s
Experience of Neoliberal Industrialization since 1980
Bülent Bilmez
Erol Taymaz and Ebru Voyvoda
115 Internationalization of Finance Capital in Spain
Brian Silverstein
Mustafa Kutlay
139 Privatization Processes as Ideological Moments: The
Block Sales of Large-Scale State Enterprises in Turkey in
the 2000s
247 Ayşe Kadıoğlu and E. Fuat Keyman, eds. Symbiotic
Antagonisms: Competing Nationalisms in Turkey. Salt Lake
City: The University of Utah Press, 2011.
Didem Türkoğlu
Merih Angın and Pınar Bedirhanoğlu
Review Articles
169 Reflections from the Conference “Turkey Debates
its Social Policies”: A Rights-Based Turn in Social Policy
Making in Turkey?
Ayşe Alnıaçık and Ayşen Üstübici
185 Rewriting the History of Port Cities in the Light of
Contemporary Global Capitalism
Nurçin İleri
ISSN 1305-3299
ISSN 1305-3299
9
771305 329004
252 Nicole Watts. Activists in Office: Kurdish Politics and
Protest in Turkey. Seattle: University of Washington Press,
2010.
Ceren Belge
256 Cenk Saraçoğlu. Kurds of Modern Turkey: Migration,
Neoliberalism and Exclusion in Turkish Society. London: I.B.
Tauris, 2011.
Çetin Çelik
No. 47 | Fall 2012
and Turkey: Neoliberal Globalization and the Political
Economy of State Policies
240Amit Bein. Ottoman Ulema, Turkish Republic: Agents
of Change and Guardians of Tradition. Stanford, CA:
Stanford University Press, 2011.
NEW PERSPECTIVES ON TURKEY
Special Issue on Turkey’s Experience with Neoliberal Policies and Globalization
NEW
PERSPECTIVES
ON TURKEY
No. 47 | Fall 2012
Special Issue on Turkey’s Experience
with Neoliberal Policies and
Globalization
NEW
PERSPECTIVES
ON TURKEY
New Perspectives on Turkey is published in
cooperation with the Chair in Contemporary Turkish
Studies at the London School of Economics and
Political Science.
Editors
Ayfer Bartu Candan, Boğaziçi University
Biray Kolluoğlu, Boğaziçi University
Book Review Editor
Reşat Kasaba, University of Washington
Editorial Board
Ümit Cizre, İstanbul Şehir University
Selim Deringil, Boğaziçi University
Çağlar Keyder, Binghamton University
Cengiz Kırlı, Boğaziçi University
Erol Köroğlu, Boğaziçi University
Yael Navaro-Yashin, Cambridge University
Ayşe Öncü, Sabancı University
Şevket Pamuk, London School of Economics
Asuman Suner, İstanbul Technical University
Fikret Şenses, Middle East Technical University
Cihan Z. Tuğal, University of California, Berkeley
Zafer Yenal, Boğaziçi University
Deniz Yükseker, Koç University
Editorial Assistant
Cem Bico
Manuscript Editor
Yan Overfield Shaw
New Perspectives on Turkey is a series of research
papers published biannually by Homer Academic
Publishing House, Yeniçarşı Caddesi, No: 12/A,
Galatasaray, Beyoğlu, 34433, İstanbul / Turkey
Correspondence relating to subscriptions and back
issues should be sent to [email protected]
Homer Kitabevi ve Yayıncılık Ltd. Şti.
Yeniçarşı Caddesi, No: 12/A, Galatasaray, Beyoğlu,
34433, İstanbul / Turkey
www.newperspectivesonturkey.net
New Perspectives on Turkey is indexed and abstracted
by the Social Science Citation Index, Sociological
Abstracts, Worldwide Political Science Abstracts,
Historical Abstracts and America: History and Life
Book Design: Emre Çıkınoğlu, BEK
Printed in İstanbul
ISSN: 1305-3299
New Perspectives on Turkey
Sayı: 47/Sonbahar
Sorumlu Yazı İşleri Müdürü
Ayşen Boylu
Adres
Yeni Çarşı Caddesi, No: 12/A
Galatasaray, Beyoğlu, 34433, İstanbul
Tel: 0212 249 59 02
www.homerbooks.com
e-mail: [email protected]
Katkıda Bulunanlar
Ayfer Bartu Candan, Boğaziçi University
Ümit Cizre, İstanbul Şehir University
Selim Deringil, Boğaziçi University
Reşat Kasaba, University of Washington
Çağlar Keyder, Binghamton University
Cengiz Kırlı, Boğaziçi University
Biray Kolluoğlu, Boğaziçi University
Erol Köroğlu, Boğaziçi University
Yael Navaro-Yashin, Cambridge University
Ayşe Öncü, Sabancı University
Şevket Pamuk, London School of Economics
Asuman Suner, İstanbul Technical University
Fikret Şenses, Middle East Technical University
Cihan Z. Tuğal, University of California, Berkeley
Zafer Yenal, Boğaziçi University
Deniz Yükseker, Koç University
Baskı
Yaylacık Matbaacılık San. ve Tic. Ltd. Şti.
Litros Yolu, Fatih Sanayi Sitesi, No:12,
197-203, Topkapı - İstanbul
Tel: 0212 612 58 60
Dağıtım
Yeni Çarşı Caddesi, No: 12/A
Galatasaray, Beyoğlu, 34433, İstanbul
Tel: 0212 249 59 02
New Perspectives on Turkey and the Chair in
Contemporary Turkish Studies at the London
School of Economics and Political Science gratefully
acknowledge a generous grant from Türk Ekonomi
Bankası for the publication of this journal.
Special Issue on Turkey's Experience with Neoliberal Policies and Globalization
5
Editor’s Introduction: Turkey’s
Experience with Neoliberal Policies and
Globalization since 1980
Şevket Pamuk
Articles
11 Turkey’s Experience with Neoliberal
Policies since 1980 in Retrospect and
Prospect
Fikret Şenses
Kurtuluş Gemici
57
Economic Institutions and Institutional
Change in Turkey during the Neoliberal Era
İzak Atiyas
83
Marching to the Beat of a Late
Drummer: Turkey’s Experience of Neoliberal
Industrialization since 1980
115
Internationalization of Finance Capital in
Spain and Turkey: Neoliberal Globalization
and the Political Economy of State Policies
Mustafa Kutlay
139 Privatization Processes as Ideological
Moments: The Block Sales of Large-Scale
State Enterprises in Turkey in the 2000s
Review Articles
169 Reflections from the Conference “Turkey
Debates its Social Policies”: A Rights-Based
Turn in Social Policy Making in Turkey?
185 Rewriting the History of Port Cities in
the Light of Contemporary Global Capitalism
Nurçin İleri
Ali Sipahi
221 Anti-, Non-, or Post-Saidian?: The
Challenge of Discussing German Orientalism
Malte Fuhrmann
Book Reviews
229 Tuncay Zorlu. Innovation and Empire in
Turkey: Sultan Selim III and the Modernization of
the Ottoman Navy. London: IB Tauris, 2008.
Gelina Harlaftis
232 Hannes Grandits, Nathalie Clayer, and
Robert Pichler, eds. Conflicting Loyalties in
the Balkans: The Great Powers, the Ottoman
Empire and Nation-Building. London: I.B.
Tauris, 2011.
Bülent Bilmez
240Amit Bein. Ottoman Ulema, Turkish
Republic: Agents of Change and Guardians of
Tradition. Stanford, CA: Stanford University
Press, 2011.
Brian Silverstein
247 Ayşe Kadıoğlu and E. Fuat Keyman,
eds. Symbiotic Antagonisms: Competing
Nationalisms in Turkey. Salt Lake City: The
University of Utah Press, 2011.
Didem Türkoğlu
252 Nicole Watts. Activists in Office: Kurdish
Politics and Protest in Turkey. Seattle:
University of Washington Press, 2010.
Ceren Belge
256 Cenk Saraçoğlu. Kurds of Modern Turkey:
Migration, Neoliberalism and Exclusion in
Turkish Society. London: I.B. Tauris, 2011.
Çetin Çelik
No. 47 | Fall 2012
115
Mustafa Kutlay
Abstract
This study applies the proactive/reactive state framework to the transformation of Spanish and Turkish finance capital in a comparative perspective. It concludes that the “proactive” policies pursued by the Spanish
state and the strategic coalition established between political elites and
the integrationist segments of finance capital resulted in the heterodox
internationalization of Spanish firms, whereas the “reactive” state policies in Turkey, designed in line with orthodox neoliberal dictums, paved
the way for an incomplete internationalization. The 2007/2008 crisis,
however, demonstrates that the same state may be both proactive and
reactive across various policy fields over time. The recent Spanish financial crisis and Turkey’s regulatory success after 2001 illustrate this point.
Keywords: neoliberal globalization, proactive/reactive state, state capacity,
transformation of finance capital, comparative political economy.
Introduction
Neoliberal globalization, which took off in the early 1980s, shifted the
world political economy from state-centered and regulatory Keynesianism to market-oriented neoliberalism. The transformation of finance
capital was an indispensable part of this change.1 Most of the countries
Mustafa Kutlay, Koç University, Department of International Relations and Political Science, Rumeli Feneri
Yolu, 34450, Sarıyer, İstanbul, [email protected].
Author’s Note: I am heavily indebted to M. Fatih Tayfur and Ziya Öniş for their invaluable contributions on
earlier drafts of this paper. I would also like to thank the two anonymous referees of New Perspectives
on Turkey for their illuminating comments.
1 In this study, “finance capital” refers to the firms that unify different strands of the financial, trade and
industrial sectors under an organizational umbrella. The term “financial,” on the other hand, mainly
refers to the banking system, due to the dominance of the banking sector in the overall financial system in Spain and Turkey.
New Perspectives on Turkey, no. 47 (2012): 115-137.
Internationalization of finance
capital in Spain and Turkey:
Neoliberal globalization and
the political economy of state
policies
116
Mustafa Kutlay
which underwent this process adapted themselves to pro-market principles and opened up their financial systems. Structural explanations
attributed this change to both inevitable and irreversible market forces
and the international state system. According to this thesis, the increasing mobility of capital shifts the balance of power from states to markets
and from holders of fixed assets (labor) to holders of liquid assets, such
as financial capital itself. The logic of this “globalist orthodoxy” relies
on a new understanding of global capitalism which assumes that “states
are now virtually powerless to make real policy choices; transnational
markets and footloose corporations have so narrowly constrained policy
options that more and more states are being forced to adopt similar fiscal, economic and social policy regimes.”2 Since states are regarded as
passive victims of the global order, neoliberal globalization is perceived
as the “realm of necessity to which states must adapt.”3
If we review the comparative literature on the issue, however, it becomes apparent that various states’ specific practices diverge, and some
states play their strategic targeting roles in the economy very actively.4
Within the framework of state capacity discussions, two main types
of state reactions to neoliberal globalization are postulated in the literature; “proactive” and “reactive” states.5 Proactive states transform
their finance capital as part and parcel of a comprehensive re-framing
of their national political economy structures. Thanks to the strategic
involvement of the state in the economy and the mutual interaction
between interest groups in the industrial and financial spheres of such
countries, the transformation of financial systems has materialized
within the context of carefully designed and patiently implemented
protection of infant industries against harsh international competition.6 Weiss uses the term proactive state in order to refer to a state
Linda Weiss, “Globalization and the Myth of the Powerless State,” New Left Review I, no. 225 (1997):
3. For two illustrative texts staunchly supporting the “globalist orthodoxy,” see Kenichi Ohmae, The
Next Global Stage: Challenges and Opportunities in Our Borderless World (New Jersey: Wharton School
Publishing, 2005); Thomas Friedman, The World Is Flat: A Brief History of the Twenty-first Century (New
York: Farrar-Straus & Giroux Publishers, 2005).
3 John M. Hobson and M. Ramesh, “Globalisation Makes of States What States Make of It: Between
Agency and Structure in the State/Globalisation Debate,” New Political Economy 7, no. 1 (2002): 7.
4Ibid.
5 In this study, “proactive” and “reactive” states should not be confused with the liberal state. In fact,
proactive and reactive states have a common element, which is “action.” Liberalism, in this context,
refers to a third dimension. The point is that proactive and reactive states act in a very different
manner against market developments and state-market relations. The proactive/reactive distinction in this study is essentially used as positive descriptive tool and it does not have any normative
bases.
6 Ha-Joon Chang, “Breaking the Mould: an Institutionalist Political Economy Alternative to the Neoliberal Theory of the Market and the State,” Cambridge Journal of Economics 26, no. 5 (2002).
2
117
7 Weiss, “Globalization and the Myth of the Powerless State,” 15.
8Ibid.
9 Linda Weiss, The Myth of the Powerless State (Ithaca: Cornell University Press, 1998), 7.
10 The author thanks Ziya Öniş for clarifying this point in earlier drafts of the paper.
11 Weiss, “Globalization and the Myth of the Powerless State,” 22-23.
“with the organizational capacity for governing industrial transformation [instead of ] neoliberal dictums.”7
The proactive state, argues Weiss, is a precondition, not an obstacle,
for the successful internationalization of domestic finance capital in the
global economy.8 Moreover, proactive states tend to have, in addition
to transformative capabilities, capacity in the regulatory realm of the
economy.9 A robust regulatory element also constitutes an important
aspect of proactive states, though they are mainly distinguished by their
strong transformative component. In other words, strong regulatory capacities are not sufficient to distinguish proactive states from reactive
ones.10 In this regard, the various strategies followed by proactive states
are; supporting local firms in raising money in foreign capital markets,
supplementing private overseas investments with official/diplomatic assistance, encouraging and financially supporting the mergers and acquisitions of domestic private firms to increase their competitiveness (especially in banking, telecommunications and infrastructure), and assisting
domestic firms in relocating operations overseas.11 As these key strategies reveal, it is the degree of partnership between government and business that remains at the heart of proactive/reactive state discussions.
The determining factor and the starting point in active state involvement are the political will and entrepreneurial ambition of the state elite.
The state is expected to invest in the formation of a strategic coalition so
as to formulate a broader political-economic framework which can comprehensively overhaul the existing structures. It is of vital importance to
both overhaul the traditional mechanisms of production and transform
the political system that underpins the aforementioned traditional interest coalitions. This means that the state backs a particular type of
finance capital that aims for further integration with global economic
networks. On the other side of the coin, these integrationist segments of
finance capital also respond positively to proactive state policies.
Reactive states, on the other hand, are not able to establish a strategic
coalition between finance capital and state elites during the transformation process. As a result, economic transformation exacerbates the fragmentation of political-economic structures in the country in question.
Öniş and Şenses argue that “reactive states’ ability to overcome sectional
conflicts and concentrate their attention on longer-term strategic goals
118
Mustafa Kutlay
such as developing internationally competitive export industries tend to
be more limited.”12 Reactive states tend to follow the orthodox recipes of
international financial institutions and regional power blocks, and open
up their markets “hurriedly without first putting into place an effective
regulatory framework.”13 Putting it another way, the liberalization and
integration process is not part of a comprehensive political-economic
process with the guidance and active participation of the state, nor is
cooperation between state and business firms established. Moreover,
policy changes in reactive states are mainly crisis-triggered and driven by
external stimuli, such as the IMF and World Bank.14
Spain and Turkey represent instructive cases and illuminating examples of a proactive and a reactive state, respectively. If one scrutinizes the
post-war period, these two countries demonstrate considerable similarities. Due to their unique geographical qualities, similar positioning in
the stratification of the world political economy, and socio-cultural and
political characteristics, Spain and Turkey can be studied as part of the
same subsystem, namely Southern Europe. In retrospect, between 1945
and 1975, both countries displayed semi-peripheral characteristics in
terms of low value-added traditional production, low GDP per capita
incomes, and highly authoritarian political regimes. The finance capital
in both countries was quite traditional, fragmented, uncompetitive and
overwhelmingly dependent on state protection. Although the developments in the political economy of these two states showed striking similarities in the post-war period up until the beginning of the 1970s, they
diverged and followed very different paths from the second half of that
decade.15
In addition to its substantive democracy, Spain currently stands out
as the fifth largest economy in Europe (even despite the devastating eurozone crisis) and controls world-leading industrial and financial giants
in telecommunications (Telefónica), oil and natural gas (Repsol-YPF),
public utilities (Iberdrola, Unión Fenosa) and banking (BBVA and Grupo Santander). On the other hand, Turkey has periodically plunged into
severe financial and political crises, including a military administration,
12 Ziya Öniş and Fikret Şenses, “Global Dynamics, Domestic Coalitions, and a Reactive State: Major
Policy Shifts in Post-War Turkish Economic Development,” METU Studies in Development 34, no. 2
(2007): 255.
13 Joseph Stiglitz, “Capital Market Liberalization, Economic Growth, and Instability,” World Development
28, no. 6 (2000): 1075.
14 Öniş and Şenses, “Global Dynamics, Domestic Coalitions, and a Reactive State: Major Policy Shifts in
Post-War Turkish Economic Development,” 255.
15 M. Fatih Tayfur, “Yunanistan ve İspanya’nın Batılılaşma Serüveni ve Türkiye: ‘İki Nikah, Bir Cenaze’,”
in Türkiye ve Avrupa, ed. Atila Eralp (İstanbul: İmge, 1997).
119
The Spanish case: The emergence of business conquistadors
Spain was ruled by Francisco Franco for about 35 years under an absolutist political regime. After the death of Franco in 1975, the Spanish transition to democracy was extremely rapid and peaceful because a
democratic constitution was accepted with the support of 83.87 percent
of the population in 1978, and was swiftly followed by nation-wide pluralist elections. Additionally, the Spanish Communist Party was legalized and, after a center-right reformist Unión de Centro Democrático
(UCD) administration, the socialist Partido Socialista Obrero Español
(PSOE) came to power in 1982 in a landslide victory, taking 48.5 percent of the vote. In the immediate post-Franco era, transforming the
regime into a democratic one from the bottom became the main political
ideal of almost all major interest groups. Spain’s transformation towards
democracy and integration with Europe emerged in a very short time
thanks to the willing consensus of major groups in Spanish society, including finance capital. In addition to the consolidation of democracy,
there was a rapid consolidation of Spanish finance capital during socialist rule.16
Consolidation of Spanish financial capital
During the transition period (1977-1982), the policies of the governing party, UCD, and its leader, Adolfo Suarez, were quite important for
state-finance capital relations. Suarez was aware that economic transformation was sine qua non. In a fragile political economy conjuncture,
he spent all his energy on democratization to prepare the institutional,
legal, and political backdrop for eventual European Community (EC)
membership. Spanish finance capital, which had experience of working
16 For a comprehensive history, see ibid.
and experienced volatile and unsustainable economic growth, resulting
in its finance capital remaining relatively uncompetitive.
This study undertakes a comparative analysis of the political economy of the transformations of finance capital in Spain and Turkey over
the last three decades, in order to assess the determining impact of particular state policies. The first part investigates the transformation of
finance capital in Spain with special reference to proactive state strategies. The second part focuses on Turkey and analyses the role of reactive state policies in the relatively deficient transformation of Turkish
finance capital. The conclusion draws lessons for further research on the
proactive/reactive state framework.
120
Mustafa Kutlay
with the state during Franco’s reign, found a progressive political voice
in the Suarez era. In fact, Suarez became the major actor in leveling the
political field, enabling the incoming PSOE government to concentrate
on economic modernization and financial transformation.17 The socialist PSOE government started this task in 1982 by overhauling and restructuring the semi-peripheral Spanish economy. One of the aims was
to improve the economy’s structural basis by creating a transnational
business armada of Spanish origin.
The investment build-up was related in several cases to the cabinet’s
attempt to launch certain companies into leading positions in the
world market. In order to build something akin to a set of “national
champions,” the government continued, in the first place, to pursue a
strategy of rationalization and concentration of business lines around
strong companies.18
To this end, the White Paper on Reconversion and Re-industrialization was put into force in 1983 to stimulate the transformation of the
economy from low-value added, traditional sectors into high-value added, modern ones.19 Initially, the government merged public enterprises
around strong entities and rationalized/reorganized their administration. For example, all state-owned electricity companies were brought
together under the umbrella of one power supplier, Endesa; the iron,
steel, aluminum and electronics companies were organized around CSIAceralia, Inespal and Inisel; and the oil and gas companies were transferred to the ownership of one company, Repsol.20 These companies,
once the “dustbin of public sector,” had, by the end of 1980s, been transformed into profitable public utilities.21 Also, Spain’s entry to the EC in
1986 did not leave the government much time to transform its industrial
base in a protectionist way. As a result, up to 1993, the year in which
17 The UCD government can be credited not only with Spain’s smooth transition to democracy, but also
the enactment of 1978 constitution, the signing of historic Moncloa Pacts (1977) between different
interest groups, the bold steps towards liberalization and finally the first democratic power transition
from a center-right party to the socialists in 1982.
18 Carles Boix, Building a Social Democratic Strategy in Southern Europe: Economic Policy under the Gonzalez Government (1982-93), Juan March Working Paper Series (Madrid: Centro de Estudios Sociales
Avanzados Fundación, 1995), 27.
19 Sima Lieberman, Growth and Crisis in the Spanish Economy: 1940-1993 (London: Routledge, 1995), 311.
20 Pablo Arocena, Privatization Policy in Spain: Stuck Between Liberalization and the Protection of Nationals’ Interests, CESifo Working Paper Series, CESifo Working Paper No. 1187 (2004), 3-4.
21 Rosio V. Real, “Reform of State Enterprises in Spain,” The Asian Journal of Public Administration 23, no.
1 (2001): 170; M. Fatih Tayfur, Semiperipheral Development and Foreign Policy: The Cases of Greece and
Spain (Aldershot: Ashgate, 2003), 173-174.
121
22 Carles Boix, “Managing the Spanish Economy within Europe,” South European Society and Politics 5,
no. 2 (2000): 182.
23Arocena, Privatization Policy in Spain, 4.
24 Boix, “Managing the Spanish Economy within Europe,” 181; Real, “Reform of State Enterprises in
Spain,” 171.
25Tayfur, Semiperipheral Development, 173.
26 Ege Tekinbaş, “The Political Economy of Spanish Financial Sector and Foreign Policy” (Unpublished
MSc Thesis, The Graduate School of Social Sciences of the Middle East Technical University, 2009).
27 Otto Holman, Integrating Southern Europe: EC Expansion and the Transnationalization of Spain (London: Routledge, 1996), 163.
the European Single Market was established, the government increased
investment in the prospective “national champions” of Spain. The public giants, Repsol, Endesa, and Telefónica, were subsidized through tax
reliefs, cost reduction schemes and other means, and despite pressure
from Brussels.22 As Arocena underlines, the main intent of the government was to “protect [them] from foreign and domestic competitors.”23
Therefore, capital formation by public firms increased by about 15 percent every year in the mid to late-1980s; a rate higher than that in the
private sector.24 Subsequent PSOE administrations implemented the
plans quite successfully, and 80 percent of investment targets were realized.25
The crucial aspect in this period was the intensification of state-business relations. Under the PSOE regime, the political-economic center
was occupied by the financial elite and the interlocking directorates with
industry. When the PSOE government came to power, the seven biggest
Spanish private banks controlled almost 70 percent of total banking activities, either directly or indirectly.26 Apart from their enormous power
in the commercial banking sector, they were also active on the boards of
directors of all major industrial firms. They directly controlled 54 percent of “the biggest 100” companies in the manufacturing industry, and
participated in more than 83 percent of them.27 This banking oligopoly
was in a position to influence the economy via equity participation, crossboard membership between banks and firms, family links, and credit
policies. Moreover, through a consultative committee that “advised” the
government on economic and monetary policies, the Consejo Superior
Bancario, the Spanish banking elite directly contributed to shaping the
government’s economic policies. The Spanish government, on the other
hand, protected the biggest banks from foreign acquisition by directly
intervening in the deals. The government’s concentration strategy was
backed by the financial elite as well. In the words of José Ángel Sánchez Asiaín, the President of Banco de Bilbao: “banking mergers [were]
the only way to prevent Spain from becoming completely dependent on
122
Mustafa Kutlay
the big European banking consortia in a single market characterized by
the free movement of capital.”28 As a result, the first breath-taking wave
of mergers/acquisitions in Spanish finance capital took place between
1987 and 1993.
In January 1988, Banco de Bilbao and Banco de Vizcaya decided to
merge under a new name, BBV (Banco Bilbao Vizcaya). The merger created the biggest bank in Spain, with a share of 20 percent of the market,
and the 33rd largest bank in the European Community.29 The merger
of two private banks, known for their close affinity with the socialist
government, paved the way for other big mergers and acquisitions. In
May 1991, six public banks functioning in different segments of the
economy were brought together by the socialist government to create
a stronger and more active financial system. The banks were brought
together under the umbrella of the government agency CBE (Corporación Bancaria de España). Immediately after the establishment of the
CBE, two other big banks in the Spanish financial system, Banco Central and Banco Hispano Americano, merged and formed BCH (Banco
Central Hispano-Americano). The last phase in the wave of mergers
was realized in 1993, when the government took another active stance
in transforming the state-owned CBE into Argenteria, half of which was
privatized and sold to the public. In the same year, largest bank of the
pre-merger period, Banesto, was sold to Santander after an auction in
which Argenteria and BBV also participated. The auction was arranged
by the government in a way which made it almost impossible for foreigners to take part in the bidding.30 When the Socialist government was dethroned by the conservative Partido Popular (PP) in 1996, the socialists’
concentration policy had already been achieved to a degree that enabled
the consolidation of financial power in the hands of four major banks;
Banco Bilbao Vizcaya, Banco Santander, the Argenteria group, and the
Banco Central Hispano.
Proactive policies of the PP government: The rise of the “new Spanish armada”
The consolidation and national champion policies of the Gonzales governments (1982-1996) prepared very suitable ground for the rise of a
modern Spanish armada in international fora during the Aznar governments (1996-2004). The role of proactive government policies and
state-finance capital interaction went through two major phases in this
28 Ibid., 174.
29 Tekinbaş, “The Political Economy,” 73.
30 Sophia Perez, Banking on Privilege: The Politics of Spanish Financial Reform (New York: Cornell University Press, 1997), 162.
123
31 State-owned Argenteria was sold to Banco Bilbao Vizcaya to create BBVA (Banco Bilbao Vizcaya Argenteria) and Banco Santander merged with Banco Central Hispano to create BSCH (Banco Santander
Central Hispano) in 1999.
32 Pablo Toral, “The Foreign Direct Investments of Spanish Multinational Enterprises in Latin America,
1989-2005,” Journal of Latin American Studies, no. 40 (2008): 540.
33 Ibid., 541.
34 Sebastián Etchemendy, “Revamping the Weak, Protecting the Strong, and Managing Privatization:
Governing Globalization in the Spanish Takeoff,” Comparative Political Studies 37, no. 6 (2004): 639.
35 F. Mauro Guillén, The Rise of Spanish Multinationals: European Business in the Global Economy (Cambridge: Cambridge University Press, 2005), 70.
36 Toral, “The Foreign Direct Investments of Spanish Multinational Enterprises in Latin America, 19892005,” 541.
era. The first phase was a consolidation strategy at home. In this phase,
the Aznar government continued the strategy of the PSOE governments, creating large private companies out of small and fragmented
state-owned firms. In the biggest step, the four largest banks merged
into two giants in the late 1990s.31 In the public utilities industry, for
example, Endesa, Unión Fenosa, and Iberdrola controlled 95 percent of
the total market share in Spain by 1996. Repsol was also cradled from
foreign competition in its downstream oil operations up until the mid1990s. In the same vein, the Spanish telecommunications giant, Telefónica, did not “face significant competition in its domestic market until
1998.”32 Apart from consolidating state-owned firms, the Spanish state
followed a hands-on strategy during the privatization of these companies.33 As a precaution, the state also reserved its right to veto core decisions even after the privatization of the firms. This was possible thanks
to the golden shares law, used to prevent eventual takeovers of leading
privatized firms by foreigners, since “the government controlled in practice the boards of the major Spanish groups Telefónica, Endesa, Repsol,
and their subsidiaries.”34 In addition, the Aznar government enacted a
decree, called “prior administrative approval,” under which private firms
had to consult the government before making “certain strategic decisions
or for direct or indirect acquisition of a sizable proportion of shares in
previously state-owned companies.”35 In order to preserve the “Spanishness” of national companies, public utilities were not privatized until
those companies had acquired a sustainable competitiveness. For example, the Aznar government resisted early EU demands to liberalize
its energy and telecommunications industries. Telefónica was sheltered
from foreign competition up until 1998 and German power and gas giant E.ON was prevented from acquiring Endesa. Instead, the Spanish
government encouraged another bid by a consortium formed by Acciona, a Spanish construction firm and Italy’s Enel.36 By doing so, Endesa’s
complete acquisition by a foreign firm was avoided.
124
Mustafa Kutlay
The second phase of internationalization was a promotion strategy
abroad, during which the role of integrationist interest coalition became
crucial. The state encouraged Spanish firms to invest abroad via different instruments like direct financial transfers, favorable tax incentives,
and diplomatic support on bilateral and supranational platforms. As
part of the state’s promotion strategy, it provided extensive advantages
such as selective credit schemes, direct cash injections, and tax relief. For
example, Telefónica received $ 1 billion in government support in order
to acquire Brazil’s Telesp in 1997. Similarly, the state offered special tax
laws that enabled domestic firms to be compensated for 30 percent of
their goodwill costs in any foreign purchase.37 The state also created the
Instituto de Comercio Exterior (ICEX) to design and implement new
policies towards Spanish SMEs investing abroad. ICEX provided new
funds to firms, and designed courses, seminars, and workshops in which
experts informed Spanish firms about the legal, economic, cultural, and
political conditions in countries targeted for investment.
Diplomacy is another channel through which the state has contributed to the internationalization of the Spanish national champions. The
Spanish foreign mission and its top-politicians have pursued a very active mediation strategy in the diplomatic corridors of countries where
Spanish corporations have extensive market opportunities. The most
prominent Spanish political figures have taken active part in concluding deals between “national champions” and foreign firms. For instance,
King Juan Carlos lobbied intensively before Spanish oil giant Repsol
acquired Argentina’s YPF for $ 14.7 billion dollars. Similarly, the Spanish firm Iberia’s acquisition of Argentinean airlines was only concluded
after Spanish Prime Minister Gonzales agreed terms with Argentinean
President Carlos Menem.38 In the Latin American case, the Spanish
government’s diplomatic efforts were quite successful in the sense that
they prepared the legal and political background for the penetration of
Spanish finance capital into the main Latin markets. From 1990-1995,
the Spanish government signed many bilateral agreements with various
Latin American states that laid the legal and institutional backdrop for
Spanish economic penetration.39
As part of Spain’s foreign policy aims, the Spanish political elite also
lobbied hard to position Madrid as a “bridge” between Latin America
and Europe in order to create an Ibero-Latin American sphere of influ37Ibid.
38Tayfur, Semiperipheral Development, 202.
39 Toral, “The Foreign Direct Investments of Spanish Multinational Enterprises in Latin America, 19892005,” 542.
125
The financial system and, specifically, the banking industry have
played a decisive role in the internationalization process of Spanish
companies. On the one hand, the large Spanish banking groups have
been pioneers and main players in this process, through their ambitious international expansion strategies… On the other hand, the
modernization and sophistication of the Spanish financial system has
made the internationalization of many other companies possible.42
In the first decade of twenty-first century, Spanish finance capital was
competing at the commanding heights of global capitalism and “Spanish
multinationals have become Spain’s most important ambassadors.”43 Of
the 50 leading financial institutions in the world, Banco Santander and
BBVA were ranked 20th and 34th, respectively. Spanish non-financials
Telefónica (12th), Endesa (35th)44 and Repsol (53rd) had also secured a
place among the top one hundred global firms.45 In the Transnationality
Index, Telefónica (at 69 percent), Repsol (at 55 percent), and Endesa
40 Eric N. Baklanoff, “Spain’s Economic Strategy toward the ‘Nations of Its Historical Community’: The
‘Reconquest’ of Latin America?,” Journal of Interamerican Studies and World Affairs 38, no. 1 (1996).
41 Toral, “The Foreign Direct Investments of Spanish Multinational Enterprises in Latin America, 19892005,” 530, 541.
42 Matias R. Inciarte, “The Financial System and the Internationalization of Spanish Companies,” in
Yearbook 2007: Internationalization of Spanish Companies, eds. Belén Romana García, et al. (Madrid:
Círculo de Empresarios, 2007), 75.
43Guillén, The Rise of Spanish Multinationals: European Business in the Global Economy, 172.
44 Endesa is no longer a Spanish company since the Italian multinational company Enel purchased a 67
percent share of it in October 2007.
45 Mª Jesús Valdemoros Erro et al., Yearbook 2009: Internationalization of Spanish Companies (Madrid:
Círculo de Empresarios, 2009), 61-62.
ence vis-a-vis the EU.40 With this ultimate aim in mind, Spanish multinationals invested in the region under the protection and diplomatic
umbrella of the government. Throughout this process, organic links
between Spanish financial and other major corporations were consolidated, thanks in part to government policies. With government encouragement, the two largest Spanish banks, BBVA and Banco Santander
acquired increased stocks in other large Spanish firms, called the núcleo
duro (hard core), so as to become their major stockholders. For instance,
BBVA became part of the núcleo duro of Repsol, Telefónica, Gas Natural, Iberdrola and Endesa.41 As a result, Spanish banks became active
supporters of Spanish corporations’ operations abroad. In other words,
the Spanish banks’ leadership has had a demonstration effect on other
domestic firms from the technological, managerial, and financial points
of view. As Inciarte, Vice President of the Santander Group emphasizes;
126
Mustafa Kutlay
(at 49 percent) had positioned themselves at the top of the most transnationalized companies list.46 BBVA and Banco Santander had become
the biggest players in Ibero-Latin America and Europe, whereas Telefónica and the electricity companies led their sectors in Latin America
and Europe.47 Moreover, there were also other relatively less well-known
but nevertheless influential domestic firms operating in Spain’s infrastructure sector, where ten of the world’s one hundred largest transnational infrastructure companies are based.48
Despite these apparent successes, the hubris of the Spanish economy
also attracted the attentions of nemesis after the late-1990s, especially
in the regulatory realm. It is fair to argue that the Spanish elite had complacency problems during the good times of economic growth, and did
not adequately concentrate on surveillance and regulatory mechanisms.
In fact, two major developments underpinned the regulatory shortages in the Spanish economy. In the 2000s, first the construction sector
boomed, and approximately 400,000 new houses were built just around
Madrid. House prices rose by 150 percent between 2000 and 2008. In
2006, Spain built a record 760,000 homes; more than the combined total
of Germany, Italy, and France for the same period.49 Second, domestic
demand and consumption skyrocketed.50 Ominously, family indebtedness increased to more than 115 percent of disposable income, and over
70 percent of Spanish families devoted more than 40 percent of their
income to the payment of mortgage credits on their homes during the
same period.51 The global financial meltdown triggered by the bursting
real estate bubble paved the way for the evaporation of investment in
the Spanish housing sector. The recent financial debacle in Spain clearly
demonstrates that Spain falls short of being a robust regulatory state.
It is probable that both the overemphasis on transformative capacity as
part of foreign policy ambitions and an industrial transformation policy
has created lop-sidedness in the regulatory realm regarding private finance capital.52
46 The Transnationality Index is calculated as the average of foreign sales to total sales, foreign employment to total employment and foreign assets to total assets. The index has been developed by United
Nations Conference on Trade and Development (UNCTAD).
47 Issidro Lopez and Emmanuel Rodriguez, “The Spanish Model,” New Left Review, no. 69 (2011): 10.
48 William Chislett, Spain, Going Places: Economic, Political and Social Progress, 1975-2008 (Madrid: Telefónica, 2008), 10.
49 Economist Intelligence Unit, Country Profile 2008: Spain (London: EIU, 2008).
50 Sebastian Royo, “After the Siesta: The Spanish Economy Meets the Global Financial Crisis,” South
European Society and Politics 14, no. 1 (2009).
51 Joan Guitart, “Zapatero: Left in Form, Right in Essence,” International Viewpoint Online Magazine
(2008), http://www.internationalviewpoint.org/spip.php?article1508.
52 The literature is mostly silent on how a proactive state performs under external economic shocks. To
127
53
54
55
56
the knowledge of the author, Weiss and other scholars studying state capacity do not address this vital
question. This point needs to be investigated in detail. In this context, the Spanish financial crisis may
be an illuminative case in point for further research.
Ziya Öniş, “Domestic Politics versus Global Dynamics: Towards a Political Economy of the 2000 and
2001 Financial Crises in Turkey,” in Turkish Economy in Crisis, eds. Ziya Öniş and Barry Rubin (London:
Frank Cass, 2003), 6-9.
For a comprehensive analysis of Turkey’s integration into neoliberal globalization from an institutionalist point of view, see İzak Atiyas’ article in this volume. Aziyak points out that “the liberalization of
the capital account was carried out in such a lax regulatory environment, without the endorsement
of the central bank, and despite warnings that liberalizing international finance under conditions of
macroeconomic instability was not a good idea.”
Korkut Boratav and Erinç Yeldan, “Turkey, 1980-2000: Financial Liberalization, Macroeconomic (In)Stability, and Patterns of Distribution,” in External Liberalization In Asia, Post-Socialist Europe, and
Brazil, ed. Lance Taylor (New York: Oxford University Press, 2006).
Öniş and Şenses, “Global Dynamics,” 279-280.
The Turkish case: An incomplete internationalization
As a case that was closely supervised and approved by the international financial institutions of the time, Turkey became one of the leading
countries embracing neoliberal doctrines in the 1980s. Unlike in the
Spanish case, Turkey’s integration into neoliberal globalization materialized within the context of orthodox recipes. The hurriedly implemented
capital account liberalization, in this context, was premature and underinstitutionalized.53 In the last decade of the 20th century, when capital
inflows and outflows were allowed to float freely under bad macroeconomic fundamentals and in the absence of corresponding regulatory
institutional checks and balances, the Turkish economy plunged into a
series of deadlocks.54 Uncontrolled liberalization pushed Turkey into
unstable and risky paths in four directions.55 First, the fragility of the
domestic financial sector was unprecedentedly exacerbated. Second, the
economy was subject to volatile boom and bust cycles, mainly due to
short-term capital in and outflows. Third, public sector imbalances and
external borrowing requirements hampered productive investment opportunities in the economy. Finally, the arbitrage-seeking character of
short-term capital flows directed both resident and non-resident investors into speculative activities, which in turn paved the way for further
fragility.
In the neoliberal restructuring period, it is hardly possible to argue
that the Turkish state actively internationalized the Turkish economy by
restructuring itself into a transformative power guiding coalition formation in industrial and financial structures.56 On the contrary, successive
Turkish governments became actual obstacles to the proper allocation
of resources.
First, instead of institutionalized decision-making mechanisms stemming from formal/informal coalitions, a personalistic understanding of
128
Mustafa Kutlay
top-down economic management became the basic norm in Turkish
political economy. At this conjuncture, the importance of legal norms
and institutional mechanisms was downgraded under the influence of
efficiency-biased market rhetoric. As a result of this, Cabinet Decrees
rather than Acts of Parliament constituted the main decision-making
method.57 In terms of ideology and ideal, there was no doubt that Turgut Özal, Prime Minister between 1983 and 1989, was a firm believer
in the free market economy and a supporter of the business community.
However, his style of economic management was quite personalistic and
far from being oriented to the long term. In Heper and Keyman’s words,
“Özal used others basically as suppliers of data; otherwise, he made all
the critical decisions himself.”58 As a result, unlike in Spain, a statebusiness synergy could not emerge and “policy-making did not help
to develop the institutionalization of collaboration between the state
and business.”59 In this fragile economic environment, with its accompanying political instability, short-term capital accumulation strategies
dominated over productivity concerns on the agenda of finance capital. Furthermore, the Turkish business elite, in contrast to their Spanish
counterparts, did not support the progressive wing of the government
in its attempt to integrate the Turkish political economy into European
structures in a planned and coordinated way, though this might have
promoted democratic consolidation and economic competition.
State policies, moreover, were always incoherent, and state-business
relations were subject to frequent change. This state-induced uncertainty had a major consequence: it prevented professionalization in specific areas of production and expertise accumulation. The business elite
searched for unrelated diversification strategies to reduce risk and to
exploit political rents in other fields.60 Yet long-term perspectives were
absent, and the business class lost direction in formulating long-term
policy. However, this was mainly because of arbitrary political decisions.
The “tremendous uncertainty” created by politicians was underlined by
the chairman of Turk-Trade in 1989: “We cannot see what is in the near
future. We cannot make any contracts. If we knew that [the government]
would provide us with subsidies, we would act accordingly.”61
57 Ziya Öniş, “Turgut Özal and His Economic Legacy: Turkish Neo-liberalism in Critical Perspective,”
Middle Eastern Studies 40, no. 4 (2004).
58 Metin Heper and Fuat Keyman, “Double-Faced State: Political Patronage and the Consolidation of
Democracy in Turkey,” Middle Eastern Studies 34, no. 4 (1998): 267.
59Ibid.
60 Ayşe Buğra, State and Business in Modern Turkey: A Comparative Study (New York: State University of
New York Press, 1994).
61 Quoted in Işık Özel, “Beyond the Orthodox Paradox: The Breakup of State-Business Coalitions in
129
Emergence of a regulatory Turkish state: A volte-face?
The populist cycles and politically-motivated fiscal expansionism of the
1990s proved so catastrophic that Turkey entered the twenty-first century in the grip of two disastrous crises.66 In November 2000, Turkish
financial markets were shaken by the liquidity problems and bankruptcy
of a medium-sized bank. Yet the economic elite managed to keep the
economy on its feet, mainly thanks to the financial support of the IMF.
1980s Turkey,” Journal of International Affairs 57, no. 1 (2003): 104.
62 Özgür Öztürk, Türkiye’de Büyük Sermaye Grupları: Finans Kapitalin Oluşumu ve Gelişimi (İstanbul: SAV,
2010), 148.
63 Selim Somçağ, Türkiye’nin Ekonomik Krizi: Oluşumu ve Çıkış Yolları (İstanbul: 2006 Yayınevi, 2006), 54.
64 The interest rate paid by the Turkish treasury was 30 points above the inflation rate during the 1990s,
and more than 85 percent of government debt securities were held by Turkish banks. See Öztürk,
Türkiye’de Büyük Sermaye Grupları, 148.
65 Yılmaz Akyüz and Korkut Boratav, “The Making of the Turkish Financial Crisis,” World Development 31,
no. 9 (2003).
66 In fact, the Turkish economy had also experienced a crisis in 1994; an early-sign of the structural
problems in Turkey’s macroeconomic balances.
Second, the unproductive linkages between the state and the financial system deeply influenced the developmental path of the industrial
sector because of the major industrial firms’ organic links to the financial system. In the mid-1990s, almost two-thirds of the total assets,
deposits, and credits in private banks were controlled by the banks of
holding companies.62 In a situation where major banks concentrated on
government debt securities, the industrial sector did not benefit from
financial expansion and could not access the funds necessary to invest
in green-field areas. Instead, industrial firms chose to bandwagon the
state-dependent rentier coalition. By some calculations, almost half
the profits of the largest 500 industrial corporations were accumulated
thanks to interest rate revenues from government securities. This ratio
had increased to 88 percent by the end of 1999.63
Finally, in the mid-1990s, instead of fulfilling their intermediary role
between savers and investors, Turkish banks relied heavily on state debt
instruments. The extraordinarily high public sector debt requirement
encouraged the banks to finance the Turkish treasury. In this era, the
domestic financial elite borrowed from international markets with an
interest rate margin of 6-7 percent, and then extended these credits to
the public sector at an astonishing interest rate margin of 20-40 percent.64 The share of government debt securities in total banking sector
assets increased from 10 percent in 1990 to 23 percent by 1999.65 This
demonstrates that, in the Turkish case, the crowding-out effect of the
government hampered the main functions of finance capital.
130
Mustafa Kutlay
However, it became apparent, three months later, that enormous risks
had accumulated in the country’s macroeconomic balance and financial
system. In February 2001, the economy plunged into its most severe
crisis in the Republican era, resulting in the abandonment of the IMFdesigned exchange-rate-based stabilization program, and the Turkish
lira depreciated by 51 percent vis-a-vis other major currencies. GDP
shrank by 7.4 percent in real terms, inflation increased to 68.53 percent,
and unemployment reached a 10.3 percent plateau at the end of 2001.67
Moreover, the financial system almost came to a halt after the crisis. The
government spent $ 47.2 billion to bail the financial system out, including $ 25.3 billion to rescue private banks.68 The cost of the crisis constituted 32 percent of Turkey’s GDP in 2001, and the incumbent coalition
government lost its legitimacy in the eyes of the Turkish electorate.
In November 2002, the newly established Adalet ve Kalkınma Partisi (AKP) succeeded in forming a single-party government, taking 34.28
percent of the total vote. In its first term in office (2002-2007), it materialized major changes which had a crucial influence on developing state
capacity in Turkey. The structural reforms in the financial system were
actualized by increasing the capacity and surveillance power of regulatory
agencies (the Competition Board, Banking Regulatory Agency, Central
Bank, and Savings Deposit Insurance Fund) over financial institutions.
In 2001, in the wake of the crisis, the “Banking Sector Restructuring
Program” and “The Program for Transition to a Strong Economy” were
prepared under the supervision of Kemal Derviş, Minister of State for
Economic Affairs in Bülent Ecevit’s cabinet. His IMF-supported economic recovery program was then followed staunchly by the incoming
AKP government between 2002 and 2007. The ultimate aim was to
formulate state-augmenting institutional reforms to improve the state’s
regulatory capacity in line with the post-Washington consensus. The
system was comprehensively overhauled by strengthening the private
banks, rehabilitating insolvent banks transferred to the SDIF, restructuring the state banks via operational, legal, and administrative measures, and improving the legal and institutional framework of the overall
financial system via independent regulatory institutions. The Turkish
economy recovered quickly from the crisis, and entered a virtuous cycle
of uninterrupted high-growth performance for 27 quarters between
2002 and 2008. This was both a result of the new macroeconomic and
supervisory regulations, and also partially thanks to the extra-ordinarily
67 Akyüz and Boratav, “The Making of the Turkish Financial Crisis.”
68 Ziya Öniş and Caner Bakır, “The Regulatory State and Turkish Banking Reforms in the Age of PostWashington Consensus,” Development and Change 41, no. 1 (2010): 92.
131
Consolidation of Turkish finance capital: Fledgling proactivism
Because the destructive consequences of the 2001 crisis affected almost
all classes, a window of opportunity opened up for the transformation of
the ingrained structure of Turkish political economy, which had hitherto
been based on inward-looking state-business coalitions. The intensity of
the shock helped to create a broad and resilient pro-reform coalition to
fix the very deep-seated structural problems in both the financial and industrial pillars of the economy. This broad understanding, in turn, created a suitable environment for reformist policy entrepreneurs to gain the
upper hand, though with the full support of influential business associations like the Turkish Industry and Business Association (TÜSİAD)
and The Association of Independent Industrialists and Businessmen
(MÜSİAD), as well as from many other regional associations (SİADs).
The developments in the financial system constituted the basic pillar
of the restructuring process. At the outset, it is important to explain the
bifurcation of Turkish finance capital in the late 1990s. In fact, the exhaustion of the state-dependent accumulation strategy in the early 2000s
necessitated a restructuring of financial firms and their affiliated holdings. The Banking Sector Restructuring Program and related financial
reforms were developed with this shifting strategy in mind. It is crucial
to underline at this point that the restructuring in question was by no
means solely a state project, nor was it solely dictated by international financial institutions like the IMF. In addition, divergences within finance
capital itself were a crucial factor. According to Gültekin-Karakaş, the
diverging positions within finance capital can be categorized into two
basic groups.70 In the first faction were the conglomerates that relied
on a “primitive capital accumulation” strategy, in which the overwhelming share of their accumulation came from rentier-type profits extracted
from investments in treasury bonds and bills.71 This faction, in the in69 In this period, up to 2008 when the waves of the global financial crisis hit Turkish shores, the economy
grew by 6.8 percent annually, and the inflation rate was reduced from about 45 percent to less than 10
percent. In terms of public accounts, the budget deficit (11.4 percent in 2002) was reduced to reasonable levels (less than 2 percent in 2008), and net public sector debt stock met the Maastricht criteria
of less than 30 percent in 2008. Export volume also increased from $ 36 to more than $ 132 billion. Yet
the export-boom was heavily dependent on imports, which increased from $ 51 to $ 201 billion in the
same time-frame.
70 Derya Gültekin-Karakaş, Hem Hasımız Hem Hısımız: Türkiye’de Finans Kapitalin Dönüşümü ve Banka
Reformu (İstanbul: İletişim Yayınları, 2009).
71 Ibid., 211.
buoyant global economic conditions, which led to considerable financial
inflow to emerging financial markets, including Turkey.69
132
Mustafa Kutlay
dustrial sector, was characterized by low-value added and traditional production that impeded their competitive advantage in the stratified global
economy. These companies demonstrated mainly reactive, state-dependent characteristics, and opted for state protection via different types of
subsidies. In fact, high state-indebtedness provided a type of financial
protection for these firms, which survived without facing real competition on a global scale over the 1980s and 1990s. However, this strategy
collapsed in the late 1990s with the fiscal crisis of the state. Unsurprisingly, the bankrupted financial institutions were those of the holdings
that had overwhelmingly relied on this “primitive accumulation” strategy.
The other faction was comprised of conglomerates which relied on
“dynamic accumulation” strategies, and did not rely solely on the treasury to sustain their financial profitability.72 It is a fact that these holdings had also benefited from state-dependent relations throughout the
1990s, but they nevertheless succeeded in surviving when the state’s
fiscal crisis hit the economy in the early-2000s. These conglomerates,
moreover, had foreseen the unsustainability of the Turkish political
economy of the 1990s, and had systematically improved their capital accumulation methods by investing in high-value added sectors. In the industrial realm, they veered towards newly emerging sectors and regions
via internationalization strategies. For these conglomerates, including
Koç Holding, Sabancı Holding, and Doğuş Holding, the most popular
sectors turned out to be automotive, finance, high-technology products,
and durable consumer goods. They also developed their financial arms
more thoroughly than the first faction, and invested in their banks to
improve their competitive position on the world stage.
Additionally, as part of a wider political-economic transformation in
the financial system, Turkey’s Banking Sector Restructuring Program
can be interpreted as a blueprint for a proactive state. Its aim was to
transform Turkish finance capital from a state-dependent structure into
a globally integrated competitive one. In this process, the state (with IMF
support) performed an active role, liquidating financial institutions relying on “primitive accumulation” and assisting with the internationalization of financial conglomerates by promoting a “dynamic accumulation”
strategy. At the same time, the second, progressive faction of finance
capital encouraged the state to adopt a new political-economic strategy
of state-business relations. A strategic coalition was thereby formed for
the effective implementation of post-crisis reforms.73 In turn, the power
72 Ibid., 249.
73 Ibid., 246.
133
Differences between Spanish and Turkish cases
Are all the aforementioned developments sufficient to label the Turkish
state during this period a proactive one, as in the Spanish case? There
are two shortcomings that stand out as challenging. First, from an ownership perspective, the Turkish political elite did not outline a clear vision of a systematic long-term strategy to merge the state banks or to
encourage private finance capital to coalesce in order to create competitive national champions. Unlike in the Spanish case, the domestic financial system was not protected from the intense onrush of foreign
investment. In other words, the Turkish political elite did not aim to
protect the “Turkishness” of national finance capital, as the Spanish elite
did. Thanks to Turkey’s open-door policy and unrestrictive regulations,
foreign penetration into the economy intensified after 2004 to the extent that between November 2004 and June 2007, 14 Turkish banks
were acquired by foreigners. The total amount paid to these banks was
$ 26.4 billion, which composes approximately 50 percent of all the foreign direct investment Turkey attracted in the 2005-2007 period.75 The
foreign equity ownership in the Turkish banking system had reached
25.8 percent in 2011, and, when the secondary market is taken into consideration, this ratio increases to nearly 43 percent.76 It is apparent that,
unlike in Spain, there was no comprehensive strategy from the Turkish
state to transform domestic finance capital enterprises into strong national champions.
Second, if Turkish state policies are further compared with those of
Spain, it becomes clear that the drive for short-term profitability has
dominated over long-term strategic goals. Contrary to the Spanish case,
neither the privatization of the Turkish banking sector, nor the acquisition of its banks by foreign capital had been accounted for in any longterm strategic perspective. In terms of foreign direct investment, the
overwhelming majority of inflows into Turkey targeted the already ex-
74 Mustafa Kutlay, “Economy as the ‘Practical Hand’ of ‘New Turkish Foreign Policy’: A Political Economy
Explanation,” Insight Turkey 13, no. 1 (2011).
75 Saruhan Özel, Küresel Dengesizliklerin Dengesi (İstanbul: Alfa, 2007), 267-268.
76 Central Bank of the Republic of Turkey, Financial Stability Report, vol. 13 (Ankara: 2011), 28.
shift in domestic finance capital paved the way for a new type of financial system; one that had the capacity to play its main intermediary role
in the economy in line with international standards. Thus both the performance of the Turkish economy and its international relations have
benefited from the reshuffle within finance capital.74
134
Mustafa Kutlay
isting financial and retail firms, instead of green-field investments.77 For
example, the industrial sector attracted just a quarter of the cumulative
FDI between 2004 and 2010 whereas the services sector gained about
75 percent of the total inflows. Moreover, about 60 percent of the FDI
channeled into the services sector was directed to financial firms.78 Unlike in Spain, the other vital problem of the Turkish industrial sector
was its lack of productive links with financial institutions. The trilateral
coalition of the state and the financial and industrial sectors in Turkey
still remain ad hoc, fragmented and fragile. The figures cited above support the argument that, state capacity in Turkey falls short of promoting a strategic coalition among industrial and financial firms, despite its
increasing regulatory strength.
Conclusion
In this study, the proactive/reactive state framework has been applied
to investigate the transformation of finance capital in Spain and Turkey.
Starting from the Suarez administration in 1978, the Spanish political
parties, the PSOE and, the PP, supported the transformation of financial and economic structures to enable competition on a global scale.
This led to the creation of Spanish multinationals (the famous “national champions” policy) and fostered a Spanish presence on international platforms. In this context, the Suarez government laid down the
institutional, legal, and democratic grounds for a sustainable relationship between the state and finance capital, the Gonzales governments
concentrated on economic transformation and domestic consolidation
strategies, and the Aznar governments proactively supported the internationalization of a “new Spanish Armada.” Meanwhile, Spanish finance
capital supported these integrationist state policies. Spain is now one of
the biggest economies in the EU with a consolidated democratic regime
accompanied by big finance capital, and displays a high performance in
international fora with 9 multinationals in the Fortune 2011 Global 500
list, despite the devastating impact of eurozone crisis.
In contrast to the Spanish case, state interventions in Turkey and the
business elites’ reactions to these interventions have not underpinned
any bottom-up restructuring of Turkish political economy. Reactive
state policies have been the main creator of ambiguity in the economy,
as a result of which business groups have opted for clientelism over rulebased and integrationist economic relations. Unlike in Spain, private fi77 Ziya Öniş and İsmail Emre Bayram, “Temporary Star or Emerging Tiger? Turkey’s Recent Economic
Performance in a Global Setting,” New Perspectives on Turkey, no. 39 (2008).
78 This ratio has been calculated on the basis of various YASED reports (www.yased.org.tr).
135
References
Akyüz, Yılmaz, and Korkut Boratav. “The Making of the Turkish Financial Crisis.” World Development 31,
no. 9 (2003): 1549-1566.
Arocena, Pablo. Privatization Policy in Spain: Stuck Between Liberalization and the Protection of Nationals’
Interests, CESifo Working Paper Series, CESifo Working Paper No. 11872004.
79 Michael Mann, The Sources of Social Power, vol. II (Cambridge: Cambridge University Press, 1993).
nance capital did not succeed in creating competitive international firms
to act as the practical hand of the Turkish state abroad. In the post-war
period, Turkey experienced four major financial crises, the last of which
(February 2001) was by far the biggest. The 2001 crisis changed the
structure of Turkish political economy in that, in the bifurcation of finance capital, outward-oriented integrationist segments gained the upper hand. Yet even this transformation demonstrates a reactive character
because it was a crisis-driven change. Therefore, Turkish finance capital
is still far from achieving the level attained by Spanish finance capital.
For instance, Turkey has just one corporation in the Fortune 2011 Global
500 list, with Koç Holding ranked 248th. From the surveillance perspective, however, a reverse trend is visible: while Turkey redesigned its financial surveillance mechanisms as a result of the institutional change
driven by the 2001 crisis, the Spanish state’s overemphasis on transformative capacity has resulted in its overlooking the regulatory loopholes
in the system. In this context, the 2007/2008 financial crisis has provided an opportunity to investigate the crucial determinants in sustaining the proactive characteristics of states in both the transformative and
regulatory fields.
In conclusion, this study draws three lessons from its discussion of
the proactive/reactive state debate. First, state strategies matter, even in
the period of intense neoliberal globalization; as in Mann’s notion, provide “infrastructural power”79 by assisting, coordinating, and promoting
domestic finance capital in the consolidation and internationalization
process. Second, despite the main focus of the literature being on the
transformative credentials of proactive states within the context of a
governed interdependence framework, the 2007/2008 financial crisis
has demonstrated that regulatory capability appears to be as important
as proactive states’ transformative role. Finally, we should not presume
states will always remain in either the proactive or reactive category. It is
possible for reactive states to be transformed into proactive states over
time and vice versa. The mechanisms of such transformations constitute
an important area for further research.
136
Mustafa Kutlay
Baklanoff, Eric N. “Spain’s Economic Strategy toward the ‘Nations of Its Historical Community’: The
‘Reconquest’ of Latin America?” Journal of Interamerican Studies and World Affairs 38, no. 1 (1996):
105-127.
Boix, Carles. Building a Social Democratic Strategy in Southern Europe: Economic Policy under the Gonzalez
Government (1982-93), Juan March Working Paper Series. Madrid: Centro de Estudios Sociales
Avanzados Fundación, 1995.
——. “Managing the Spanish Economy within Europe.” South European Society and Politics 5, no. 2 (2000):
165-190.
Boratav, Korkut, and Erinç Yeldan. “Turkey, 1980-2000: Financial Liberalization, Macroeconomic (In)Stability, and Patterns of Distribution.” In External Liberalization In Asia, Post-Socialist Europe, and
Brazil, edited by Lance Taylor, 417-455. New York: Oxford University Press, 2006.
Buğra, Ayşe. State and Business in Modern Turkey: A Comparative Study. New York: State University of New
York Press, 1994.
Central Bank of the Republic of Turkey. Financial Stability Report. Vol. 13. Ankara: 2011.
Chang, Ha-Joon. “Breaking the Mould: an Institutionalist Political Economy Alternative to the Neo-liberal
Theory of the Market and the State.” Cambridge Journal of Economics 26, no. 5 (2002): 539-559.
Chislett, William. Spain, Going Places: Economic, Political and Social Progress, 1975-2008. Madrid: Telefónica,
2008.
Economist Intelligence Unit. Country Profile 2008: Spain. London: EIU, 2008.
Erro, Mª Jesús Valdemoros, Mauro F. Guillén, and Maria Grandal Bouza. Yearbook 2009: Internationalization
of Spanish Companies. Madrid: Círculo de Empresarios, 2009.
Etchemendy, Sebastián. “Revamping the Weak, Protecting the Strong, and Managing Privatization:
Governing Globalization in the Spanish Takeoff.” Comparative Political Studies 37, no. 6 (2004): 623651.
Friedman, Thomas. The World Is Flat: A Brief History of the Twenty-first Century. New York: Farrar-Straus &
Giroux Publishers, 2005.
Guillén, F. Mauro. The Rise of Spanish Multinationals: European Business in the Global Economy. Cambridge:
Cambridge University Press, 2005.
Guitart, Joan. “Zapatero: Left in Form, Right in Essence.” International Viewpoint Online Magazine (2008),
http://www.internationalviewpoint.org/spip.php?article1508.
Gültekin-Karakaş, Derya. Hem Hasımız Hem Hısımız: Türkiye’de Finans Kapitalin Dönüşümü ve Banka
Reformu. İstanbul: İletişim Yayınları, 2009.
Heper, Metin, and Fuat Keyman. “Double-Faced State: Political Patronage and the Consolidation of
Democracy in Turkey.” Middle Eastern Studies 34, no. 4 (1998): 259-277.
Hobson, John M., and M. Ramesh. “Globalisation Makes of States What States Make of It: Between
Agency and Structure in the State/Globalisation Debate.” New Political Economy 7, no. 1 (2002): 5-22.
Holman, Otto. Integrating Southern Europe: EC Expansion and the Transnationalization of Spain. London:
Routledge, 1996.
Inciarte, Matias R. “The Financial System and the Internationalization of Spanish Companies.” In Yearbook
2007: Internationalization of Spanish Companies, edited by Belén Romana García, Mauro F. Guillén,
Mª Jesús Valdemoros Erro and José Luis Álvarez Arce, 75-105. Madrid: Círculo de Empresarios, 2007.
Kutlay, Mustafa. “Economy as the ‘Practical Hand’ of ‘New Turkish Foreign Policy’: A Political Economy
Explanation.” Insight Turkey 13, no. 1 (2011): 67-88.
Lieberman, Sima. Growth and Crisis in the Spanish Economy: 1940-1993. London: Routledge, 1995.
Lopez, Issidro, and Emmanuel Rodriguez. “The Spanish Model.” New Left Review, no. 69 (2011): 5-28.
Mann, Michael. The Sources of Social Power. Vol. II. Cambridge: Cambridge University Press, 1993.
Ohmae, Kenichi. The Next Global Stage: Challenges and Opportunities in Our Borderless World. New Jersey:
Wharton School Publishing, 2005.
Öniş, Ziya. “Domestic Politics versus Global Dynamics: Towards a Political Economy of the 2000 and
2001 Financial Crises in Turkey.” In Turkish Economy in Crisis, edited by Ziya Öniş and Barry Rubin,
1-30. London: Frank Cass, 2003.
——. “Turgut Özal and His Economic Legacy: Turkish Neo-liberalism in Critical Perspective.” Middle
Eastern Studies 40, no. 4 (2004): 113-134.
Öniş, Ziya, and Caner Bakır. “The Regulatory State and Turkish Banking Reforms in the Age of PostWashington Consensus.” Development and Change 41, no. 1 (2010): 77-106.
137
Öniş, Ziya, and İsmail Emre Bayram. “Temporary Star or Emerging Tiger? Turkey’s Recent Economic
Performance in a Global Setting.” New Perspectives on Turkey, no. 39 (2008): 47-84.
Öniş, Ziya, and Fikret Şenses. “Global Dynamics, Domestic Coalitions, and a Reactive State: Major Policy
Shifts in Post-War Turkish Economic Development.” METU Studies in Development 34, no. 2 (2007):
251-286.
Özel, Işık. “Beyond the Orthodox Paradox: The Breakup of State-Business Coalitions in 1980s Turkey.”
Journal of International Affairs 57, no. 1 (2003): 97-110.
Özel, Saruhan. Küresel Dengesizliklerin Dengesi. İstanbul: Alfa, 2007.
Öztürk, Özgür. Türkiye’de Büyük Sermaye Grupları: Finans Kapitalin Oluşumu ve Gelişimi. İstanbul: SAV,
2010.
Perez, Sophia. Banking on Privilege: The Politics of Spanish Financial Reform. New York: Cornell University
Press, 1997.
Real, Rosio V. “Reform of State Enterprises in Spain.” The Asian Journal of Public Administration 23, no. 1
(2001): 167-180.
Royo, Sebastian. “After the Siesta: The Spanish Economy Meets the Global Financial Crisis.” South
European Society and Politics 14, no. 1 (2009): 19-34.
Somçağ, Selim. Türkiye’nin Ekonomik Krizi: Oluşumu ve Çıkış Yolları. İstanbul: 2006 Yayınevi, 2006.
Stiglitz, Joseph. “Capital Market Liberalization, Economic Growth, and Instability.” World Development 28,
no. 6 (2000): 1075-1086.
Tayfur, M. Fatih. Semiperipheral Development and Foreign Policy: The Cases of Greece and Spain. Aldershot:
Ashgate, 2003.
——. “Yunanistan ve İspanya’nın Batılılaşma Serüveni ve Türkiye: ‘İki Nikah, Bir Cenaze’.” In Türkiye ve
Avrupa, edited by Atila Eralp, 177-239. İstanbul: İmge, 1997.
Tekinbaş, Ege. “The Political Economy of Spanish Financial Sector and Foreign Policy.” Unpublished MSc
Thesis, The Graduate School of Social Sciences of the Middle East Technical University, 2009.
Toral, Pablo. “The Foreign Direct Investments of Spanish Multinational Enterprises in Latin America, 19892005.” Journal of Latin American Studies, no. 40 (2008): 513-544.
Weiss, Linda. “Globalization and the Myth of the Powerless State.” New Left Review I, no. 225 (1997): 3-27.
——. The Myth of the Powerless State. Ithaca: Cornell University Press, 1998.
261
Manuscripts of articles and communications should be sent to: Cem Bico,
Editorial Assistant, NPT, Boğaziçi Üniversitesi, Türk Dili ve Edebiyatı Bölümü,
Bebek, İstanbul, 34342, Turkey.
e-mail: [email protected]
NPT publishes articles in English only. Submission of an article implies that
it has not been simultaneously submitted or previously published elsewhere.
The entire manuscript, including notes, tables and references, must be typed
double-spaced. The first page of the manuscript should contain: the title, the
name(s) and institutional affiliation(s) of the author(s); an abstract of no more
than 200 words.
All non-English words found in an unabridged English dictionary should be
treated as English words. All other transliterated words and phrases should be
underlined. All non-Roman alphabets must be transliterated, and authors are
responsible for the consistency of their transliterations.
NPT uses footnotes. Acknowledgments of any sort should be typed as an
Author’s Note above the first note. The author should provide a complete list
of all the cited references at the end of the manuscript. The style of footnote
citations should conform with the 16th edition of The Chicago Manual of Style
the humanities style. Further information on the humanities style is available
at the official web site of The Chicago Manual of Style. When a work is referenced
more than once, for the second and consecutive citations use the author’s last
name and a shortened title of the book or article. When references to the same
work follow without interruption, use Ibid..
Samples:
1. Book with one author: Wendy Doniger, Splitting the Difference (Chicago:
University of Chicago Press, 1999).
2. Book with two authors: Guy Cowlishaw and Robin Dunbar, Primate
Conservation Biology (Chicago: University of Chicago Press, 2000).
3. Book with more than two authors: Edward O. Laumann et al., The Social
Organization of Sexuality: Sexual Practices in the United States (Chicago:
4. Editor, translator, or compiler: Judith Walzer Leavitt and Ronald L.
Numbers, eds., Sickness and Health in America: Readings in the History of
NOTICE TO CONTRIBUTORS
262
5.
6.
7.
8.
9.
10.
11.
12.
Medicine and Public Health, 3rd ed. (Madison: University of Wisconsin
Press, 1997).
Chapter or other part of a book: W. Freeman Twaddell, “A Note on Old
High German Umlaut,” in Readings in Linguistics I: The Development of
Descriptive Linguistics in America, 1925-1956, ed. Martin Joos (Chicago:
Journal article: John Maynard Smith, “The Origin of Altruism,” Nature
393 (1998): 639–40.
Article in an electronic journal: Mark A. Hlatky et al., “Quality-of-Life
and Depressive Symptoms in Postmenopausal Women after Receiving
Hormone Therapy: Results from the Heart and Estrogen/Progestin
Replacement Study (HERS) Trial,” Journal of the American Medical
Association 287, no. 5 (2002), http://jama.ama-ssn.org/issues/v287n5/
rfull/joc10-108.html#aainfo.
Popular magazine article: Steve Martin, “Sports-Interview Shocker,” New
Yorker, May 6, 2002, 84.
Newspaper article: William S. Niederkorn, “A Scholar Recants on His
‘Shakespeare’ Discovery,” New York Times, June 20, 2002, Arts section,
Midwest edition.
Book review: James Gorman, “Endangered Species,” review of The Last
American Man, by Elizabeth Gilbert, New York Times Book Review, June
2, 2002, 16.
Theses and dissertations: M. Amundin,“Click Repetition Rate Patterns in
Communicative Sounds from the Harbour Porpoise, Phocoena phocoena”
(Ph.D Dissertation, Stockholm University, 1991), 22–29, 35.
Paper presented at a meeting or conference: Brian Doyle, “Howling
Like Dogs: Metaphorical Language in Psalm 59” (paper presented at the
annual international meeting for the Society of Biblical Literature, Berlin,
Germany, June 19–22, 2002), 15–16.
NEW
PERSPECTIVES
ON TURKEY
No. 47 | Fall 2012
5
Editor’s Introduction: Turkey’s Experience with
Neoliberal Policies and Globalization since 1980
Ali Sipahi
Şevket Pamuk
221 Anti-, Non-, or Post-Saidian?: The Challenge of
Articles
Discussing German Orientalism
11 Turkey’s Experience with Neoliberal Policies since
Malte Fuhrmann
1980 in Retrospect and Prospect
Fikret Şenses
Kurtuluş Gemici
Book Reviews
229 Tuncay Zorlu. Innovation and Empire in Turkey: Sultan
Selim III and the Modernization of the Ottoman Navy. London:
IB Tauris, 2008.
Gelina Harlaftis
57 Economic Institutions and Institutional Change in
Turkey during the Neoliberal Era
232 Hannes Grandits, Nathalie Clayer, and Robert
İzak Atiyas
Pichler, eds. Conflicting Loyalties in the Balkans: The Great
Powers, the Ottoman Empire and Nation-Building. London:
I.B. Tauris, 2011.
83 Marching to the Beat of a Late Drummer: Turkey’s
Experience of Neoliberal Industrialization since 1980
Bülent Bilmez
115 Internationalization of Finance Capital in Spain
Brian Silverstein
Mustafa Kutlay
139 Privatization Processes as Ideological Moments: The
Block Sales of Large-Scale State Enterprises in Turkey in
the 2000s
247 Ayşe Kadıoğlu and E. Fuat Keyman, eds. Symbiotic
Antagonisms: Competing Nationalisms in Turkey. Salt Lake
City: The University of Utah Press, 2011.
Didem Türkoğlu
Review Articles
169 Reflections from the Conference “Turkey Debates
its Social Policies”: A Rights-Based Turn in Social Policy
Making in Turkey?
185 Rewriting the History of Port Cities in the Light of
Contemporary Global Capitalism
Nurçin İleri
ISSN 1305-3299
ISSN 1305-3299
9
771305 329004
252 Nicole Watts. Activists in Office: Kurdish Politics and
Protest in Turkey. Seattle: University of Washington Press,
2010.
Ceren Belge
256 Cenk Saraçoğlu. Kurds of Modern Turkey: Migration,
Neoliberalism and Exclusion in Turkish Society. London: I.B.
Tauris, 2011.
Çetin Çelik
No. 47 | Fall 2012
and Turkey: Neoliberal Globalization and the Political
Economy of State Policies
240Amit Bein. Ottoman Ulema, Turkish Republic: Agents
of Change and Guardians of Tradition. Stanford, CA:
Stanford University Press, 2011.
Special Issue on Turkey’s Experience with Neoliberal Policies and Globalization
NEW
PERSPECTIVES
ON TURKEY
No. 47 | Fall 2012
Special Issue on Turkey’s Experience
with Neoliberal Policies and
Globalization

new perspectives on turkey

Transkript

Benzer belgeler

Representation of Geo-Political Disputes in Geo

Fact sheet Turkey

Hi Jane and Jack, First, I am very happy because you are coming to

A Children`s Guide to Turkey - Ages 12-14

47th meeting of the EC-Turkey Association Council Tuesday, 19

Table of Contents

İngilizce CV Örneği 2