Turkey’s intensified crackdown on human rights and the rule of law has targeted business interests in the country too, and should ring alarm bells for European companies and investors. Business associations representing them should convey their concerns to Turkey at the economic leadership gathering in Brussels on December 7-8.
After a failed coup attempt that tragically left 248 dead in July 2016, Turkish authorities imposed a state of emergency that allowed it to intensify its crackdown on critics in the media and civil society. More than 150,000 people have lost their jobs, and more than 50,000 have been detained over alleged coup or terrorism links, many despite a lack of credible evidence. Companies have been seized and in some cases sold off, and their assets frozen. The government has further threatened judicial independence, denying a meaningful remedy to those whose rights have been violated and setting a dangerous precedent for the rule of law.
In July, media reported that Ankara had shared with Berlin a list of 680 German companies, including major firms, and some with a long history of investment in Turkey. Turkey accused these companies of ties with the Fethullah Gülen organization, which Ankara considers a terrorist group and says was behind the attempted coup.
The move against German businesses from a government that prides itself on being pro-business was an extreme step. It seemed to be a response to German officials’ criticisms of the poor human rights situation in Turkey, and the unfair detentions of German human rights defender Peter Steudtner and Turkish-German journalist Deniz Yücel. Turkey had also objected when Germany blocked Turkish officials’ from holding political campaign rallies in German cities for the April 2017 constitutional referendum.
After it came out in the media, the Turkish authorities rapidly realized that its move against German business could lead to disaster. Prime Minister Binali Yıldırım reached out to a group of German companies – including Bosch, Siemens, Mercedes, Metro Group, Frankfurt Messe and Thyssen Krupp, all of which have heavily invested in Turkey’s economy – and publicly reassured them that political tensions with Berlin would not harm their interests or investments in Turkey.
He later confirmed the assurances reportedly given by Turkish Interior Minister Süleyman Soylu to his German counterpart a few days earlier that the push for investigation into the 680 companies had been dropped, attributing the issue to a “communication problem.”
But companies and their shareholders should not assume it is back to business as usual in Turkey.
The threat to investigate the companies illustrates the declining independence of Turkey’s prosecutorial and judicial system, and the willingness of the executive to use it against its perceived opponents even when there is little or no evidence of criminal wrongdoing.
As many as 150 journalists and media workers are held in prolonged pretrial detention and face terrorism charges, based on unsupported allegations of connections with terrorist organizations or involvement in the coup attempt.
Prominent human rights monitors and civil society leaders face politically motivated charges. Many of them have also been detained. While some, including Amnesty International’s Turkey director, have been released on bail, others including Amnesty’s chair, the lawyer Taner Kılıç, and the businessman and philanthropist Osman Kavala remain in detention. The chilling message is clear: if you fall out of favor with the government, you could be next.
The efforts by the Turkish government to bring the courts under tight control should also concern all investors in Turkey. Anyone who runs a business in Turkey can find that their assets have been confiscated and their boards replaced at the government’s whim.
This has happened to a number of large and medium-sized businesses and media companies accused of Gülenist ties. And as the closure and confiscation of Kurdish media companies shows, a company doesn’t have to have Gülenist links. These companies have had no recourse to the courts.
Turkey’s resilient economy relies in part on the impact of foreign investments. But a government willing to target major companies for political reasons, combined with a compromised judiciary and shrinking space for independent organizations and media freedom, are never good news for the long-term stability or success for business. Turkey is still pushing for a modernized customs union with the EU, but the prospect looks remote given Turkey’s political situation
Europe’s business leaders should send a clear message at the Brussels meeting that the rule of law is paramount. They should tell Turkey’s government that shackling the judiciary, targeting investors or assets, and compromising democratic institutions is the wrong formula for maintaining prosperity or stability in Turkey.