Military Bestrides Turkey 's Path to the European Union

"Indirect pressure to curtail the military is also coming from the International Monetary Fund, which asked the government last month to trim the budget for the armed forces as part of reforms in return for $7.5 billion in emergency aid.

The annual defense budget is about $9 billion, about 3.5 percent of the country's gross domestic product and four times the amount spent on education. Analysts say billions more are spent through mechanisms that are not reported in the budget.

Turkey is currently on a military buying spree, shopping for about $10 billion in tanks, helicopters and airborne early-warning systems — an illustration of the military's economic resources that are almost never discussed, even as the military's political involvement comes under increasing scrutiny.

Military-owned businesses — including a bank, 47 percent of a leading automobile maker and 10 percent of Turkey's cement-making capacity — are among Turkey's largest enterprises and exist free from taxes. The businesses operate outside government control and profits pay for pensions, resorts, and other benefits for members of the armed forces, helping attract and retain top personnel and cementing the soldiers' elevated social standing.

Through a large holding company called Oyak, the military has financial interests in 24 companies involved in manufacturing, automobile production, agriculture, construction and finance. It owns a bank, a supermarket chain, extensive real estate and 47 percent of Oyak-Renault, one of the country's two dominant automobile makers. Many of these businesses are partnerships with the elite of the economic world, from powerful and wealthy families of Turkey like Sabanci and Koc to multinationals like Goodyear and DuPont. The effect is to align the economic interests of the military and important segments of the business establishment.

Oyak, the Turkish acronym for the Armed Forces Trust and Pension Fund, was established by Parliament in 1961, after the first military coup, to provide economic benefits for military officers. Competing with Oyak and its estimated 30,000 employees can be tough. Although it was set up outside the government, the company is exempt from taxes and financed by payroll contributions from military officers and land donations from the treasury.

Describing the history of Oyak in 1998, Taha Parla, a professor at Bosporus University in Istanbul, concluded, "The civil servant on horseback already turned politician was further to become merchant, industrialist, financier and rentier."

The military also controls the Foundation for Strengthening the Turkish Armed Forces, a sister corporation established in 1987 that has interests in 30 defense-related companies manufacturing everything from aircraft and artillery to missiles and telecommunications systems. It employs an estimated 20,000 people and 80 percent of its income is donated to the armed forces.

Critics like Mr. Parla and Eric Rouleau, a former French ambassador to Turkey who wrote about the Turkish military's power in Foreign Affairs last month, argue that Oyak and its sister foundation blur the line between the private and public economies and help militarize the society.

The traditional respect for the military is underpinned by a yearlong class that every Turkish 10th grader must attend, taught by a current or retired military officer using a textbook prepared by the military. Besides inculcating the principles of Ataturk, the course covers political events from the military perspective, concentrating on threats posed by Turkey's neighbors.

"The course has helped internalize the idea that the military has a space in civilian life," said Ayse Gul Altinay, a cultural anthropologist who interviewed dozens of students and teachers on the topic. "Even students who are critical of what the officer says still believe he is the most qualified to speak about these issues.""

They ran the Islamist parties out of power. Islamists use the levers of democracy for the purpose of destroying it and instituting a Sharia state. If the German Army had ran the duly elected Hitler out of power Germans would have been a lot better off.

"The interlacing of the army and big business actually goes far beyond that. Both the Aid Organisation for Members of the Military (OYAK) and the Foundation for the Stabilisation of the Turkish Security Forces (TSKGV) enjoy tax-exempt status as non-profit organisations. In reality, both have long since become large enterprises and maintain shares in numerous European and American corporations, including Goodyear, Mobil, Shell, Renault and Tuerk Telekom.

The military stands to profit from a restructuring of the Turkish economy along the lines proposed by the IMF. Some generals and MHP ministers, however, oppose for nationalist reasons any far-reaching opening up of strategic sectors of the economy to international capital."

Turkey has to choose between joining the EU, and retaining its sovereignty. Thats only obvious. Having a military that counts is part of being a sovereign country, with an independent foreign policy. You won't need that after you join the EU.

"The Turkish government announced yesterday that it has sold the Sumerbank, seized by the government in 1999 as part of a programme to help clean up the banking sector, to the ?OYAK company. Shares were transferred to Oyak from the government yesterday and OYAK announced plans to merge the bank with its existing Oyakbank by January 2002 at the latest. Sumerbank was seized by Turkey's banking watchdog in December 1999 and placed under state control. The bank was merged with five other seized banks in an attempt to make the institution more attractive to investors. The poor regulation of the banking sector contributed considerably to the economic crisis which struck Turkey in late 2000, and under IMF tutelage Turkey has sought to clean-up the sector. Sumerbank is the second seized bank to be sold back into the private sector after Bank Ekspres was bought by the Turkish holding company Tefken. Another, Demirbank, is set to be bought by HSBC. The sale of seized banks is an indication of a gradually improving financial services sector."

OYAK is owned by the Turkish MILITARY. - TAX EXEMPT!

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