Crisis or opportunity? Turkey, Greece and the political economy of South-East Europe in the 2010s

Abstract

During the 2000s, the European Union (EU) and the euro zone provided anchors for regional integration in South-East Europe including the Western Balkans. Today’s crisis has called into question the credibility but not the desirability of that framework, and regional actors can still mobilize building blocks forged in the past decade for much needed bottom-up reforms. The process could be galvanized by a regional insider with economic and political capital. With Greece absorbed in its own crisis, Turkey is a candidate for such a role. Assessing Ankara’s capacity to drive change in the region vis-à-vis the debate over its once touted, apparently moribund ‘zero-problems-with-neighbours’ policy, we argue that Turkey’s most sustained foreign policy success has been in the Western Balkans. This is because its approach complement the soft instrument legacies of the earlier EU framework for regional integration. As such, if Ankara abandons its own commitment to economic and political liberalization, it may forfeit its potential to serve as a leader in the region.

Keywords:

• Western Balkans
• EU
• Euro zone
• regional integration
• Greek crisis
• Turkish foreign policy
• economic and political reform

Notes

1. The Council for Mutual Economic Assistance brought together socialist countries during the Cold War as a sort of counterweight to Western fora for economic cooperation.

2. This is attested to in recent surveys by the World Bank, the EBRD and the World Economic Forum.

3. Even Ireland, the former poster child of convergence, has fought to extract itself from a deep economic and financial crisis – hardly a heartening example from the perspective of South East European states.

4. For an extensive survey of the rise and fall of the ‘model’ discourse, see Fisher Onar (2013).

5. See, for example, the SEECP and Cultural Corridors Istanbul Summit of 21–23 June or the conference in Sarajevo in October 2009 entitled ‘The Ottoman Legacy and the Balkan Muslim Communities Today’.

6. For an elaboration of these principles see the exposition by Turkish Foreign Minister, Davutoglu (2012).

7. Such critics also dismiss Ankara’s warm ties with Skopje as being based, from the latter’s perspective, solely on a desire for allies in the with regard to the name debate with Greece.

8. Davutloglu, ‘A Forward Looking Vision’.

9. In this regard, the oft-expressed view that Turkey is diversifying its economic and political linkages away from an exclusively Western orientation – and by extension away from South East Europe – in favour of the ‘East’, namely the Middle East, is somewhat misleading. To be sure, there has been an active policy of courting Middle Eastern, particularly Gulf, investment, and cultivation of trade ties with the region since the late 2000s. This trend must be read in light of the clouds looming over the European economy at the time. At least until recently, Turkish leaders’ economic outreach to the Arab world has emphasised that the country’s added value is tied to its ability to serve as a bridge to Europe with Turkey’s eventual EU membership cited as a reason why Middle Eastern investment should choose Turkey as a destination.

10. This trend changed with a consumer boom after 2008.

11. See the Life in Transitions Survey II (2012) of the European Bank for Reconstruction and Development (EBRD) available at www.ebrd.com.

12. The opposition in Tunis, for example, cancelled a meeting with Prime Minister Erdogan in light of his strong statements dismissing the ongoing protests and protestors during a state visit to North Africa.