Analysis: It’s a long way to Copenhagen – Turkey’s membership of and convergence with the European Union

EurActiv, Friday 24 March 2006

In this CEPS policy brief, Willem Buiter, Professor of European Political Economy at the European Institute of the London School of Economics and Political Science, argues that, with the right institutions and policies, Turkey could become a true tiger economy. But with the institutions and policies of the second half of the 20th century, it could end up a mangy cat instead of a tiger. This policy brief is motivated by some rather optimistic official reports and especially by the World Bank’s recent Country Economic Memorandum for Turkey, « Promoting Sustained Growth and Convergence with the European Union ».

Introduction

On October 3, 2005, Turkey officially started negotiations for membership in the European Union. Whether Turkey becomes a full member of the EU is likely to be a defining decision, both for the existing EU members and for Turkey. The regional- and geo-political consequences of success or failure of the negotiations, and its cultural and ideological impact, are likely to be even more significant than its economic consequences, although even from an economic perspective the stakes are very high. Turkey’s population of over 70 million is larger than that of the ten countries that joined the EU on 1 May 2004 combined. Unlike the EU-25 (and in particular the ten new member states), the Turkish population is young and growing. Its present per capita income is lower than that of any of the EU-25 countries – about at the level of Romania and Macedonia, using Purchasing Power Parity (PPP) estimates of per capita Gross Domestic Product (GDP). However, with the right institutions and policies, Turkey could become a true tiger economy. But this is not guaranteed. With the institutions and policies of the second half of the 20th century, it could end up a mangy cat instead of a tiger. 

This note is motivated by some rather optimistic official reports1, and especially by the World Bank’s recent Country Economic Memorandum for Turkey Promoting Sustained Growth and Convergence with the European Union. On balance, I strike a somewhat more downbeat chord, although I believe that even my extended list of obstacles and problems can be handled by Turkey given sufficient ambition, determination and political courage.

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