by Mehrunisa Qayyum, Political Economy Analyst of MENA Region
As the European Union battles the falling Euro and grapples with the Greek financial crisis, neighboring Turkey is literally seeing greener pastures on its side. Turkey’s Prime Minister, Recep Tayyip Erdogan, has overseen a 9 percent growth in Turkey’s GDP since 2010. At the same time, Islamic banking institutions and investments have experienced popularity and expanded within Turkey and abroad. As such, on July 2nd, the 3rd Annual Turkish Symposium partnered with the Islamic Society of North America and held a seminar entitled “Turkey’s Zero Problem Foreign Policy under the Leadership of Recep Tayyip & Its Impact”. Specifically, the discussion reviewed how Islamic banking enterprises successfully have engaged Turkey’s 70 million—and growing—population and developed American and Middle Eastern ties as Turkey secures its political and regional place as a leader.
According to the UK Telegraph, Turkey demonstrated “China style growth” within a year. Similar to US presidential elections, economic health acts as a strong determinant of who is reelected, and who is ousted. Remember how the Democratic party won the presidential and numerous congressional races to take the majority in 2008? It was the economy’s poor health, silly. Perhaps, it is no surprise that the Islamic party Justice & Development, AKP, defended its third consecutive win.
The foreign policy oriented panel could not separate Turkey’s political and economic successes, since these have occurred hand in hand. Panelists included: Fatih Yildiz, Consul General of the Republic of Turkey in Chicago; Mahinur Ozdemir, first Muslim Member of Parliament of Belgium—and part of the Christian Democrat party; Kemal Bozkurt, Lawrence Library’s Reference Librarian; and Cemal Demir, Journalist, Haber7.com. (Mehmet Kemal Ozdemir moderated.)
The panel used WISE Capital Fund (WISEX) as an example of how Muslim Americans are putting faith in Turkey’s financial growth and strong prospects in political stability. Azzad Asset Management highlighted how WISE Capital Fund has banking partnerships with Turkiye Finans, for instance. (See www.azzad.net ) According to the MEMRI Economic blog,“Following the introduction of the Banking Act 2007, the country’s four participation (Islamic) banks – Albaraka Turk, Kuveyt Turk, Turkiye Finans, and Asya Finans Participation Banks – were brought under the same provisions of the above act, which meant that the regulatory regime was exactly the same as for the conventional banks.” Earlier this year, Turkey launched the ISE Participation Index KATLM on January 6, 2011. The index reflects an initiative to promote ethical funds and “Socially Responsible Investments”, SRI. (See “Islamic Finance in Turkey–Looking Ahead With Confidence”, 2007, by Peter Wouters.)
Turkey is one case study that invites more optimism if not just keen interest in their economic progress via banking. As noted in the Turkish Symposium, as the Arab Spring occupies its neighbors, more opportunities will emerge for Turkey to serve as a bastion of not only political stability, but as a hub for financial stability. Morever, the idea of “Socially Responsible Investing” prompts further discussion—especially considering how the trend mirrors certain Islamic Banking principles. This will be covered in next week’s post—so stay tuned and be ready to rebut the arguments for Islamic Banking!