ISSN 1392–1258.

EKONOMIKA 2005 69

GEOECONOMIC POLICIES FOR REGIONAL DEVELOPMENT:

TURKEY AS A CATALYST FOR EASTERN EUROPE

Sukru Inan
Research Assistant Inonu University,
Faculty of Economics and Administrative
Sciences,
Department of Economics
Malatya, Turkey
Phone: +90 (0) 422 341 00 10 Office: 4343
Fax: +90 (0) 422 341 00 43
E-mail: [email protected]

This paper examines the influence of geoeconomic policies on development. The new age is
characterized by not political or ideological rivalry but by economic competition. States do not aim at
conquering lands but rather at dominating and controlling markets. That process brings the discussion
that the age is whether a geoeconomic age or a neo-mercantilist age with the writings of pundit
writers of geoeconomics in terms of the economic policies of developed and developing countries. In
the geoeconomic world developed countries mainly apply neo-mercantilist policies towards the
developing countries, and as a response developing countries that were “second orders” or “middle
powers” of the geopolitical era generate their own regional geo-mercantilist policies and closer
economic relations with neighbor countries.
Turkey’s strategic and geopolitical importance is continuing with its geoeconomic importance in
the new era. Since the 1980s Turkey’s growth and industry-oriented policies have shifted from the
realm of public policy to a market-driven domain. And later, with the collapse of the USSR and the
end of the Cold War, the “Iron Curtain” around Turkey has absented. These two transformations gave
Turkey a great chance with her historical, cultural and economic ties to form a geoeconomic space
and to become an engine of regional development.
This study investigates the importance of Turkey for regional development with its geoeconomic
policies in terms of energy, trade, and investment policies. Turkey as a bridge or a frontier between
East and West could play an effective role. For Eastern Europe, Turkey will create a catalyst effect as a
bridge, however, its effect will be an impediment as a frontier.
Keywords: geoeconomics, neo-mercantilism, geo-mercantilism, Eastern Europe, Turkey

Introduction
economic policies. From this point of view I
The central argument of this theoretical stressed on some concepts, which are geoeco-
paper is that in the new world order geoecono- nomics, neomercantilism and geomercantilism,
mics is the primary instrument of states’ to explain the new formations on the globe.

30
My argument rests on the proposition that cohesion. The New World Order emerges
second order states (Turkey is taken into instead of the Old World Order as the novel
consideration in this paper) will play an framework that guides the behavior of interna-
effective role in the geoeconomic world with tional institutions and of the important
their geographical position, population and regional entities. The power behind today’s
economic potential. headlines is the eagerness of a nation state to
Until recently, most of those who studied expand its markets, guarantee its supply lines
power thought of it largely in geopolitical and thrust upon its antagonist its competitive
rather than geoeconomic terms. But events advantages. The central feature of the era of
over the last two decades have resulted in Geopolitics was immobility. The superpower
increased attention to geoeconomic power and rivalry had a static effect on the overall global
conflicts in international relations (Nester, situation. In the days of Geoeconomics the
1995). primary feature is dynamism. There is an
The British economist Hawtrey wrote of a interrelation between markets, states and
world where ‘the major concern of the state is technology.
prestige. The means to prestige is power. Power
is economic productivity capable of being Geoeconomics
applied as a force’. Samuel Huntington (1993)
has expressed the same point in a modern Geoeconomics was initially part of geopolitics.
idiom ‘Economists are blind to the fact that Since the beginning of the 20th century geoeco-
economic activity is a source of power, as well nomists have been studying the relationships
as well being. It is, indeed, probably the most between “homo economicus” and space, the
important source of power and in a world in influence of space on production and goods
which military conflict between major states is flows, as well as the possibilities of space usage
unlikely economic power will be increasingly for the progress of economic activities. Space
important in determining the primacy or factors are comprised of geographical location,
subordination of states’. The model which is the distribution of natural and human re-
implicit in this view is a kind of zero sum game sources, location of production knots and
in which the gains of one country (primacy) poles, the structure and specification of
are seen as canceling out the losses of another railroad and telecommunication networks,
(subordination) even if both achieve growing costs of exploitation and transportation of
prosperity. It has been called ‘geo-economics’ resources, etc. From an epistemological point
by Edward Luttwak (1990), ‘the pursuit of of view, geoeconomics is a synthesis of
adversarial goals with commercial means’. economics, history and politics. Geoeconomics
National security involves winning this is an applied science, which takes into account
economic ‘war’ (Cable, 1995). spatial, historical, cultural, ethno-psycho-
Our age is characterized by three main and logical, etc. factors. It elaborates technologies,
powerful trends (Andrianopoulos, 2004): for promoting national economic interests
Geoeconomics is replacing Geopolitics as the abroad and for strategic operating in geoeco-
major force behind inter-state relations. New nomic space, with the aim of identifying and
Economy rivals Old Economy as the engine of occupying the most advantageous patterns and
growth and as the principal means of social niches that will assure the participation of the

31
national economy in global product creation states, especially those regarding international
and global income distribution (Prohnitchi, trade. Finally, the geographer and former
2003). Hérodote editor Michel Foucher (1997) has
The old version of state rivalry is now called also discussed geoeconomics as a new dogma.
geoeconomics. Countries acting as a firm He emphasizes that geoeconomics is practiced
would maximize their profits. Some of the by states among which war is no longer
strategies they might use against their oppo- conceivable. Geoeconomics point out the fact
nents are investment capital provided by the that states compete with each other for
state for industry, subsidizing product develop- economic power, and no more for territorial
ment, and penetrating the market. This is what power (Mamadouh, 1999).
is called geoeconomics. Some other strategies “Geoeconomics elevates the entrepre-
are to use tariffs through taxes, quota limits to neurial interests of investors and consumers;
cope with too little money. In the past, most in contrast to the geopolitical focus on national
people thought that in the future there would borders and place, geoeconomic discourse
be no trading blocks, but the fact remains that privileges networks and pace; and instead of
they are actually increasing. In economic terms, concentrating international politics on building
it is wise to maintain these relationships with alliances for “security” against supposed “evil
other countries, but countries do not always empires,” geoeconomics is primarily con-
act according to economic terms. The logic of cerned with building international partnership
conflict between two countries involved in war that advance “harmonization,” “efficiency,”
is a zero-sum relationship. That means that “economic leverage” and “growth” against the
when one of them has gains, the other must supposed threats of political “radicalism,”
have losses. In commerce, both countries can “anachronism” and “anarchy.” Both Sum and
gain (Luttwak, 2004). Jessop use geoeconomics in a similarly critical,
Geoeconomics purports to place interna- postnational way, applying it largely to the
tional politics on an economic basis. In the macro, continental-scale dynamics associated
words of Edward Luttwak, “everyone, it with the relations between the so-called “triad”
appears, now agrees that the methods of regions of the EU, NAFTA and the Yen-bloc
commerce are displacing military methods – (Spark and Lawson, 2004).
with disposable capital in lieu of firepower, According to Savona and Jean (2004),
civilian innovation in lieu of military-technical geoeconomics as a discipline deals with aspects
advancement, and market penetration in lieu of international competition in which the main
of garrisons and bases. States, as spatial entities protagonists are not corporations, trusts or
structured to jealously delimit their own banks, but states. The interpretation of world
territories, will not disappear but reorient development emphasizes economic and
themselves toward geoeconomics in order to geopolitical processes seen as interstate rivalry.
compensate for their decaying geopolitical “Geoeconomics is economic geopolitics which
roles.” In geoeconomic state rivalry, the “logic is coming to replace the predominantly military
of conflict” will be expressed in the “grammar geopolitics of the past”, write the authors in
of commerce” (Owens, 1999). the preface to the Russian edition.
According to Lorot (1997), geoeconomics There are many definitions of “geoeco-
is the analysis of the economic strategies of nomics”, but geoeconomics is commonly seen

32
as a state centric model of post-Cold War era mercantalist states concentrate on promoting
that analyzes interrelations of state behaviors high technology consumer- and equipment-
in a globalized world. However, in preference industries that most efficiently create wealth
to “geoeconomics” some economists see the and expand the middle class. In many ways,
new era as a neomercantilist age and use neo- neomercantilism is a reaction against liberal
mercantilism instead of geoeconomics. But the idealism. Liberal economists construct an ideal
word neo-mercantilism does not explain the world and attempt to shape the real world
whole world and the practices of states, which accordingly. In contrast, neomercantilists
are still the main actors. Recognizing the attempt to understand the way global political
concept of neomercantilism means that the economy really operates and act accordingly.
world is a market and a colony of the three big While liberalism’s goal is free markets,
trade blocs. Neo-mercantilism can be seen as neomercantilism’s is the creation, distribution
a geoeconomic policy that “three big states” and securing of wealth. Thus, neomercantilists
practice. On the other hand, developing states first determine which industries can create
which were “second orders” or “middle most wealth and then map a strategy whereby
powers” (see Berridge, 1992) of the geopo- those industries can be developed. In addition,
litical era generate their geomercantilism as a neomercantilists see international trade as
geoeconomic policy. largely a zero-sum competition in which one
side’s gain is another’s loss. Thus, neomer-
Neomercantilism cantilist governments use any means they can
to tip the international trade playing field in
Mercantilism is the short name given to the favor of its own firms.
“commercial or mercantile system” that Adam Robinson (1951–1979) also analyzed the
Smith was so opposed to. A mercantilist world practice of trade and financial policy in the real
was the one dominated by rival empires, in world, which she argued to constitute a “new
which the government of each was subservient mercantilism” in which individual countries
to big business interests and in which nations sought to increase their own income and
competed by trying to maximize their holdings employment (via trade surpluses) at the
of ‘treasure’ (Rankin, 1999). “Mercantilism”, expense of their trading partners. Since the
Keynes writes, “is a continually developing total market does not grow fast enough to
doctrine of the role of the national state in make room for all, each government feels it a
economic and social affairs, and the term neo- worthy and commendable aim to increase its
mercantilism is merely a means of distin- own share in world activity for the benefit of
guishing between the absolutist or oligarchical its own people. This is the new mercantilism…
form and that of a more democratic society” Every nation wants to have a surplus in its
(Rich, 2003). balance of trade. This is a game where total
Neomercantilism (Nester, 1995) is the scores add up zero. Some can win only if others
contemporary version of mercantilism; it is a lose (Blecker, 2003).
developmental and national security strategy Bartlett (1994) sees Luttwak’s geoeco-
for liberal democratic countries in an inter- nomics as mercantilism. He says, “ Luttwak has
dependent world. Rather than spend scarce failed in his effort to develop a new geoeco-
resources on the military sector, neo- nomics. That is mainly because he is mixing

33
apples and oranges. The premises that underlie contains three established economic nations
geopolitical analysis are completely different (USA, Japan, and the European Union), one
from those that underlie economic analysis. At emerging economic nation (China), one
the simplest level, geopolitical analysis assumes defunct economic nation (Russia), and the
a zero-sum game: territory can only be held by West Asian nation centered on Saudi Arabia.
one state at a time, thus, one state’s gain must “Wallerstein (1984) argues that it would be
be another’s loss. The basic premise of rational for a hegemon to promote free trade”
economic analysis, however, is that both parties (Wilkinson, 2000), however, neither the
benefit in a free market exchange, otherwise American economic nation nor the Japanese
the exchange would not be made… In the end, economic nation adopt free trade. Nor are they
Luttwak’s worldview can be summed up in one likely to. In the real world, trade is something
word: mercantilism”. Luttwak (2004) res- that takes place mostly within rather than
ponses that “the role of government can really among economic nations.
affect the outcome of a particular industry in “Economic growth is the most important
the economy. The state must be strong and well social policy objective a country can have other
organized. There cannot be a successful geo- than keeping its people physically safe”, writes
economic action without industrialist and Gingrich. He adds: “America’s future depends
bureaucrats to take the process underway. on economic growth. Economic growth
Geoeconomics is not new, it is compared to depends on our ability to compete in the world
mercantilism, the only difference is that there market” (Rich, 2003).
is no actual war; no physical damage is done “In the neomercantilist world we actually
to either side. The only competition is done live in, most trade (and most investment) is
through economic means. Those who are at a internal. The neomercantilist world economy
loss in this geoeconomic transactions are small is structured around a few large economic
businesses and new big corporations who are nations. That is better than the three alterna-
not subsidized by the state”. However, colo- tives: (i) an anarchic world containing many
nialism is still continuing with the American small nations with minimal freedom from the
Hegemony in today’s geoeconomic world near power plays of others, (ii) an anarchic world
energy resources. And, Luttwak accepts the without nations, or (iii) a world without nations
neomercantilism in which “geoeconomics but with a government which could all too
practices are only possible to well developed easily abuse its considerable powers”, says
countries like the U.S., European countries, Rankin (1999) and adds that “modern neomer-
and Japan. Countries which are smaller have cantilism, however, is based on regionalism,
too many territorial problems to worry about which in some ways represents a retreat from
such things as innovation”. globalization (1997).
Neomercantilism (Rankin, 1999) is best
understood as the grouping of the world’s many Geomercantilism
political nations into a small number of large
economic nations. The ‘capital’ nation of any Joseph Stiglitz, former Chief Policy Adviser in
economic nation is just the nation that serves President Clinton’s Administration, said:
as the primary source of capital within each “I found myself in the uncomfortable position
group of nations. The present world economy of an American saying ‘do as we say, not as we

34
do’” (see Shafaeddin, 2000). that regionalism has been on the march. There
Braudel (1979, 1987) showed that the basic were widespread attempts at regional trading
economic units of capitalism were neither local agreements in the 1960s, which largely failed.
nor national, but were rather regional eco- That period has been called the First Regio-
nomic units which included several local nalism, and the current period the Second
realities linked amongst them by a system of Regionalism (Bhagwati, 1991). Before that, in
relations (mainly commercial) that constituted the 1930s, there was a major fragmentation of
a world economy (Santos, 2000). the world trading system into competing blocs,
Regional trade is everywhere on the rise which in the standard view succeeded only too
and much more so than international trade well. There is little point in trying to identify
proper. As a case in point, on a thirty to thirty- the earliest regional trading agreement in
five year period, the world economy has history. For as long as there have been nation-
witnessed the consolidation of a double states with trade policies, they have discri-
process: that of a slower growth in extra- minated in favor of some valued neighbors and
regional trade on the one hand (+3.2%) and against others. Regional trading arrangements
a much more important growth in intra- have at times played major roles in political
regional trade (+10%) on the other (Brunelle history. For example, the German Zollverein,
and Deblock, 2004). the customs union that was formed among 18
One of the commonly supported hypo- small states in 1834, was a step on the way to
theses about world trade, often given without the creation of the nation of Germany later in
statistical validation, is that intraregional trade the century (see www.iie.com). Since the
has been growing faster than global trade. middle 80s, we are witnessing in each continent
Some economists even express concern that a quantitative and qualitative growth of various
the world will be trisected into three economic forms of regional cooperation, regional
and trade zones: Europe, the Americas, and organizations and regional associations. This
Asia (Otsubo, 1998). The world outside of new phenomenon can be explained (Telo,
these three is also making efforts to organize 1998):
their economic regionalism. The Andean – as a reaction to increasing international
Group, CACM, CARICOM, LAIA, competitiveness;
MERCOSUR, OECS, ECO, GCC, SAARC – as a consequence of the interest of
are signs of the economic regionalism of national economies to make themselves
developing countries. Success of these intra- fit to face globalization (limited free
trade arrangements depends on these four trade areas and so on);
characteristics (Kotler, Jatusripitak and – as a Forum of intergovernmental
Maessincee, 2000): cooperation;
– similar GNPs – as an imitation of the well-performing
– geographical proximity E.U., supported by the E.U. itself (as in
– similar or harmonious trade regimes the case of Mercosur);
– political commitment to the regional – as a consequence of a functional
organization. spillover of companies-cooperation,
This is certainly not the first time in history branch-cooperation, interest-networks

35
 and so on (namely in the case of Asia). rience in many parts of the globalized eco-
Regional cooperation provides public nomy. They are characterized by economic,
goods, very useful for peace keeping and trade or strategic goals that could even
conflict preventing: degenerate in political conflicts. Given the
– reducing nationalism and intolerance, failure of protectionism everywhere in the
reducing localism, braking frag- world, a “benevolent neomercantilism” seems
mentation, regulating migration flows, to be a more realistic variant: as a kind of
in the name of cooperation, people defensive trade policy with the goal of keeping
understanding and good neighbourship; the domestic market protected from a too
– making the dialogue of center and strong global competitiveness and to answer
periphery countries belonging to the social demands.
same region easier (USA and Mexico; Asian policy communities have learned
EU and Eastern Europe; Japan and that globalization and regionalization are not
Asia; South Africa and neighbouring mutually exclusive activities but rather they
countries); exist in a dialectical relationship. The ‘new
– reducing the number of international regionalism’ is not an alternative to globali-
players and making the world gover- zation. Rather, it is an ineluctable part of it.
nance easier. Less a challenge to multilateralism, the new
For developing countries, PTAs may regionalism represents a meso level in an
increase leverage by accumulating the market emerging structure of multi-level governance
power of individual members, giving them a geared to fostering cooperation and trade
greater ability to influence their terms of trade creation (Dieter and Higgott, 2002).
and to negotiate favorable settlements with According to Pahala and Sharma (1996),
outsiders. On this score, Pascal Lamy, the EU’s “the developing world is at present expe-
Commissioner for External Trade, conceded riencing a wave of trade reform as has never
that “consolidating MERCOSUR will give been seen before. The reforms include the
Brazil and its partners… more political weight reduction of quantitative restrictions and their
in inter-national negotiations.” Anticipating replacement by price measures, the lowering
the formation of MERCOSUR, a Brazilian of tariffs, the simplification of import and
official similarly remarked, “Dealing directly export procedures and the unification of rates
with the U.S. on international trade issues is of exchange. Even some of staunchest believers
like getting into a cage with a tiger. Only if we in important substitution (such as Mexico,
have others in with us do we stand a better Turkey and a score of African countries) have
chance of getting some satisfactory results” recently yielded to the siren song of “outward
(Mansfield and Reinhardt, 2003). orientation”. The Big Emerging Markets
An opposite scenario (Telo, 1998) would (BEMs) have become a new attraction these
mean neo-regionalism as a reaction against days. These markets share a number of
globalization, as a channel of domestic fears, important attributes. They are all geogra-
a kind of a shield ensuring economic security, phically large, have significant populations, and
a framework for demands of trade protec- represent considerable markets for a wide
tionism. Geoeconomic conflicts between range of products. Virtually, all have strong
regional blocs are already a common expe- rates of growth or hold out the promise of

36
economic expansion in the future. Each has agreements currently in force. These agree-
undertaken significant economic reforms and ments and initiatives vary substantially in
seems likely to expand on them in the future”. coverage, scope and completeness: the
These large scaled countries which have a European Community, the only entity with a
strategic position in the geoeconomic world fully fledged single market and a supranational
achieve geomercantilist policies toward authority; MERCOSUR, the Andean Group
neighboring countries. Brazil with and CARICOM designed as “classic” custom
MERCOSUR is an early example of that unions with a common external tariff; EFTA
geomercantilism. and NAFTA as free trade areas; APEC as an
example of a looser association of trading
Geoeconomic world order partners with the long-term aim of free trade;
the Free Trade Area of the Americas, a grand
During the cold war the international system design but still only at a conceptual stage. As
was characterized by a bipolar structure and regional trading arrangements (RTAs) have
an ideologically driven basis of enmity and spread, enlarged and deepened over the last
rivalry between the two major power blocs. By decade the discussion has intensified whether
the mid 1990s a number of competing images RTAs stimulate growth and investment,
had emerged to describe the new configuration facilitate technology transfer, shift comparative
in international relations (Kemp and Harkavy, advantage towards high value-added activities,
1997). After the Second World War the world provide credibility to reform programs, or
moved towards its stability and new social induce political stability and co-operation.
goals, that is, it moved from geopolitics to There is also the proposition that RTAs are a
geoeconomics. In other words, it allotted an useful vehicle for countries to employ for
increasing importance to economic processes, improving their international competitiveness.
transnational economic integration, globali- In this context it is claimed that trading blocs
zation and the creation of the new world can serve as a testing ground for eventual
economic balance (Mitrovich, 1999). global integration as they allow firms to
Fisher (2004) states that together with the gradually develop internationalization skills
acceleration of the process of globalization (see Table 1).
regional trade agreements have gained According to Harkavy (1997), the three-
momentum in the 1980s and 1990s in all parts bloc neo-mercantilist thesis, or the Three-Bloc
of the world, 10 involving economies at all Geoeconomics Model theory, a new interna-
levels of development. This means that the tional system in which geoeconomics replaced
world has seen at least as much fracturing as geopolitics as the most crucial determinant of
merging. With the emergence of APEC, the rise or decline of nations, and that military
virtually all members of the World Trade power was thus becoming increasingly less rel-
Organization (WTO) now participate in at evant, hence wasteful, in the context of global
least one agreement to advance regional trade competition. Central to the geoeconomics im-
liberalization in goods and/or services. In the agery as expressed in the writings of Walter
context of the newly established Committee on Russell Mead, Jeffrey Garten, Edward
Regional Trade Agreements, the WTO Secre- Luttwak, Lester Thurow and others is the be-
tariat has identified 88 individual regional lief that the world is evolving into three com-

37
Table 1: Intra-trade of trade blocs
Intra-trade of groups as percentage of total exports of each group
TRADE BLOC
1980 1990 1995 2000 2001 2002

EU and Countries 60.9 67.1 66.1 67.2 66.6 66.6

acceding in 2004 (25)
NAFTA 33.6 41.4 46.2 55.7 55.5 56.0

ASEAN 17.4 19.0 24.6 23.0 22.4 22.8

MERCOSUR 11.6 8.9 20.3 20.9 17.3 17.7

ECO 6.3 3.2 7.9 5.5 5.4 5.5

BSEC 5.9 4.2 18.1 14.2 15.0 13.9

APEC 57.9 68.4 71.8 73.1 72.6 73.5

Source: UNCTAD: Handbook of International Trade and Development Statistics 2002

petitive economic blocs including (1) a Japan- thesis and the related theme of the “end of
led Pacific Rim region including Korea, South- history,” there will likely be a permanent peace
east Asia, and presumably China; (2) a U.S.- among the industrialized democracies of
led Western Hemisphere bloc centered on the Europe, North America, Asia, and Oceania
North American Free Trade Agreement juxtaposed against the increasing chaos,
(NAFTA) and potentially encompassing Latin bloodshed, and ethnic-racial fragmentation
America; and (3) a German-centered Euro- within what used to be called the third world.
pean bloc, assumed to include Russia and other This model accepts the idea, central to the
ex-Soviet states and perhaps also North Africa. three-bloc configuration of evolving, peaceful
In this way, the less-developed expanses of economic competition among the major
Africa and South Asia, not to mention the power regions (Harkavy, 1997). Also Cohen
Middle East, are relegated to the status of saw The Middle East and Southeast Asia as
neocolonial resource zones to be courted by the primary shatterbelt regions, and he says
the three major blocs. Such bloc competition that “the shatterbelt appears to be incapable
is predicted to be primarily economic in char- of attaining political and/or economic unity of
acter, that is, without a security dimension (no action,” and that whereas some parts of the
arms races and potential warfare). In a broader shatterbelt may be committed to neutrality,
sense, some analysts see geopolitics being su- others are enmeshed in external ties. Hence,
perseded as the main focus of international too, referring to the Middle East, he says that
relations by geoeconomics. “it is because internal differences are so
This geoeconomics model is related to marked, and because they are found in a region
another image – that of the “zones of peace- that is crushed between outside interests, that
zones of turmoil” theme propounded by Aaron we have defined the Middle East as a shatter-
Wildavsky and Max Singer. According to this belt.” That was, of course, during the cold war

38
(Kemp and Harkavy, 1997). time also gateway toward second outside
Cohen’s analysis covers two types of the geopolitical region named a Shatterbelt region
re-orientation and realignment of political covering Near and Middle East”.
territorial units at all levels of the geogra- Politically, according to Cohen, the world
phical chart – territorial and political (Tunjic, is becoming multipolar with a hierarchy of
2004). states within the system. The position of a state
Cohen’s geopolitical structure is hierar- on the system’s hierarchy list will be deter-
chical. At the highest level there are two mined by its capability to project its own power.
strategic realms, which are “arenas of strategic The list will not remain static, and the positions
place and movement.” Reflecting the classical of the states on it will be changing constantly.
origins of geopolitics, he identifies these However, on top of the list are five major forces
geostrategic realms as the maritime and the or centres of the first order: the USA, a
Eurasian continental. Two are part of Eurasian maritime and sole military and economic
continental realm: the Russian heartland and colossus; Russia and China, militarily strong
East Asia. Of the remaining regions, Cohen but economically relatively weak land Eurasian
argues that one, South Asia, is independent. forces; Japan and the European Union,
Another, the Middle East, remains a shatter- economically dominant but without sufficient
belt. Yet another, Central and Eastern Europe, military capabilities. The second place on the
Cohen describes as a “gateway region” (see list is occupied by regional forces which have
Figure 1), a transitional zone that can facilitate challenged and changed the bipolar and
contact and interchange between the two multipolar world, but have not displaced the
realms. “What seems to be important is that major powers. Rather, they have become
Southeastern Europe is twofold gateway. It is absorbed within an evolving system. They are
between geostrategic realms and at the same located within individual regions that are

Gateway Geopolotical Region or Europe in Between

Southeast Europe
Empires and centres (Brussels, Moscow, Ankara)
Huntington's line

Figure 1: SEE in the new global and European structure. Source: Waever, 1997

39
already dominated by a major force and cannot Central Asia, and the Black Sea. In close
represent any serious challenge. “Second- proximity to the major oil and gas deposits in
order states may have regional hegemonic the Caspian Sea and northern Iraq, it is also a
aspirations, but such hopes are far from key player in the “Great Game” of pipeline
reality”, says Cohen. “In general, then, the politics in the region.
destiny of second-order powers is not to The disintegration of the Soviet Union and
achieve hegemony over an entire geopolitical transformation process in Eastern Europe
region. Rather, it is to exercise broad regional created a boom in economic relations between
influence, with hegemony having practical Turkey and Eurasian countries. A chance for
significance only in relation to proximate Turkish businessmen to play an important role
states” (Tunjic, 2004). in Turkish policy towards this region came
The imperialisation of the European space because of the geographical proximity,
is characterised also by the traditional rivalry historical and cultural links, ethnic links, and
of Germany, Russia and Turkey. The last two, Turkey’s success in adapting to market
due to their imperial legacy and geographical economy, speedy growth in sectors producing
location, are even today wavering between the goods and services in demand in Eastern
national and imperial vision of their identity Europe, and a wise export promotion strategy
(Tunjic, 2004). (JIA, 1996). Besides that, since the collapse of
Turkey’s historical, cultural and geostra- the USSR, Istanbul, a vast metropolis of over
tegic relations in the region with her geoeco- 9 million people, has become the center of the
nomic space present to Turkey many oppor- so-called “Turkish world”. In the light of this
tunities. Turkey is a “second order” of the development Istanbul is now regarded by
region that only exercises a broad regional Western companies as a strategic gateway for
influence. accessing these previously unknown emerging
markets (Pérouse, 1999).
Geoeconomic role of Turkey Turkish firms have permanently enlarged
their trade with Romania, Bulgaria and
The liberalization of the Turkish economy in Macedonia, but only in Romania have they
the 1980s, the adoption of an export-oriented supported their trade activities with serious
development strategy, the positive state of investments. The number of Turkish invest-
affairs in the neighboring regions, the country’s ments in Romania has grown to 4000. The
geographical position at the crossroads of value of Turkish investments in Romania has
Europe, Central Asia and the Middle East, all reached $60 million and Turkey has become
provided a high growth in foreign trade and one of the major investors in that country. In
foreign economic relations. Bulgaria, where approximately 1200 Turkish
Turkey’s location, as Torbakov (2003) firms are established, the value of total
defines that, right in the middle of the Southern investments is very small ($3–$4 million) and
Caucasus/Northern Mesopotamia region, most of the firms are engaging in trade and
makes it a key player in several overlapping services. This trend is also valid for
regions: Western Europe, the Balkans, the Macedonia, but in Albania the number of
Aegean and Eastern Mediterranean, the Turkish firms has increased in the last year
Middle East, the Caucasus–Caspian complex, and some Turkish firms undertook serious

40
projects (JIA, 1996). relations, energy and energy transportation,
Another important element in Turkey’s communication, education, tourism, culture,
foreign economic policy at the time was the health, technical assistance and services.
steps it took towards strengthening its regional Agreements on Trade and Economic Co-
position through founding and developing operation, Reciprocal Promotion and Protec-
regional economic organizations. The imple- tion of Investments and Avoidance of Double
mentation of the European Union (EU)– Taxation constitute the legal basis of economic
Turkey customs union agreement, 1 January relations between Turkey and the Republics.
1996, started the third period of reforms in These three kinds of agreements were con-
Turkish foreign economic relations. cluded with most of the Republics. Within the
The biggest disadvantage of the customs framework of Agreements on Trade and Eco-
union is the effect on relations between Turkey nomic Cooperation, Joint Economic Commis-
and third countries. Turkey’s obligation to sions were established to review the economic
automatically implement common tariffs and commercial relations and to help the re-
against third countries will create problems for alization of cooperation possibilities between
the country in establishing relations with third the parties.
countries and different co-operation models, The cooperation in the energy sector,
because decisions affecting Turkish relations particularly in the transportation of oil and
with third countries will be taken abroad. The natural gas between Turkey and the Republics
speedy signing and ratification of free trade seems to contribute greatly to the development
agreements (FTAs) will partly solve this of trade and economic relations in the coming
problem. The first agreement of this sort is the decade. The Turkish Petroleum Company has
agreement signed with Israel, 14 March 1996, invested in Azerbaijan and Kazakhstan both
after three years of negotiations. The signing by itself and in the form of joint ventures. In
of FTAs with Russia, other CIS states and respect to pipelines, two great projects have
Balkan states will compensate for some of the utmost importance, one being the Baku–
disadvantages of the customs union agreement. Ceyhan Crude Oil Pipeline Project which shall
It will be in harmony with the EU policy toward transfer 45–60 million ton Caspian basin oil
regional countries too. Another important fact per year to the Mediterranean, and the other
is that Turkey is historically obliged to work is Turkmenistan–Turkey–European Natural
for the signing of FTAs between the EU and Gas Pipeline Project which shall transfer
the Black Sea Economic Co-operation project 30–35 billion cubic meter natural gas per year.
and the Economic Co-operation Organization. Today, the Caucasian and Central Asian
In doing so, Turkey will increase the economic countries, with wider virgin resources in all
experience, knowledge and successes which fields of economy, present an important
have been achieved in the last two decades potential not only for Turkey, but also for
(JIA, 1996). Western and Eastern countries.
Turkey has concluded more than two With the end of the Cold War, a new chap-
hundred agreements within a broad range of ter was opened in the understanding and per-
political, economic and cultural relations with ception of the Black Sea. Driven by Turkey,
the Turkic Republics. These agreements cover the Black Sea Economic Cooperation scheme
the fields of economy, trade, finance, industrial became a new vision for the region (see:

41
www.bsec.gov.tr) On June 25, 1992, the heads hauling,
of state or government of eleven states met in – broad manufacturing basis in need of
Istanbul to sign the Black Sea Economic Co- restructuring, overhauling, moderni-
operation Pact. Albania, Armenia, Azerbaijan, zation and commercialization.
Bulgaria, Georgia, Greece, Moldova, Roma- In other words, the Black Sea Region wants
nia, Russia, Turkey and the Ukraine wanted to be seen as the center of Eurasia with its
to let the world know that the Greater Black enormous wealth of cultures and experiences
Sea area with around 350 million people and and its unique geographic features which are
vast natural resources such as gas, oil, coal, naturally linked with the Caspian Sea on the
wood and ore deposits would be a new center one hand and the Mediterranean on the other.
of gravity in the emerging new world order. It wants to be more than just an infrastructural
Critical observers seem to assume that the hub for commerce and trade in the field of
Black Sea Economic Cooperation has, at least natural energy resources, although this has
so far, fell short of hopes and expectations been the almost single aspect which has been
while the Organization itself is pointing to its able to carry the regional agenda of the Black
potential and ever increasing visibility: Sea Cooperation partners into an element of
– an area of nearly 20 million km², new global politics. Since this is inevitably
– an unsaturated market of 330 million linked with the potential and role of the
people with supply well behind demand Caspian Sea region, the two areas are easily
in the three principal economic sectors connected by the strategists of geopolitics and
of agriculture, industry, services, geoeconomics as they have developed since the
– a foreign trade capacity of over 300 end of the Cold War in 1990 (Kühnhardt,
billion US Dollars annually, 2002).
– after the Gulf, second largest source of The Caspian, according to Love (1999), is
oil and natural gas, thus important not only because of a potential
– rich in proven reserves in minerals and contribution it can make to world energy
metals exploited, with underground markets, but also because the competition for
potential even greater, its reserves reflects a wide-ranging network of
– major supplier of commodities in interrelated domestic, regional and global-
international trade, scale rivalries, all of which are helping to
– diversified and creative human re- recarve the geopolitical energy map of the 21st
sources, scientifically qualified and century.
scholarly disciplined, In geoeconomic terms, taking into account
– abundant labor force, skilled and the states that are involved in the BSEC sys-
unskilled, at competitive costs, tem, this region is a sphere of gravitation of
– endowed with Ohots Sea, Caspian Sea, many countries that, although not directly in-
Azov Sea, Black Sea, Marmara Sea, volved with the Black Sea basin, have substan-
Aegean Sea, Mediterranean Sea, Ionian tial economic and transportation interests
Sea, here. Iran, Macedonia, the Federal Republic
– covers important sea lanes and occupies of Yugoslavia and Uzbekistan have put forward
strategic location in maritime transport, applications to join BSEC. Austria, Italy, Is-
ship-building, repairing and over- rael, Egypt, Slovakia, Tunisia and Poland par-

42
ticipate in the organization in the role of ob- future course of Turkey’s relations, not only
v
servers; Bosnia and Herzegovina, Kazakhstan, with the West, but also with the Eurasian
Cyprus, Jordan, Slovenia and Croatia have countries, beyond the 21st century (Ögütçü,
submitted applications to become observers. 1995).
Thus, according to some views, a geography is
present here that does not limit itself to just Discussion
the Black Sea region but envelops a broad area
from the Balkans to Central Asia and from the Geoeconomics is a science that aims to clarify
Baltic to the Arabic states. This territory unites the foreign economic policies of states and to
European, Asian and North African countries, describe the state’s economic interests on the
regardless of the heterogeneity and level of globe. It is a useful policy not only for the “big
development of their civilizations. In practical powers” but also for the developing countries.
terms, this means the creation of a trans-re- Neomercantilism and geomercantilism are the
gional integrative formation. This is also the geoeconomic policies for states that can be
first large integrative formation correspond- practiced according to their geographies and
ing to the post-confrontational stage of devel- economic powers (Inan, 2004). While the “big
opment of the world economy, which is able powers” (U.S.A., Germany–E.U. and Japan)
to unite countries with different political and practice “neomercantilist” policies, the
economic orientations (Danko, 2004). “second orders” (Turkey, Brazil, etc.) of the
Turkey, standing as it does at the geo-center geopolitical era, gradually practice “geomer-
of the Eurasian world and at the juncture of cantilist” policies to increase their influence
strategic energy transportation routes, is in the region and so on the globe. The
destined to play a critically important rote in MERCOSUR, BSEC, ECO in the near future,
any energy trade between the Eurasian (and with their potential, can exercise important
some Middle Eastern) suppliers and the regional economic successes. Especially
European consumers – a rote which requires Central Asia, the “heartland” of the geopolitical
wisdom, creativeness and strategic thinking on era, can gain a real importance in the geoeco-
the part of Turkish leadership given the nomic era, with coordinating Russia and Turkey.
magnitude of the existing political sensitivities That synergy will also influence the economies
and economic problems in the region. The of the Caspian region and Eastern Europe.
pressure on Turkey (a major oil and gas Turkey is a key country as an economic and
importer itself) from the oil and gas exporting political catalyst at the crossroads of Europe,
states of the Caspian region is expected to grow Middle East and Central Asia.
stronger as these countries in need of hard On the other hand, the expansionism of
currency would want to pump as much oil and “neomercantilists” would divide the region and
gas as possible to the world markets. And the thus prevent the geomercantilist structuralism.
ability of Turkish energy diplomacy in formu- The result of that, as Cohen defined, is a
lating a viable response to this historic “shatterbelt” region. So the region itself would
challenge is no doubt to affect profoundly the be an impediment for both the Eurasian and
the Middle East economies.

43
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REGIONINËS PLËTROS GEOEKONOMINËS POLITIKOS PRIEMONËS:

TURKIJA KAIP RYTØ EUROPOS KATALIZATORIUS

Sukru Inan
Santrauka

Straipsnyje analizuojamas geoekonominiø politikos kuria savo regionines geomerkantilines politikas ir

priemoniø poveikis ekonomikos augimui. Naujie- glaudesnius ekonominius ryðius su valstybëmis kai-
siems laikams bûdinga ne politinë ar ideologinë mynëmis.
konfrontacija, bet ekonominë konkurencija. Ðalys, Turkijos strateginë ir geopolitinë reikðmë didëja.
kurios yra geografiðkai ir ekonomiðkai artimos, su- Nuo praëjusio amþiaus devintojo deðimtmeèio Turki-
formavo stiprius ekonominius ryðius, o ekonomi- jos augimas ir á pramonæ orientuota politika trans-
niai blokai uþima politiniø blokø vietà. Geoekono- formavosi ið valstybinës á rinkos politikà. Parodoma
miniame pasaulyje iðsivysèiusios valstybës taiko Turkijos svarba regiono plëtrai, jo geoekonominei po-
neomerkantilines politikas besivystanèiø ðaliø at- litikai energijos, prekybos ir investicijø srityse. Turki-
þvilgiu, o atsakydamos á tai besivystanèios ðalys, ja, ávardijama kaip tiltas tarp Rytø ir Vakarø, galëtø
kurios buvo „antros rûðies“ ar „vidutinës galios“, vaidinti labai svarbø vaidmená.

Áteikta 2004 m. lapkrièio mën.

45