Osman Şenkul
During his visit to Turkey at the end of October (2025), German Chancellor Friedrich Merz responded to a journalist’s question at a press conference following his meeting with President Erdoğan, stating, “The path to the EU lies in fulfilling the Copenhagen Criteria. In Turkey, decisions have been taken that do not yet sufficiently meet the rule of law and democracy as we see it from a European perspective. There is a dialogue process on this, and it will continue,‘ he said, adding:
’And we want Turkey to play an important role now, but even more so in the future. And such a perspective is linked to the relevant reports prepared by the European Commission. This is not just an assessment by the German federal government, but a joint assessment that the entire EU must make. We will, of course, continue this dialogue with each other. We discussed this issue comprehensively, and I expressed my concerns, for example, by pointing out that some aspects of judicial independence do not meet our expectations. However, these are matters for our discussions.”
Turkey signed the Association Council Decision (ACD) No. 1/95, commonly known as the ‘Customs Union,’ with the EU in 1995 and was officially recognised as a candidate for full membership at the Helsinki summit of the European Council of Heads of State and Government on 12 December 1999. Consequently, a sui generis customs union was established between the EU’s Customs Union and Turkey’s customs territory. Subsequently, at the Intergovernmental Conference held in Luxembourg on 3 October 2005, Turkey formally began accession negotiations with the EU. On the same day, a press conference was held, and the Negotiation Framework Document for Turkey was published. Bulgaria and Romania, which went through this process at around the same time as Turkey, became full members in 2007; Croatia, which went through this process later, also joined the EU as a full member in 2013. It seems impossible to predict the outcome of Turkey’s accession process, let alone analyse such a process in detail, design it within the framework of a doctoral thesis, and reach a conclusion.
Turkey’s accession process to the European Union was initiated by the DSP-MHP-ANAP coalition (1999-2002) led by Prime Minister Bülent Ecevit; however, the approach of the subsequent AKP governments, which effectively halted the negotiations, also placed Turkey in the position of being the country that has waited the longest at the EU’s door.
Despite everything, the trade volume between Turkey and the EU, which stood at approximately $30 billion in 1995, prior to the Customs Union, increased sevenfold by 2023. Turkey exported $103 billion worth of goods to EU countries in 2022, while this figure rose to $104.3 billion in 2023. In 2024, 41.8 per cent of Turkey’s total exports, amounting to 109.52 billion dollars, were made to EU countries. Furthermore, when we consider other European countries in addition to EU countries, exports to European countries amounted to 147 billion dollars, representing 56.1 per cent of the total; this indicates that more than half of Turkey’s exports are made to Europe.
Even while waiting at the door, the Customs Union, which we joined in 1996, is certainly one of the areas where we benefit greatly from the EU. Dr Can Baydarol, Founding Member of the European Union and Global Studies Association (ABKAD), explains some of these benefits as follows:
“Turkey’s automotive exports were approximately $2.0 billion until 1995. Of this, $1.8 billion came from the ancillary industry, with only $200 million coming from the main industry’s exports. Today, we have reached an automotive export figure exceeding $30 billion. Why? Everyone adapted their strategy and logic to the new conditions, and Turkey has now become a very serious export base. In other words, we cannot deny the existence of the Customs Union in this regard. Despite all the problems, the EU is the only stable export market. A significant portion of our exports is still made by EU investors in Turkey, which we have not yet managed to miss out on.”
Although we have been waiting at the EU’s doorstep for a very long time, significant support continues to flow our way, particularly in terms of exports. Among these, the EU is also taking on a significant portion of the burden of refugees, whose high costs we have grown weary of. At the Turkey-EU Summit held on 29 November 2015, the European Commission pledged to set up a €3 billion fund for Syrian refugees in Turkey, and then at the second summit on 18 March 2016, it added an additional €3 billion in case this fund was depleted. Alongside these resources used to cover the health and other essential expenses of refugees, it also made promises regarding visa exemptions for Turkish citizens, EU membership and the expansion of the Customs Union, subject to certain conditions being met.
All this aside, the social and economic landscape in Turkey has also deteriorated significantly since the years when the foundations were laid for the structure of full EU membership. In particular, the deepening inequality in income distribution is quite striking. Some studies emphasise that the Gini coefficient is high and that income inequality is a serious problem. In particular, the rapid rise in inflation affects those with low and fixed incomes the most: while basic expenses (food, rent, transport) are increasing, households whose income remains below inflation are struggling to make ends meet.
The risk of poverty is also widespread among the working population: not only the unemployed, but also a large proportion of workers face the risk of ‘not having sufficient income’. Fifty-four per cent of workers earn the minimum wage, which is below the poverty line, or even less. The proportion of those earning between the minimum wage and 30 per cent above it is 21 per cent. Consequently, 75 per cent of workers are forced to live on wages around the minimum wage. Furthermore, according to the third quarter labour force statistics released by the Turkish Statistical Institute (TÜİK) at the beginning of the week, 29 out of every 100 young people aged 15-34 are neither in education nor in employment. In other words, almost one-third of the population aged 15-34 is neither studying nor working, i.e., they are idle. In other words, the population aged 15-34 stands at 24.1 million as of the third quarter, and approximately 7 million of this population, or 28.9 per cent (6,954,000), are neither in education nor employment.
As a result, personal debt (credit cards, consumer loans, etc.) has reached record levels. For example, as of 11 July 2025, the total amount of credit card and consumer loans stands at approximately 4.659 billion TL (4.6 trillion TL). The number of people with credit debt is very high: approximately 42 million people carry personal credit debt, and the average debt per person has exceeded 100,000 TL. The number of people unable to pay their debts is also increasing: in 2025, the number of people subject to legal proceedings for failing to pay their credit or credit card debts exceeded 4.1 million. Part of this indebtedness stems from short-term, high-interest debt (credit card debt), which increases financial fragility. The interest burden is very heavy: citizens struggle to pay off their debts because the cost of borrowing is high, creating a debt spiral. This increases household fragility. The problems are intertwined: high inflation reduces purchasing power → households borrow → debt servicing difficulties increase; at the same time, unemployment and informality suppress incomes — this chain amplifies vulnerability and social risks.
In short, according to experts on the subject, these balances may become unsustainable: an increase in the debt stock poses a risk to both individuals and the banking system in the event of an economic downturn. The need for structural reform is immense: social safety nets must be strengthened, income inequality must be reduced, and borrowing must be made more sustainable. Policy makers face a difficult balancing act: ensuring macroeconomic stability while improving household living conditions. Meanwhile, complaints about the sharp decline in production have become a key topic even in ordinary street interviews. As we enter the final month of the year, one of the most prominent issues is the forecasts, demands and hints from the public regarding the expected rates of increase in the minimum wage and pension payments at the start of the new year.
Furthermore, news from various sectors unfortunately, offers no indication that things will improve and return to normal. First and foremost, Turkey’s textile and ready-to-wear clothing sector continues to shrink in 2025. According to data from the sector, between January and August alone, 2,781 businesses closed and 58,918 people lost their jobs. Factors such as high costs, currency fluctuations and dependence on foreign cotton are putting pressure on the textile sector, and dozens of factories loaded onto lorries are being moved to Egypt. Meanwhile, it has been reported that Japanese automotive company Mazda has suspended its operations indefinitely. It was stated that the brand had sales of less than 1,000 cars in the first 10 months of 2023 and that operations were suspended due to the decline in sales. British oil giant BP transferred 770 licence rights to Petrol Ofisi and exited the Turkish market. German car manufacturer Volkswagen, which announced in 2020 that it was abandoning its investment in Turkey, revealed that it would make the investment it had planned in Manisa in Slovakia instead. LG, the electronics giant from the Far East, was going to invest in Turkey but decided against it. Honda, which has been manufacturing in Turkey since 1997, announced in September 2021 that it would halt production at its factory in Gebze, where it manufactures the highly popular Civic model, and has now officially closed the factory.
Another door Turkey could knock on is located on 19th Street in Washington. The institution behind this door is the International Monetary Fund (IMF). Our most recent debt relationship with the IMF, at least according to the statements made, was realised with a payment made at the Central Bank of the Republic of Turkey (CBRT) Ankara Branch on 14 May 2013, with the participation of then Deputy Prime Minister Ali Babacan. Although there is a need, it is clear that going to the IMF’s door is not very easy, because a Stand-by agreement for an IMF loan is an agreement to provide funds requested in accordance with a specific economic and policy programme, with payments and repayments to be made within a specific timetable. In other words, the IMF programme associated with the agreement to be made at the loan stage can take the form of a different package of policy measures for each country; however, the most important thing is that, during the loan process, it must be convincingly demonstrated to the IMF management that a policy consistent with this programme is being pursued with concrete indicators.
Consequently, many of our senior executives travelling to the US for various reasons have not knocked on the IMF’s door on 19th Street in Washington for a long time; even if someone did knock, at least no ceremony or meeting was held that we could hear about. Yet the IMF offers the world’s lowest-cost loans to the countries it has agreements with; but our government’s hand just can’t seem to reach out to knock on the door at 19th Street in Washington. Let’s say it’s too far away; load all those cars onto planes, fly that long distance; after landing, unload the huge convoy from the planes, line them up in front of the airport, then wait for the American police escort, etc. It would take a lot of time.
In that case, it would be possible to send someone competent to the European Union Delegation to Turkey at No. 88, Uğur Mumcu Caddesi, Çankaya. But then, he knows very well that at the top of the pile of files placed before him will be the Public Procurement Law, which was legalised by the government of the time in January 2002 under pressure from the IMF, but which has been amended 191 times since November of the same year (as of 2021) when the new government was formed, and that it will be reinstated in its original form. Then, how would we have acquired such great riches as five-lane bridges, five-lane motorways, the southern motorway, the northern tunnel, five-lane dual carriageways, five-lane motorways, five-runway airports, wallets connecting five continents, and five-domed palaces?
However, the Public Procurement Law was discussed many times in the ‘progress reports’ analysing the European Union (EU) harmonisation laws, regulations and related practices that began after Turkey was accepted as a full membership candidate during the Bülent Ecevit government, following a long wait. For example, the ‘2004 Regular Report on Turkey’s Progress Towards Accession,’ dated 6 October 2004, stated:
“No agreement has been reached on the action plan for the expansion and deepening of the Customs Union. Negotiations aimed at reaching a compromise on services and public procurement continued, albeit slowly, in 2003 and 2004. Turkey’s failure to harmonise public procurement has been a major obstacle to these negotiations. The Association Council Decision on the application of competition rules could not be signed because the Turkish State Aid Monitoring Committee was not established.”
Subsequently, the relevant section of the ‘Turkey 2005 Progress Report’ dated 9 November 2005, covering ‘the general principles of transparency, equal treatment, free competition and non-discrimination in public procurement,’ stated as follows:
“Since the last Progress Report, no new developments have been recorded in the alignment of Turkish legislation with the acquis on public procurement. On the contrary, some legislative steps have even reduced the level of alignment. No significant progress has been made. On the contrary, there are a number of exceptions in the Public Procurement Law, and additions to the procurement law have further distanced Turkish procurement legislation from the acquis. Turkey should refrain from adopting new exceptions that conflict with the acquis. Transparent and non-discriminatory public procurement practices must be implemented, and action must be taken to bring the Public Procurement Law into line with the acquis.
The journalist Metin Münir, whom we recently lost, wrote in an article in 2008:
“Fourteen of the amendments were made directly to the Public Procurement Law. Three were incorporated into the Public Procurement Contracts Law. The others are exceptions to the Public Procurement Law introduced by other laws. For example, the Petroleum Market Law removed the requirement for projects related to petroleum and natural gas to comply with the Public Procurement Law. This paved the way for projects such as pipelines and refineries to be awarded to companies close to the government without a tender process.”
In short, developments regarding public procurement regulations are included in the EU’s annual reports on Turkey, as in the latest report dated 12 October 2022:
“There is still no comprehensive public financial management reform programme in Turkey. The annual budget is prepared as part of the medium-term budget. Public procurement legislation is not in line with the EU acquis. Numerous exemptions added to the Public Procurement Law undermine transparency and accountability in public spending (see Chapter 5). Due to the lack of adequate post-expenditure monitoring, major public investment programmes lack transparency.”
The amendments made to the Public Procurement Law have been met with criticism not only from the EU but also from leading employer organisations in the business world. For example, the Istanbul Chamber of Industry (ISO), the Turkish Industrialists’ and Businessmen’s Association (TÜSİAD) and the International Investors Association (YASED) jointly objected to the ‘Draft Law on Amendments to Certain Laws’ proposed on 15 July 2003 to the Presidency of the Grand National Assembly of Turkey, which envisaged amendments to the ‘Public Procurement Law and Public Procurement Contracts Law’ within the first year of the AKP government.
The joint statement by ISO, TÜSİAD and YASED said:
“The article of the Law regulating eligibility to participate in tenders is proposed to be amended. Accordingly, while the Law requires a condition of performing, supervising or managing similar works at a rate of 70 per cent of the contract value, the Draft introduces a condition of performing at a rate of 70 per cent or supervising or managing at a rate of 50 per cent. The Public Procurement Law has been meticulous in terms of the professional qualifications required of bidders, previously placing significant emphasis on “having actually performed the work” in this regard. With the amendment proposed in the Draft Law, those who actually perform the work and those who supervise it are evaluated in the same manner. This approach stems from the negative consequences in our country caused by the “contractor’s licence” practice during the period of Law No. 2886, which led to individuals with no actual experience performing work. The provisions of the Law regarding the experience documents required of bidders are appropriate and should not be changed.
Olli Rehn, the European Commission’s Commissioner for Enlargement, was also one of the most recognisable figures in the Turkish public sphere at the time. His every visit to Turkey was among the top news stories. During one of these visits (in 2005), we asked him, “Mr Rehn, despite all these regulations being made in line with EU legislation, the fact that Turkey is not being brought closer to full membership is causing a public backlash. What do you think?‘ His response, delivered syllable by syllable, was simply:
’Imp-le-men-ta-tion…”
In short, he meant to say:
“For us, what matters in Turkey’s full membership of the EU is not the EU’s presence on paper, in files, or in legislation, but its integration into everyday life…”
At this stage, at least, it is fair to say that the government has already pushed the EU to the back burner. In other words, as has been the case for a long time, the government currently faces numerous ‘implementation’ issues that need to be resolved: the economy/cost of living, unemployment, education, justice, healthcare…
In other words, Turkey needs to resolve its problems, particularly those related to the economy, but without neglecting education and justice. We can roughly see the cost of deviating from the decision made years ago to aim for EU membership. Therefore, it is clear that we must accept that the door to prosperity still lies with the EU, as it did before, and quickly begin to ‘implement’ the necessary measures.
Based on this, we can see that there are two possible ways out of the impoverishment Turkey currently finds itself in:
We will knock on the IMF’s door in Washington and say, ‘Okay, we will plan where to spend the money you give us, and we will comply with this plan.’
Or,
We will knock on the door of the European Union Delegation to Turkey in Ankara and say, ‘Okay, we will make all the legal arrangements you propose and we will implement each one as required.’