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April 16, 2012, Monday

France faces blowback for Sarkozy’s fight with Turkey

Lost in popular rhetoric and cynical campaign speeches amid a rapidly rising xenophobic and anti-Muslim mood among the French population was the embattled French President Nicolas Sarkozy’s deliberate attempt to pick a fight with Turkey, which was Europe’s fastest growing economy as of 2011.

By doing so, Sarkozy did in fact a great disservice to his fellow countrymen, especially for blue-collar workers, farmers and retirees in France. While heading towards presidential elections, he unsuccessfully pushed a major “nuisance law” on Turkey with a shortsighted attempt to criminalize Armenian genocide denial in French territory. Yet, I must regretfully say, Sarkozy fared well in alienating the most vibrant economy in Europe, which has a young, well-educated labor force, people with great business savvy and an entrepreneurial spirit as well as industries that enjoy a strong manufacturing base.

With a misguided sense of French nationalism up for grabs in political rallies across France, understandably it was not easy for French citizens to realize how much damage this failed law did to future job creation for working class families, on the security of benefits French retirees seem to have taken for granted, and on the income of farmers who have been selling over $1.5 billion worth of livestock to Turkey annually.

The fact is that many multinational firms, including French, have already moved their regional headquarters to Turkey to capitalize on, first and foremost, the rising political clout of Ankara in southeastern Europe, Central Asia, Africa and the Middle East. That includes some French multi-nationals as well. Yet Sarkozy has been doing his best to sever ties with Turkey for reasons unknown to even French government officials, who acknowledge privately that they have no idea what the French president is trying to accomplish.

This is not the first time we’ve tested the waters in France. When France officially recognized the 1915 killings of Armenians as a genocide in 2001, Turkish-French relations took a serious blow, which took years to repair. By the time everything returned to business as usual, at the initiative of the Socialist Party and with the support of conservative French President Jacques Chirac, the French Assembly approved another bill that criminalized the denial of “Armenian Genocide” in Oct. 12, 2006, throwing ties into chaos once again. The Senate never took up the bill, effectively killing it in its tracks, but the damage was done, and repairing the frayed relationship took many more years than did the 2001 episode.

Now the French did it again with the center-right party leader Sarkozy pushing a new bill criminalizing the denial of the genocide on the eve of presidential elections. The bill was approved in the assembly on Dec. 22, 2011, and was passed by the senate on Jan. 23, 2012. But France’s Constitutional Council struck it down on Feb. 28, 2012, ruling that the law was contradictory to the principles of freedom of expression written into France’s founding documents. Sarkozy vowed to keep fighting when he instructed the government to reintroduce a new bill to parliament, which they submitted on the same day. But Sarkozy simply ran out of time when the parliament went into recess on March 6 for the presidential election, which is slated for the April-May period.

Nonetheless, the sanctions announced by the Turkish government in its first batch of reactionary measures against France are still being enforced because the French government did not change its position on the bill. This time the damage seems to be having a longer-lasting effect on French interests in Turkey. All of the activities in terms of exchange of visits, education, training and seminars at the bilateral political and military levels as well as economic cooperation are still suspended. The decision to ban all of the EU twinning projects with French involvement is in effect. There are no political consultations going on at the bilateral level. France was shunned from participating in joint military exercises while France naval vessels are denied entry into Turkish ports. Turkey has started to examine the overflight, landing or re-fueling permissions for French military aircraft on a case-by-case basis, revoking the earlier right to ask for blanket permission for all flights annually.

These measures carry some weight, but they are mostly political messages. The disturbed bilateral relationship took a real toll on the business between Turkey and France. The trade volume in the first two months of 2012 has pretty much stayed dormant with respect to the same period last year albeit with some slight increases. Turkey’s trade with other EU partners have by and large increased. We could have and should have done much better with France, provided that there were no obstacles to the bilateral ties, which thanks, but no thanks, are owed to Mr. Sarkozy himself.

Even if Cabinet members in the Turkish government announce publicly that the French are welcome to invest in and do business in Turkey, the way they are treated in the government bureaucracy is no picnic. The licensing and permission applications filed by French companies have obviously been slowed down in the government maze and there is an undeclared embargo on French companies being offered government tenders and contracts. All these inevitably have a blowback impact on French economy in terms of lost jobs and trade revenue.

There is also a sensitive opposition factor in Turkey, which the government now needs to take into account when dealing with the French. In the new legislative session of the Turkish Parliament, there are at least two dozen question motions filed by opposition party members asking each and every minister to detail what kind of business relations their ministry is currently pursuing with French companies or French institutions. As each minister needs to respond to these questions by law, now even a small amount of cooperation in Turkish agencies with French counterpart is under scrutiny. For example, according to the EU ministry, Turkey has implemented 14 “twinning projects” with France out of a total of 118 with EU partners since 2002. French projects, which were no big deal as they run at the value of $25 million, are now under parliamentary probe.

But there are other projects valued in multi-million or even billions of dollars. Just to give you some idea, let me mention two statements from two different ministries. In a letter dated March 20, 2012 and addressed to Parliament, Environment and Urban Planning Minister Erdoğan Bayraktar listed Bureau de Recherche Géologiques et Minières (BRGM), the French national institute for research on earth and environment sciences; the Muséum national d’Histoire naturelle (MNHN), the National Museum of Natural History in Paris; French banking and insurance firm Groupama; and French consortium Société Anonyme Française d’ Etude de Gestion et d’ Entreprises (SAFEGE) as partners doing business with his ministry in Turkey. He said he would comply with any government directive to slash the business deals when one is issued.

On March 5, 2012, Energy and Natural Resources Minister Taner Yildiz disclosed to Parliament that French company Vivirad has been working with the Turkish Petroleum Refineries Corporation (Tüpraş), Turkey’s main oil supplier, on a project funded by the Turkish Atomic Energy Agency (TAEK). He also noted that Turkish Coal Enterprises (TKİ) is working with France’s largest governmental research organization, the National Center for Scientific Research (CNRS), while Turkey’s Electricity Generation Holding Company (EÜAŞ) is cooperating with French firm Alstom on different projects. Yildiz named French companies Geostock, NVT Perenco, Réseau de Transport d’Électricité (RTE), SNF SAS Andrezieux, Ardatem and Saint-Gobain SA as companies doing business with Turkish government agencies. The list is by no means an exhaustive one.

The French elite understood all the risks associated with Turkish wrath over genocide allegations and tried to prevent Sarkozy from dragging France into an uncalled-for dogfight with Turkey, which is being hailed as a fast-emerging power in Eastern Europe. France’s Constitutional Council put a stop to Sarkozy’s love of adventure for now. I guess the upcoming presidential election will tell us what direction we are headed towards on the bilateral ties as well.

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