Escalating violence hits eastern Turkey’s economy

Şehriban Oğhan - ISTANBUL

DHA Photo

Escalating violence hit investments and the tourism sector in Turkey’s eastern and southeastern regions. Hotel occupancy rates have decreased from 85 percent to 30 percent and it has become impossible for exporters to find any truck drivers willing to transport goods, according to businesspeople in the regions. 

Businesspeople also noted that banks are unwilling to grant loans to any company for business activities in the eastern and southeastern regions, where armed conflicts have been rising for the last three months as the peace process between the government and the outlawed Kurdish Workers’ Party (PKK) has stalled. 

“We cannot take loans out from any banks. We want the guns to be silenced and economic activities to revive again,” said a local businessperson, who wants to remain anonymous. 

The PKK burned more than 20 trucks transporting goods, according to sources in the regions. 

“It is almost impossible for companies to find a truck driver to transport goods from Turkey to Iraq and Iran, hurting the exports,” said another businessperson. 

According to figures from the International Transporters’ Association (UND), the number of the trucks passing through Turkish border to Iraq and Iran decreased to 362,000 in the first eight months of the year from 422,000 the previous year. 

“We are afraid of seeing steeper decreases in the following months unless the problems are resolved,” said UND Executive Director Fatih Şener. 

With the peace process, a dramatic rise in economic activities had been the case until a couple of months ago in both areas, which have great potential in the agricultural, textile, livestock breeding, tourism and energy sectors. 

“It was possible for us to realize these potentials and to increase welfare levels in these regions, which had long been in disadvantageous positions in economic terms. We saw the rise in investors’ attention after the peace process inaugurated… For instance, two big production facilities were established for around $180 million in investment in Diyarbakır…We have now seen a dramatic decrease in investors’ attention to our region. Even the projects that had the preliminary approval for bank loans could not get any money from banks,” said the head of the Eastern and Southeastern Industrialists and Businesspeople Associations Federation (DOĞÜNSİFED), Şah İsmail Bedirhanoğlu.

Tourism representatives have also said there is a sharp drop in hotel occupancy rates in the eastern and southeastern provinces. 

“While the hotel occupancy rates skyrocketed to 85 percent in the last couple of years, we have now seen the rates plunge to 30 percent with the rise in violent acts,” said a sector player. 

According to the “Resolution Process and Regional Tourism Report” released by the Association of Turkish Travel Agencies (TÜRSAB), the number of local and foreign tourists visiting the region reached 1.5 million in 2012 and surpassed 2 million in 2013.