The Syrian bill is huge

GÜNGÖR URAS

Finance Minister Mehmet Şimşek said they have transferred 400 million Turkish Liras from the budget to Syrian refugees up until today, but the general spending of the municipalities and the state are most probably more than this. We initially welcomed the increasing number of refugees. Now, we have started worrying. How are we going to feed them; when will they return?

The Syrian policy has cost us too much in a variety of ways. Worse, the bill is constantly rising.

1) When the Syrian border closed, exports were halted
Ankara is involved with how Bashar al-Assad is going to be toppled and with the refugees from Syria, while whatever is going on in Syria has a huge economic bill for us. The Turkish economy and especially people living in border provinces are suffering very much, extremely much, from what is going on. Other than that, this damage is not temporary. It is permanent. We did not just export to Syria through the Syrian border; we exported to 11 Middle East countries. As if losing the Syrian market was not enough, we are not able to send goods to other countries.

After the gates to the Syrian border were closed, Turkey’s exports to Syria and to 11 Middle East countries through Syria have come to a stop. Transporting cargo trucks from Mersin port with ro-ro ships to Egypt did not solve the problem. The length of the journey and the high cost of the freight caused the amount of exported goods to stay at a certain limit. Those countries that could be reached by cargo trucks within four days can now only be reached by ro-ro after 20 days.

Before the crisis, an average of 9,000 cargo trucks would carry export goods to the Middle East through Syria each month. In 2010, a total of 106,000 such trucks crossed from Turkey to Syria carrying export goods.

2) Several workplaces in the east and southeast in dire straits
“Trade with Syria has stopped,” said the head of the Gaziantep Chamber of Commerce, Mehmet Aslan. “Before the incidents, we had $100 million to $150 million exports to Syria alone. The transit passes to the Middle East have also stopped.”

The head of the Executive Board of the Kilis Chamber of Commerce and Industry, Mehmet Özçioğlu, said: “The economy of Kilis is dependent on Syria. Every day, 3,000 to 5,000 people used to come, sell and buy goods with hot money. This has completely stopped.”

Ninety percent of the exports to the region, primarily to Saudi Arabia, Jordan, Qatar and the United Arab Emirates, were conducted with transit passes through Syria. Hatay exported one-fourth of Turkey’s total raw vegetable exports. The export market in the region was $2.8 billion. The halt of production, trade, transportation services and exports is indeed the biggest problem of the local population, but this is, in the end, a loss for the Turkish economy as well.

3) Huge bill of the closure of the air space
Syrian air space is closed to Turkish planes. This air space was being used for flights from Istanbul to Saudi Arabia, Qatar, Oman, Yemen, United Arab Emirates and Bahrain, as well as the Far East. Now, flight times have been extended half an hour. Planes will be using $1,500 more in fuel for each flight.

4) Heavy bill of military operation
We had to mass troops along the Syrian border. Tanks, armored vehicle are at the border. Planes and helicopters are making patrol flights. This extraordinary movement has a heavy bill.

5) War risk premium
Let’s be realistic. There is a “risk of hot contact” behind the Syrian policy. The issue could last a long while. Investors have to add this risk to the price of everything; they are already doing so. This risk is added to the price of money and the price of goods. In terms of investments to be made in Turkey in general and especially in the east and southeast, this risk has resulted in the slowing down of business and delays with the thought, “Let’s see what will happen?”

Naturally, the finance minister has taken into consideration only the money that was drawn from the budget; however, it is apparent that the bill of this business is way over 400 million liras. And this huge bill is being paid for by our people.

Güngör Uras is a columnist for daily Milliyet in which this piece was published on Oct 17. It was translated into English by the Daily News staff.

GÜNGÖR URAS - guras@milliyet.com.tr