The Emergence of Modern Turkey

The first paperback edition, in line with latest historiography - "Ottoman Empire" is a major and advanced early modern power, this book is based on a huge study of original sources and personal accounts. The author leading historian of early modern Ottoman Empire in all aspects - political, economic, diplomatic and cultural. In Islamic law the world was made up of the House of Islam and the House of War with the Ottoman Sultan - the perceived successor to the Caliphs - supreme ruler of the Islamic world. However, Suraiya Faroqhi demonstrates that there was no iron curtain between the Ottoman and other worlds but rather a long-established network of diplomatic, financial, cultural and religious connections. These extended to the empires of Asia and the modern states of Europe. Faroqhi's book is based on a huge study of original and early modern sources, including diplomatic records, travel and geographical writing, as well as personal accounts. Its breadth and originality will make it essential reading for historians of Europe and the Middle East.

The Ottoman Empire and the World Around it

In the midst of political decline and burgeoning financial problems in the late nineteenth century, the Ottoman Empire became embroiled in a borrowing frenzy, which eventually resulted in the financial collapse of the empire. Under political pressure and with the growing need for external funds, the Ottoman court compromised its fiscal sovereignty by ceding the most liquid revenue sources to a financial administration controlled by European creditors. In this book, Murat Birdal sheds light on the handling of the external debt crisis, one of the most controversial periods of Ottoman economic history. Based on extensive archival research foreign archives, he explores the pivotal role of the Ottoman Public Debt Administration (OPDA) in the peripheralization of the Ottoman economy. This book will be invaluable to scholars of Ottoman, Middle East and economic history.

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The Political Economy of Ottoman Public Debt: Insolvency and European Financial Control in the Late Nineteenth Century

By the mid-19th century, after nearly 600 years of power, the Ottoman Empire’s financial strength weakened considerably exposing the Empire to the risk of losing its territories in the Balkans, Middle East, and Africa. The Ottoman Empire’s involvement in the costly Crimean War (1853-56) was a fatal mistake which marked the beginning of the Empire’s everlasting addiction to foreign borrowing. The creation of the Ottoman Public Debt Administration by Sultan Abdulhamid II in 1881 (similar to the IMF) turned the Ottoman Empire into Britain’s semi-colony and was labeled as ill-man. Mustafa Kemal – a brilliant man, military commander, politician, strategist, and genius – had initiated the Turkish national resistance movement in the aftermath of World War I to expel occupying armies. Eventually, Mustafa Kemal created an independent Turkish Republic in November 1922 from the ashes of an Empire that existed 623 years. But not without cost, the Paris Conference of 1925 forced Turkey as the new Republic to agree to pay the debt of the Ottoman Empire (last remaining payment was made in 1954). Now the question is to be with the IMF or not to be. Following the Justice and Development Party’s win in the 2007 general elections (47% of parliamentary seats), Prime Minister Recep Tayip Erdogan said “No IMF in Turkey’s future”. Although Turkey made its final loan payment to the IMF in May 2008, many contend that Turkey’s divorce from the IMF can hardly qualify as a true graduation since the country is on the brink of an economic crisis (financial meltdown), attributable to excessive private and household debt, massive dollarization, a failed coup attempt by a fraction of the Turkish military (July 15, 2016), fast rising unemployment (over 14%), fast devaluation of lira due to repeated speculative attacks and the subsequent cascade of corporate defaults. At the backdrop of multifaceted instability, Turkey’s current gloomy financial situation (high inflation and chronic deficits of current account, budget, and trade) is in desperate need of foreign capital inflows especially when Turkey’s options to finance deficits through external barrowing have become substantially limited. Elongated addictions, whether to the U.S. dollar or to the IMF, are not easy to overcome by a politically oriented decision provided that Turkey has been the IMF’s longest devoted member (since 1947). Turkey is going through very tough times; with low foreign reserves, Turkish economy has become vulnerable to speculative attacks stemming from domestic and external sources.

A Delicate Moment in Turkey’s Economic Transition: Can Turkey Survive Mounting Economic Problems without the IMF’s Bailout Package?

Turkey has experienced the biggest financial and economic shock in 2001 resulting a massive overhauling of its entire banking system that eventually cost the government over $50 billion The IMF was involved in the recovery process from the beginning providing Turkey nearly $24 billion of financial assistance between the fragile years of 1999 and 2002 After 19 Stand-By arrangements, the Turkish government recently announce that it had decided to put an end to its partnership with the IMF since 1947 and it also said that it would not commit to another arrangement after the last payment of the existing loan is made on April 2013 The resilient Turkish banking system capable of absorbing shocks during financial stress, thanks to the extraordinary work by the BRSA, a decade long political stability (one-party government since 2002) along with improved global investor confidence enabled Turkey becoming the 16th largest economy in the world with over $1 trillion in GDP On the contrary of common arguments, a large number of Turkish government officials and the top banking executives believe that Basel III’s new rigorous capital requirements will have little or no impact on the Turkish banking sector which currently has a capital adequacy ratio (CAR) of little over 16%, thatis significantly higher than Basel III’s 105% in effect by January 2019

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Rigorous Capital Requirements under Basel iii Possible Impact on Turkey’s Financial Sector

French economic development under the July Monarchy led the class that most benefited by it, the bourgeoisie, to demand increased political power. It was in the interest of the new regime of 1852, whose establishment was made possible by the support of the bourgeoisie, to favor the investment of capital acquired by its supporters, and to find new outlets abroad for the goods produced at an ever growing rate by France's new factories.

Michelle Raccagni

Papers

The French Economic Interests in the Ottoman Empire