Will Israel soon be a client of Turkey's army?

[SpArK]

Will Israel soon be a client of Turkey's army?​

The Turkish army is not just an army. Via its pension fund, Oyak, it also controls civilian businesses worth billions of dollars. Now, the government is trying to curtail its economic might.

By Zvi Bar'el


With an annual budget of $12.2 billion, the Turkish army is one of the world's largest purchasers. One giant acquisition it is now about to make is for 109 helicopters worth some $4 billion, with an option for an additional 300 helicopters.

Two firms are competing for this juicy contract - the American aircraft corporation Sikorsky, which manufactures the Black Hawk helicopter, and the Italian firm Augusta Westland. Both are offering not only enticing prices but also other benefits.


Sikorsky, for example, is promising to give Turkey a contract to repair planes it has sold to Third World countries. It also agreed to buy 109 helicopters from Ankara that were manufactured in Turkey under license from Sikorsky; these will then be resold to other countries. Finally, it offered to build a regional support base for its Black Hawks in Turkey.

Will Israel, which in the past has repaired Turkish helicopters, become a client of Turkey if the Turks decide to buy the American helicopters? It would be an interesting role reversal. But Augusta Westland has also come up with a tempting proposal. It has promised to let Turkey participate in building its helicopters, so that it can become a helicopter manufacturer in its own right.

And while the Turkish army is busy mulling where to put its billions, Prime Minister Recep Tayyip Erdogan is busy clipping its wings. The defense budget is just one source of the army's income. It also has another important source: Oyak, the Armed Forces Pension Fund, which manages the military's pension funds and has become the largest commercial corporation in Turkey, with holdings of billions of dollars.

Best of both worlds

So far, Oyak has been able to enjoy the best of both worlds. As a corporation operating on the army's behalf, it enjoys special tax benefits and advantages in competing for government tenders. At the same time, it invests in civilian companies that provide goods and services completely unrelated to military or security equipment. Among others, it owns a cement company, iron manufactories and a plant that produces Renault vehicles.

The Renault Fluence cars that are sold in Israel are manufactured by Oyak Renault, so any vehicle of this kind bought in Israel puts money directly in the Turkish army's pockets. According to Turkish media reports, the company also plans to sell some 100,000 electric Fluences in Israel and Denmark over the next few years. Anyone wondering about the current state of relations between Israel and Turkey should note the volume of business that civilian companies owned by the Turkish army are doing with Israel.

Oyak owns some 60 companies of this kind, and until now, they have not been subject to oversight by the entity that supervises the activities of government offices and government companies. Thus on one hand, Oyak could say that since it runs civilian companies, it is not subject to government oversight. But on the other hand, it could demand the privileges offered to government companies.

The relationship between Turkey's army and the Turkish economy is structurally similar to that of the Revolutionary Guards in Iran: The latter also have an independent economic base comprised of manufacturing and service companies. In Turkey, this structure was established in 1961, after the military revolt.

The rationale was to supply retired soldiers and officers with a solid income in addition to their relatively small military pensions, and thus make it possible for them to enjoy a quality of life "appropriate to their social status." Career soldiers were required to contribute 10 percent of their salaries to the fund, and soldiers doing their compulsory service, who won't even receive a pension from it, had to contribute 5 percent.

But from a mere pension fund, it became an octopus with many tentacles. And now, the government has decided to rein it in.

Legislation adopted last week, which the army opposed, subjects Oyak to what is known as the oversight court. This institution is not a real court; rather, it resembles Israel's state comptroller. But its decisions cannot be appealed, and in that way, it resembles Israel's Supreme Court.

The oversight court reports to the Turkish parliament, where Erdogan's Justice and Development Party has a majority. Thus the party will now know what the pension fund is doing. In addition, all of Oyak's special privileges are being done away with, including the tax benefits and discounts on various government fees. The result is that Erdogan now has the army by its short hairs.

In effect, Erdogan adopted the conclusions of a study published by the Institute for Economic and Social Research in August 2010. The study recommended that the army be separated from its economic concerns for fear of conflicts of interests. But even more serious, according to the report's authors, is that the special benefits the fund offers its members, who are all military personnel, creates a privileged social status protected from the vicissitudes of the country's economy, and thus "constitutes an obstacle to democracy."

The report also warned that if Oyak continued to exist in its present format, it could harm Turkey's chances of joining the European Union, since it has a negative influence over the country's democratic processes. That is a good excuse for a government that in any case wants to reduce the army's influence on both society and the economy.

Despite the new law and the army's criticism of it, there is no need to feel sorry for the Turkish army's economic conglomerate. It will continue to produce cement and cars, market its products worldwide and enjoy huge profits. It will merely have slightly stiffer competition inside Turkey and be forced to pay somewhat higher corporate taxes.

And military personnel, upon retiring, will continue to benefit from a double pension - one from the government and one from Oyak, whose policy is to supply every career soldier "with an apartment and a car."



Will Israel soon be a client of Turkey's army? - Haaretz Daily Newspaper | Israel News

 

[SQ8]

Askari foundation anyone??
Army welfare trust?
Fauji foundation?

 

[Mehmet]

The sign of an emerging world power is that of a nation that has influence and weight in various sectors of foreign nations. Already considered a regional hegemony Turkey is fast on track to become a world power and in this it does not surprise me that foreign nations and political entities such as the EU and Israel will resist this emerging power.

In this regard it would also not be a surprise if Rennault was deliberately unfairly treated in both Israel and the EU however it is already too little and too late since the influence of the emerging Turkish giant is not only being felt through the expansive power of Oyak but through the cultural and media power of Turkey.

Cheap and often boring (for me) Turkish television shows are penetrating all markets and even hostile Greece has featured a few Turkish television shows dubbed into the Greek language. While a TV show may seem insignificant at first we should remember that in time such "media" influences often change people's perspective.

Using this analysis it seems the propaganda that our rivals having been using against us for years is doomed to fail, the attempted discrediting of the recent Five Minarets In New York (featuring Hollywood and Turkish actors) movie utterly failed and the film become a top box office hit in several countries.

 

[greatsequence]

Askari foundation anyone??
Army welfare trust?
Fauji foundation?

and who copied whome.

 

[greatsequence]

The sign of an emerging world power is that of a nation that has influence and weight in various sectors of foreign nations. Already considered a regional hegemony Turkey is fast on track to become a world power and in this it does not surprise me that foreign nations and political entities such as the EU and Israel will resist this emerging power.

In this regard it would also not be a surprise if Rennault was deliberately unfairly treated in both Israel and the EU however it is already too little and too late since the influence of the emerging Turkish giant is not only being felt through the expansive power of Oyak but through the cultural and media power of Turkey.

Cheap and often boring (for me) Turkish television shows are penetrating all markets and even hostile Greece has featured a few Turkish television shows dubbed into the Greek language. While a TV show may seem insignificant at first we should remember that in time such "media" influences often change people's perspective.

Using this analysis it seems the propaganda that our rivals having been using against us for years is doomed to fail, the attempted discrediting of the recent Five Minarets In New York (featuring Hollywood and Turkish actors) movie utterly failed and the film become a top box office hit in several countries.

The only way to change the minds is the person to person interaction. Tv and cinema does not have much significance anymore. Pakistanis and indians are connected to each others entertainment industries but not much has changed between them.

 

[Mehmet]

Cultural and entertainment mediums such as television do have I believe a significant impact however my post was about the encroaching power of a nation, I believe the Pakistani-Indian situation is different since both countries as you state have connected their entertainment industries (which I find surprising!) and both have still fresh hostility to each other (given the frequent skirmishes and the sheer number of wars both nations have fought).

For example during the cold war you would find U.S media not making fun of the USSR however now that the cold war is over the U.S often makes light of the defunct USSR and this idea of making the USSR has also found its way into Russia who now themselves make fun of the USSR and despise it. This is the kind of power I am talking about, infiltrating and changing people slowly.

If a war breaks out, of course no amount of television will help but what it does do it makes the resistance to the invading/encroaching culture less and less until effectively all forms of resistance become useless and pointless.

Looking at Hollywood it would be difficult to imagine a world without Hollywood despite the fact that so many people bemoan that Hollywood movies are so boring, lacking class and repetitive. It would not only be disastrous for the economy of say Australia to ban all Hollywood movies but it would also spell political suicide for the government.