27 March 2003

1. "The Kurdish Question: Eyeing Turkey nervously", Turkey prepares to send more troops into Iraq to stop the Kurds seizing perhaps their best chance of self-rule since the Ottoman empire collapsed

2. "Kosovo for the Kurds", Which peoples should govern themselves? Our answers are as confused as ever.

3. "Turkish-US Relations Experience Precipitous Decline Over Iraq Conflict", differences over the Iraq conflict are fueling a rapid deterioration in relations between the United States and Turkey.

4. "Turkish general moves to defuse rising tensions with Iraqi Kurds", Hilmi Ozkok, Turkey's top general, yesterday sought to defuse an international outcry over his country's intentions in northern Iraq by promising that additional Turkish troops would not enter the Kurdish-dominated enclave "with the aim of fighting or occupation".

5. "Death toll in Turkish prison hunger strike rises to 66", the death toll in a long-running Turkish hunger strike in protest over conditions in controversial high-security jails rose to 66 on Wednesday, a human rights activist said.

6. "Thirty-five mayors of defunct HADEP join DEHAP ranks", Thirty-five mayors of defunct People's Democracy Party (HADEP) joined the ranks of the Democratic People's Party (DEHAP) after a ceremony held in Ankara on Wednesday.

7. "TUSIAD warns government", Turkey's most powerful employers association warns the government: Ozilhan: 'If we don't come to our senses, Turkey will backstep 50 years. Nobody can take the responsibility of making Turkey a lonely country in the Middle East'

8. "U.S. Watches Warily as Turkey's Economy Teeters", a severe financial crisis is engulfing Turkey as a result of its diplomatic rift with the United States, raising the prospect of a debt default that could wreak economic havoc in a country long viewed in Washington as a linchpin of stability in the Muslim world.

1. - The Economist - "The Kurdish Question: Eyeing Turkey nervously":

Turkey prepares to send more troops into Iraq to stop the Kurds seizing perhaps their best chance of self-rule since the Ottoman empire collapsed

26 March 2003

THE Kurds, numbering around 25m, are often called the world's biggest stateless nation. Since the carve-up of the Ottoman empire, after the first world war, they have been mainly divided between four inhospitable countries: Iraq, Turkey, Syria and Iran. They have endured decades of repression and of being used as pawns in regional power struggles. Some Kurds, especially the large numbers who have migrated to western Turkey, have assimilated and intermarried. Many, though, still dream of uniting their fragmented populations in an independent Kurdistan, the like of which has not existed for centuries.

Since the last Gulf war, in 1991, the Kurdish part of northern Iraq has enjoyed autonomy from Saddam Hussein's regime, with its security guaranteed by American and British air patrols. Now, the American-led war to topple Saddam offers a chance to take another step towards a Kurdistan, by getting the autonomy of the Iraqi Kurdish enclave entrenched in the constitution of a post-Saddam, federal Iraq. This alarms the other countries with big Kurdish populations, who fear that it will encourage a revival of separatist fervour among them. Turkey's parliament voted last week to send troops into northern Iraq to discourage its Kurds from seeking anything resembling independence, as well as to stop Kurdish refugees flooding into Turkey to escape the war.

Turkey has had a military presence in Iraq since the early 1990s, mainly to discourage the Kurdistan Workers' Party (PKK) from using its bases there to launch guerrilla raids on Turkey. There is now the danger, if Turkey sends masses of troops, of a confrontation between them and Iraqi Kurdish forces, with each side desperate to stop the other seizing the oil-rich areas of Kirkuk and Mosul, on the edge of the Kurdish enclave. Even Iran might join in.

America is desperately trying to avoid such a disastrous "war within a war". It has brought the Turks and Iraqi Kurds together for talks. It has persuaded the Kurds to put their troops under American command and made them promise not to take Kirkuk, while pleading with the Turks not to send more troops. But within hours of the Ankara parliament's vote, it was reported that 1,500 Turkish commandos had crossed into Iraq. America's special envoy, Zalmay Khalilzad, then spent several fruitless days trying to persuade the Turks to hold back until, on March 26th, their armed-forces chief gave the first hint that he might be persuaded not to send in any more troops. This came the day after President George Bush unexpectedly announced proposals for loans of up to $8.5 billion to help Turkey's frail economy withstand the impact of war.

To the Turks' consternation, the various Iraqi Kurdish groups, which have been notorious for factional infighting, have begun to show signs of unity. Soon after gaining autonomy in 1991, the two main groups, the Patriotic Union of Kurdistan (PUK) and the Kurdistan Democratic Party (KDP), began squabbling, with Saddam backing the KDP and Iran supporting the PUK. But in recent months the two parties have talked of uniting their administrations in the chunks of northern Iraq that each controls. And a smaller militia led by Jawhar Harki, a tribal warlord, has stopped supporting Saddam and joined forces with the KDP.

If the war to overthrow Saddam really has united the fractious Kurds, it will be an historic achievement. As a collection of tribes that speak mutually unintelligible dialects of the Kurdish language, the Kurds' lack of unity has, for eight centuries, made it easy for neighbouring powers to divide and rule them. In the 12th century, the most famous Kurd in history, Saladin, the arch-foe of England's Richard the Lionheart, recaptured Jerusalem for Islam and ruled an empire stretching from Syria to Egypt. But it began to crumble soon after Saladin's death, amid internecine rows. In the 16th century, the Kurdish heartlands, which had become a battleground between the rival Persian and Ottoman empires, were carved up.

After the first world war, when the victorious allies dismembered the Ottoman empire, Britain and France put their promises of a Kurdish homeland on paper, in the 1920 Treaty of Sèvres. But this was ripped up and renegotiated three years later, and the Kurds' aspirations were forgotten. Turkey, deprived of much of its former territory, was determined to impose unity on the rest, and crushed repeated uprisings among its Kurds, today around 12m of a total population of 70m.

The PKK's separatist campaign, launched in 1984, took Turkey 15 years, 50,000 troops and about $8 billion a year of military costs to subdue. It was finally quelled in 1999 when Turkish forces snatched the PKK's leader, Abdullah Ocalan, while he was in Kenya. Until last year, when Turkey passed liberalising laws aimed at being accepted into the European Union, the Kurdish language and even the word "Kurdish" were banned. People are still being arrested for speaking Kurdish in public and for demanding Kurdish-language education, even though these are now supposedly legal. Earlier this month, Turkey banned the pro-Kurdish People's Democratic Party.

The 6m Kurds in Iran, of a total population of 71m, have also had various uprisings crushed since the 1920s. The Kurds, mostly Sunni Muslims, are mistrusted by the Shia clergy who run Iran nowadays. The same is true of the 1m-plus Kurds who live under the Alawite Muslim regime in Syria, where teaching and publishing in Kurdish remain banned. But for all their harshness towards the Kurds, Turkey, Iran and Syria cannot match Iraq under Saddam Hussein, who, ironically, presents himself to the Muslim world as a modern-day Saladin. Towards the end of the Iran-Iraq war in the 1980s, he executed as many as 180,000 Kurds (some of whom had backed Iran), including using poison gas to massacre all 5,000 inhabitants of a Kurdish village.

Almost 2m of the 4m Kurds in Iraq have been driven from their homes, most of them to "collective towns" where Saddam's forces can more easily control them. However, after many years of oppression, the Iraqi Kurds have begun, since the 1991 Gulf war, to enjoy a degree of self-determination and prosperity. Their protected enclave has earned revenues from Iraqi oil sales legally, via the UN's oil-for-food programme, and illegally, by taking a cut of oil smuggled out of Iraq in defiance of the UN embargo. The two main Kurdish factions have ploughed some of their earnings into improving roads and schools.

Some Kurds, then, have been enjoying a taste of what a future Kurdistan might be like-self-reliant and prosperous, especially if it included the oilfields of Kirkuk and Mosul. But so too have the Turcomens, an ethnic minority in Iraq's Kurdish region, some of whom complain of maltreatment by the Kurds, thereby giving their kin, the Turks, another reason to contemplate intervening. Faced with the reality that the Turks, Iranians, Syrians and indeed the rest of Iraq would all resist fiercely any move to Kurdish independence, the Iraqi Kurds' leaders are insisting that they seek nothing more than to keep the limited autonomy they now enjoy, within a democratic, post-war Iraq.

2. - The Guardian - "Kosovo for the Kurds":

Which peoples should govern themselves? Our answers are as confused as ever

27 March 2003 / by Timothy Garton Ash

Here's a riddle with an explosive core: there's a hardy, mainly Islamic people, who have long been oppressed by a different ethnic group running a repressive state. They've been tortured, shelled, bombed, driven out of their homes; some of these oppressive state actions qualify as attempted genocide. A fighting people with a long tradition of mountain banditry, they've responded by armed uprising and guerrilla war; some of the means they have employed would qualify as terrorism. Who are they, and what are we doing about them?

Answer 1. They are the Albanians in Kosovo. We intervene militarily against their oppressor. American special forces work first covertly and then overtly with the Kosovo Liberation Army. We secure them effective independence from Serbia, under an international protectorate. As a result, one day there will either be a little state called Kosova (the Albanian spelling) or a greater Albania.

Answer 2. They are the Kurds in Turkey. We wring our hands, wave our dollars or euros, and tell Turkey that since it's a member of Nato and very much wants to be a member of the European Union, it should please, please, in the name of God, Allah and the World Bank, treat its large Kurdish minority a little better. After all, Turkey thinks it's part of Europe, doesn't it?

Answer 3. They are the Kurds in Iraq. We intervene militarily against their oppressor. American special forces work first covertly and now overtly with the Kurdish liberation armies which over the last decade have rallied under the aerial protection of British and American planes patrolling the "no-fly zone". Since Turkey has refused to allow US troops to move across its territory to open a northern front against Saddam in Iraqi Kurdistan, the Anglo-American coalition may have to depend more on these Kurdish forces. But Turkey is threatening to send (or, perhaps, already has sent) its own special forces into Iraqi Kurdistan. This is ostensibly to fend off a potential flood of refugees into Turkey, but is mainly to deter the Kurds of Turkey from imagining that they can follow the example of their brothers and sisters across the border.

All three answers are correct.

So, what is to be done for the Kurds? Bush and Blair in Camp David today, divided EU-rope, the UN, "the west" (if it still exists), and "the international community" (whatever that is now), will all pretend that we have an answer. Any reader of this column could write the spokesperson's brief: "minority rights", "internal autonomy but territorial integrity of Iraq", "federal structures", etc. But let me whisper this truth in your ear: we don't have an answer. We're flummoxed and floundering, as so often when faced with the issue of self-determination.

The Kurdish question raises a cardinal dilemma for the Anglo-Saxon liberal imperialism on which we have so curiously re-embarked at the beginning of the 21st century. When London and Washington were briefly making the case for the Iraq war as a "humanitarian intervention", it was the gassing of the Kurds at Halabja that they always cited, and the killing of an estimated 100,000 Kurds by Saddam's men. Though such comparisons are always odious, the Kurds have suffered even more terribly than the Kosovans. The moral case is also strong for two other reasons. The Bush (senior) administration encouraged the Kurds to rise against Saddam in 1991, and then let him massacre them with the helicopter gunships that Washington let him keep. Britain has its own special responsibility, since the first people to bomb the Kurds were us, when they revolted against the Iraq we created after the first world war. (Since Tony Blair has apologised for the potato famine in Ireland, will he be apologising for this?)

Watching the television footage from Iraqi Kurdistan, I am irresistibly reminded of Kosovo - tough, gnarled mountain people, dusty roads, village minarets, peasant women in Muslim headscarves, a still largely traditional, rural society, with extended families and clan leaders. The Kurds are not so very different from the Kosovans, after all, nor so very far away. Who would dare claim they should be treated differently because one group is in Europe and the other is not? In both cases, we are still wrestling, nearly a century later, with the legacy of the Ottoman empire.

The moral reservations are also familiar from Kosovo: among our new-found "freedom fighters" are unscrupulous brigands, heavily implicated in organised crime and no strangers to the use of terror. Uncomfortable allies in a "war against terrorism". The political reservations are familiar too: because these people live in several neighbouring countries as well, giving them autonomy here would be destabilising there. Which it was, and will be. Our support for the Kosovo Liberation Army mightily encouraged the Albanian insurgency in neighbouring Macedonia. As a result, we're still there to keep a fragile peace.

Turkey's fears are not unfounded. If I were a Kurdish separatist in south-eastern Turkey, I would be greatly encouraged by seeing US marine General Henry Osman hitching up with my brothers-in-arms across the frontier in Iraq. That's not the only potential knock-on effect. Turkey is the biggest headache, but the Kurds also live in Iran, Syria and Armenia. At an estimated 20 to 25 million they are, it is claimed, the largest stateless nation on earth.

If you think it's a little academic to ponder the fate of stateless nations while the war still rages around Baghdad, think again. The Kurdish question is the largest unexploded bomb in all Iraq. And its future will also be determined in the heat of battle over the next few days and weeks. If the Kurdish forces contribute significantly to the American victory on the northern front, while America's traditional ally Turkey refuses to help, and even actively hinders it by a cross-border incursion, the balance of American opinion will swing in their favour, as it did in Kosovo. Anyway, in one of the stranger freaks of international affairs, the Kurds in the north of Iraq have been enjoying far-reaching, de facto autonomy under our "no-fly zone" for a decade already. Hard to imagine that we will now abandon them to their fate.

So clever specialists are already designing schemes for a "federacy", involving autonomy for Iraqi Kurdistan and individual rights for Kurds throughout Iraq. But Iraqi Kurdistan in what borders? With or without the Kirkuk oilfields? How can you guarantee such individual rights for Kurds in the other parts of a chaotic, occupied country? Or for Iraqi Arabs in Kurdistan? (Remember that British soldiers ended up guarding individual Serb grannies in Kosovo.)

If such delicate constitutional arrangements still don't avert inter-ethnic conflict in developed European countries like Spain (where Catalonia is just pressing for an enhanced autonomy that comes remarkably close to independence), what chance have they here? What would it mean for the democratic self-determination of all Iraq if this bit of radical devolution were immediately dictated by the occupying power? What if the majority of all Iraqi voters don't accept what the majority of Iraqi Kurds obviously want?

Let's face it: when this bleedin' war is over, we'll be back in 1918, confronting many of the same questions in the same places that our grandparents wrestled with, from the Balkans to the Middle East. And we still don't have answers. Sometimes I think we should reinvent the Ottoman empire.

3. - Eurasianet - "Turkish-US Relations Experience Precipitous Decline Over Iraq Conflict":

26 March 2003 / by Ariel Cohen*

Differences over the Iraq conflict are fueling a rapid deterioration in relations between the United States and Turkey. The Bush administration is livid over Ankara's refusal to grant temporary basing rights for American troops and now is reportedly contemplating punitive political and economic measures against Turkey. Meanwhile, Turkish leaders, angered by the White House's perceived high-handed behavior, are unapologetic. Bilateral tension could increase in the coming days, as Turkey prepares for possible military action in northern Iraq.

The Turkish parliament's March 1 vote against US basing rights set the current confrontation in motion. [For background information see the Eurasia Insight archive]. Turkish Prime Minister Recep Tayyip Erdogan publicly supported the proposal to grant US forces the temporary use of Turkish military facilities. Nevertheless, the failure of Erdogan's Justice and Development Party (AKP) to solidly support the measure in parliament was a major factor in the measure's defeat.

Following weeks of debate, Ankara finally granted permission for US bombers to use Turkish airspace for strikes against Iraq. However, Turkey maintained its refusal to give US forces access to Turkish air bases and ground facilities. From Washington's point of view, the Turkish decision offered too little, too late.

Bush administration officials privately blame Erdogan for what they view as a debacle, saying he failed to enforce party discipline on the AKP, which dominates the Turkish legislature. Some analysts believe Erdogan's lack of leadership experience played a significant role in recent developments, which have already resulted in Turkey losing an aid package from Washington worth $6 billion. However, there is also speculation in Washington over whether Erdogan harbors a hidden Islamist agenda. The AKP's political origins are linked with Islamic activism. [For background see the Eurasia Insight archives].

In addition, the actions of Turkey's influential military establishment has left US strategic planners fuming. Many in Washington believe Turkish generals should have brought more pressure to bear on MPs to approve US basing rights. The ensuing controversy, many US policy makers believe, could end up scuttling decades of close military cooperation between the two countries. Indeed, some in Washington say that strategic ties between the two countries could suffer long-term damage.

Pentagon planners are now scrambling to readjust tactical and strategic plans concerning northern Iraq. Prior to the March 1 parliament vote, the US attack blueprint called for American troops to move into northern Iraq from Turkish bases. US officials also were counting on Kurdish militia, known as peshmerga, to attack Iraqi dictator Saddam Hussein's military and to assist the US forces in securing northern Iraqi oil fields around Mosul and Kirkuk.

At present, Washington is concerned about the possibility of Turkish-Kurdish hostilities. Many Turkish officials are concerned that Kurdish separatists may try to establish an independent state amid the anticipated collapse of Saddam Hussein's regime. [For additional information see the Eurasia Insight archives]. Moreover, US military planners reportedly have obtained information about contacts between Iran and Turkey, raising concerns that Tehran and Ankara might attempt to partition Iraqi Kurdistan and secure the oil fields for themselves.

The falling out between the Bush administration and Erdogan's government stands to hurt Turkey far more than the United States, experts in Washington say. The Bush administration appears willing to implement punitive action against Ankara. In the defense sphere, Washington may reduce Turkish participation in US-led ballistic missile defense programs. The Bush administration may also lean on Israel to curb or stop existing military cooperation.

In the diplomatic realm, US support for Turkish membership in the European Union is likely to diminish. Washington also will be less likely to side with Turkey against Greek claims in the Aegеan Sea, or on the Cyprus partition issue. In addition, the Bush administration may consider reopening the US debate on recognizing Turkey's slaughter of Armenians in 1915 as genocide. [For additional information see the Eurasia Insight archive].

In the area of economic cooperation, some US experts believe Washington may reevaluate its commitment to the construction of the Baku-Tbilisi-Ceyhan pipeline. At the very least, the Bush administration will not feel inclined to lend further assistance to Ankara in the event of another economic crisis. [For background see the Eurasia Insight archive].

Turkish leaders appear undaunted by the prospects of US retribution. A large share of the country's political elite believe the Bush administration has acted in an arrogant manner. "I do not find it right that the United States behaved unilaterally before the process in the United Nations Security Council ended," the Anadolu news agency quoted Turkish President Ahmet Necdet Sezer as saying March 20.

Turkish political analysts assert the United States bears a large share of the blame for the crisis in bilateral relations. "What was the United States' mistake? Actually it made many," political analyst Taha Akyol wrote in the Milliyet daily March 26. "First of all it was a mistake to even begin this war. Clearly it [the Bush administration] planned it poorly."

The Bush administration "made many blunders in its meetings with Ankara," Akyol continued. "When Turkey was on the verge of agreeing to a set of terms [to grant US basing rights], the next day the US inexplicably threw these terms out and started again from scratch. As a result a crisis of confidence ensued. What's more, even our public thinks we handled this issue badly. However, we don't want anti-US sentiment to take hold in Turkey."

In the coming days, attention will be focusing on possible Turkish action in northern Iraq. Washington has warned the Erdogan government against any unilateral movement of large numbers of Turkish troops into northern Iraq. On March 25, Turkish Foreign Minister Abdullah Gul said Ankara sought to cooperate with the United States on northern Iraq, but cautioned that "Turkey will make its own decision on the issue if it thinks there is such a need," the Anadolu news agency reported.

Hilmi Ozkok, the chief of Turkey's general staff, indicated a small Turkish force has been deployed in northern Iraq primarily as a defensive measure to prevent instability from spilling over into Turkey. Ozkok insisted that Turkish operations were being coordinated with US planners. "All necessary initiatives will be launched to prevent any misunderstandings," Ozkok told Anadolu, adding that Turkey had no "aim of fighting or occupation" in northern Iraq.

* Editor's Note: Ariel Cohen, Ph.D., is a Research Fellow in Russian and Eurasian Studies at the Heritage Foundation. He often visits Turkey.

4. - The Financial Times - "Turkish general moves to defuse rising tensions with Iraqi Kurds":

ANKARA-ARBIL-BRUSSELS / 27 March 2003 / by Leyla Boulton, Harvey Morris and Judy Dempsey

Hilmi Ozkok, Turkey's top general, yesterday sought to defuse an international outcry over his country's intentions in northern Iraq by promising that additional Turkish troops would not enter the Kurdish-dominated enclave "with the aim of fighting or occupation".

General Ozkok also said that any move to reinforce Turkey's existing troop presence - estimated at about 3,000 - would be taken "in co-ordination" with the US.

Turkey had previously talked about dispatching several thousand more troops to stop a possible flood of refugees, discourage Iraqi Kurds from establishing an independent state, and prevent Turkey's separatist militants from exploiting the turmoil of war to launch fresh attacks from northern Iraq.

Abdullah Ocalan, leader of the former Kurdistan Workers' party (PKK, last year renamed Kadek) is currently serving life imprisonment in Turkey.

Iraqi Kurdish leaders interpreted the announcement by the chief of general staff of the armed forces as lifting the threat of a Turkish intervention.

"I think it will have a major, major impact, because it means there won't be any distraction from the main war," said Hoshyar Zebari, a leader and spokesman of the Kurdistan Democratic party, one of two groups running northern Iraq.

"The US coalition is doing all it can to stabilise the situation here so that attention will be on Baghdad rather than on the border region. We are very pleased and welcome this positive, constructive decision by the Turkish military."

Western diplomats in Ankara also welcomed the general's remarks as reassuring and timely. But they warned that it was not possible to guarantee that Turkey would not intervene if it felt the situation was spiralling out of US control.

They also saw no link between the general's statement and indications earlier this week that the US would give Turkey enough aid to avoid a debt default. "The government might need the money but the priority of the military, which calls the shots on Turkish policy in northern Iraq, is to preserve Turkey's strategic alliance with the US," said one.

Ties with the US were strained when Washington earlier this month withdrew a $24bn aid package for Turkey's debt-ridden economy in exasperation at parliament's foot-dragging over the deployment of US troops for the opening of a second front against Baghdad.

KDP officials had pledged to forcibly resist any Turkish incursion. But the US has so far successfully put pressure on Turkey to desist from a pre-emptive intervention and on Iraqi Kurds to avoid taking steps that could provoke Ankara.

General Ozkok also described as "unfair and offensive" criticism form abroad. He compared the all but defeated Kadek, which used northern Iraq as a base for attacks on Turkey in the 1990s, with Islamic terrorism against the US. "I have difficulty understanding those on the other side of the ocean who say they are under threat but do not believe Turkey when it says we face those same threats directly across our borders."

As he was speaking, the European Union's executive body repeated its opposition to Turkey sending troops into northern Iraq, even for humanitarian reasons.

Guenter Verheugen, the commissioner responsible for Turkey's bid for EU membership, said that Brussels was "extremely concerned" that war in Iraq could have "repercussions on the internal stability in Turkey".

As Turkey was allocated more than €1bn (£680m) as part of pre-accession aid over the next three years, Mr Verheugen added it would be a "fatal strategic" mistake for Turkey to suspend human rights reforms aimed at securing membership negotiations.

One of Gen Ozkok's deputies recently suggested re-introducing emergency rule in Turkey's Kurdish-dominated south-east for the duration of the war. The proposal was rejected by the government.

5. - AFP - "Death toll in Turkish prison hunger strike rises to 66":

ANKARA / 26 March 2003

The death toll in a long-running Turkish hunger strike in protest over conditions in controversial high-security jails rose to 66 on Wednesday, a human rights activist said.

Yusuf Arici, 32, who had been on strike since May last year, died in a hospital where he had been receiving treatment for his deteriorating condition, a spokeswoman for the Turkish Human Rights Association (IHD) told AFP.

Yusuf had been jailed for membership of the illegal extreme leftwing group Revolutionary People's Liberation Party Front (DHKP-C), which is accused of masterminding the protest. The hunger strike was launched in October 2000 by mainly left-wing inmates to protest the introduction of new jails in which one to three-person cells replaced large dormitories for dozens of inmates.

The strikers say the new cells leave them socially isolated and more vulnerable to mistreatment. The protestors have been fasting on a rotating basis, taking only liquids with sugar and salt as well as vitamin supplements to prolong their lives.

Despite the rising death toll, the government has categorically ruled out a return to dormitories in prisons, arguing this leads to frequent riots and hostage-taking incidents in the country's unruly jails.

6. - Turkish Daily News - "Thirty-five mayors of defunct HADEP join DEHAP ranks":

ANKARA / 27 March 2003

Thirty-five mayors of defunct People's Democracy Party (HADEP) joined the ranks of the Democratic People's Party (DEHAP) after a ceremony held in Ankara on Wednesday.

Defunct HADEP's chairman Ahmet Turan during the ceremony stated that the closure of HADEP was a political move.

The Constitutional Court, earlier this month, banned pro-Kurdish HADEP for good on charges of aiding the outlaw Kurdistan Worker's Party (PKK) and carrying out activities challenging the state.

The top court's head Mustafa Bumin stated that the court has decided to ban a total of 46 HADEP members including its founders from politics for five years.

Shortly after the decision of the top court, Court of Appeals Chief Prosecutor Sabih Kanadoglu asked the Constitutional Court to ban DEHAP, a party that was formed in 1997 and largely mirrors HADEP's views.

Kanadoglu said that the party is against the democratic republic, equality and law and principles of the state.

HADEP during the November 3 elections, campaigned under DEHAP and some 20 senior HADEP officials had resigned to join the party.

The Constitutional Court has closed down three predecessor parties to HADEP.

The party has denied any links to the PKK and says it demands greater rights for Kurds.

The closure case against the party was opened in 1999 after now-retired Court of Appeals Chief Prosecutor Vural Savas said HADEP became the center of activities challenging the integrity of the state.

More than 35,000 people have died in the 15-year old conflict in the Southeast of Turkey, between the Turkish Armed Forces and PKK.

The clashes ended after the capture of PKK chieftain Abdullah Ocalan. The PKK declared a cease-fire after Ocalan was arrested and sent to prison on Imrali prison island. Ocalan is the only inmate of Imrali.

The Court's decision and chief prosecutors move to ask the closure of DEHAP, are expected to hinder Turkey's ambition to become a member of the European Union, which Turkey seeks to join, presses Turkey to grant greater rights to minority Kurds.

7. - Turkish Daily News - "TUSIAD warns government":

Ozilhan: 'If we don't come to our senses, Turkey will backstep 50 years. Nobody can take the responsibility of making Turkey a lonely country in the Middle East'

ISTANBUL / 27 March 2003 / by Guzin Yildizcan

Turkish Industrialists' and Businessmen's Association (TUSIAD) Chairman Tuncay Ozilhan harshly criticized the government. Ozilhan, who stated that there were two alternatives for Turkey, "We'll either be a Middle East country or integrate into the developed western society. If this management mentality changes, Turkey can take the steps to change the dark picture. If the government wants to make good use of its 4.5-year term, it should avoid populism and succeed to reestablish the confidence that it lost."

Ozilhan, who made a speech at the meeting of TUSIAD to announce the report on "Independent Regulatory Institutes and Turkey Implementation", said "The events that took place within last 10 years brought Turkey to such a point that if we don't come to our senses, we will have to leave all of our ideals and dreams, and return back 50 years and start from the very beginning. He stated that whatever the relations with the U.S. would be, it would take a long time for U.S.-Turkey relations to become normal.

Ozilhan, who noted that they supported the Justice and Development Party (AK Party) government despite the disagreement with TUSIAD, said, "When the government came to power, it guaranteed that it would solve the current problems. Unfortunately, after a short time we found a government which hadn't made preparations and gave contradictory statements on national issues. The government was submitted by well-established political understanding which has existing for 10 years in Turkey."

'Turkey drifting into loneliness'

Ozilhan, who stated that Turkey was drifting into loneliness in the world said, "In this process, will we be powerful in the economy? No. Mr. Prime Minister says that he will implement the International Monetary Fund (IMF) program with determination. Markets show no reaction to this statement. Because determination should be shown with actions. It is seen that the government adopted the politics of postponement. We will loose our way with $90 billion internal debt and $80 billion foreign debt. Surprise sources will not be able to save us."

Ozilhan, who pointed out that the first political responsible of these developments was the government, said that the opposition, higher state institutes and all management mechanisms were responsible for this situation.

Stating the fact that officials said that everything was under control in such an environment caused TUSIAD to become suspicious. "I wonder if Turkey wants to be made a country which is easily governed? We don't believe this but we can't stop thinking this by looking at the events," Ozilhan said.

"If you bring relations with the U.S., a 50-year alliance, to a difficult point, take the risk of being isolated in the world by failing to solve the Cyprus problem and create difficulty in relations with the European Union (EU), what is the other alternative? Is it to be an authoritarian and low-income Middle Eastern country? Nobody can take the responsibility of making Turkey a lonely country in the Middle East."

After the meeting, Ozilhan replied to questions from press members about financial aid from the U.S., and stated that it would be more useful to use this aid as credit. Turkey will find an opportunity to repay this money back with low interest in 10-15 years."

Ozilhan, who recalled that economic sensitivity had been continuing, said that the IMF recommendations should be obeyed and added: "The aid from the U.S. will contribute to repay internal debts. But is it enough? I think it is not. We will see it in time."

Proposals of TUSIAD

Tuncay Ozilhan proposed the following for economic and political issues:

- 5 percent income increase and 16 percent inflation rate in the government program should be revised.

- Expansion works should start and include 2004-2006 term of the IMF program.

- The continuation of private sector investments should be provided in order to solve unemployment problem.

- The review with the IMF should be completed as soon as possible.

- It should be announced that the base of the Annan Plan for the solution of the Cyprus problem was accepted.

- In relations with the EU, it should focus on the 2003 progress report at first and deficiencies in the Copenhagen criteria should be completed.

- Turkey should explain its views about northern Iraq to the world public.

8. - The Washington Post - "U.S. Watches Warily as Turkey's Economy Teeters":

26 March 2003 / by Paul Blustein

A severe financial crisis is engulfing Turkey as a result of its diplomatic rift with the United States, raising the prospect of a debt default that could wreak economic havoc in a country long viewed in Washington as a linchpin of stability in the Muslim world.

The Turkish lira hit a new low against the U.S. dollar Monday, and the yield demanded by investors for holding Turkish government domestic bonds shot well above 70 percent, amid mounting fears that policymakers in Washington would balk at funneling aid to Ankara's heavily indebted regime. Turkey's refusal to cooperate fully with the U.S.-led attack on Iraq has angered administration officials and many members of Congress.

Although Turkish markets rallied yesterday on news of a White House proposal to Congress for $1 billion in aid to Ankara, the gains erased only a modest portion of the sell-off that has battered Turkish currency, bonds and stocks over the past couple of weeks. At 60 to 70 percent interest rates, the government stands little chance of being able to carry its debt burden for very long, analysts agree. Moreover, administration officials suggested that the new aid offer -- much less than the $6 billion Washington once envisioned as compensation for Turkey's cooperation in the war -- may not pan out.

Deepening the gloom surrounding Turkey's economic prospects, the country's debt was downgraded yesterday by Fitch Ratings Ltd., the credit-rating agency. Turkey's foreign debt rating is now the same as that of Moldova, an impoverished nation that was recently forced to restructure its obligations.

"Fitch is concerned over how the authorities will manage to fill a growing public sector funding gap in 2003," the agency said, using polite terminology for a possible default.

The crisis is a potentially enormous headache for the Bush administration because Turkey's geopolitical importance far exceeds that of some other "emerging markets" that have been stricken by financial panics -- Argentina, for example. Not only is the country strategically located, but it also is a NATO ally and its moderate Muslim society is viewed by Washington as a model for its neighbors.

Until recently, that was enough to convince investors that Washington would move heaven and earth to keep Turkey's economy afloat, including using its dominance at the International Monetary Fund, which committed last year to lend Ankara $17 billion. But now irritated U.S. officials are sending quite different signals, and in conveying their displeasure to Ankara they risk worsening the Turkish crisis by confirming the market perception that the country can no longer count on easy IMF support.

Some experts believe that the administration will ultimately resolve the dilemma in Turkey's favor, perhaps by prodding the IMF to increase its loan program.

"The last thing they need is a major financial crisis in Turkey on top of everything else that's going on in the region," said Steven Radelet, a fellow at the Center for Global Development, who previously oversaw relations with Ankara at the Treasury Department.

But administration officials have shown little enthusiasm for increasing the IMF loan and have confined themselves mainly to admonishing Ankara to stick to the fund's requirements for fiscal discipline. The amount Turkey owes the IMF is already more than five times what it would ordinarily be permitted to borrow under fund rules.

So in the markets, many are betting that Turkey will eventually decide to default because of a vicious circle that has taken hold. Worries about U.S.-Turkey relations have prompted investors to insist on higher bond yields, which drives up government borrowing costs, which worsens the budgetary problem, which arouses even further market anxiety.

"They've got to get on a virtuous path of some sort, and it's hard to see how they can do that even if they implement the IMF program," said Daniel Hewitt, a senior international economist at Alliance Capital Management.

The overarching problem is that the government is staggering under a debt of about $160 billion, close to the nation's annual national output. So when interest rates shoot up a few percentage points, as they have recently, the impact is huge. The same goes for declines in the lira, because a substantial chunk of the government's debt is denominated in dollars or linked to the U.S. currency.

The recently elected government has taken many of the budgetary steps required by the IMF, which praised Ankara's latest moves yesterday. But those measures are often "swamped by changes in financial market sentiment" such as higher interest rates and a lower lira, said Dani Rodrik, a Turkish-born economist at Harvard University who is advising the nation's central bank.

If the government finally gives up and suspends payment on the debt, the most likely effect would be a major contraction in credit that would add to the problems of an economy already threatened by a war-related drop-off in tourism.

"One could argue that in the medium to longer term, [default] might be a better thing than just stumbling along with this albatross around your neck," Rodrik said. "But in the short term, it's very damaging. We're not talking just about foreign debt; this is debt held by domestic residents and the banking sector."