An Analysis on the Impacts of the Economic Recommendations of the EU over Turkish Trade and Investments

This study primarily focuses on evaluating the impacts of European Union’s (EU) economic recommendations over Turkish trade and investments during the accession process. The effects were thoroughly examined by analyzing and comparing progress reports published by the EU on Turkey between 2005 and 2019 considering these reports include EU’s advices on the course of economy. Content analysis methodology has been used for the sake of the research. The developments in Turkish economy are investigated by checking the changes in five topics of the EU acquis that fall into the progress reports and related to trade and investment: External openness in trade, market access, financial openness to foreign capital inflows, foreign direct investment (FDI) and current account balance. The findings suggest that, alignment with the EU suggestions are highly advanced in two sections which are openness in trade terms, and financial openness and the foreign capital inflow, particularly before 2010. These areas constitute the external parts of an economy and prove that the interactions with the international markets have been in good shape during the period of investigation. However, it seems that in other areas such as improving current account balance and the environment for the FDIs, Turkey did not perform well enough in line with the advices. EU underlines that there were decreases in the numbers of well-structured actions related to these areas particularly in the last decade. Another interesting finding of the study is that there are some inconsistencies in the recommendations by the EU since the reports sometimes lacked providing a continuous approach and caused some confusions. In conclusion, one can assert that the economic conditionality of the EU has been a stimulus for Turkish economy in some certain areas.

Keywords

International economics, trade policies, negotiations, European Union, Turkey, investments