Political Economy of Turkish US Relations During Turgut Özal Era and AK Party Period

Turkey integrated into world financial system and opened to financial flows from western countries during the Turgut Özal era. That improved under liberal economic policies established during AK Party ruling. Özal, succesfully transformed Turkish economy from import substutition model to export promotion model with declining state intervention to national economy with more liberal policies. The privatization of State Companies has been done in the following years during AKP governments. Turkish-US relations ges back to 1950’s and strengthened after 1980’s with liberal economic policies enlarging financial inflows to Turkey. Even though AKP has islamic conservative roots they strictly followed IMF remedies after 2001 economic crisis with further integration in World capital markets with increasing amount of financial flows. In this paper my humble intention is to provide comparative analyses of those terms in a given context. I compare main macroeconomic indicators such as inflation, unemployment, current account deficit and economic growth in both terms. The low exchange rate and high interest rate policy was common in the beginning of two terms and have different outcomes. Both leaders aim to attract foreign direct investment for economic growth. Thus the capital accumulation and inflow in both registered and unregistered ways also searched in the borders of this paper.

Keywords

International Economics, Political Economy, USA Turkey relations, Turgut Özal, AK Party