Foreword

This report is a product of PODEM’s “business community for social peace” project, launched in 2015 in partnership with the Berghof Foundation. During the two years of the project, PODEM and the Berghof Foundation brought together business people from Turkey’s western and eastern provinces in a series of meetings in Istanbul, Diyarbakır, Şanlıurfa and Van to discuss regional development for social peace.

Within this framework, the following report shares the findings from a recent field research carried out with business people from Istanbul and Diyarbakır who closely followed the regional economic developments during the peace process. Besides the prospects of regional economic development, the report details business people’s views on contemporary political issues, with specific reference to the Kurdish issue. In addition, it examines the business communities’ potential for contributing to peace.

With this, the report aims to lay out the contemporary issues that business people from Istanbul and Diyarbakır agree and diverge on, and compare the similarities and differences in their perceptions. The ultimate objective of this report is to encourage collaborative projects that will promote and strengthen links between the business communities in the two regions.

Introduction

As an actor with interests in economic development and growth, the business community is certainly among the most important stakeholders of political and social stability. Conflict environments lead to losses in investment, distrust of markets and a decrease in demand.¹ Thus, the business community primarily expects political and social stability, which protects existing investments and encourages new ones. It can therefore be argued that business people may advocate the maintenance of security to ensure stability and democratization processes that strengthen social harmony and peace.

The constructive potential of the business community in democratization processes and its limits are widely debated in academic literature.² In the mitigation of conflicts and post-conflict rehabilitation processes, there is a broad range of areas where the business community can add value. It is argued that business people can undertake projects that unearth the development potential of conflict-afflicted regions in dire need of economic improvement. Collaborations that encourage solidarity with local businesses and associations in conflict regions and increased interaction between chambers of commerce and industry, can both work to demonstrate the economic costs of the conflict. It is argued that such collaborations and projects can even lay the foundation for the business community to act as a neutral intermediary between the political class and society when conflict resolution is on the agenda.³ 

It must be noted that the business community’s potential for supporting democratization processes is not confined to academic debates alone. As a matter of fact, in countries like South Africa and Northern Ireland—which experienced divisive conflicts that damaged the social fabric—members of the business community took on facilitative roles in the implementation of peace.

One such example is the Consultative Business Movement (CBM) of South Africa, which brought together business people from both sides of the apartheid regime between 1988 and 1994, to push for a constitutional solution built on consensus. The movement declared itself an objective stakeholder of the peace process and its presidency was shared by business people from both sides of the apartheid regime, exhibiting an impartial approach. With an end goal of terminating the violence in the country and the establishment of peace, CBM initially worked to increase interactions between different political parties and the business community. As it expanded, the movement organized meetings with the government, syndicates and wider business communities in order to foster cooperation. Within a short period of time, budding relations between political actors and various social stakeholders of the process allowed the movement to assume a facilitative role in the negotiations that culminated in the peace of 1991. After the conflict, the movement, under the name National Business Initiative (NBI), conducted campaigns that aimed to mobilize the business community for the rebuilding of a new South Africa.⁴ 

The impact of the business world can also be seen in the transformation of the conflict between Catholic and Protestant communities in Northern Ireland. During conflict escalation, the worry that communities would find themselves engulfed in sectarian violence resulted in the proliferation of a business profile that was rather distant to politics. In the early 1990s, business people started becoming more receptive to politics as they increasingly saw the  link between the continuing violence and the country’s weak economic performance. When steps for peace were revived between the political parties in Northern Ireland and the British government, the business community in Northern Ireland decided to take action. Under the initiative of the Northern Irish branch of the Confederation of British Industry (CBI), they first worked to increase border trade between Northern Ireland and the Republic of Ireland. In a report published in 1994, CBI referred to the “peace dividend” and revealed the yearly cost of the conflict for Northern Ireland ($1.42 billion). It further pointed out the likely benefits of redirecting this money to various other sectors that could promote peace and to investments that could create employment. The report garnered significant attention from civil society and the media.⁵ 

In 1996, CBI and various business institutions formed the Group of Seven (GoS) and conducted meetings with the participation of nine political parties that were active in the peace  negotiations.  After the Good Friday Agreement in 1998, GoS continued its research and advocacy work with an aim to improve the grounds for living together through economic development.6 It is worthy to note the efforts of various other institutions in Northern Ireland that worked to contribute to economic rehabilitation in the post-conflict period. Companies in Northern Ireland (e.g. through the Future Ways program of Ulster University) tried to assemble a workforce equally composed of the members of the Catholic and Protestant communities. The objective was to increase interactions between the two communities to strengthen grounds for commonality and encourage them to internalize peace.^{7 8}

However, it is not possible to claim that the impact of businesses on conflict transformation is typically peace-oriented. Even though business communities may find common ground to support economic development, conflicts of interest and diverging viewpoints may prevent them from becoming truly unified to serve as a peace-oriented pressure group. A notable case in point is seen in the polarization of the Colombian business community, where one group supported negotiations led by the Andres Pastrana government and the Revolutionary Armed Forces of Colombia (FARC), and another supported the hard line attitude espoused by Álvaro Uribe’s government. As a result, it could be argued that the business community’s relationship with peace and resolution is an intricate, multidimensional and fluctuating one, largely dependent on the nature of the conflict and the capacity of the business community.⁹ 

While these cases bear significant differences from Turkey in terms of political and social dynamics, the country has witnessed—and continues to witness—conflicts that negatively affect its economy and also deepen regional socio-economic inequalities. In this context,   the peace process experience between 2013-2015 continues to be presented as a point of reference for the economic development of the eastern and southeastern regions. It is a fact that with the peace and resolution process, a sense that the end of the decades-old Kurdish issue and peace were only “within reach” was widespread among the people of the region, reflecting positively on economic life. Only a couple of months into the peace and resolution process, despite the lack of any tangible economic development, the local press was already frequently referring to the high potential for swift economic progress in the region.¹⁰ 

The business community in Turkey’s western provinces was not entirely indifferent to the positive developments during those years; large-scale investments and projects for the  eastern regions were frequently discussed. In June 2013, the Turkish Industrialists and Businessmen Association (TÜSİAD) held a summit in Cizre, on the economic aspects of the peace process, which drew wide participation from the business community in the western regions.¹¹ In addition, in 2013 the Cross-regional Common Initiative Project (BORGİP) that aimed to “decrease cross-regional inequalities, increase prosperity in eastern and southeastern Anatolia, and strengthen entrepreneurship and small-to-medium sized enterprises (SMEs) in the region” was launched with the partnership of TÜSİAD and the Turkish Enterprise and Business Confederation (TÜRKONFED).¹² 

Two years later, in 2015, the termination of the peace process, re-escalation of the conflict, and unprecedented urban clashes in the eastern and southeastern regions (diverging from the past experiences with rural clashes) led to a severe rupture of the positive economic developments in the region. Investment plans were shelved due to the lack of security. Besides large-scale investments, the work capacity of small businesses—the driving forces for urban economies in the region—was also curtailed due to the clashes and curfew orders. The already problematic relationship between local entrepreneurs who sought credit and their banks came to a complete dead-end in the conflict environment.

The East and Southeast Investment-Support Package announced by Prime Minister Binali Yıldırım in September 2016 in Diyarbakır, which includes incentives and grants, “centers of attraction” projects and housing initiatives, was one of the first steps taken to compensate for the economic destruction in the region. Following this development, in December 2016, Minister of Treasury Naci Ağbal announced that $12 billion from the 2017 budget would be allocated to the eastern and southeastern conflict afflicted regions. The actual potential of these measures for regional development is expected to be seen in 2017.

This report is a product of PODEM’s “Business Community for Social Peace” project, launched in 2015 in partnership with the Berghof Foundation. During the two years of the project, PODEM and the Berghof Foundation brought together business people from Turkey’s west and east in a series of meetings in Istanbul, Diyarbakır, Şanlıurfa, and Van to discuss regional development for social peace. Within this framework, this report shares the findings of a recent field research with business people from Istanbul and Diyarbakır who closely followed the regional economic developments during the peace process.

As part of the fieldwork, in-depth interviews were conducted with a total of 24 representatives of the business community, half of whom were from Istanbul and the other half from Diyarbakır. Participants from Istanbul were carefully selected among business people who closely followed political and economic developments during and after the peace process; either had or have plans to make large-scale investments in the region; and/or have roles in the management of various institutions that represent the business community in the western provinces. Participants from Diyarbakır were selected from business people who are active on the boards of prominent business associations and have conducted work on the economic development of the region.¹³ The interviews were conducted by Beril Bahadır and Zeynep Gülöz from PODEM throughout September-October 2016.

The report aims to lay out contemporary issues that business people from Istanbul and Diyarbakır agree and diverge on, and compare the similarities and differences in their perceptions. The ultimate objective of this report is to encourage collaborative projects that will promote and strengthen links between the business communities in the two regions.

To this end, the report first evaluates perspectives on the region’s economic development and roadmaps for the future. Subsequently, it surveys the perspectives on recent political developments since the termination of the peace process and prospects for a resolution. The final section assesses comments on the business community’s possible contribution towards establishing peace. Exploratory data from Diyarbakır and Istanbul will be evaluated through a comparative lens under the three above-mentioned sections. The conclusion will summarize the findings of the report.

Executive Summary

Perspectives on regional development and road maps for the future

• The East and Southeast Investment-Incentive Package, announced in September 2016, was generally positively received by the business community. However, a widespread perspective among participants from both Istanbul and Diyarbakır suggests that due to security concerns, the incentive package will fail to attract investment, and thus not deliver the expected results.
• A number of participants from Diyarbakır think that the package was announced to relieve tensions at a time when politics failed to offer any concrete solutions. Hence, they believe that it did not originate from a genuine political will to improve the economic conditions in the region. In Istanbul, the political will behind the incentive package is of secondary concern. Still, most do not believe the package will deliver the expected results.
• When asked about the reasons for their predictions on the incentive package, participants in Diyarbakır suggest that similar stimulus schemes had been tried in the region in the past and that while the current package does offer various incentives, it does not offer creative and satisfactory solutions that can strengthen existing investors’ confidence in the region. A fact that reinforces the pessimism towards the commitments of the incentive package is that support pledged to Diyarbakır’s conflict-afflicted small businesses in the past was not fulfilled.
• Participants in Diyarbakır suggest that instead of—or in addition to—the incentive package, measures such as declaring the area a “natural disaster zone” due to the conflict, or putting in place a pardon for business owners who cannot repay their debts to banks to facilitate their access to credit, would be more aligned with the region’s needs.
• Business people in Diyarbakır say they will continue investing in the region and “they trust themselves the most” for the economic development of the region.
• On the issue of road maps for regional development, participants in Diyarbakır draw attention to the potential economic benefit post-war reconstruction of Syria and Iraq could bring to their region. If seen as suitable and the appropriate environment is created, they believe reconstruction efforts could revive the construction sector, create employment, and bring about the desired level of economic progress.
• According to business people in Diyarbakır, it is imperative for political discourse to be constructive and stable, as opposed to destructive and inconsistent, if they are to trust the state. This is also an important point for regional development, as most participants in Istanbul state that they can only perceive the region as investment-friendly when the political discourse assumes a more constructive and stable tone.
• Several participants from Istanbul have an ambitious vision for the economic development of the region. They recount a variety of projects ranging from small-scale tourism projects that could improve public spaces in the cities and engender employment to large-scale ones such as cross-border industrial zones. For these to be realized, however, improvements in the political discourse and establishment of security and peace are seen as crucial first steps.

Perspectives on recent political developments and prospects for resolution

• According to some participants from Istanbul, in the post-peace process phase, the Kurdish issue must be clearly separated from the “PKK issue”, which is seen as linked to terrorism, and a political road map must be developed accordingly. Business people believe that the resolution of the Kurdish issue can only be achieved through democratization efforts that satisfy the demands of Kurdish people, while the PKK issue’s international dimension requires the utilization of different and innovative tools.
• However, almost every participant from Istanbul and Diyarbakır alike believes that establishing social peace with respect to the Kurdish issue is not solely the AK Party’s (Justice and Development Party) responsibility, but instead, that everyone must assume responsibility for peace and resolution in the country.
• Business people in Istanbul view political developments both with anxiety and hope. The biggest source of anxiety pertains to freedom of expression, which they see as being increasingly curtailed. They note the lack of a free environment for debate, which in turn constrains the business world. The source for hope is the resistance shown by the public against the 15 July coup attempt, demonstrating that the people are the true determinant in politics.
• Business people in Diyarbakır are pessimistic due to the physical, economic and psychological damages caused by the conflict, in addition to the recent political developments which they describe as anti-democratic. It is possible to say that they hold both the PKK and the state responsible for their experiences throughout the re-escalation period and clearly feel disappointed with both entities. However, the fact that state promises for post-conflict economic rehabilitation have not materialized, along with the perception that the region has been recently subjected to political pressure, creates distrust towards the state.
• Participants from Istanbul and Diyarbakır state that political instability and distrust in the country’s general economic situation results in a westward flow of capital; from Istanbul to Europe and from the eastern regions to Istanbul or mid-Anatolia.
• Even though political reconciliation between the government and the Kurdish political movement is regarded as a distant possibility, perceptions in Istanbul and Diyarbakır over how social consensus can be facilitated overlap. Domestically, many voice the need for normalization, i.e. an end to the State of Emergency and democratization—both structurally and as a mindset of governance. Outside the borders of Turkey, the need to resolve the situation in Syria is also mentioned.
• With that, participants from both cities stress that the necessary political will for resolution and peace inside the country and in the wider region rests predominantly with President Erdoğan.
  

The potential of business to contribute to peace

• In Diyarbakır, diverging comments are made on the local business community’s potential to unite and take action to overcome local challenges. According to one view, the conflict situation has weakened the ability of local business communities to impact society, and local and national politics. This, in turn, has reflected negatively onto the larger civil society culture. Others argue that the business community has become more tight-knit due to the conflict.
• Among Diyarbakır business people, there are two different perceptions of their counterparts in western Turkey. One side believes that the business community in Western Turkey remains distant to the problems their counterparts face in eastern Turkey. Those who hold this opinion state that there is no cooperation between the two business communities that is reflective of solidarity, and deem that this is due to the apathy of the western business community. Another perception holds that the business community in western Turkey situates itself according to contemporary political trends and that this further deepens the gap between the two groups.
• According to the other side in Diyarbakır, even though the business community in western Turkey is interested in economic development in eastern Turkey, the political environment is not conducive to the realization of initiatives that would spark their interest. Business people who hold this opinion think that the intensification of the conflict in the eastern regions and growing economic destruction has resulted in the western business community becoming completely introverted.
• In Istanbul, there are varying interpretations of the business community’s contributions to social reconciliation processes. According to most participants, it is not realistic to have expectations of the business community outside the confines of economic life. A few others believe that an introverted business community is harmful for Turkey.
• On the other hand, most business people in Istanbul believe that the only way cross- regional interactions can be increased is if the politics start moving towards consensus. The business communities say that once peace-oriented processes seeking social consensus and regional development are taken up on the political agenda, they can play a mediating role to protect these processes and encourage different sides.
• According to a view that advocates a more active role for the business community in social processes, the business community in western Turkey should assume more social responsibility and mature the prospects of peace in eastern provinces through economic development. This includes designing development projects that show that Turkey is “at one” with the conflict-afflicted region. It is put forward that such development projects could be widely shared with the business people in the region to create pressure and expose the economic benefits of peace with wider audiences. Nevertheless, the support of political actors is seen as critical if constructive initiatives aiming for peace are to be realized and create the expected impact.

Perceptions on Regional Development and Road Maps for the Future

The East And Southeast Investment-Support Package

For business people in Istanbul and Diyarbakır, economic development in the eastern    regions is directly correlated to the security environment and the economic and social   policies geared towards them. In this framework, their comments on the East and Southeast Investment-Support Package announced by Prime Minister Binali Yıldırım in September 2016  in Diyarbakır are worth consideration.

Although business people in both Istanbul and Diyarbakır state that it is too early to make definitive comments on the incentive package’s potential and possible impact, they agree on some of its positive aspects in comparison to past incentive packages. In Diyarbakır, the proposals on centers of attraction and focus on employment are regarded positively.

Specifically, provisions such as the public financing of superstructure investments, the state’s compensation of interest costs of capital expenditure of industry and the guarantee for market access and purchase have been received well by the business communities.

Despite this, in both Istanbul and Diyarbakır, the dominant foresight holds that the incentive package will not deliver the desired results. An important reason for this lies in past experience with similar packages—even though several other stimulus schemes have been implemented in the region, they neither met the expectations nor attracted steady investment due to security concerns. Participants in Istanbul especially emphasize that as long as security issues persist in the region and security of life and property cannot be safeguarded, it will not be possible to rehabilitate the region economically through incentive packages. Some participants in Istanbul state that even if incentives are provided, long-term investments such as the construction of facilities and opening of corporate offices will not reach the desired levels.

Beyond security concerns, the foresight that the incentive package will not be effective is primarily rooted in its lack of measures to address the dire needs of the region. Secondly, the fact that the government has still not taken the steps for the economic rehabilitation it had promised during the conflict, creates insecurity towards the political actors.

Regarding immediate needs, declaring the region a “natural disaster zone” due to clashes that have almost brought life to a halt in the city, and issuing pardons for business owners who cannot pay their debts to banks to facilitate access to credit, are viewed as more appropriately suited measures for the region, and also, essential actions for the incentive package to succeed. In this context, some business people in Diyarbakır feel concerned that, as with previous packages, they were not consulted by political actors or policy-makers, and their suggestions were not taken into consideration during the policy preparation phase, to which they attribute the package’s disconnect with local demands.

As businesses in Sur have not received the level of support they  expected from the government during the curfews, they resorted to new and creative methods to maintain their businesses. One entrepreneur, whose tourism agency had to close down as  a result of clashes, devised a mobile application so he could offer services to customers through smart phones and thus, continued his business and maintained his livelihood. Entrepreneurs have devised alternative ways to survive economically during the conflict.

In Diyarbakır, the prediction that the incentive package will not provide the expected results is rooted in the distrust towards the sincerity of political actors. Therefore, there is a perception that the package does not directly aim to provide economic rehabilitation for the region, but will rather act as a “distraction policy” to relieve political tension (In Istanbul, whether or not there is genuine political will behind the incentive package is regarded as a secondary concern).

Other reasons that deepened the distrust of political actors in Diyarbakır include the lack of expected attention to the economic aspect of the peace process. More recently, promises made to business owners in the conflict-afflicted Sur district of Diyarbakır, who had to close down or move their shops to other districts, were not fulfilled. The business owners were also not provided with any answers on what measures would be adopted to compensate them for the losses incurred due to the imposed urban curfews. The support for small-businesses in Sur is said to have been limited to 3,000TL (790 USD as of 01.02.2017), which was insufficient in the compensation for damages, and incited feelings of frustration.

Suggestions for development in the region

There is strong consensus in Diyarbakır that the eastern regions’ development will be from “within”—meaning that it will be initiated and carried out by business people in the region. One can argue that this consensus is rooted in the fact that business people have not received the attention they expected from the state and the business community in western Turkey over the past years. When the potential for future economic programs is discussed, economic opportunities tied to the reconstruction efforts for post-war Syria and Iraq are frequently mentioned. It is suggested that this can reinvigorate the construction sector in Diyarbakır and create work opportunities that can address current unemployment problems. There is desire for existing investors to seize the opportunities in Syria and Iraq once peace is established in order to transform the eastern Turkish regions into a “construction hub.”

When business people in Istanbul are asked what projects could be useful for development in the eastern regions, an array of projects, from small-scale touristic tours to large-scale, cross-border projects like industrial bases, are mentioned. They think that investment can diminish regional inequalities by providing employment and strengthening peace indirectly through socio-economic transformation. Should an environment of peace and security be established, business people in Istanbul suggest they would like to realize the following points within the region:

• Improvement of living spaces in cities in post-conflict zones;
• Investments to improve existing business sectors;
• Initiation of projects that can provide employment to youth and especially women;
• Establishment of economic centers of attraction and coordination of their dispersal within the region;
• Creation of tourism islands and surrounded by industries centered on tourism, such as the service and agricultural industries;
• Agricultural investments and land procurement for this purpose; and building of renewable energy stations.

However, for all these to be realized, most business people believe it is necessary to institute an environment of peace and security. A few participants add that once security is established, the suggested development measures should not be implemented through a top-down approach, but rather through strong cooperation with local business people. They also add that there has to be genuine empathy with the society in the region for a culture of cooperation to develop, and that the business community in western Turkey tends to be inadequate in this sphere.

Constructive political discourse and economic development

In both Istanbul and Diyarbakır, participants emphasize the potentially positive influence of an inclusive and consistent political discourse on the economic development of the eastern regions. According to most business people, the dominant discourse in the political arena deeply impacts the level of hope or despair in the region. Participants in Diyarbakır especially note that sudden shifts in political discourse can be very harsh; for example, while a hawkish discourse can predominate on a certain day, the following day statements of peace can prevail. It is stressed that this cycle wears the public down. Prime Minister Binali Yıldırım’s emphasis on terror during his speech announcing the new incentive package is shown as an example of this.

“For two years during the peace process, all dialogues (with political actors and officials) were very productive. Everyone in the region is insistent on the resumption of the peace process, because they have experienced what that can be like […] We had plans for investment, and started working on their infrastructure, but later halted them because we can’t see our future in the region (due to the unpredictability of the situation). We will immediately restart our investments if we can see a glimpse of mutual trust between the conflict parties. The legal procedures of the peace process would be spread out and implemented over time, but if we receive the green light from the political establishment, we will continue with investments.”

(Diyarbakır)

Even though the importance of the situation in Syria is emphasized as a way out of the current conflict in the eastern regions, in taking steps to pave the road for peace, there is widespread agreement that an inclusive discourse by President Erdoğan towards the regions could make a significant difference. This perception is also shared by participants in Istanbul—most believe that the region can be emotionally “regained” through positive changes in discourse, even before concrete political steps are taken. Therefore, it is generally agreed upon that there is no need to wait for structural reforms for economic investments in the region; a green light from the political establishment would be sufficient at this point:

“Politicians will provide the signal for development; we, as investors will receive it, and afterwards, mutual interaction will begin between political and economic actors. When you see that softening, that ownership towards the regions, you would say ’okay, things are taking a positive turn, I don’t need to wait for the reforms to culminate entirely; these signals are very strong, so I’m taking action’. The economic world is all about receiving and responding to such signals, not about incentive packages…”

(Istanbul)

Perspectives on Recent Political Developments and Prospects for Resolution

Views on the Kurdish Issue

Business people were asked how their view of the Kurdish issue has changed after the termination of the peace process, and how probable they think peace is in the current political environment. Participants in Diyarbakır and Istanbul both agree that steps to institute an environment of political reconciliation and social peace will not be taken in the short to medium-term period. They see this as a consequence of the government’s focus on operations against Fethullah Gülen after the 15th July coup attempt, military campaigns against ISIS and PKK and the war in Syria with ground forces.

According to most business people in Istanbul, in the post-peace process period, a very   clear distinction has to be drawn between the Kurdish issue and the “PKK issue.” They believe that addressing these two issues separately will result in healthier outcomes, as they are of different natures and therefore necessitate different political tools.

Most participants in Istanbul think that the resolution of the Kurdish issue lies in normalization and democratization. By normalization, they mean the Turkish Parliament’s and ministries’ return to standard working procedures, i.e. “the functioning of political life and democracy.” On the other hand, through democratization, they maintain that the Kurdish issue will resolve itself through the expansion of freedoms and fulfillment of the demands of the Kurdish society for cultural rights. In this sense, the Kurdish issue is regarded as a matter that is directly related to Turkey’s democratization—in fact, a “sub-topic of the democratization agenda”—and also to the struggle of becoming a country governed by the rule of law. Similarly, in Diyarbakır, there is widespread belief that achieving consensus on democratization and basic rights between all political parties in the Parliament can facilitate the first steps in that direction. However, this consensus in itself would not be enough for a resolution.

Despite the differences of perception, there is an additional point of agreement besides normalization and democratization. Nearly all participants from both cities agree that a resolution can only be achieved if it is perceived as an issue that everyone, and not just the AK Party, should assume responsibility for.

On the other hand, resolving the PKK issue, which most participants in Istanbul situate separately from the Kurdish issue, requires tools other than democratization. Someparticipants argue that even if progress is made on the Kurdish issue through democratic means, the PKK will continue to be an unresolved issue, largely due to its international dimension. Most participants believe the re-escalation of the conflict is directly correlated to the developments in Syria, and define the situation as a long-term and arduous process where “cards for the global distribution of power are being reshuffled. “As a result, it is possible to argue that business people in Istanbul are prepared to allow the government a larger room for maneuver to pursue the resolution of the PKK issue through its self-defined policy of “exterminating the PKK.”

In Diyarbakır, however, it is argued that the PKK is the “region’s reality” and that it is not realistic to expect that hard security policies will go far in eliminating it. In trying to resolve the Kurdish issue, there is criticism that the state does not accept this reality and is not able to develop a comprehensive strategic vision that takes into consideration the economic and social dimensions of the issue. As a result, participants warn that anti-democratic political moves, seen as curtailing the freedoms in the region, expand the PKK’s room for maneuver.

There is mutual agreement from an international point of view, however, that the resolution is conditioned on the situation in Syria. According to the business community, the fact that the Syria issue includes a multitude of actors—who have varying conflicts of interest—makes the resolution of the PKK issue a more distant possibility. They add that the resolution will   be nearer once the demands and interests of international actors in Syria are clarified. Participants in Diyarbakır add that the resolution in Syria can be possible through the facilitative efforts of strong international actors.

Within this somber scene, business people in Diyarbakır mainly expect the government to start taking constructive steps, which would change the perception that it has completely taken out the Kurds from the equation:

“Regardless of who is right and who is wrong, there is now a perception that the state is employing an anti-Kurdish reflex. On the other hand, Kurds have also ceased to appreciate this state as their own state; there is a lack of sense of belonging. This has to be addressed.”

(Diyarbakır)

 Views on political actors

In Diyarbakır, it is possible to say that a much more pessimistic mood is currently pervasive in comparison to the previous years, when the peace and resolution process was ongoing. The past expectations of the local business community for cooperation with the government and western Turkish business community on regional economic development have now been overtaken by a complete lack of expectations altogether.

The majority of the participants frequently mention the physical and psychological destruction of the conflict in the region. It can be deduced that they mostly hold the PKK and HDP (Peoples’ Democratic Party) liable for the unprecedented urban conflict, and that expectations from their politics have been tarnished. Some participants perceive the PKK as a hindrance to the economic and social development of the region. Moreover, the PKK’s decision to initiate urban warfare, based on developments in Syria, is seen as a decision  made by the organization to maintain and expand its own presence. When viewed from the perspective of Kurdish people’s preferences, this is described as a “strategic mistake.”

After these destructive events, business people in the region had significant expectations that the state would compensate their losses. However, there has been widespread disappointment that the state has neither taken the anticipated steps nor assumed a positive presence in the region. While the harsh intervention by the state against urban clashes is understood and tolerated, the closure of the Kurdish IMC TV and Zarok TV (which broadcasts children’s cartoons in Kurdish), the laying off of teachers and while less so, the state appointment of trustees in place of elected mayors in the region, have deeply tarnished trust in the state.¹⁴ 

All of the above factors have reinforced the opinion among the majority of business    people in Diyarbakır that the region is under “political pressure.” In a similar context, most participants mutually criticize the decision to exclude HDP from political processes. Business people in Diyarbakır suggest that HDP’s exclusion from the leaders’ summits after the 15th July coup attempt has solidified their feelings of isolation. A few emphasize that even those   in the region who do not support HDP feel a deep sense of discontent with this issue.¹⁵ 

Business people hold the opinion that the developments of the past few months—which have gradually narrowed freedoms—have completely rolled back the democratic achievements of the last decade. As a result, it can be asserted that belief in Kurdish politics, as well as the sincerity of the state has been shaken, resulting in distrust toward the two sides. Despite these negative reactions, the pervasive silence in the region is attributed to the impact of hard security policies on the society and the anger felt towards the PKK and the HDP.

Most participants in Istanbul point out the government’s goodwill when launching the peace process, and assert that the PKK has exploited this goodwill to ignite a tougher battle to advance its own gains. Some participants therefore espouse the view that none of the future dialogues for peace will be similar to the peace process climate experienced in the past. They have a perception that different actors, other than the PKK and HDP as usual counterparts, will be involved in the process. Contrarily, the majority of participants in Diyarbakır believe that regarding counterparts, Abdullah Öcalan’s statements on the region are regarded as binding, and that neither Kandil nor the HDP can be considered the only decision-making actors in this matter.

There is a shared impression in both Istanbul and Diyarbakır that peace can only be achieved through the political will of President Erdoğan, as the only person who can make the decisions for resolution and assume the risks these can generate. It is argued that peace can be possible if President Erdoğan desires an end to the conflict with a peaceful agreement that satisfies the democratic demands of the Kurdish people—in other words, peace is only possible if he shoulders the responsibility.

Hope-inspiring developments and concerns

According to a few participants in Istanbul, there have been some hope-inspiring developments on the Kurdish issue despite the current backward slide. The participants emphasize that the potential lessons derived from the perceived mistakes of the government can be both instructive and useful for the institution of a resolution that is more firmly embraced by society.

In addition, participants point out the political possibilities which emerged in the aftermath    of the 15th July coup attempt. Some emphasize that the coup attempt has demonstrated   how strong the society has become and how “it could take its destiny into its own hands.” According to those who espouse this view, society—which is a few steps ahead of politics—is ready for social peace and the fundamental structural changes this would require.

Business people who emphasize opportunities simultaneously voice their concerns: the coup attempt, incidents of terrorism that have spread into big cities, and the economic burden weighing on the country to combat these threats, creates anxiety among the business community with regard to the future of the democratic system and the soundness of investments.

However, according to some business people, this anxiety is not entirely novel. They assert that the relationship with important NGOs of the business world—which bring together companies that account for a significant portion of the economy and make up a large share of imports and exports—has suffered from trust-related issues for years. The business community believes that this type of anxiety towards politics can be dispelled through a transparent and accountable notion of governance and the protection of the rule of law,  both critically important factors for investments.

Another source of concern is related to economic forecasts. Business people in Diyarbakır think that beyond the obvious economic damage in the region caused by the conflict,   Turkey’s politics at the macro-level will negatively impact the economic situation, similar to that of Istanbul. They mention that the economic downturn has created alarm among capital holders in Istanbul and the region, encouraging them to migrate west of where they resided. Based on the opinion that rapid economic rehabilitation in Diyarbakır can only be achieved  if local businesses stay in the region, business relocation to the west of Turkey engenders concern for the region’s development.

The Potential of Business to Contribute to Peace

Views of the East from the East

During the toughest days of the conflict, the business community in Diyarbakır has assembled with the intention of establishing communication with political actors, in order to lift the urban curfews and receive compensation for the losses that resulted from their imposition. They are working to assume the responsibility to establish sensitive balances and form bridges between the society, local politics and the national government. Even though they admit that their efforts will not create the desired effect and expected results without the support of the government, they believe that they can still respond to the urgent needs of the region.

On the other hand, there are differing opinions as to how much unity the business community could achieve during the conflict while pursuing its work. A few of the participants assert that civil society maintains the potential to act together during such periods. Another view suggests that it is not possible discuss either unity and/or independence. It is argued that when unified action is taken, it remains largely inadequate and non-influential. This weakens the belief in the business community’s capacity to succeed in its efforts both when acting independently and in the spirit of unity, which also discourages and damages the broader local civil society culture.

A third approach suggests that while it was possible to talk of unity in the past, the period of conflict has created divides as a result of its unique pressures:

“In the past, there were those among the business community and NGOs who stood close to both sides of the process—there were gray areas. This was the most natural thing in the efforts to achieve peace. However, in recent periods, the experience of urban clashes led to very dramatic incidents, which led to an increase of polarization.”

(Diyarbakır) 

However, despite the range of ideologies and differences in approaches between the business community and NGOs, everyone agrees on a need to return to the peace process and establishment of a peaceful and secure environment.

Views of the West from the East

To understand the perceptions of the business community in Diyarbakır towards their colleagues in western Turkey, the participants were asked on the frequency, depth and consequences of their interactions. In response, two types of leanings surfaced towards the western business community. The first one suggests that even though the western business leaders possess the potential to act for the development of the eastern regions, they are apathetic and detached. Business people who espouse this view say that collaborative projects conducted in the first year of the peace process were often disrupted by setbacks, and did not lead to the desired results that would deepen interactions and further collaboration. They primarily link this to the security situation, and secondarily to the western business community’s “precaution to act within the framework of the dominant political parameters of the day.” The latter point has especially resulted in a skeptical view of the western business community.

“They [western business leaders] are not completely indifferent but I believe they haven’t made the contribution they could have made. It is clear that they are wary of government pressure. We say that if it were for us we wouldn’t have refrained from pointing out the government’s mistakes; we say that they should have succeeded in properly directing the course of regional affairs. After the 15 July coup attempt, they convened information sessions all over Europe (to reflect the national awareness on the issue), but turned their backs on the problems of the region.”

(Diyarbakır)

The second view is that the western business community is not entirely indifferent as claimed and is in fact, attentive to the region. However, the political climate that can prompt them into action does not exist, which is why they are acting with caution. Some participants from Diyarbakır suggest that they themselves are “doomed” to become political actors due to the situation in  the region; while in western Turkey the business community can afford to be relatively indifferent to politics. However, the participants claim that during the peace process—when the political climate was more optimal—Istanbul-based business NGOs undertook  collaborative  meetings and projects. Still, they say that the conditions starkly differed during the peace process and that the NGOs have now taken the Kurdish issue out of their agenda. In their own words, they have become “introverted.” To them, this is understandable in an “environment where political neutrality is not accepted.”

Despite these diverging views, almost all the participants in Diyarbakır expect the business community in western Turkey to at least show symbolic solidarity with them, through awareness that its problems are not limited to the region but concern the entire country.

They state that one way to do this is by conducting collaborative meetings and calling for steps towards peace. Participants who think there is no unity among civil society in the eastern regions argue that the business community in western Turkey, by contrast, has greater potential for organizing and assembling to deliver common messages, which they can also utilize for the development of the region and narrow the gradually widening gap of perceptions between the two business communities.

Most business people agree that it is only possible to increase interactions between eastern and western business communities when the politics start moving towards consensus. The business communities maintain that only when peace-supporting processes are taken up on the political agenda, can they assume a mediating role to protect these processes, encourage the different sides and avert potential crises through bilateral relations. As an example, they show that the will for political consensus during the peace process years impacted the business world by increasing the number of collaborative projects that encouraged regional cooperation. The business communities’ potential contribution to social processes can take place when the politics allow and encourage it to do so.

Views of the East from the West

According to a number of business people in Istanbul, it is problematic and even “dangerous” to separate the business community into such geographical categories of west and east, confine them into separate zones of perception, and then claim that the west is apathetic towards the east. Some participants in Istanbul assert that the business community in the western regions know the eastern regions well; acknowledges the eastern regions’ problem as also belonging to the West; and believes that it will be unnecessary to “attract investment” into the region once security is established, since investment will naturally flow into the region. It is emphasized that the real reason behind the separations of west and east is not apathy but the problem of security along with the historical fact that nearly half of all capital has accumulated in Istanbul and the surrounding areas.

“It is perceived that the business people in the east are dealing with the entire issue on their own and struggling over there, trying to achieve something. There is a perception that business people in more developed regions do not care about their predicament, and this is very dangerous. If there are such businessmen, they are cutting off the branch they are sitting on, because at a time when the world has globalized to such an extent—that a problem in any corner of the world affects us—it is impossible for us not to be affected by problems in our own country.”

(Istanbul)

There are different interpretations of the business community’s contributions to processes of social consensus. Most of them say that the business world is comprised of purely economic actors and therefore, deem it unrealistic for them to assume responsibilities beyond the borders of economic life. It is asserted that the business community cannot be expected to make a progressive move as it only moves with the goal of creating value according to the investment climate. As a matter of fact, as long as political actors do not take the initial steps to institute an inclusive consensus environment, expecting the business community to take steps in this direction is interpreted by some as “a loss of hope in political solutions.” As a result, this view purports that it is a fundamental mistake to have expectations of a political and economic nature from the business community before complete security is established in the eastern regions.

Views of the West from the West

Based on the perception that the business community “has the capacity to create something out of nothing, ”a small number of the participants maintain that it can play consensus- building roles in politics and open channels for resolution. They think that an introverted business community that positions itself entirely according to the political discourses of the day will inevitably be harmful for Turkey.

“If the business world expects everything to be ready, that means it has not progressed. It should work to facilitate peace and not only expect that it will happen one day. Like the attentiveness you show to your work, you should also use your resources for this purpose. At the end of the day, this is your future.”

(Istanbul)

 According to this attitude, as the western business community operates using a more institutionalized structure, it should assume more responsibility and prepare the region for peace, at least “economically.” This does not mean making big investments in the region without waiting for any investment signals; rather, it means creating peacetime development projects that can express Turkey’s regard for the region. Widely sharing these ideas within  the regional business community and demonstrating their economic benefits can also create leverage for a resolution.

According to most participants in the region, the business community can have a voice in the resolution if the politics pave the way and encourage it to do so. Most participants find it risky to start a project in Turkey without receiving political support first. To be sure, business people who made efforts to bring together western and eastern business communities during the peace process —and made progress as long as it was politically viable—suggest that they launched these initiatives after garnering the support of prominent political actors.

However, at present, it is seen unlikely that a constructive relationship dynamic can be established between the government and business communities in the short run. Participants assert that such a relationship can only be possible once there is a constructive mechanism    of criticism and communication between the political class and society, and when the government adopts a more open attitude to the criticisms, demands and expectations of the business community.

Evaluation and Conclusion

There are many points of agreement between business people in Istanbul and Diyarbakır on current political developments and resolutions to problems. The majority of business people in Istanbul think that freedom of expression is being curtailed, democracy is regressing and the Kurdish issue—which they regard as a sub-theme of democratization—is being negatively affected by these developments. Accordingly, they think that mechanisms of communication and criticism should be established in order to reclaim freedom of expression and democratic steps must be taken to satisfy the rights-based demands of Kurdish people. The Kurdish issue is situated separately from the PKK issue—which has an international dimension and involves a multitude of actors—and requires different and innovative resolution methods. The former issue, however, is perceived as a domestic one that can resolve itself by way of a rigorous democratization process.

While such a clear separation is not made in Diyarbakır, expectations are not very different. Nevertheless, it seems that distrust in the PKK, due to terrorist attacks and conflict, and distrust in the government, due to the lack of positive measures for the compensation of their losses, has mutually tarnished the belief that their expectations will ever be realized. Besides the sheer physical and psychological destruction of the conflict, the primary causes of despair for the future are the government’s failure to keep its promises of economic development and the political operations that are targeting the region. In addition, it seems that there is a perception of the western business community acting “under the guidance of politics” (for example, they only conduct meetings on issues that are on the political agenda) and this has fed the eastern business community’s perceptions that they are left alone with all their troubles.

While both sides believe that a resolution is a distant possibility, their ideas on what can facilitate peace closely correlate. Domestically, the need for normalization and democratization is voiced, while internationally, the future of Syria is mentioned. In addition, in both Istanbul and Diyarbakır, there is frequent emphasis that the political will which can bring resolution rests solely with President Erdoğan. When one talks of a possible road map for peace, potential stakeholders, impact of political discourse and the region’s needs for development, almost every participant makes reference to President Erdoğan’s decisive role. Still, in the current environment, both domestically and internationally, all of these are seen as distant possibilities.

When the region’s possibilities for economic development are evaluated, participants from Istanbul primarily emphasize security, stability, and peace. These are seen by the majority of participants as mandatory conditions, not only for investment in the region, but also for conducting any type of collaboration with the region. However, there are also business people who believe that the region has to be “prepared for peace” as soon as possible. For this, they advocate increasing cross-regional communication and organizing more meetings with the aim of narrowing the gaps of perception and encouraging collaborations. According to some business people, it may just be enough for politicians to soften their rhetoric towards the region and adopt a constructive approach for this to become a reality.

There are two dominant attitudes in the views of Diyarbakır towards the western regions. The first one suggests that business people in the west are apathetic to the east and its problems. It is argued that the western business community has no grounds for cooperation to show solidarity with the region or its people; apathy is cited to explain this. Furthermore, the perception that the business community in western Turkey acts according to contemporary political trends seems to have widened this gap. The second attitude maintains that businesses in western Turkey are in fact attentive to the eastern regions but cannot find the ideal political climate to demonstrate it. However, even the business people who espouse this view are of the opinion that as the conflict intensified and economic damage worsened, western business communities retreated from the region.

In this framework, the majority of business people agree that increasing cross-regional interactions is only possible if the politics start moving towards consensus. The business communities claim that once peace-supporting processes are taken up on the political agenda, they can play a mediating role to protect these processes and encourage the different sides.

ANNEX1. PARTICIPANT PROFILES

Istanbul 

• Chairman of the Board in one of Turkey’s 10 largest companies;
• Chairman of the Board in one of Turkey’s 100 largest companies; Board Member in a Business NGO;
• Chairman of the Board in one of Turkey’s 100 largest companies;
• Board Member in one of Turkey’s 5 biggest conglomerates; Board Member in one of Turkey’s 5 biggest banks;
• Chairman of the Board in one of Turkey’s 250 largest companies; Board Member in a Business NGO;
• Group Chair in one of Turkey’s 5 largest conglomerates;
• Chief Economist in one of Turkey’s 5 biggest banks;
• CEO in one of Turkey’s 250 largest companies;
• Chairman of the Board in one of Turkey’s 250 largest companies; Board Member of Business NGO;
• Chairman of the Board in one of Turkey’s 500 largest companies; Board Member in a Business NGO;
• Board Member in a Business NGO;
• Board Member in a Business

Diyarbakır 

• In Diyarbakır, interviewees were chairpersons and members of the boards of selected business institutions and associations.