14. August 2000

1. "Turkey's economy hero Dervis set to choose his party this week", Kemal Dervis, who stepped down as Turkey's economy minister last week to build a pro-European alliance ahead of early elections in November, was to announce by Thursday which party he would back in the snap poll.

2. "Turkey keeps Swedish politicians from entering Iraq", Turkey has barred a delegation of Swedish politicians from crossing into mainly Kurdish northern Iraq for security concerns, a Turkish official said Wednesday.

3. "Turkey's IMF Deal Likely To Survive Election Campaign", Turkish election-campaign tradition requires that governments increase spending in search of votes - but with the International Monetary Fund keeping a close eye on the books, the run-up to elections due Nov. 3 may be different.

4. "Kurds offer territory for Iraq attack", a prominent Iraqi Kurdish opposition leader said Tuesday U.S. military forces would be "welcomed" at areas in Kurdish-controlled northern Iraq to stage attacks against Saddam Hussein's regime.

5. "Yilmaz: "Turkey will benefit most from solution of Cyprus problem", from an interview with Deputy Prime Minister Mesut Yilmaz on CNN Turk

6. "Protect the Kurds", the writer, a former American ambassador, is a professor at the National War College. He has just returned from northern Iraq.

Dear reader,

due to the holiday time our "Flash Bulletin" will not be forwarded to email addresses from August 1, 2002 until August 25, 2002. It can be viewed, however, right here in the internet at www.flash-bulletin.de as usual.

the staff

1. - AFP - "Turkey's economy hero Dervis set to choose his party this week":

ANKARA / August 14, 2002

Kemal Dervis, who stepped down as Turkey's economy minister last week to build a pro-European alliance ahead of early elections in November, was to announce by Thursday which party he would back in the snap poll.
Dervis is expected to join the New Turkey party founded by former foreign minister Ismail Cem, behind whom he has already informally thrown his support.
Yet Dervis, seeking to unify the fractured center-left, has said that he would like to see New Turkey ally itself with the Republican People's Party of Deniz Baykal, ailing Prime Minister Bulent Ecevit's long-time rival.
"I hope that Mr Cem and Mr Baykal will meet and can get along -- it's not impossible," he told Turkey's Radikal newspaper in an interview published Wednesday.
Dervis, an independent credited with saving Turkey from financial collapse by crafting far-reaching economic reforms backed by the International Monetary Fund, resigned on Saturday to concentrate on building a pro-European alliance between fractured center-left parties ahead of the snap November 3 poll.
He told Radikal that the fractured leftist and rightist parties that have governed Turkey in recent years had led to instable ruling coalitions.
Divisions within and between the country's main parties, often due to personal rivalries between leaders, may lead the conservative Justice and Development Party (AK), which has its roots in a banned Islamist movement, to win the election with around 20 percent of the vote, recent polls have found.
The election outcome is crucial at a time when Turkey, the only Muslim member of NATO, is mired in an economic crisis and political turmoil triggered by the illness of 77-year-old Ecevit.
Many fear an AK victory could bring setbacks to a country that has just passed a series of democratic reforms aimed at advancing its EU bid and slowly begun dragging itself out of one of its worst recessions.

2. - AFP - "Turkey keeps Swedish politicians from entering Iraq":

ANKARA, August 14, 2002

Turkey has barred a delegation of Swedish politicians from crossing into mainly Kurdish northern Iraq for security concerns, a Turkish official said Wednesday.
"The current security conditions are not suitable for their passage. When they improve the matter will be reconsidered," foreign ministry spokesman Yusuf Buluc told reporters.
"We apologize if we have caused any inconvenience," he added.
The group, which included five members of Sweden's Green Party, among them parliament member Yvonne Ruwayda, was intending to study conditions in northern Iraq, an official from the Swedish embassy here said.
The region has been controlled by two rival Kurdish faction since the 1991 Gulf War, outside Baghdad's authority and under the protection of a US-enforced no-fly zone.
The two factions are part of the Iraqi opposition, whose support the United States is seeking for a possible military operation to oust Saddam Hussein.
The Turkish army has often made incursions into northern Iraq to hunt down Turkish Kurdish rebels who have set up bases there, taking advantage of the power vacuum in the area.
The army is widely believed to keep a military presence in the region in cooperation with the local Kurds.
The Swedish delegation arrived at the Turkish-Iraqi cross point in Sirnak province Sunday and were still in the region.
It was not clear whether they would stay there until being granted permission to travel on.
The incident prompted Swedish Foreign Minister Anna Lindh to intervene with a letter to Turkish authorities, but her effort failed to bear fruit, the embassy official said.

3. - Dow Jones Newswire - "Turkey's IMF Deal Likely To Survive Election Campaign":

ANKARA / August 13, 2002

by Selim Atalay

Turkish election-campaign tradition requires that governments increase spending in search of votes - but with the International Monetary Fund keeping a close eye on the books, the run-up to elections due Nov. 3 may be different.

A $17 billion loan from the IMF is Turkey's only defense against a new financial crisis. In order to keep the IMF cash flowing, and to maintain fragile market confidence, the government must keep a lid on its budget deficit.

Concerns that the government may go on a pre-election spending spree increased with the resignation Saturday of Economy Minister Kemal Dervis, who was seen as the main guarantor of adherence to the IMF program.

Turkish governments have broken pledges to the IMF in order to secure reelection before, most recently in 1995 when the government of then Prime Minister Tansu Ciller simply shelved an IMF program to be able to spend freely during the campaign.

The stakes are higher this time around, with voters keen to punish politicians regarded as being responsible for the financial crisis that began last year. Any sign of behavior that puts IMF support at risk would likely lead to a fall in support at the polls.

It's also a lot more difficult for politicians to buy votes without the alarm bells ringing. Thanks to a series of institutional reforms, the central bank and state-owned commercial banks are no longer available as back channels for government patronage.

The budget has also been consolidated, eliminating a number of hidden funds that were used by politicians to spend money without public scrutiny. As an added safeguard, the IMF has set monthly targets for the public sector budget in the run up to the vote.

Economists believe this belt-and-braces approach should ensure that the government keeps its budget under control, and sticks to the IMF program until the elections are out of the way.

"The program isn't at risk in the short term," said Yarkin Cebeci, an economist at J.P. Morgan in Istanbul. "The latest measures are sufficient to curb any election spending."

Opportunities Dwindle

Turkish vote buying surged in the late 1980s when center-right parties with nearly identical platforms competed for support on the basis of what they could hand out.

In one election campaign True Path leader Suleyman Demirel promised farmers a tobacco price 10% higher than whatever the competing Motherland Party offered.

Parties were able to make those offers because the state bought wheat, tobacco and other major crops under a state-run agricultural support program. That program still exists, but its activities have been significantly reduced at the insistence of the IMF.

In a similar attempt to bribe voters, Turks gained the right to retire and collect pensions at the age of 38, while the politically well-connected were granted generous state bank loans without any requirement to repay.

Those handouts were financed by budget deficits and inflation, leading to a sharp rise in Turkey's public debt, which stood at 93% of gross national product at the end of 2001.

It's now a lot more difficult to run a 1980s-style election campaign. The board that controls state-owned banks is independent and no longer run by political appointees, whose main mission was to accommodate the government's financing requests.

This practice had already cost the state banks some $20 billion, a loss that was hidden in their balance sheets but came to light under the IMF program.

The government's budget has also become more transparent. There is now a single, consolidated balance sheet rather than the numerous budgets for different layers of the public sector that were based on opaque estimates.

The central bank can no longer print money at the government's request, and can no longer lend to the Treasury to finance government spending. Under the IMF program, the central bank has a strict mission to ensure price stability and its monetary targets are closely scrutinized by the IMF and the financial markets.

"The system is less vulnerable to political pressures now," said Odd Per Brekk, senior resident representative of the IMF.

The consolidated budget is also closely scrutinized by the IMF, with the Fund now monitoring the budget on a monthly basis, having previously examined the balance every three months.

"The government can spend," Brekk said. "However, it also has to raise revenue, or cut costs to ensure the monthly primary surplus target."

The key target is a primary budget surplus of 6.5% of gross national product for 2002. This is revenue minus expenditure, excluding debt interest payments.

Such close scrutiny is doubtless embarrassing for a nation that sees itself as a candidate for membership of the European Union ( news - web sites), and which is a member of the Organization for Economic Cooperation and Development, the club of rich nations.

But Turkey's track record with the IMF speaks for itself - in total, it has agreed and then reneged on 17 separate programs with the Fund.

"It's sad to be under such close watch, but police supervision is historically justified," said Cigdem Guclu, economist at Societe Generale Bank in Istanbul.

4. - CNN - "Kurds offer territory for Iraq attack":

WASHINGTON / August 13, 2002

A prominent Iraqi Kurdish opposition leader said Tuesday U.S. military forces would be "welcomed" at areas in Kurdish-controlled northern Iraq to stage attacks against Saddam Hussein's regime.

Jalal Talabani, founder and secretary-general of the Patriotic Union of Kurdistan, told CNN's Wolf Blitzer that after weekend meetings with top Bush administration officials, he and other Iraqi opposition leaders are convinced the United States is now serious about ousting Hussein.

"I explained to the United States officials here that the Iraqi opposition, Kurds included, ... have tens of thousands of armed people," Talabani said.

"We have more than 100,000 (Kurdish resistance fighters), and Syria also has tens of thousands. These forces can liberate Iraq with the support of the United States, with cooperation and coordination with American forces. This is all second, of course, with allowing the United States and facilitating any work that the United States wants to use our area until we stay there."

The opposition leaders met with Vice President Dick Cheney, Secretary of State Colin Powell, Defense Secretary Donald Rumsfeld and Gen. Richard Myers, chairman of the Joint Chiefs of Staff, as well as other top officials. Talabani said that despite rumors to the contrary, "The American army will be very warmly welcomed in Iraqi Kurdistan."

"Believe me, the United States is very popular now in Iraqi Kurdistan," he said.

A U.S. official told CNN the Bush administration is assessing the offer. The official said the Iraqi opposition has previously made similar offers in private, but this is the first time they have gone public with an offer to use areas in northern Iraq.

Turkey -- a staunch U.S. ally during the 1991 Persian Gulf War -- has expressed concern that military action could lead to the creation of an independent Kurdish state on its border and encourage Kurdish separatists in Turkey.

Turkey has been fighting a 15-year civil war with Kurdish militants in the southeast of the country.

At Tuesday's Pentagon briefing, Rumsfeld was asked if he was aware of the offer and if it was helpful that it was made publicly. The secretary said he doesn't recall hearing the offer in the meetings, which he described as "constructive."

"If I said, 'My goodness, that's a big help,' it suggests that we plan to go use them. And that is a decision the president has not made," Rumsfeld.

Talabani said he expected Hussein to respond to the Kurdish offer by attacking with chemical or biological weapons. He said Iraqi opposition groups have asked the United States for equipment to protect against chemical or biological attacks.

"They promised to help and to protect us. Even Dick Cheney was clear when we asked him about the protection of the Kurdish people. He said he would do it," Talabani said.

5. - Cyprus Press and Information Office - "Yilmaz: "Turkey will benefit most from solution of Cyprus problem":

CNN Turk Television carried an interview with Deputy Prime Minister Mesut Yilmaz conducted by Ahmet Sever in the "Kriter" [Criterion] program on August 11, 2002.

Sever started the interview by asking how it is possible that the Turkish Grand National Assembly enacted the EU harmonization laws at a time when everybody had given up hope, and why this did not happen before. Yilmaz noted that it is obvious why it did not happen during the past two years, adding: "Unfortunately, we were not able to reach a consensus within the government on the most important EU harmonization laws. The Nationalist Action Party, our coalition partner, was opposed to these laws." He noted that common sense prevailed in the Assembly, as he had hoped, and the said laws were enacted.

Asked if the effective role he played regarding this issue will affect his chances in the elections, Yilmaz said that he never thought about that, and added that all the candidates must mostly dwell on what they intend to do about Turkey's EU membership, because that is the most crucial issue facing Turkey.

In reply to a question, Yilmaz pointed out that the determination of the next Turkish Government regarding the country's EU membership will greatly influence the EU stand on Turkey. "That is why," he added, "the 3 November elections are very important for Turkey."

Yilmaz explained that if the EU announces a timetable for Turkey's accession, this will greatly improve the Turkish economy because it will "trigger a foreign capital inflow, increase the positive expectations in the Turkish markets, and solve the psychological aspect of the fight against inflation."

Yilmaz expressed the belief that no matter what the outcome of the German general elections, they will not obstruct Turkey's membership. "They may make the process a little more difficult, or they may delay it a little and make it more difficult for us, but they cannot stop us," he said.

On the Cyprus question, Yilmaz said: "As I always say, the solution of the Cyprus problem is in the interests of Turkey, the whole of Cyprus, Greece, and Europe; but it is Turkey which will benefit most from that. Therefore without letup we must go on with the peace initiatives we have started through Mr. Denktas. We must show mainly to Europe and then to the rest of the world that we are the side looking for a solution, the side that is trying to reach an accord. An opposite stand would create problems for us not only in Cyprus but in Turkey's foreign policy in general and in our relations with the EU. Naturally it is impossible to reach a solution only with our efforts. A solution can be reached only if both sides take certain steps. I believe that the steps taken by Mr Denktas are extremely positive. I agree that the Greek Cypriots have not responded to him in kind so far. However, this should not be a reason for us to leave the negotiating table or prevent us from making peace efforts."

Sever asked Yilmaz if it is not true that almost all the EU harmonization laws are, in fact, radical reforms. Yilmaz replied in the affirmative, but stressed that it is as important to implement them as it is to enact them, and expresses the hope that the political will that enacted these laws will be reflected in the government that will be established after the 3 November elections.

6. - The Washington Post - "Protect the Kurds"

August 11, 2002 / by Peter W. Galbraith

The writer, a former American ambassador, is a professor at the National War College. He has just returned from northern Iraq.

In making his case to remove Saddam Hussein, President Bush has no more appreciative audience than Iraq's Kurds. Having been on the receiving end of his chemical arsenal, the Kurds want Hussein gone as much as the American president does. Yet, as U.S. officials meet with Kurdish leaders this weekend, they encounter a potent ally whose cooperation cannot be taken for granted.

Nearly 4 million Kurds live in an enclave in the north and east of Iraq. Comprising nearly one-fifth of Iraq's territory and population, the Kurdish enclave has been free from Saddam's control since 1991, thanks in part to regular patrols by U.S. and British aircraft. Since the 1994 breakdown of a common Kurdish government, the enclave has been divided between a region in the north administered by Massoud Barzani's Kurdistan Democratic Party and one of comparable size in the east administered by Jalal Talabani's Patriotic Union of Kurdistan. After intense fighting in the mid-1990s, the two Kurdish parties have made peace and are working together -- cooperation that seems to be increasing as the prospects for eliminating Saddam Hussein grows.

The Kurds possess considerable military resources. Their territory includes Iraqi-built airfields and other facilities that could enable U.S. forces to launch an assault on Baghdad from Iraqi soil. The combined military of the two Kurdish factions now numbers more than 100,000. Constantly training, disciplined and well equipped with light arms, they have recently proved more than a match for the demoralized Iraqi army forces on the front lines opposite them.

The Iraqi Kurds have good reason to want Saddam Hussein gone. Since the 1970s, the Kurds have been particular targets of Hussein and his Ba'ath Party, whose ideology stresses the primacy of the Arabs at the expense of non-Arab minorities such as the Kurds. Hussein has long been vicious toward his foes. In 1983 his forces rounded up hundreds of Barzani's male relatives, who have not been seen since. Barzani believes they may have been used as human guinea pigs to test the lethality of Iraq's chemical weapons.

Nothing, however, rivaled the scale of the campaign that Hussein initiated in 1987 against the Kurds. In three years the Iraqi regime systematically destroyed every village in Kurdistan, more than 4,000 altogether. Hundreds of Kurdish villages and towns were attacked with mustard gas and nerve agents, including the eastern Iraqi city of Halabja. No one knows the total death toll, but I heard firsthand accounts of hundreds of deaths from survivors of 40 villages that were gassed in just three days from Aug. 25 to Aug. 28, 1988. Altogether upward of 100,000 Kurds, and possibly as many as 180,000, died from gas, forced deportation and mass execution between 1987 and 1990.

Precisely because of the brutality of Hussein's vengeance, neither Talabani nor Barzani wants to jeopardize the de facto armistice that exists between the Kurdish enclave and the rest of Iraq unless there are assurances of U.S. seriousness and protection.

So far, both men like what they have heard from the Bush administration. Nonetheless, President Bush's strong words cannot erase Kurdish suspicions of American resolve, which date back to a Henry Kissinger double-cross of a 1974 Kurdish rebellion but are felt most acutely with regard to the first President Bush. As every Kurd remembers, the elder Bush called for the Iraqi people to overthrow Hussein and then ignored their pleas for help as Iraqi forces swept north at the end of March 1991 to crush the rebellion.

This weekend, visiting Kurdish leaders are looking for public guarantees that the United States will protect the territory and people of the Kurdish enclave from an Iraqi ground assault. So far, the most any U.S. administration has said is that it will answer an attack on the Kurds in "a manner and time of its choosing."

The Kurds will also be seeking assistance with civil defense. With nothing to lose, Hussein has no reason not to use his chemical and biological weapons. While America may be his most desirable target, the Kurds are the closest. Kurdish leaders will ask Pentagon officials for antibiotics and chemical weapons protection gear.

Finally, the Kurdish leaders will be seeking American endorsement of their vision of a post-war Iraq. In the past 11 years, the Iraqi identity has largely disappeared from the north of Iraq. Kurdish television, media and universities have replaced earlier Iraqi counterparts. In schools, Arabic has been demoted from the language of instruction to a foreign language (one considered by young people far less useful than English). Kurds take pride in what they have accomplished on their own -- from rebuilding destroyed villages, to tripling the number of schools, to establishing one of the Middle East's most extensive and accessible Internet networks.

In a post-Hussein Iraq, the Kurds will insist on maintaining the independence they now enjoy. Barzani and Talabani have proposed that a future Iraq be a federal state with Kurdish and Arab entities. In the coming months, they will be moving unilaterally to create a legal structure for a self-governing Kurdistan that will have its own assembly, president, tax and spending powers and police. Believing that written promises in an Iraqi constitution provide scant protection, the Kurdish leaders insist on retaining a Kurdistan self-defense force.

Iraq's neighbors fear federalism as a prelude to the breakup of the country. In fact, it may be the only way to save Iraq. The Kurds know that the Bush administration will have little choice but to block any effort to force them back under Baghdad's control. But Kurds and Arabs do have practical reasons to cooperate, not least of which is their shared interest in Iraq's vast reserves of oil. A voluntary association of two equal peoples is far more likely to produce stability in Iraq than the failed 20th-century strategies of repression and dictatorship.