The Creation Of ‘national Merchant’ In Turkish Republic AND Significance Of Is Bankasi Essays Examples

Introduction

The ‘National Merchant’ was connoted by the Young Turks and Unionists in a determined effort of competing with the non-Muslim merchants and dominating the national trade. This was as a result of the initial dominance of trade by the non-Muslim ethnic communities that was in existence during the Ottoman Empire. The members of the ‘National Merchants’ were devoted to the development and consolidation of their positions and the positions of national manufacturers through the consequent promotion of commercial activities of Muslim Turks. The corporations that were established afterwards had little or no affiliation with non-Muslim Ottomans. These corporations were committed to ensuring a ‘national economy’ (as the Unionists described the ideology) that was purely controlled by merchants who were first Muslims then Turks_ the definition of a true Turkish nationalist (Çetin, 30).
During the late 1920s, most of the remaining non-Muslim merchants and the foreign companies were already suffering continuous pressures from the emerging trends that promoted the nationalist economic trends. Through the ‘National Merchants’s class that had been created, the Muslim Turkish merchants were able to create an isolate identity for themselves and thus solicit government support through Turkification schemes at the expense of the minority businessmen and companies that were foreign owned. These schemes were to seen to be implemented through the establishment of policies that favored the supremacy of these Turkish ‘National Merchants’ in aspect of both economic and social life (Hirschon, 92).

A historical perspective of Nationalism and its impact on the creation of the ‘National merchants’

Ziya Gokalp (1876-1924) was responsible for the formulation and coordination of the ideology of Turkish Nationalism during the period of the Balkan Wars. His system laid emphasis on race and ethnicity where the culture and linguistic backgrounds were viewed as criteria for the membership into the national community. Such criteria were necessitated by the existing Ottoman Empire during his time. In his system, Islam would only be viewed as a moral force that would play a key role in bringing about social solidarity rather than a necessary condition or requirement to be considered a Turkish nationalist (Hirschon, 93).
The conceptions of Ziya were widely accepted until the later part of the 1920s where the model of Turkish nationalism underwent a period of ideological break and radical reconstruction. This was through parliamentary debates where the Ministers of Exchange and Settlement were heavily criticized due to their neglect of the linguistic criteria. Dr. Riza Nur was particularly vibrant on this issue and soon gathered supporters of the republican political elite class in his new interpretation and comprehension of nationalism where the ethnic background soon become a pivotal point of determining whether a person was considered a Turkish nationalist. This led to the formation of ‘national communities’ such as the ‘National Merchants’ where non-Muslim minorities in spite of their Turkish citizenship were clearly left out leading to their discrimination through formulation of one sided policies (Hirschon, 94).
These policies favored business people and merchants who were Muslims and Turkish and particularly members of the ‘National Merchants’ class. Such policies included the requirement of foreign corporations to keep their books in the Turkish language, allocation of certain positions to Muslim Turks and also the ruling that three quarters of their employees had to be Muslim Turks. During the period of the late 1920s, companies were encouraged not to the hire non-Muslim professional and only employ Muslim Turks. Initially, these policies did not have a legal or constitutional backgrounds rather were backed up the de facto pressures of the Turkish bureaucracy. However, in the later periods, these policies acquired a de jure status through their legalization leading to the reinforcement of the discriminatory practices against the minority non-Muslim merchants and foreign companies (Hirschon, 93).
A case in point of such oppressive policies is the law numbered 2007 that was passed in 1932 in an effort to restrict certain professionals and trades to the Turkish citizens leading to about 9000 Greeks losing their jobs who would later migrate to Greece for good. The members of the National Merchants were automatically exempted from such restriction due to their Muslim-Turkish backgrounds (Hirschon, 93).
Another instance of oppression of non-Muslim merchants was Varlik Vergisi, a wealth tax that was levied against non-Muslim citizens in 1942 that was claimed to be aimed at raising funds for the country’s defense against an entry into the World War II although the underlying reason as was generally accepted was to incur the financial ruin on the non-Muslim merchants, who were not considered part of the ‘National Merchants’ class, terminate their dominance in the country’s economy and also move their assets into the hands of the so called Muslim bourgeoisie (İnce, 75).

The Significance of the Is Bankasi in the Turkish Economy

The Is Banakasi founded in the 1924 by Ataturk who recognized the great need to create a national bank that would be used to drive the country’s infrastructural growth and also ensure its financial stability. Immediately after its launch, the bank would begin its role as a source of fuelling Turkey’s economic and industrial growth through its close association with the government’s economic policies particularly during the Ataturk regime (Referenceforbusiness.com, n.d).
According to Dincer (86), the new regulatory approach of banking institutions by the Government was liberal and was aimed at development of a banking system where the government provided the much needed initial capital for the establishment of public banks such as Is Bankasi while at the same time encouraging the formation of private banks. Is Bankasi and other public banks were created with the vision of supporting and funding the new state enterprises that were mainly controlled by the members of the ‘National Merchants’ class.
Public banks such as Is Bankasi have had an invaluable use as vehicles through which the Turkish government has used to finance the provision of the much needed low interest credits for developmental activities such as agricultural SMEs and the municipal infrastructure (Marios and Gangen, 1). Also, the public banks have also played a critical role particularly during crisis and instability through counteracting the debilitating removal of lending services by private banks as a measure to prevent larger recessions. Another contribution of the bank is through its operation of numerous branches in small towns and rural areas where the commercial banks, whose main goal is to seek profits, have remained reluctant in setting up offices. This has positively contributed to the goal of ensuring a nationwide distribution network of financial system. Fourthly, the Is Bankasi is regarded by merchants and the Turkish population in general as a safe haven due to the state guarantee as witnessed in the 2008-2009 financial crisis where members of the public flooded public banks such as Is Bankasi with their savings (Marios and Gangen, 2).
On the hand, the dominance of public banks such as Is Bankasi backed up by the insufficiency of deposits and loans and the high level of losses from the public banks had contributed to financial instability in the country from the latter period of the nineteenth century. This forced the government to loosen the restrictions for entry in order to allow for newer entries. During this transformation of banking system there were 31 new entries of which 19 were foreign and 11 national between the years 1980 and 1990 after the collapse of 6 public banking institutions (Dincer, 88).

Conclusion

The ‘National Merchants’ was an ideological community or class that was connoted to distinguish between the non-Muslim merchants from the Muslim merchants. After the collapse of the Ottoman Empire, Ziya’s interpretation of Turkish nationalism that incorporated both aspects of ethnicity of race was transformed to an ethnical background where the non-Muslim merchants were not considered as part of the Turkish nationalists and as a result were heavily discriminated against. This was facilitated by the implementation of bureaucratic and legal policies that were meant to oppress non-members of the ‘National Merchants such as the requirement of paying wealth tax and the designation of specific sectors of the economy to the ‘National Merchants’.
The growth Turkey’s economy can be attributed to the government’s commitment to support the banking sector and particularly public banks such as the Is Bankasi. As an effort to promote the expansion of the country’s economy, banks such as Is Bankasi were created with the aim of ensuring the support of SMEs and other state owned enterprises. Also, Is Bankasi as a pubic bank enabled the government to seize control of the financial sector and prevent crises such as recessions that would have been witnessed during the periods when private banks withdrew their lending services. In addition, Is Bankasi together with other public banks were able to set up offices in the small towns and rural areas where profit making banks were reluctant to set up thus ensuring that financial network was nationally distributed rather than concentrated in only a few well to do cites. Lastly, Is Bankasi also offered a sense of security to the public and merchants and particularly during the global crisis between 2008 and 2009 due to the state guarantee.
However, the dominance of the public banks had a negative side to them through their contribution to the financial instability that was coupled to poor management and increased losses that forced the government to loosen their restrictions for entry allowing 31 new entries between the years 1980 and 1990 after the collapse of 6 state owned banking institutions.

Work Cited

Çetin, Berfin Emre. Paramilitary Hero on Turkish Television. Newcastle upon Tyne: Cambridge Scholars Publishing, 1900. Print.
Dincer, Hasan. Globalization of Financial Institutions. Cham [u.a.]: Springer, 2014. Print.
Hirchson, Renee. Crossing the Aegean. Berghahn Books, 2003. Print.
İnce, Başak. Citizenship and Identity In Turkey. London: I.B. Tauris, 2012. Print.
Marios, Thomas, and Ali Riza Gangen. The Critical Role of State-Owned Banks in Turkey’S Development. 1st ed. Municipal Services Project, 2014. Print.
Referenceforbusiness.com,. Turkiye Is Bankasi A.S. - Company Profile, Information, Business Description, History, Background Information On Turkiye Is Bankasi A.S. Web. 5 Jan. 2016.