Ulker Biskuvi – the Turkish confectioner that owns chocolate brand Godiva and biscuits brand McVitie’s – had no idea its April Fool’s Day prank ad would go so spectacularly wrong.
The spot portrayed a cartoon of two brothers, one of whom is always bullying the other. The bullied brother, runs the script, will seek revenge on April 1. Hence the strapline, “The day of reckoning is approaching”.
Cue outrage, feigned or otherwise, in a country where the memory of last year’s failed bloody coup is still all too fresh, and where politicians are rather too eager to grasp any opportunity to incite emotions to swing the upcoming constitutional referendum.
Ruling AKP party politicians are intent on stirring patriotic feelings as they bid to secure a ‘Yes’ vote on April 16, a result that would severely limit parliament's role and make President Recep Tayyip Erdogan an executive president with sweeping powers.
Shares in Ulker, which is controlled by Yildiz Holding, fell 3.4%, from TRY18.46 on March 31 to TRY17.83 on April 6, as AKP propagandists took up the theme that the company was attempting to manipulate the psychology of 80mn people.
AKP supporters reacted by rallying in front of President Recep Tayyip Erdogan’s residence in Istanbul’s Uskudar district, while pro-government newspaper Aksam reported that Ulker would soon be prosecuted.
In a country where substantially more than 100,000 people have been dismissed from their public sector jobs and more than 800 firms, worth some $10bn, have been seized in the government purge carried out since the attempted putsch, Ulker had to react fast. It apologised for having touched a raw nerve, and company owner Murat Ulker pleaded that the ad had been misconstrued. The group also said it would launch legal action against people who had posted hacked or manipulated versions of the commercial on social media.
Other companies have used the referendum campaign to pledge their loyalty to Erdogan’s vision of Turkey. Leading Turkish coach company Metro Turizm, for instance, even tried to take direct advantage of Ulker’s woes by declaring that it had stopped serving the company’s products on its buses.
In the Black Sea coastal province of Sakarya, meanwhile, a construction company went so far as to tweet that it would name one of its residential projects after Senior Master Sergeant Omer Halisdemir. The soldier became a hero to many after he was killed in the line of duty on the night of the coup attempt after he shot dead a general involved in the move to overthrow Erdogan. However, the attempt to to use the state hero for marketing proved too much to stomach for many. The tweet quickly disappeared after encountering a largely negative reaction. Not that the episode has prevented tacky online purveyors of Sergeant Halisdemir memorabilia moving into the market.
Nation on edge
The referendum is indeed “everywhere” in Turkey, and even movie theatres are plastered with posters of “Reis” (“The Chief”). This heavily-hyped cult of personality biopic, tracing the life of Erdogan from his childhood selling sunflower seeds in a poor district of Istanbul to his time as the city’s mayor, hit silver screens across Turkey on March 3. But it’s not proved a box office smash. In four weeks, just 172,000 people watched the movie, according to boxofficeturkey.com. Nevertheless, the producers are apparently promising that "The Chief II" and "The Chief III" are coming soon.
If the government’s claims are to be believed, the ties between Turkey’s business community and the alleged mastermind of the coup attempt – the self-exiled cleric Fetullah Gulen whom Ankara has so far unsuccessfully attempted to have extradited from the US – run wide and deep. As well as relieving suspect owners of their enterprises, state officials have had hundreds of business people brought in for questioning over issues such as financial assistance provided to the Gulenist network. They have also cracked down on any media enterprises seen as enemies of the nation.
Plans to sell off 600 of the seized firms have, however, reportedly been postponed, with sources claiming there are concerns about triggering legal battles, but around 40,000 people, including company bosses and employees, are still being held pending trial.
Turkey’s largest conglomerates, such as Sabanci and Koc, as well as leading business associations such as the Turkish Industry and Business Association (TUSIAD), joined in condemning the coup attempt, and Murat Ulker, owner of hapless confectioner Ulker, himself denounced events on Twitter. “It is unacceptable. Our people defeated the insurgency. Sorry for the lives lost,” he wrote on Twitter on July 15, a day after the staged putsch was foiled.
The stance of TUSIAD is particularly important. Long seen as the representative organisation of Turkey’s secular business elite, it represents the country’s leading 3,500 companies. Excluding energy imports, TUSIAD member companies account for 80% of Turkey’s total foreign trade and provide 80% of corporate tax revenues.
Erdogan has had something of an uneasy relationship with TUSIAD and its power has been greatly diminished. Not that Erdogan should be seen as anti-business. A conservative in social affairs, he is a liberal in economic issues, even if some of his declared theories go against mainstream economic thinking, such as his conviction that high interest rates cause inflation (a stance that on April 5 was blamed for driving Turkish banks to cut mortgage rates to below deposit rates).
The ruling AKP is of course aware that Turkey needs the ties that TUSIAD members have established with large international companies over the years. For example, Sabanci has joint ventures with Aviva, Heidelberg, E.On, and Carrefour. Koc Holding’s international partners are LG, Ford Motor, UniCredit, and Fiat Auto.
It is not unusual in Turkey for the government to postpone a strike if it thinks industrial action would threaten the country’s security or economy, and the AKP maintained this business-friendly approach in late March when ministers ordered that a strike at Sabanci-owned private lender Akbank be delayed by 60 days.
TUSIAD has not publicly declared whether it is for or against the proposed executive presidential system or not, though it has voiced some concerns over social tensions generated by the referendum campaigning and the lack of social dialogue. “I wish that parliament could have dealt with this [executive presidency]. A ‘Yes’ or a ‘No’ vote at around 50% cannot mean strong public support,” TUSIAD’s head, Erol Bilecik, told Hurriyet newspaper in an interview on March 24.
Down to the wire
Some polls suggest the referendum will go down to the wire, even though the opposition complains about the lack of a level playing field. Opposition politicians claim they receive far less media airtime and coverage to reach out to voters than the government, and their rallies have been banned. Of the most read 10 dailies and most watched 10 TV channels, seven (in each category) belong to businessmen who are affiliated with the government, a study conducted by Bianet and Reporters Without Borders found.
The opposition also insists the allocation of government-sponsored advertising is skewed towards pro-government media outlets. The state’s Press Bulletin Authority (BIT), which records the government’s advertising spending, does not provide a detailed breakdown, only saying that total state spending on ads and announcements increased by 11% to TRY370mn (€93.8mn) last year.
The opposition media’s reporting is also far from balanced. It is almost impossible to find any stories in those outlets that praise government policies. The Turkish media have in fact become increasingly partisan, reflecting the deep divides in society amid the polarised pre-referendum political climate.
It remains to be seen whether the clash of the media outlets will help the undecided voters – estimated at around 10% – make up their minds. “The base case of the people we met [in Turkey] last week was mostly ‘Yes’, yet most of them said that it is also quite difficult to rule out a ‘No’ vote as they think the gap between them is not very big,” Morgan Stanley said in a report published on April 5.
The opposition CHP claims the appropriation of the hundreds of companies and the arrests of their owners has created an atmosphere of fear among the business community, depressing business morale and investor confidence in Turkey.
But business confidence has been rising in recent months, if the central bank’s latest survey of sentiment has got it right. It shows that the business confidence index rose by 2.6% m/m to 108.1 points in March, after advancing 8.5% m/m in February. Major M&A deals announced in Turkey this year are another indicator of apparent foreign investor confidence in the Turkish economy, which rebounded from its Q3 2016 slump with an expansion of 3.5% in Q4.
A ‘No’ vote would certainly stoke political uncertainty, given that Erdogan is thought likely to push for a snap election if that happens. But whether a ‘Yes’ vote will give business a stable political platform to build on – as the AKP claims – remains far from clear, given what the opposition sees as a slide towards authoritarianism.