Sunday, 15 May 2016

The Unhurried Charm Of Ireland Provides A Truly Relaxing Break

In addition to natural beauty and hospitality of the people a visit to Ireland offers a striking contrast to many mass tourism destinations that dominate the Mediterranean and Aegean coasts. For one thing, as you drive away from Shannon Airport you can’t help notice the absence of anything to interrupt your view of the deep, rich green valleys and rugged hills. There is none of the hideous over-building or intrusive bill-boards that have obliterated so much natural beauty in Spain and Turkey.

But we found something even more unique and precious these days – a real break from the pressures and angry confrontations that seem to afflict so much of continental Europe and the Mediterranean tourist destinations.

We spend a lot of time in Greece and Turkey where right now the national blood pressure is in the red zone and the medications don’t seem to be working very well. Both countries are wracked with serious social and political tensions that can catch unwary tourists in a wave of demonstrations, strikes or worse. Turkey also faces serious internal threats from Kurdish guerrillas and external threats from the Syrian conflict spreading across the border. Major cities like Istanbul, Ankara, and Diyarbakir have been hit with several bombings in the last few months that have claimed hundreds of innocent lives, including some tourists caught in the wrong place at the wrong time.

Ireland, like Greece, was caught in the great financial downdraft of 2008/09. But, unlike Greece, it is working its way out of that hole. Unemployment has been dropping steadily and is now just over 8%. The economy is growing, debt is shrinking, and the banks are once more reducing mortgage rates. Perhaps the main difference between the two countries is that where the Irish crisis was primarily financial the Greek crisis was, and remains, a toxic mix of deeply rooted political, administrative, and economic problems that are far more resistant to solutions.

Ireland, to be sure, has its own sad and bloody history, highlighted by its complicated history with Great Britain. But one gets the real sense that bitter events like the Great Famine, the waves of emigration that denuded so much of the countryside, the Easter Uprising, the War of Independence are memorialized more in music and literature than in daily life. Even the deadly sectarian violence in Northern Ireland has diminished greatly in the last few years. People may never forget. Some may never forgive. But, unlike much of south-eastern Europe, the angst of that history does not block forward motion.

In any event, none of that history intruded on our long weekend in County Clare on Ireland’s stunning west coast. Much of the county is dominated by the massive Burren, 250 square kilometres of limestone hills and cliffs that were formed more than 300 million years ago, scraped clean by successive glaciers, and eroded by rain and streams into fantastic shapes. Evidence of 3,000-year-old human settlements can be found throughout the region and several limestone tombs remain in place. Abandoned houses, churches and abbeys are poignant reminders of more recent human movements.
Ancient tomb on the Burren  in County Clare

No trip to County Clare would be complete without a visit to the Aran islands protecting the mouth of Galway Bay from pounding North Atlantic storms. The ticket agent advised us to go to the island of Inishmaan because she said it would be quieter than the busier, more touristic Inishmore. Quiet didn’t fully describe it. Silent would have been more accurate. The other passengers looked at us a little strangely because we were the only people to get off the boat at Inishmaan. Undeterred, we trudged up a narrow lane flanked with high stone walls to the very small village and encountered our first human contact in the tiny general store/post office. No, he wasn’t sure when the island’s only pub would open, but we were welcome to see for ourselves. The pub was indeed closed – with uncertain opening hours –but we were saved by a Dutch woman who ran a small tea room and served excellent homemade soup and sandwiches. It would have been interesting to learn exactly how or why this nice woman wound up on a craggy rock in the middle of the Atlantic Ocean, but we didn’t want to risk our sanctuary from the wind and rain by asking intrusive questions.
We weren't the only ones seeking shelter on Inishmaan

Back on the mainland we ate in good, unpretentious restaurants specializing in fresh local seafood, including the clams, mussels, crabs and lobsters from Galway Bay. There were meat dishes on the menu, but when you’re in one of the centers of great shellfish it seemed a waste not to take advantage of the opportunity.
Part of a long-abandoned Cistercian  abbey

If you are used to short, simple, straightforward answers to routine questions you might get a bit frustrated in Ireland. Once we pulled off the road to ask a passer-by for the shortest route to a certain site. “Well now, that’s an interesting question . . .” he began. We turned off the engine and settled in for a leisurely description of local life, history, ecology, and food that surpassed anything to be found in a guide book. Somewhere in there was a description of which road to take. It took a while. But then, that’s part of the unhurried charm of Ireland

Thursday, 5 May 2016

Turkey Illustrates The Real Risk Of Emerging Markets

The current political turmoil in Turkey illustrates with startling clarity the real risk in the so-called Emerging Markets.  Commonly used economic indicators such as GDP growth, debt, deficits, corporate profits, etc. tell only part – the superficial part -- of the story.

            Much more important for anyone seduced by the theoretical growth potential of these markets are issues like the underlying political stability, existence of ‘crony’ capitalism, competence of government institutions, level of systemic corruption, and -- most important of all – respect for the rule of law.

            A brilliant young Turkish financial analyst, who needs to remain anonymous given the poisonous climate in Turkey, emphasized this contradiction in a recent email about Turkey and cautioned against a headlong rush into emerging markets in general.

“The key issue is to understand that a growing population, rich natural resources, or a large manufacturing (assembly) base do not in themselves make a good long term story. In fact, three common denominators of emerging markets are lack of the ‘rule of law’, an economic system of ‘crony capitalism’, and a poor education system. These, in turn, create a system of constant corruption and regular boom/bust cycles. In emerging markets corruption is the grease that turns the wheels of the economic system – where politicians, bureaucrats and businessmen benefit at the expense of productivity and innovation. This system is usually supported by a political system that plays on social/political divisions along different ethnic, religious or political lines.”

            Turkey, thanks mainly to the work of former economic minister Ali Babacan, doesn’t score too badly on the raw numbers. Unfortunately, the country scores at or near the bottom of any league table on the second set of issues – the ones that can really make or break any investment. President Tayyip Erdoğan has gone out of his way to show that he recognizes no constitution and no law except the law of sheer power.

            The dramatic events yesterday that saw the dismissal of the prime minister only confirm this trend. It is well known that Erdoğan does not tolerate any dissent from his narrow, parochial world view – particularly his ambition to transform the office of president into an untouchable, unaccountable power center. Prime Minister Ahmet Davutoglu was seen as the softer, more reasonable side of Turkey’s unequal power balance. Despite his frequent avowals of undying loyalty, he apparently infuriated the president with his lack of enthusiasm for several issues key to Erdoğan’s megalomania: 1) the change to an unchecked presidential system, 2) his reluctance to throw people in jail before a trial, and 3) his willingness to use professionals like Babacan as economic advisers rather than rely on the sycophants who surround Erdoğan.

            In some ways Davutoğlu was the architect of his own downfall. His deeply flawed foreign policy only succeeded in completely isolating Turkey. Arab countries don’t really trust Turkey, Russia openly loathes and mocks Erdoğan, and the Europeans would really like to keep Turkey in some sort of ante-room to be seen and not heard. The Americans look on in despair at the rapid polarisation in Turkey and the deterioration of the country’s political discourse. But then they grit their teeth and think of Turkey’s geopolitical importance. Perhaps Davutoğlu’s main foreign policy problem as far as Erdoğan is concerned was to be perceived as mildly pro-Western. Erdoğan despises the West. He reacts furiously when Western politicians, journalists, NGOs, etc. scold him for his miserable record on human rights, press freedom, or judicial independence. His only response is loud bravado that ‘Turkey was great once and will be great again’.

            The name of the non-entity who takes over as prime minister is completely irrelevant because his only job will be to enact whatever Erdoğan wants. Cabinet meetings will have the same vibrant discussion, bright ideas, and independent thought as Stalin’s politburo meetings.

The only sliver of good news is that Erdoğan’s Turkey has absolutely no ability to project power beyond its own borders. Erdoğan would love to act like Putin throwing his weight around. But he can’t. He is hemmed in on all sides – if not militarily then politically. The Turkish army is large, but so far has shown no interest at all in moving one meter beyond its borders. From time to time the Air Force chases Kurdish guerrillas into northern Iraq and makes the boulders bounce with a few bombs, but that’s about it.

In the long run Erdoğan will fail because he is making the same major mistake as his arch-enemy the old Kemalist regime that ruled the Republic with an iron hand for more than 70 years. By alienating a large part of the population the Kemalist regime created fertile recruiting ground for Erdoğan. Erdoğan, too, is alienating a large part of the population. He is trying to force all Turks into his narrow mold of what he thinks a Turk should be. The trouble is, Turks don’t do ‘should’. The country is too diverse, too heterogeneous to fit into anyone’s mold. Erdoğan’s mold, like that of the Kemalist regime’s, will one day break. The only question is ‘How long is the long run?’