THE LEGATUM PROSPERITY INDEX™ 2016

Bringing Prosperity to Life

Turkey

Ranked 78th of 149

At a glance

Ranks

78 th on the Legatum
Prosperity Index™

49th
74th
65th
80th
52nd
126th
94th
104th
55th

SUB-INDEX RANKINGS

In the Prosperity Sub-Index rankings, Turkey performs best on Economic Quality and Health and scores lowest on the Safety & Security sub-index.

Visit our Rankings table to see how Turkey compares to other countries.

Prosperity Gap

The ‘Prosperity Gap’ takes a country's GDP and uses it as the yardstick to measure a nation's expected Prosperity Index ranking.

Turkey has a considerable prosperity deficit – the 29th biggest deficit in the world – and has seen its prosperity deficit increase slightly over the past decade and the security and governance situation declines.

Note:
In the chart above, each dot represents a country. The curve shows the general tendency with which prosperity increases as GDP per capita increases. If a country falls below the curve, then we can say that compared to all other countries, it is under-delivering prosperity for its citizens. Likewise, if a country rises above the curve, then we can say that it is over-delivering prosperity for its citizens. Learn more about the Prosperity Gap here.

Alternatively, have a look at the Prosperity Gap view on our Rankings table for a full list of countries and to see how each of them are performing on the various sub-indices.

Commentary

Turkey’s economy experienced rapid growth in the early 2000s with GDP per capita rising significantly until 2008. Since then, however, GDP per capita growth has stagnated and foreign investment has suffered in part because of domestic and regional political instability, raising questions over whether Turkey’s economic progress is sustainable. This also highlights the importance of good governance, rule of law, and security in a country’s economic prosperity. Over the past decade, Turkey has moved up only three ranks in the Economic Quality sub-index to 49th. While there has been a considerable decrease in poverty, economic development has been uneven. Convergence between urban and rural areas has not occurred. There has also been a slight increase in the female labour force participation rate from 25.6% to 32.2%, but this remains very low and is by far the lowest in the OECD. Mexico has the second lowest female labour force participation rate at 48.3%, while the OECD average is 66.73%.

Female labour force participation (%) in Turkey and the OECD
Turkey lags considerably behind its OECD peers when it comes to women participating in the workforce.

One improvement comes in Education: Turkey has moved up ten ranks to 80th: more workers have received vocational, secondary, and tertiary education over the past decade. There has also been a 7% increase in the adult literacy rate, as access to education has improved. However, Turkey’s performance in Education remains, again, far below the OECD average, as does its educational quality (PISA) score. If Turkey’s aim is to strengthen economic prosperity and ensure economic development spreads throughout the country, education can play as important a role as good infrastructure. Helping people to enter the workforce and improving national human capital could be a strong source of economic and prosperity growth to Turkey.

Turkey’s biggest concerns, unsurprisingly, come in Governance, Personal Freedom, and Safety & Security. In the Governance sub-index, Turkey has fallen 17 ranks to 65th. There was a noticeable drop in 2014 after Erdogan’s election to the presidency after 12 years as Prime Minister. The election was criticised by both domestic and foreign observers for alleged media bias and an uneven campaign allocation favouring Erdogan. While the President is officially a symbolic position, Erdogan is seeking constitutional changes to create an executive presidency, giving increased authority to the position. Recent judicial reforms were also seen as an erosion of judicial independence meant to favour the ruling AK Party. Nevertheless, the government is popular, particularly in rural areas, with nearly 50% of the population expressing confidence in the national government.

While Turkey remains democratic, concerns over authoritarian tendencies, corruption and the weakening of the independent judiciary have seen the country’s level of democracy drop from nine to three (with 10 being the most democratic, -10 being fully autocratic.) Notably, Turkey has been overtaken in the Governance sub-index by Qatar, which, despite being undemocratic, has lower corruption, greater transparency, and higher judicial independence. This poor performance in Governance is damaging for Turkey’s long-term prosperity prospects, given that it will likely affect the country’s economic performance and business climate in the future as foreign investors remain wary.

Level of Democracy (10 = full democracy, -10 = full autocracy)
Turkey’s level of democracy has dropped significantly amid growing concerns that the government is flirting with authoritarianism.

The weakening of democracy in Turkey seems to have also had an effect on Turkey’s Personal Freedom score which sees Turkey move down eight ranks to 94th in this sub-index. It has the lowest Personal Freedom Score in the OECD, performing well below average. The Prosperity Index indicates a decline in civil liberties. Government restrictions on religion are also going up, despite the official secularism of the state. There are considerable concerns over press freedom as the ruling AK Party has expanded its control of, and surveillance powers over, the media. It is still a crime to denigrate the Turkish nation or President, which makes criticism by opposition and/or journalists sensitive. Turkey has jailed 76 journalists so far, more than Iran and China. Its press freedom score is now the same as Iraq’s and Angola’s.

The Prosperity Index captures the spillover effects of the conflict in neighbouring Syria, presenting itself in a declining Safety & Security score in Turkey. The country has fallen seven ranks in Safety & Security since 2011, when the war in Syria began. Unsurprisingly, the Index reports more terrorist deaths following numerous attacks in the country and around 20% more people feel they don’t have enough money for adequate food or shelter. The refugee crisis as a result of the conflict has further consequences for prosperity, putting pressure on Turkey’s government, economy, and society. Recent instability is also set to dampen foreign direct investment. This highlights the importance of resolving the conflict in Syria, most importantly for the safety and future prosperity of Syrians themselves, but also because it has wider consequences for prosperity in the region as a whole.


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Data

How to read this graph:
When comparing multiple countries on a spider chart, data points that appear
further away from the center represent a better performance to the points that are closer to the center.

Special Analysis

Special Analysis

OVERALL

Improvements in Health, Education, and the Natural Environment sub-indices have been offset by declines in Governance, Personal Freedom, and Safety & Security. Progress in Economic Quality and Business Environment has been muted as reforms have been interrupted and implemented slowly. This uneven performance means Turkey has continued to considerably under deliver prosperity given its wealth over the past decade, despite the fact that GDP per capita tripled in the years leading to 2008. Turkey has been unable to convert greater wealth into prosperity and is particularly constrained by growing deficits in Governance and Personal Freedom, as well as an especially large deficit in Safety & Security.

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Areas of Success
Areas of Success
Turkey has made good progress in Education, moving up 10 ranks over the past decade thanks to increased participation in vocational, secondary, and tertiary education. Adult literacy has also improved by 7.2% so that it now stands at 97% of the adult population. Nevertheless, educational performance is well below the OECD average, particularly given low access to tertiary education. Turkey moved up five ranks in Health to 52nd since 2007: this comes after Turkey embarked on ambitious health care reforms in 2003 to provide universal health coverage and improve the quality of healthcare. 71% of people are satisfied with the availability of quality healthcare, 17% more than ten years ago. However, Turkey’s biggest improvement comes in the Natural Environment, which sees Turkey move up 23 ranks to 55th after working to reduce exposure to air pollution: 10% fewer people live in areas exposed to levels below WHO guidelines, which is notable given Turkey’s economic development. Conservation of marine and land areas, however, remain limited.
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Areas of Little Change
Areas of Little Change

There has been little movement in Social Capital over the past decade: Turkey ranks 104th, the same as in 2007. Civic participation in organisations and donations to charities were low to begin with and have, in fact, decreased. While more Turks feel that they have been treated with respect and that it is easier to meet new people than ten years ago, these positive trends are offset by a decline in those voicing their opinion to public officials, perhaps given ongoing corruption and increasing concerns over fair democratic practices.

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Areas of Improvement
Areas of Improvement

Governance and Personal Freedom are essential areas for improvement to enhance Turkey’s prosperity. Concerns that Turkey is turning into a faux democracy should be addressed, particularly when it comes to judicial independence, which has been compromised. Purges of the court, law enforcement, and government following the recent coup attempt are worrying for the preservation of a dynamic, stable democracy in the country. Likewise, the jailing of, and threats towards, members of the media must be restrained as this limits transparency and open debate, making it ever more difficult for the government to be held accountable for potential abuses of power.