Refugee crisis holds economic benefits for Turkey

Refugee crisis holds economic benefits for Turkey
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The UN High Commissioner for Refugees defined the Syrian crisis as the “biggest migration flow of history.” As a gateway to Europe, Turkey has been the first country to welcome Syrian refugees. How this massive influx of refugees is managed and economically integrated into society will determine Europe’s policy and public perceptions.

According to the United Nations, over 6 million Syrians have been forced to leave their homes, and around 4 million people have fled the country. In late 2015, Turkey sheltered more than 2.5 million refugees. Those alarming figures are feeding the European fear of being flooded by a wave of refugees. However, this misconception might hide economic opportunities.

According to Turkish Insights, Turkish people are recognizing the right to help Syrians and embracing the humanitarian notion of welcoming people who are fleeing war. However, even when understanding the importance of the crisis, the main perception is that Syrians are a threat to the economy and security.

Indeed, locals do not want to welcome more refugees and demand that they be placed in camps far from cities. The limits of hospitality have been reached.

In this light, contrary to public perceptions, the influx of Syrian refugees into Turkey holds many possible economic benefits for Turkey. How Turkey will harness this potential will be a guidepost for the European Union.

syria refugees

Local perceptions 

While Syrian refugees might inspire insecurity, economically the Turkish local population is linking unemployment and inflation to the refugees. According to the Statistical Institute of Turkey, in 2013 the unemployment rate was at 0,3% compared to 10,3% in September 2015, with more than 251,000 people joining the ranks of unemployment.

Furthermore, the Syrian workforce accepts lower wages of approximately 20 lira instead of a normal daily wage of 50 lira. Those figures fuel local resentment against the Syrian refugees, making a correlation between the rise of unemployment and refugees.

Despite the perception of refugees as economically inconvenient, it is essential to deconstruct this way of thinking and analyze how they can contribute to the local economy.

Firstly, opening borders could bring potential economic benefits to revitalizing some cities. Refugees embody a new purchasing power that can be positive for the local economy: they need to buy homes, send their children to school, or may choose to open small businesses.

These activities are creating jobs for the whole community – both Turkish and Syrian.

Furthermore, available and inexpensive workers attract both Syrian and international investors. The Washington Institute for Near East Policy highlights that Syrian investors have moved to Turkey to boost investments. While in 2010 only 30 Syrian companies were listed, in 2015 more than 1000 companies were established in Turkey.

According to the recent Vancity report, the local belief that Syrian refugees are stealing jobs must be shaded. Indeed, Syrian workers are hired in specific fields, such as agriculture and factories, where locals are not attracted to due to hard working conditions and low salaries. Rather than stealing jobs, Syrians are filling available positions for unskilled labor.

In reality, the problem of such a shift in the labor market is more long-term because of Syrians accepting lower wages, which can also lead to illegal hiring. This constitutes a real disadvantage for the Turkish workforce.

In order to address this problem the Turkish government recently published new regulations that allow the 2.5 million Syrian refugees to apply for work permits. With this permit, refugees will have the guarantee to earn at least minimum wage and is aimed at stopping the recruitment of illegal workers.

Response to an ageing Europe

In parallel, because of the expansion of life expectancies and low birthrates, Europe has been ageing. According to the United Nations’ Population Division, 27 out of 30 countries with the largest 65 and older populations are in Europe, including Italy, Germany, and Portugal. The European Union’s statistical agency highlights that in 2015, 81% of the people who applied for asylum in Europe were younger than 35.

euro age

Thus the Syrian refugees crisis can be seen as an opportunity for “graying Europe’s” economy rather than as a cost.

They represent a valuable human resource that can reverse the trend of ageing. Rather than just rejuvenate the labor market, they could also bring new ideas and perspectives and therefore boost innovation.

So despite misconceptions, refugees are ultimately boosting the local economy because they represent a new purchasing power and a young injection into the workforce with new ideas.

Turkey is slowly integrating Syrian refugees into its economy, and this should act as a guidepost for European countries – especially when facing the challenge of an ageing Europe.

In this context, Turkey plays a crucial role in shaping both policy and perceptions in regards to Syrian refugees. Hopefully its recent regulation concerning work permits will show the right path for Europe to jump-start the continent’s economy.

Categories: Economics, Europe

About Author

Jason Dozier

Jason specializes in crisis management and the organizational development of terrorist groups. He currently works for the Embassy of Malta in Paris where he serves as Executive Assistant to the Ambassador. Jason holds a Master’s in Terrorism, Security and Society at King’s College London concentrating on a comparative analysis between Al-Qaeda and the Islamic State. He also obtained a Bachelor in International Relations from the Institute of International Relations in Paris.