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EMRE DELİVELİ > Building airports versus airplanes

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When you land in São Paulo Guarulhos International Airport, go through international arrivals to the parking lot and then drive to the city, you immediately notice that Brazil’s infrastructure is way behind Turkey’s.

Because of the neglected roads, you are treated to a bumpy ride even in the poshest neighborhoods. The Rua Oscar Freire, the city’s equivalent of the chic Istanbul neighborhood Nişantaşı, becomes flooded with every rainfall. Most of the buildings in the business district look quite old, with little new construction going on.

On the contrary, after landing in Istanbul visitors are greeted by the immaculate Atatürk Airport. They see brand-new high-rises and shopping malls sprouting like mushrooms on the way to their hotel. When I was in Istanbul at the beginning of the month after a three-month hiatus, I almost became disoriented in the business district of Maslak because of all the new skyscrapers there.

You can see this construction-led boom in the data as well. Unemployment has been held at bay by the rise in employment in the construction and public sectors. Interestingly enough, this “Lego-nomics” led by the state-run Housing Development Administration (TOKİ) is almost never mentioned in foreigners’ narratives of Turkish economic success. Instead, the emphasis is on the emergence of conservative businessmen, the so-called Anatolian Tigers.

There is certainly some truth to this story. Even the traditionally Istanbul-dominated business association TÜSİAD’s new board has quite a few tigers. With the government’s push, the tigers have been exporting more and more into new markets in Africa and the Middle East.



But the devil is in the details. Most of these exports are technologically unsophisticated products. On the other hand, I was reminded of Brazil’s mid-range airplane manufacturer Embraer when I flew to Buenos Aires from São Paulo on Feb. 10 in their E-190 aircraft.

Of course, Brazil is not South Korea, and Embraer’s success story is quite complicated. But the fact is that a Brazilian company is one of the global leaders in a very sophisticated product, which it exports all over the world. While Turkish home appliance maker Beko has claimed the top spot in the U.K. market, we just don’t have the equivalent of Embraer.

Why? Why does a TV manufacturer (Vestel’s Zorlu) build a huge residence and shopping mall in Istanbul rather than new factory? Why are many Turkish engineers working in finance rather than practicing their tools of trade? Why is Turkey at the bottom of OECD’s PISA tests for high school students? What is Turkey’s industrial policy? Compared to these questions, my usual columns on the intricacies of Turkish monetary policy seem very trivial.

The brand new Atatürk Airport makes every Turk, including me, proud. On the other hand, Brazilian supermodel Gisele Bündchen greets visitors outside the Guarulhos International Airport as if to make up for the decrepit surroundings. But I would pick building airplanes over airports.

February/15/2013

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