The Rarity of Freedom in Erdogan's Turkey: Koza Gold

The Turkish government’s hostile attitude towards businesses and organisations with even the slightest sympathy towards the Gulen Movement has continued unabated for almost a year. The situation had become precarious since allegations of corruption regarding key officials of Erdogan’s cabinet emerged in December 2013, leading to a substantial government reshuffle on Christmas Day. Moreover, the corruption probe was basically sabotaged by the replacement of more than 300 police officers working in the financial crimes unit.

Since last year, the government has adopted a rather aggressive stance towards the Gulen Movement. The very terms used in defining the Islamic movement’s allegedly treasonous acts have become part of a frequently used vocabulary in Erdogan’s political dictionary. Among the charges, the government has often accused Gulen of conspiring with foreign powers to topple the institutions of the Republic; these allegations were brought to a new zenith when a written statement by the National Security Council (MGK) - the authority tasked with outlining the national security priorities of the Turkish state - frontally attacked Hizmet. Vowing to pursue a “resolute struggle” against the “parallel state” - as the Gulen Movement has been defined by government authorities - the MGK and President Erdogan hinted that Hizmet would be inserted in the infamous “Red Book” of national security issues in 2015.

This ongoing campaign has already made it difficult for organisations involved with Hizmet to lead a peaceful existence in Turkey. Bank Asya represents the foremost example of how the government went out of its length, in blatant defiance of the Legal Banking Code, to make sure that the Islamic lender would not see the new year. The most baffling element of this story is that even the most indirect link with sympathisers of the Gulen Movement seems to be enough to attract unwanted and often unfriendly attention from government agencies and pro-government media outlets. In this article, let us divert our attention toward the Koza Mining Group owned by Akin Ipek, whose holdings also include a newspaper and a television channel considered pro-Hizmet.

Koza Mining currently controls seven gold mines throughout Turkey; the group’s first goldmine - located  near the village of Ovacik - was acquired  in 2005. The mine has an average feeding capacity of 100 tonnes per hour, making it one of the most efficient in the country. Other goldmines belonging to the Koza Group are quite proficient in their primary activity, with the Cukuralan and  Mastra plants producing respectively 170,000 and 350,000 tones of ore each year.

And yet, both Ipek Energy and Koza Mining have seen better days on the stock exchange. In December 2013, Ipek Energy  and Koza Gold shares were worth respectively 4.20 and 31.20 Turkish Liras (TRY) on the Istanbul Stock Exchange; however, following the simultaneous mediation crusade against Gulen affiliates, both companies saw their shares plummet. One year on, in December 2014, their shares are currently worth 1.59 TRY and 13.20 TRY on the Borsa Istanbul. This downward trend symbolises a 62% and 57% devaluation in value for respectively Ipek Energy and and Koza Gold. These numbers would seem typical of companies with internal financial problems, and yet here lies the most astonishing fact; the capital and assets of Ipek’s companies are in robust and healthy shape, leading to the feeling that the fall in market value could actually be due more to government pressure and media attacks on Gulen-sympathising entrepreneurs.

Koza Gold is just another example of how rule of law seems more and more a rare commodity to find under Erdogan’s government. By itself, the facts surrounding Koza Gold would not be enough of an indicator to make this assertion. However, if considered within the context of previous similar examples such as Bank Asya and the growth of a new political climate across the country, the situation becomes increasingly and worryingly clear. Turkey’s political discourse is developing a lexicon of terms - such as “foreign conspirators”, “parallel state”, “resolute struggle” - constantly used by the government to attack individuals and enterprises with no regard for existing legal structures. An old proverb correctly argued that the pen can inflict more severe damages than the sword, and this appears to be true of what is currently happening in Turkey at the moment, triggering anxiety and apprehension about its impact on the flow of foreign investment and capital. The Deputy Leader of the Republican People’s Party, Hursit Gunes, expressed in clear terms that “In a country where corruption and bribery is so very open and widespread, it would be foolish to think that foreign investment would come here or that Turkish investors would be willing to invest”. With a declining rate of foreign investment and a scheduled rise in the interest rates, the consequences of the government’s authoritarian attitude towards individuals holding different opinions is leading the country towards a grim future.