France, the future of the EU and the risks for Turkey - LEVENT YILMAZ

France, the future of the EU and the risks for Turkey

The protests ongoing in France since Nov. 17 entered a new phase as of Monday evening. The “yellow vests movement,” which started following fuel tax hikes and continued as a reaction to the economic problems being experienced in France for a while now, managed to make President Macron take a step back. Well, what do these yellow vests want?

The real problem is the increasing inequalities

Actually, the yellow vests movement represents the burst of anger of the French society which has become relatively poor recently. While they openly protest the fuel tax hikes, high rents in urban areas, low minimum wages and the exemption of large corporations and rich individuals paying tax, on a deeper level they are trying to underline the apparent inequalities in society.

Last week, the fuel tax hikes were suspended for 6 months at first, and when it seemed that the protests were not going to stop it was canceled for the whole of 2019. However, despite all the steps taken by Macron and all the measures taken on last Saturday, a major street protest took place again. Therefore, Macron had to backtrack again. In his public speech he made to ease the protests of the yellow vests, he said, “I accept my responsibility, I hurt people with my words” and declared the economic measures which aimed to end the protests. His plan is to increase minimum wage will be by 100 euros for 2019, overtime work will be exempt from taxation, and the private sector will be asked to pay their employees end-of-the-year bonuses. However, Macron did not take any step for the “wealth tax,” which actually triggered inequalities, and this was the actual move protesters expected him to make. In his statement, Macron declared that he is going to declare “an economic and social state of emergency” and it is calculated that his promises are going to cost around 8 to 10 billion euros.

The unity of the union is in danger

It doesn’t seem possible that Macron’s promises will meet the expectations of the yellow vests. In this respect, it is obvious that the steps taken will not be sufficient. Moreover, some of the critiques say that the steps taken the “yellow vests” courage, hope and the motivation to continue their protests until they get what they want. There is still a risk, even though a minor one, that these protests may spread to the whole of Europe, having already reached Belgium and Holland. Because it is possible to say that Europe is still under the impact of the 2008 crisis.

At a time when Britain is leaving the union, a political actor like Merkel is leaving politics, Italy’s budget is being rejected, and Trump is putting pressure on NATO and trade agreements, the desperate situation that Macron, who is described as the future leader of Europe, has found himself in brings up many questions about the future of the union.

How does this affect Turkey?

The EU is Turkey’s most important trade partner. According to data from October 2018, 49,8 percent of all Turkey’s exports was made to the European Union. Again, 35 percent of all Turkey’s imports are made from the EU. Therefore, a politically unstable Europe will not be good for anyone, especially for Turkey, if we also consider the scenarios for 2019 and 2020 predicting that global economic growth will slow down. Of course, it is not possible to approve the policies of the EU and the main actors of the union against Turkey. However, considering the rapprochement process started in recent days and the customs union agreement, any major development within our most important trade partner also concerns us very closely. In addition, we should not forget that besides the economic risks, these developments also bring about some political opportunities.

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