Turkish gov't-controlled wealth fund 'headed towards a parallel state'

Serkan Alan / DUVAR

Main opposition Republican People's Party (CHP) deputy Mehmet Bekaroğlu criticized the opaque workings of the Turkey Wealth Fund (TVF), saying that the fund "was becoming a parallel state."

The TVF is a government-controlled wealth fund established in 2016 that holds all or partial shares in a number of state-run companies, including the tea producer Çaykur, Turkish Airlines, Halkbank, and PTT, Turkey's postal service. President Recep Tayyip Erdoğan and his son-in-law, Finance Minister Berat Albayrak serve as the TVF's chairman and deputy chairman, respectively.

The parliamentary Budget and Planning Commission recently met regarding the 2018 activities and financial statements of the TVF. That’s when Bekaroğlu blasted Erdoğan and Albayrak for not attending the meeting.

“The president, those in charge of auditing and the Turkey Wealth Fund [itself] have not performed their duties. It is really heading toward a parallel state, a parallel financial power. This is not right, and neither you nor the country benefit from it,” Bekaroğlu said during the meeting.

Central audit staff reportedly did not determine why companies such as Çaykur, Turkish Airlines and the Turkish State Railways (TCDD) reported losses and were in debt.

CHP deputy Süleyman Girgin highlighted that Çaykur posted 82 million TL in profits in 2016, but then began to report major losses after it went under the helm of the TVF. In 2017, the tea producer lost 267 million TL, and those losses ballooned to 657 million TL in 2018 and 635 million TL last year. Çaykur's bank debt surged from 1.4 billion to 3.4 billion TL, and the debts of Turkish Airlines and the TCDD also skyrocketed while under the administration of the TVF.

The TVF's CEO Zafer Sönmez gave a presentation at the meeting in which he said that the fund's aim was to develop investment strategies geared toward solving the structural problems in the country's and referenced the construction of the Istanbul Finance Center, which is slated to open in 2022.

Pro-Kurdish People's Democratic Party (HDP) deputy Garo Paylan criticized the presentation, questioning how investment capital will come to Turkey when the country lacks a strong rule of law and economic security.

“I mean, we all know very well that tens of billions of dollars have left Turkey in the past year. Capital is not coming, it is fleeing. You can't have a financial center in a country from which capital is fleeing.”