Tongues are wagging in Turkey over President Recep Tayyip Erdogan’s scolding of the opposition about major projects carried out through public-private partnership, arguing that “Companies go to arbitration and they get what they are owed by force.”
But this issue isn’t a debate just in Turkey. A similar situation is playing out in Hungary.
Prime Minister Viktor Orban’s increasing moves violating human rights and democracy and the country’s steady decline toward autocracy recently are being criticized by the opposition.
An ‘opposition bloc/alliance’ has formed against the government in Hungary just like in Turkey. The biggest question for debate in the political backstage of the capital Budapest is major construction projects initiated by Prime Minister Orban with China in defiance of criticism – like in Turkey, again.
The opposition in Hungary is pushing back against the costly Fudan University campus project planned by Orban in the capital Budapest with money borrowed from China. Another costly project the opposition is resisting is the Belgrade railway project that Orban wants to build. The partner for that project is also China. If the railway is built, it will be used for freight transport. It will be used as part of China’s ‘Belt and Road’ initiative.
Hungary’s opposition parties are raising their voices against these two major projects in unison in the lead up to elections to be held in spring 2022. Moreover, they are receiving political support from the municipalities held by the opposition, notably the Municipality of the capital Budapest; similar to the opposition of the Republican People’s Party’s (CHP) Istanbul Metropolitan Municipality to Erdogan’s ‘crazy project’ Kanal Istanbul.
GLOBAL TREND; THE UNITED OPPOSITION
In fact, this united opposition in Hungary is the embodiment of a rising trend around the world: The rise of autocratic leaders marked the past decade globally. The new trend is that the opposition is acting shoulder to shoulder against these types of leaders -even if they come from different ideological wings.
A similar ‘united opposition’ has also been achieved in Israel and the autocratic Netanyahu government has ended with a coalition formed by eight Israel parties from a broad spectrum of political trends. Moreover, there are not only ‘ideological differences’ among the parties in the coalition government of Israel, but also ‘ethnic differences.’ Arabs have also become a part of the government for the first time by getting involved in the coalition in Israel.
When viewed from this perspective, it’s possible to say that the rise of a similar opposition alliance isn’t happening coincidentally against President Erdogan, who has clearly declared that he will build Kanal Istanbul no matter what.
THE ARBITRATION ISSUE…
Of course, there is also the issue about what happens to the tenders for major infrastructure projects signed by the government, despite social opposition, if the government is changed.
International arbitration, which President Erdogan act ‘by force’ in response to the opposition’s threat that they won’t make payments when they come to the power, is now a hot topic.
However, the contract provisions under which governments have signed aren’t sufficient for international arbitration to work. There are some additional conditions which will determine if the relevant companies can win the case.
For instance, these projects shouldn’t have any links with ‘corruption’ nor allow illicit enrichment contrary to the public interest. Additionally, there shouldn’t be any evidence or appearance that the signatory government has ‘used its power to the public’s disadvantage’.
For example, the United Nations Convention against Corruption, to which Turkey acceded, and the Group of States against Corruption (GRECO), established under the umbrella of the Council of Europe, of which Turkey is a member, are international agreements securing all these issues.
The Article 5 of the United Nations Convention against Corruption is very clear:
“Each State Party shall, in accordance with the fundamental principles of its legal system, develop and implement or maintain effective, coordinated anti-corruption policies that promote the participation of society and reflect the principles of the rule of law, proper management of public affairs and public property, integrity, transparency and accountability.”
‘The participation of society’, ‘rule of law’ and ‘proper management of public property’ are all included in the scope of the Article.
The Halkbank case tried in the U.S. and the Sezgin Baran Korkmaz case opened by the U.S. should also be considered from this perspective.