Turkey Becomes a Test Case for Including Refugees in Its Economy

Scholarships, scholarships, scholarships. That was the one-word song that many nongovernmental organizations sang early on in the Syrian refugee crisis, as young Syrians who fled the civil war in their homeland struggled to gain access to higher education.

Over time the language has shifted to words like employment, entrepreneurship, and economic inclusion. Turkey, with the largest economy in the central Middle East and the most Syrian refugees, could be the primary testing ground for finding out if new migrants can participate in a host-country economy. Lebanon and Jordan, which already had high youth unemployment when the Syrian conflict started, have largely frozen Syrians out of economic participation.

The current state of economic integration of Syrians in the region was reviewed at a conference in Istanbul this month, “Economic Inclusion & Livelihood Development of Young Refugees in the MENA.” The conference was organized by Spark, the Dutch nongovernmental organization focused on higher education and entrepreneurship in post-conflict countries, with the support of multiple partners, including the Islamic Development Bank.

Gender Imbalance

Statistics from the Turkish Directorate General of Migration Management give a portrait of Syrian economic participation in Turkey. The Turkish agency says that out of the more than 3.5 million Syrians in the country, just over two million are of workforce age, from ages 15 to 64. Of those, more than 900,000 are employed.

But the participation is considerably out of balance between women and men: Some 832,000 working Syrians are men and 105,000 are women. A Turkish nongovernmental organization working with Dutch funding had similar results: Out of 3,000 work placements for Syrians, only 8 percent were for women, although the organization is now making strong efforts to ease that inequality.

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Nearly 38 percent of the Turkish work permits issued were for entrepreneurs. (The term is now broadly defined to include those trying to sell crafts or food, not just those trying to start a business that would employ others.)

“The market conditions in Turkey and the entrepreneurial spirit of the Syrians is helping their integration,” said Basak Saral, an administrator with Building Markets, a nongovernmental organization that supports entrepreneurs in multiple developing and middle-income countries.

But promoting entrepreneurship in the Middle East can be controversial. Critics complain that government-controlled businesses monopolize many economic sectors, and the intellectual property and legal environments in Arab countries do not always support entrepreneurs. In addition, some cities and countries are actively blocking Syrian entrepreneurs, even when they are working at home or on the Internet. (See a related article, “Syrian Refugees Are Often Steered Into Illegal Jobs.”)  To lure refugee youth into hoping they can be entrepreneurs is setting them up for harsh disappointment, skeptical potential donors say.

Improving Support for Entrepreneurship

Abdul Razzak Al Qattan, a Syrian businessman in Turkey, says that more could be done in Turkey and elsewhere to support entrepreneurs. Al Qattan had $400 when he first moved to Turkey with his wife and daughters, yet he eventually built a successful food business. He exports his products and says at one point he had a payroll in Germany of a million euros a year. But he had difficulty financing his business through traditional means, and German banks made it difficult to open a commercial account because of his nationality, he said. “Not one bank would help us,” he said.

Jamal Haddad, general manager of the Palestine for Development Foundation, a nonprofit organization that supports economic and social development, said investors should not be afraid to lend money to Syrians or Palestinians in the diaspora. The foundation, he said, has had a “zero repayment problem” in the loans it has made in Palestine and Lebanon to those trying to start small businesses.

In a session focused on women trying to start businesses, one speaker said entrepreneurs need more than money to get started. They need legal support to understand the laws of the country they are working in, she said, language courses that are specialized for their businesses, and workspace or office space, since refugees do not generally have extra space in their homes. Syrians usually have great difficulty traveling and getting visas, and so those interested in exporting and seeking access to foreign markets will need help, she said.

In Turkey, Sadettin Akyil, a government official, said barriers are also slowing the traditional employment of Syrians. Employers don’t always know work-permit rules, aren’t familiar with government incentives for hiring Syrians, and are concerned about hiring Arabic speakers in a Turkish environment. Potential Syrian employees, he said, worry about losing the aid they get through the European Union-funded Emergency Social Safety Net for refugees in Turkey.

Turkey could improve the economic integration of Syrians, Akyil said, with more language education, on-the-job training that goes beyond classroom training, vocational education, and inclusion of Syrians in public works projects that could benefit Turkey. The government needs to continue to map out issues like where the jobs are and where the employable Syrians are.

Turkey, despite the recent plunge in its currency and a debt crisis, has a strong economy relative to its neighbors due to strong agriculture, manufacturing and service industries. But that economy is expected to stay flat or even shrink this year, according to a recent Reuters poll. As in other countries, refugees are often perceived as a drag on the economy. Speakers at the conference emphasized that Turkey and the Syrians living there could work as productive partners.

“The right to work is a human right, but many countries do not recognize this right,” said Bart van Bolhuis, consul general for the Netherlands in Istanbul. “It’s the right thing to do. It’s also the smart thing to do.”

Tension Around a Pledge

Some of the employment for Syrians comes from the European Union’s pledge of 6 billion euros to Turkey in return for its restricting migration up into Europe. Both sides seem a bit disappointed about how that deal is working out. “Turkey says it has been let down,” said the conference’s moderator, Ali Mustafa, a broadcast journalist with TRT World, a Turkish English-language channel.

Steven de Vriendt, manager of the European Union Trust Fund in Response to the Syrian Crisis, often known as the Madad Fund, said that the first 3 billion euros has been released for spending, but the rate of disbursement would depend on the rate at which Turkey could implement programs. Such issues as security vetting of workers who might be employed by the Turkish Red Crescent and government policy shifts in response to elections have sometimes slowed the rate at which the European money can be spent in Turkey, he said.

Despite all of the obstacles toward economic integration, the conference, at least, struck a positive note and signals a shift in where refugee-focused work in the region may be headed.

Yannick du Pont, the founder and director of Spark, said that the organization has awarded 9,000 scholarships to Syrians. But 4,500, he said, have now graduated and are looking for jobs. With experts estimating most Syrians refugees will keep their refugee status for 10 to 15 years, economic inclusion is the new development anthem.