Cablegate: Tackling Turkey's Problematic Squatter Housing

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RR RUEHAG RUEHAST RUEHDA RUEHDBU RUEHDF RUEHFL RUEHIK RUEHKW RUEHLA
RUEHLN RUEHLZ RUEHROV RUEHSR RUEHVK RUEHYG
DE RUEHAK #6580/01 3391315
ZNR UUUUU ZZH
R 051315Z DEC 06
FM AMEMBASSY ANKARA
TO RUEHC/SECSTATE WASHDC 0178
INFO RUEHIT/AMCONSUL ISTANBUL 1738
RUEHDA/AMCONSUL ADANA 1392
RUEATRS/DEPT OF TREASURY WASHDC
RUEHZL/EUROPEAN POLITICAL COLLECTIVE
RHEHAAA/NSC WASHDC
RUEAIIA/CIA WASHDC
RUEKDAI/DIA WASHDC
RUEKJCS/SECDEF WASHDC

UNCLAS SECTION 01 OF 04 ANKARA 006580

SIPDIS

TREASURY FOR JONATHAN ROSE

SENSITIVE
SIPDIS

E.O. 12958: N/A
TAGS: EAID SOCI PHUM PGOV ECON TU
SUBJECT: TACKLING TURKEY'S PROBLEMATIC SQUATTER HOUSING

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This Cable has been coordinated with Consulates Istanbul and Adana.

1. (U) Summary: For decades squatter settlements have marred
Turkey's urban landscapes in Istanbul, Ankara, Izmir, and Adana.
Prior attempts to solve the issue lacked the creativity and
political will to stem the tide of illegal constructions. As Turkey
looks to integrate further into the global economy as it pursues EU
membership, the GOT has begun to explore different approaches to
tackle this longstanding problem. No longer immune from political
attack, squatters--long viewed as a reliable source of votes--are
now seen as an impediment to economic and political development. PM
Erdogan and other local government officials express growing concern
over and intolerance for illegal housing developments. Most
recently, Turkey's Mass Housing Authority (TOKI) has turned to
large-scale "urban transformation" projects in coordination with
local municipalities to solve the squatter problem. Critics have
voiced skepticism, however, as to the efficacy of such projects,
highlighting the lack of transparency, the failure to coordinate or
consult with a cross-section of urban planning experts, and the
failure to consider social factors unique to squatter communities in
the projects' designs. End summary.

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ORIGIN AND EVOLUTION OF SQUATTER HOUSING
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2. (U) Major squatter settlements began to emerge in Ankara,
Istanbul, and Izmir in the late 1940s during the first significant
rural-to-urban migration waves in Turkey. Lacking in low-income
housing, city centers were ill-equipped to absorb the large influx
of unskilled and highly mobile migrants. Through the illegal
construction of shanty structures known as "gecekondu" on public or
private land, migrants created sprawling squatter communities in
city centers or oftentimes in undesirable marginal locations such as
along steep slopes or in river beds. (Comment: "Gecekondu" refers to
illegally constructed housing in general but literally means "built
overnight") Typical early squatter settlements consisted of one or
two-story houses with gardens or courtyards. Ankara's most visible
squatter settlements surfaced on the hillsides along the Esenboga
airport road where miles of shantytowns created a negative
impression for first-time visitors to the city. In the last twenty
years, the Southeastern city of Adana has also witnessed an upsurge
in squatter dwellings.

3. (U) The private sector and local governments initially tolerated
migrants' illegal squatting, in part, because they were a crucial
source of cheap labor during the industrialization process and also
served as a reliable source of votes for local politicians. While
some established squatter settlements gradually received services
and infrastructure, including roads and bus transportation, city
water and electricity, the issue of legal title remained unresolved.
The government enacted a series of amnesty laws legalizing existing
squatter settlements during the 1960s and 1970s. The 1980s,
however, ushered in a new approach to the cities' increasing housing
dilemma.

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DAWN OF URBAN TRANSFORMATION
----------------------------

4. (U) Although no statistics exist regarding the percentage of
squatters in major cities, local experts estimate seventy percent of
all housing in the metropolitan areas of western Turkey is on plots
that were originally squatted, many of which are still unrecorded
and therefore untaxed. The UN's 2004 Human Settlements report for
Turkey notes that of the estimated total urban population of 37.8
million (60.9% of the total population) in 1995, nearly a quarter
still resided in squatter-type settlements.

5. (U) In the 1980s, not only did new laws legalize existing
squatter areas, they provided development rights to owners or users
of the land, and gave ownership of occupied state land to local
governments to legalize and modernize existing squatter settlements
through designated improvement plans. Former peripheral squatter
settlements also grew more valuable as middle-class apartment blocks
were erected alongside them, and single-story shanties eventually
gave way to "apartment block gecekondus." Former squatters became
owners of these new apartment blocks as a result of amnesty laws,
and a new class of poorer squatter tenants from rural areas emerged.
Although physical improvements to shanty structures were achieved

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during this period, city planning bypassed most of these areas
altogether.

6. (U) In 1986, the Ankara Greater City Municipality (AGCM)
established a planning bureau as a joint stock company whose aim was
to create modern urban environments and improve existing urban
areas. The shareholders of the company were AGCM and its eight
district municipalities. The Dikmen Valley Project, centrally
located in a predominantly middle-to-upper income district of
Ankara, became the bureau's most significant undertaking and the
first "urban transformation" project in Ankara. The project's
success is an open subject of debate among experts in the field of
urban planning. Supporters argue Dikmen transformed a once
depressed squatter area of the city, while detractors criticize the
failure to consider the lifestyle and economic needs of squatters in
the community's high-rise design.

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LEGAL REFORM AND CHANGING ATTITUDES
-----------------------------------

7. (U) After decades of courtship, providing services and
infrastructure to shanty areas in exchange for votes, politicians
have begun to perceive squatters as obstacles to progress and public
safety rather than merely as a reliable source of votes. Public
statements critical of squatters would have been unthinkable from
Turkish politicians five years ago, but times have changed as
evidenced by an April 2006 speech in which PM Erdogan boldly
criticized squatters and advocated for the elimination of "ghettos"
that he likened to "tumors surrounding our cities." Acknowledging
that the politicians who permitted lands to be occupied for squatter
housing were no longer in parliament, he declared an end to
political support for illegal land grabs and expressed a firm
commitment to razing squatter housing throughout Turkey.

8. (SBU) As land prices increase and as more urban residents opt for
peripheral suburban housing, tackling the problem of illegal housing
settlements grows more urgent. Banks currently give out housing
loans as consumer credits, and with steep interest rates, few
low-to-middle income Turks can afford to purchase property.
Legalization of squatter settlements has enriched migrants who
illegally occupied government lands. Murat Dogru, head of Ankara
municipality's projects department, estimated that over the past
twenty years municipalities had essentially gifted millions of
dollars in land to squatters in addition to millions spent on
servicing illegal settlements. Dogru strongly opposes legalization
which he believes penalizes law-abiding citizens and unfairly
enriches migrants by redistributing a government resource belonging
to everyone to just a few.

9. (U) Although charged in 1966 with eradicating squatter housing,
the Ministry of Public Works' (MPW) authority was limited to
upgrading existing housing stock and clearing uninhabitable
settlement areas. In 2000, the MPW's squatter housing fund assets
were transferred to Turkey's Mass Housing Authority (TOKI).
Observers criticize this separation of implementation authority and
funding as dramatic inefficiencies for housing transformation
projects. A new draft amendment to the Squatter Housing Law
transfers all development and implementing authority to TOKI,
allowing it to undertake new development projects or to transfer
them to local municipalities. The largest of the sixteen greater
municipalities--Istanbul, Ankara, and Izmir--are located in
earthquake zones. A second pending draft law, if approved, would
increase municipalities' authority to raze squatter housing in
earthquake regions, particularly in Istanbul where illegal
constructions are on the rise. The proposed law would also grant
tax exemptions for five years to companies that partner with
municipalities to undertake housing transformation projects in these
areas.

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LATEST URBAN TRANSFORMATION/RENEWAL EFFORTS
-------------------------------------------

10. (U) A strong supporter of Turkey's EU candidacy, and mindful
that EU visitors' first glimpse of Ankara would be marred by
unsightly squatter settlements dotting the landscape from the
airport into the city centre, Ankara's mayor, Melih Gokcek, called
the airport road the "gate to our republic" and selected the site
for urban transformation. The Turkish parliament passed the North
Ankara Entrance Urban Transformation Law in March 2004 authorizing

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various agencies to undertake large-scale urban renewal projects and
prohibiting local municipalities from providing services to squatter
settlements. The North Ankara City Entrance Project (NACEP),
involving 3,600,000 square meters of land and affecting 6,500
squatters, became the main impetus for passage of the new law. When
completed, NACEP will boast 18,000 new housing units in Ankara.

11. (U) Ankara officials insist that all 6,500 squatters signed onto
the project which required razing of their current homes and
relocation to temporary housing for several years. The municipality
is providing interim government housing to several hundred families
and a monthly rental allowance to the remaining ones until their new
apartment units are completed. Former squatters will pay the
difference between the value of their old land and/or housing
structures and the newly constructed apartments. In addition to a
ten percent down pament to the municipality, they will make 110
mnthly installment payments for the remaining prce difference.
Ankara officials estimate former squatters will owe approximately
forty-five thousand Turkish lira (approximately 32,000 USD) to the
municipality for a 100 square meter apartment. Murat Dogru, Ankara
Municipality's head project planner, estimates 500 million in
additional income from NACEP through the sale of additional
apartment units. In addition to residences, the project will
include convention and health centers, educational, cultural and
recreational facilities, mosques, ponds, and commercial and shopping
centers.

12. (U) In an effort to combat its growing squatter housing
problem, Adana hatched a project called "Model Adana," which
envisions the construction of 100,000 annual units for squatter
residents to be purchased at $7,000 each. Estimated building costs
of $700,000,000 are expected to be financed through the GOT's annual
Southeast development expenditures for Adana. To date, no units
have been constructed under this plan. TOKI and the Adana
municipality, however, have recently partnered to undertake
privately financed urban transformation projects. Although TOKI
currently has seventeen projects underway in Adana-- an estimated
7,900 units--only two of the projects, totaling 800 units, are near
completion.

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CRITICS WEIGH IN
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13. (U) Critics of urban transformation projects like NACEP argue
that construction of luxurious apartment buildings in former
squatter areas perpetuate rather than solve existing housing
problems. They argue such projects fail to consider the
socio-economic level of the squatters who oftentimes cannot afford
to shop at the supermarkets and commercial centers surrounding their
new apartment buildings. Squatters frequently cannot adjust, for
example, to upscale apartment living and simply sell their units and
illegally squat in other areas of the city. Instead of treating
squatters as homogeneous populations, they emphasize local
governments should develop projects consistent with squatters'
cultural and socio-economic backgrounds and follow a more
case-by-case basis approach. Squatters' communal lifestyle provides
for socialization and networking opportunities, and many critics
warn the elimination of "gecekondu communities" will destroy this
collective character ultimately leading to increased crime and
social exclusion, especially among the youth. Critics predict that
without steady or formal employment, former squatters will be unable
to meet the terms of the municipalities' monthly repayment plans and
many will be forced to sign over rights to their apartment units.

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COMMENT
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14. (SBU) TOKI President Erdogan Bayraktar calls squatter housing
Turkey's "third biggest problem after foreign debt and terrorism."
With twenty different urban transformation projects potentially
affecting 75,000 squatters currently in the works, the magnitude of
the housing problem cannot be overstated. Although the issue is
squarely on the radar screen of many local government officials and
academics, the efficacy of large-scale projects such as Dikmen
Valley and NACEP to address the burgeoning squatter problem remains
to be seen. Turkish academics who have researched squatter issues
for decades express concern over increasing crime and drug abuse
among the youth of squatter settlements, and they are skeptical that
massive urban renewal projects will ameliorate these problems.

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15. (SBU) Local urban planning experts in Ankara voiced dismay and
disgust over the Ankara Greater City Municipality's unwillingness to
include a spectrum of collaborators in their efforts to address the
squatter housing problem. Turkish officials charged with planning
and executing large-scale urban renewal projects could certainly
benefit from collaboration with and input from Turkish and US urban
planning experts. The perception on the ground is that the lack of
transparency in all phases of urban transformation projects--at
least in Ankara--has the potential to lead to cronyism among AK
party-dominated municipalities doling out construction to
party-affiliated firms. With millions of dollars at stake in the
form of construction contracts and revenues from apartment sales,
dividing the economic spoils of such projects appears to take
precedence over tackling the root causes of the squatter phenomenon
in Turkey. Although the GOT's renewed focus on the decades-old
housing problem is encouraging, the price for failing to adequately
address the underlying causes for it will be steep.

WILSON#

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