ESC

025ESC 17 E

Original: English

NATO Parliamentary Assembly

SUMMARY

of the meeting of the Economics and Security Committee

Grand Ballroom 1

Hilton Istanbul Bomonti Hotel & Conference Center

Istanbul, Turkey

Saturday 19 November2016

2016

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025 ESC 16 E

ATTENDANCE LIST

ChairmanFaik OZTRAK (Turkey)

General RapporteurJean-Marie BOCKEL (France)

President of the NATO PAMichael R. TURNER (United States)

Secretary General of the NATO PADavid HOBBS

Member Delegations

BelgiumLuk VAN BIESEN

BulgariaTchetin KAZAK

CanadaJoseph A. DAY

Cheryl GALLANT

Matt JENEROUX

Steven MACKINNON

Jean RIOUX

Czech RepublicAdolf BEZNOSKA

FranceMichel BILLOUT

Jean-Luc REITZER

GermanyCharles M. HUBER

Ralf JÄGER

GreeceEvangelos BASIAKOS

Konstantinos KATSIKIS

ItalyAndrea MANCIULLI

LatviaIvans KLEMENTJEVS

LuxembourgNancy ARENDT KEMP

NetherlandsMenno KNIP

NorwayChristian TYBRING-GJEDDE

PolandWaldemar ANDZEL

Michal SZCZERBA

PortugalLuis Pedro PIMENTEL

SpainRamon MORENO

TurkeyOktay VURAL

United KingdomMartin DOCHERTY

Michael GAPES

Lord HAMILTON of EPSOM

Bob STEWART

United StatesJames SENSENBRENNER

Associate Delegations

ArmeniaMikayel MELKUMYAN

AustriaHubert FUCHS

Harald TROCH

AzerbaidjanGudrat HASANGULIYEV

FinlandEero HEINALUOMA

MontenegroObrad Miso STANISIC

SwedenKenneth G. FORSLUND

SwitzerlandIsidor BAUMANN

UkraineOlga BELKOVA

Yurii BEREZA

Iryna FRIZ

Mustafa NAYYEM

Regional Partner and Mediterranean

Associate Member Delegations

AlgeriaMohamed BENTEBA

Speakers Sanj SRIKANTHAN

Deputy Executive Director and Vice-president Europe, International Rescue Committee

Mehmet ŞIMŞEK

Deputy Prime Minister of the Republic of Turkey

Dr Daniela SCHWARZER

Director of the Research Institute, German Council on Foreign Relations (DGAP)

International Secretariat Paul COOK, Director

Anne-Laure BLEUSE, Coordinator

Loïc BURTON, Research Assistant

Committee SecretaryCharlotte LITTLEBOY

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025 ESC 16 E

  1. Opening remarks by Faik OZTRAK (Turkey), Chairman
  1. In his opening remarks, Faik Oztrak (TK)welcomed all members of the Economic and Security Committee to his home country of Turkey. He also thanked his colleagues in the Turkish delegation for all their efforts in preparing the NATO Parliamentary Assembly 2016 Annual Session in Istanbul.
  2. Mr Oztrak also noted that several leadership positions in the Committee would be open due to expiring mandates and departures from national parliaments. He went on to list the different open positions and the possible candidates interested in standing for the positions.
  3. Mr Oztrak concluded his opening remarks by bringing the delegates' attention to the NATOPA President's newly published report entitled "Deterring to Defend: NATO After the Warsaw Summit". The report included an updated analysis of threats confronting Allies and recommendations on necessary responses.
  1. Adoption of the draft Agenda [165 ESC 16 E]
  1. The order of the agenda was slightly changed, putting the consideration of the draft Report of the Sub-Committee on Transition and Development The Corruption-Security Nexus ahead of DrSchwarzer's presentation on An Assessment of the Current Transatlantic Economic Relationship. After this minor modification, the draft Agenda was adopted.
  1. Adoption of the Summary of the Meeting of the Economics and Security Committee held in Tirana, Albania, on Saturday 28 May 2016 [123 ESC 16 E]
  1. The Summary of the Meeting of the Economics and Security Committee held in Tirana was adopted without comments.
  1. Procedure for amendments to the draft Resolution Allied Defence Spending [190ESC16 E] presented by Jean-Marie BOCKEL (France), General Rapporteur

6.Mr Oztrak reminded delegates that the deadline for amendments to the draft Resolution was on Saturday 19 November 2016 at 10:30am and that they were to be handed to Committee Secretary Charlotte Littleboy.

  1. Consideration of the Draft Terms of Reference for the Committees and the Mediterranean and Middle East Special Group [217 SC 16 E]
  1. The delegates had no comments and the Draft Terms of Reference were adopted as they had been drafted. This document [217 SC 16 E] was later formally adopted during the Standing Committee meeting.
  1. Presentation by Sanj SRIKANTHAN, Deputy Executive Director, Vice-president Europe, International Rescue Committee, on The Europe Refugee Crisis in the Context of Global Displacement, Conflict and Security Challenges, followed by a discussion period
  1. Sanj Srikanthan opened his discussion with a short description of the International Rescue Committee's (IRC) history and mission. He noted that the IRC was founded in 1933, during a period of international upheaval and political instability in Europe. Its initial purpose was to resettle refugees in the United States. As the world has changed, so has the IRC's mission. Ten years ago, there were approximately 35 million displaced people around the world. Today, the figure is around 65 million and continues to increase. The IRC now works in Greece, Serbia and Germany as well as the Middle East, Africa and Asia. It has garnered a first-hand understanding of what drives this vast movement of people.
  1. Mr Srikanthan also noted that inter-state conflict - for which NATO was originally designed to deter - was becoming more infrequent and that, conversely, wars within states and against armed opposition groups were on the rise. This trend was related to the increase in asylum seekers, as the top three refugee-producing countries - Syria, Iraq and Afghanistan - were each experiencing varying degrees of internal conflict. However, Mr Srikanthan was quick to note that not all those fleeing these countries were refugees, as opposed to migrants. He added that people smugglers were a symptom of the problem rather than its cause.
  1. Mr Srikanthan pointed out that if economic migrants were the only problem with which Europe today must contend, the continent would be facing a much simpler and smaller crisis. Conflict is nowdisplacing huge numbers of people with many fleeing to third countries. Those who remain in countries like Syria are increasingly hard to reach. For example, 2.6 million Syrians currently receive little to no aid. With no sign of peace on the horizon and limited access to work and education - many digitally - connected Syrians see their best chance of survival in Europe.
  1. Mr Srikanthan stressed that humanitarian aid is only a short-term response to a long-term crisis. Indeed, aid alone is not sustainable for a multi-year response and more durable development solutions need to be found. Improving livelihoods and access to education and healthcare through partnership such as the one established with McKinsey in Jordan has helped spark job creation.
  1. Mr Srikanthan explained that assisting refugees is not only a moral cause, but also an economic one. The current figure of 65 million displaced persons - a share of whom are seeking a better life in Europe and North America - could become 100 million by 2030 if these issues are not addressed. When the crisis began, Europe was not prepared to cope as the common asylum system was incapable of responding to a crisis on that scale. Mr Srikanthansaid that it is very important for Europe to distinguish refugees from migrants, improve many refugee related programs and emulate the resettlement system in the United States. It should also improve partnerships with first countries of asylum in Africa and the Middle East in order to create sustainable opportunities for individuals in those countries. He suggested that together, these measures could change the views and calculations of those thinking of attempting the Mediterranean crossing, and improve the livelihood of people.
  1. Mr Srikanthan concluded his presentation by looking ahead and asking whether we would see another 1 million refugees arrive in Europe in 2017. Some of the steps taken such as compacts, better aid as well as a more cohesive response within the European Union could help control numbers, he suggested. This would be in the interest of both refugees and European governments. Also, as conflicts within states were running for longer, there was a collective responsibility to respond and prevent them at the earliest opportunity since they lead to displacement—not for months but for years. Lastly, new aid deals were starting to appear, with conditional aid tied to greater transparency and efficiency. Solutions were not going to be found in the countries experiencing conflict. Efforts had to be led from countries like the member states represented in the Committee to work together and offer practical, realistic policy solutions.
  1. During the discussion, questions were raised about the International Rescue Committee's actual role. Mr Srikanthan explained that the IRC works in 35 countries, focusing on providing services in places characterized by poverty and conflict and where government is weak. Rather than moving vulnerable individuals, the IRC worksas close as possible to conflict areas in order to minimize the "pull factor". He added that it was fair to be critical about the IRC and other aid agencies but it is essential to consider the broader framework in which aid is currently delivered. Other members also asked what would be the best policy-making mix when delivering aid. MrSrikanthan responded that the solution would not be more money allocated to NGOs, because civil society alone was not capable of bridging the current gap. Instead, it was about strengthening donor and host government capacity to respond to crises.
  1. Members also posed questions about the distinctions between refugees and migrants and ways to identify the two. Mr Srikanthan replied that the IRC referred to the 1951 UNHCR convention to determine whether an individual is a refugee or a migrant, but that is up to governments to determine whether a candidate for refugee status has a legitimate fear of persecution in his or her home country. The IRC focused solely on refugees, but at the moment, the two are frequently put into the same policy pot without a clear distinction. Others members raised similar concerns about the distinction between refugees and migrants. Mr Srikanthan responded that although the definition was clear, it is the actual determination that posed problems: "How do you interview someone and make a determination that they are a refugee or a migrant?" The resettlement process made this determination easier through verification, since people applied to be resettled from the country where they first sought shelter. Finally, citing the 1951 refugee convention, a member explained that the document guarantees a temporary protection until it was safe to return, which was different than a permanent integration in the host country population. Mr Srikanthan agreed that integration, resettlement, and citizenship were not ensured in the convention. However, a number of conflicts have endured for years and this has blurred some of the finer distinctions made in international law.
  1. Looking at the IRC’s work in specific countries, members asked questions about Ukraine and Syria. Mr Srikanthananswered that to deal with the 2 million internally displaced persons in Ukraine due to Russian aggression, a more concerted response and support should be formulated. The IRC was previously working in Ukraine, but was no longer welcomed by authorities in eastern Ukraine. Aid agencies are oftendenied access to some areas in need of support. With regard to Syria and the establishment of a safe zone to deal with the refugee crisis, Mr Srikanthan explained that, in principle, a safe zone is an attractive notion as they can provide stability and safety for civilians. There were,however, pragmatic challenges to consider such as its location, the ability to provide services in these regions, and most importantly whether there would be a guarantee that the safe zone would indeed be safe.
  1. Summary of the future activities of the Sub-Committee on Transition and Development by Jean-Luc REITZER (France), Vice-Chairman of the Sub-Committee
  1. On behalf of Chairman Francis Hillmeyer (FR),Jean-Luc Reitzer (FR) reviewed the activities of the SubCommittee in 2016. He noted that the ESCTD participated in a seminar in Kyiv, Ukraine in June as well as a visit to Canada and to New England in the United States in September. He noted that both visits were very instructive. Mr Reitzer also presented the proposed SubCommittee activities for 2017. First, the ESCTD would visit Serbia and the Former Yugoslav Republic of Macedonia[1]. The second visit in 2017 would be to Slovenia, in the format of a RoseRoth seminar in November.
  1. Summary of the future activities of the Sub-Committee on Transatlantic Economic Relations, by Menno KNIP (Netherlands), Chairman of the Sub-Committee
  1. Menno Knip (NL) reviewed the activities of the Sub-Committee in 2016. The ESCTER first took part in a seminar in Rabat, Morocco in April, and then visited Washington D.C. and Chicago in May. Looking ahead, Mr Knip presented the proposed Sub-Committee report topic and visits for 2017. Although the Sub-Committee's Rapporteur Ossur Skarphedinsson (IS) was no longer serving in the NATO PA, Mr Knip suggested that the Sub-Committee produce a report in 2017 report on Assessing and Mitigating the Cost of Climate Change. The ESCTER would have a joint visit with the Sub-Committee on Transatlantic Defence and Security Cooperation to Svalbard, Norway in May and would likely also visit Canada.
  1. Presentation by Mehmet SIMSEK, Deputy Prime Minister of the Republic of Turkey, on Outlook for the Turkish Economy, followed by a discussion period
  1. Mehmet Simsekbegan his presentation by looking at global growth in the past years. Growthhas remained below long-term averages since the global financial crisis, suggesting that the world economy was stuck in a "low growth trap". The driving factors of this phenomenon were rising protectionism—discouraging further globalization and international trade—as well as ageing populations, weak investments leading to a fall in productivity, highly indebted private and public sectors, and the slowing down of structural reforms implementation.
  1. Mr Simsek backed up these claims with figures. From 1960-2008, global trade was growing twice as fast as global growth. It was now growing at less than 50% of global headline growth, indicating that globalization could well have peaked. Global population growth had slowed. In the last 60 years, the population share of individuals aged 65 or more had grown from about 5% to just over 8%, and looked set to increase to 16% over the next 35 years. Working age population, on a 5-year cumulative basis, was declining at a dramatic pace. It had once grown at 12% on a 5year basis, but was now growing at 6% and set to decrease to less than 3% by 2050. Moreover, since the financial crisis, global investment had been the weakest since the 1970s and, as a result, productivity growth had been declining. The world had accumulated a great deal of debt over this period. Since 2008, USD60 trillion had been added to global debt, pushing debt-to-GDP on a global scale over 200%. The combination of low growth, low inflation and massive amounts of debt was bad news as it made debt servicing much more difficult. Indeed, corporate bankruptcies were at an all-time high in 2016. One would expect reforms to kick in, but instead, the pace of reform implementation in OECD countries had slowed across the board. Global growth could possibly decelerate from the current 3% to possibly 1%.
  1. Mr Simsek then shifted to discussing the state of the Turkish economy. Although the country went into a recession following the financial crisis, recovery was swift and strong. Looking at the last 15 years, Turkey's real GDP growth was about 4.7% per year, leading to a genuine convergence with the EU. Its per capita GDP rose from about 1/3 of EU average to just over 53%. However, there had been a slowdown relative to pre-crisis growth of almost 7% due to domestic and external shocks. Mr Simsek presented both the external and internal shocks that explained this economic slowdown. The referendum in 2010, the general election in 2011, four elections in 2014-15 and the failed coup attempt of July 2016 had all triggered the kind of uncertainty that discourages economic activity. Beyond the financial crisis, other external shocks had also affected the country's economy. The Eurozone debt crisis, geopolitical tensions following the Arab Spring, and tensions with Russia over the Russian military plane shot down by the Turkish military had all factored into the economic slowdown. In addition, the rise in terrorist attacks in the last few years had a significant impact. In 2016, the fall in tourism activity in Turkey alone cost the country 1.2percentage points in GDP growth.
  1. Mr Simsek concluded his presentation by discussing the need for structural reforms in Turkey but also in the rest of the world. Following the financial crisis, a significant reform effort helped Turkey move from being a middle-income country to an upper middle-income country. A massive sectoral transformation program aimed at improving competitiveness, reforms of the education, judicial and public administration sectors, and the EU accession process had helped move Turkey into this higher income bracket. Mr Simsek suggested that Turkey and the EU needed each other to strengthen the rule of law, to enhance standards of democracy and improve the quality of institutions.