Turkey has become the world’s largest refugee-hosting country, with 3.7 million Syrians under temporary protection and over 320,000 refugees and asylum seekers of other nationalities. There are 2.2 million Syrians of working age (between 15 and 65 years old) but only one per cent of them have been working in the formal sector due to bureaucratic difficulties in accessing the labour market, insufficient legislation and administrative hurdles.
Syrians who suffer labour discrimination are motivated more by push than pull factors and have formed more than 20,000 micro, small and medium enterprises (SMEs), accounting for 562 million US dollars of capital despite 80 per cent of them being micro-sized businesses with fewer than 10 employees. In addition, some Syrian entrepreneurs moved their businesses to Turkey after 2011 and continued their entrepreneurship as a way of improving their living conditions and breaking away from the difficult refugee situation. Several factors play a significant role in enabling Syrian refugees in Turkey to access self-employment, such as previous experience, diaspora networks and family support.
The effects of Syrian SMEs on the economic development of Turkey are impressive, employing seven per cent of their communities. Syrian-owned SMEs contribute to solving unemployment and informal employment problems, which are considered the main difficulties of the country. They export to neighbouring countries using their extensive networks in the Arabic-speaking Middle East and North Africa. These exports have led to an increase in Turkey’s limited trade relations with these countries. Syrian entrepreneurs are more export-oriented (55 per cent) compared to their Turkish counterparts (31 per cent) because language barriers and lack of integration prevent them from accessing the local market. They have contributed to the Turkish economy by bringing new products and services, client networks and niche skills in manufacturing and trade industries that have paved the way to new export destinations.
However, the potential contribution of refugee enterprises to Turkey’s economy is often hindered by challenges and barriers. Turkey’s legal and administrative procedures often create obstacles for Syrian entrepreneurs to start businesses and enhance their capacity. Three main legal and administrative challenges negatively affect refugee businesses in Turkey.
The first is the temporary protection status of Syrian entrepreneurs and their limited mobility within the country. In the current legal framework, Syrians are not free to choose where to live. They have to stay in designated satellite cities and report to the provincial authorities regularly. If conditional refugees or subsidiary protection beneficiaries fail to comply with the reporting obligation three consecutive times without an excuse, or leave the place of residence without permission, their asylum applications will be considered withdrawn. It should be underlined that Turkey’s policy of compulsory residence in satellite cities has a negative impact on the integration of refugee entrepreneurs in the Turkish economy, hindering their ability to enhance their capacity.
Secondly, Syrian entrepreneurs must get a work permit from the Ministry of Labour and Social Security to register their businesses officially and must renew them every year, but this is not a straightforward process. There are often delays of up to six months in processing a work permit application. Because of these difficulties, Syrian entrepreneurs have to work in ‘grey’ business areas and cannot officially employ any staff, leading to both employers’ and employees’ having to continue working within the informal sector. This situation causes a state of permanent vulnerability. Being in the informal sector keeps the business small and limits entrepreneurship’s benefits for the Turkish economy. Furthermore, these informal refugee ventures operate without the oversight of municipal controllers, health inspectors or tax officers. This leads to growing resentment from Turkish SMEs, as there is a perception that the state provides unfair advantages to Syrian SMEs. This has recently resulted in tensions between the Turkish and Syrian communities in cities where these refugees live.
Lastly, support to Syrian refugee entrepreneurs is fragmented and often dependent on a specific time and limited funding streams. Despite the Turkey Global Compact’s potential to generate employment opportunities for refugees and host communities through international preferential trade arrangements, it falls short in creating formal job opportunities. There is a need for macro-economic analysis and a national road map that identifies gaps and opportunities for the socioeconomic integration of refugees into the Turkish economy. There are many international organisations and NGOs working on refugee entrepreneurship but these are doing very similar studies in a dislocated way. Public- and private-sector coordination is not very well established due to deficiencies in the integration policy framework. Many vocational courses or entrepreneurial support services do not match the real needs of the private sector. Thus, public resources and international funds are not used effectively. In addition, gender-specific support for women who want to start their businesses faces challenges in obtaining funding, sourcing guidance and finding partners. There are many gaps and uncertainties about the sustainability of women’s cooperatives or enterprises. Monitoring and mentoring are very important even if the project ends for newly established refugee enterprises.
All of this highlights how Turkish legislation and administrative procedures impose unnecessary restrictions on Syrian refugee entrepreneurs. If the Turkish government were to develop a clearer and more transparent approach by mapping a path to citizenship, resolving the mobility problem and facilitating work permits, such a welcoming environment would contribute to the economic growth of the country and foster refugee enterprises. Turkey should develop a holistic approach and national strategic development plan to transform refugee entrepreneurs’ integration into the Turkish economy. Local government should play a leading role in providing flexible, individual, customised and accessible entrepreneurship counselling for everyone. Municipalities with local chambers and international partners should be forefront actors facilitating refugees’ integration into the local economy and promoting the registration of their businesses.
Hülya is a Lecturer of Law in the School of Law at Bolton University.
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