In just a few decades the Turkish economy has been transformed from an agro-economy to a differentiated economy with a clear divide between west and east. Western Turkey enjoys dynamic industrial development and a flourishing tourism sector. Industry contributes 25 percent of aggregate value added, and the service sector more than 60 percent.

Eastern and south-eastern Turkey have a relatively underdeveloped infrastructure and are heavily dependent on agriculture. More than 40 percent of the workforce is employed in agriculture, which contributes around 13 per cent of aggregate value added. Low-income families and middle-class earners have lost out most in Turkey’s liberalisation drive, which brought about rapid economic growth in the country, albeit accompanied by an increasing inequality in incomes.

Lower inflation notwithstanding, real income has not risen in step with economic development. Large parts of the population were forced close to subsistence level. The rural population is migrating from the eastern and south-eastern regions to the cities and industrial centres of western Turkey in search of work.

This rapid urbanisation is causing problems, with the municipal administration overburdened by the strong influx of migrants into the cities and urban services unable to meet the demands they are generating.