Turkey Pulse

Turkey hits jackpot by privatizing gambling

Article Summary
Turkey’s government has decided to privatize all games of chance, driven both by religious motives and financial woes.

In Turkish mosques, imams will sometimes speak against games of chance, preaching to the devout that getting rich without labor and earning more than one deserves is religiously forbidden.

Such sermons could be considered natural, since most religions frown on gambling. What is not natural, though, is that Turkey’s Religious Affairs Directorate (RAD) produces fatwas to fit government policies. On Aug. 29, the 88-year-old National Lottery Agency was privatized with the backing of a RAD fatwa that declared lotteries to be illegitimate.

The Justice and Development Party (AKP) government has moved to privatize all games of chance, both to get rid of criticism by conservatives that it is “sponsoring gambling” and to put some fast money in the treasury’s coffers. The games of chance, however, will continue uninterrupted, run by the private sector. Moreover, those companies are expected to offer new games and further expand the sector.

Following a briefing by the Finance Ministry, Prime Minister Ahmet Davutoglu said, “The state must completely pull out from the games of chance sector.”

The premier’s statement signals that Sports Toto and the Horse Racing Authority will be also sold off soon. With Turkey's economy in a downturn, privatization revenues are whetting the government’s appetite.

$2.7 billion from National Lottery

The National Lottery Authority, whose inception can be traced to the dying years of the Ottoman Empire, when lotteries were held from donations collected for navy warships, was privatized two months ago. The agency, through which the government generated $7.3 billion Turkish lira ($3.2 billion) in 10 years, was acquired by the Net Sans-Hitay joint venture for $2.75 billion.

Yet, the sell-off did little to soothe the critics, who demanded that all games of chance be scrapped. “We are faced with the reality of gambling gripping Turkey in the guise of games of chance. The government intends to privatize the games of chance to wash off its hands. This would amount to saying, ‘We don’t do it as a state, but you go ahead with the private sector.’ People will be further encouraged through a series of new games and television ads,” the conservative newspaper Milli Gazete wrote.

In remarks to Al-Monitor, former RAD head Mehmet Nuri Yilmaz said that the privatization plan was driven by the government’s fervor to generate funds, no matter how. He, too, asserted that lotteries were prohibited under Islam. “Even though they are not exactly equivalent to gambling, games of chance such as the lottery and numerical lotto are all religiously forbidden because they involve no labor and no effort. In Islam, businesses devoid of labor are not legitimate,” he said.

And what happens when the games of chance are privatized? “It’s all the same when the private sector operates them. Nothing changes. It’s forbidden,” Yilmaz said. “They privatize everything, but even then the government still benefits from the games of chance. It makes no difference if they are run by the government or privatized, they are equally illegitimate. The Tekel company, which sold alcoholic beverages, was also privatized. That’s not halal either. They are all the same. But the state doesn’t care what is legitimate and illegitimate. It is after the money, no matter where it comes from.”

Another former RAD head, however, disagrees. According to Suleyman Ates, lottery is not illegitimate as long as it does not consume people’s time. “People buy a ticket and then keep it somewhere or forget about it. This is not something that wastes a person’s time. You only buy a ticket. The other games, however, consume time and are illegitimate. The lottery is not something very good but is not illegitimate either,” Ates said.

Though religiously objectionable, the games of chance have been a golden goose for the AKP government, generating a total of 41 billion Turkish lira ($18 billion) over the past decade. Not surprisingly, two new games — a numerical lotto called Lucky Ball and the Iddiaa sports-book — began under the AKP.

The number of licensed agents has also significantly grown, reaching 6,000 from 1,000 in 2002. Lutfu Turkkan, a lawmaker of the opposition Nationalist Action Party (MHP), said that the new licenses were being issued to AKP cronies, and that the agencies to be privatized in the coming days would equally land in companies close to the AKP.

Some opposition lawmakers have also aided the government in laying the ground for the privatizations. “You keep talking about the commandments of religion. But who invented the Lucky Ball? Which of you are the inventors? Who invented Iddiaa? The horse races used to be held twice a week. Now you have the horses racing seven days a week, and even during the night! Who is making money from gambling? You are the ones, aren’t you?” Muharrem Ince of the main opposition Republican People’s Party (CHP) said in parliament in October 2013.

Shortly after Ince’s bashing, then-Prime Minister Recep Tayyip Erdogan announced, “The state will no longer be sponsoring betting. Sports Toto, the National Lottery and all betting games will be privatized.”

Davutoglu’s latest statement shows he will take up where Erdogan left off. Pressing ahead with privatization, the government intends to kill two birds with one stone: It would get rid of criticism of condoning “gambling” while bagging some $10 billion, the sum expected from the sell-off of Sports Toto and the Horse Racing Authority.

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Found in: turkey, private sector, justice and development party, fatwa, business & finance

Tulay Cetingulec is a Turkish journalist who has worked for Sabah and other Turkish newspapers and magazines such as Dunya, Nokta and Aktuel, covering finance and politics. She has also been a news programmer at Turkish television's Channel 6 and TGRT.  

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