1. TWENTY YEARS AFTER TRANSITION FATİH ŞAHİN YAŞAR ÖZDEN İNCELER 63085180876 65350080096

2. BEGINNING OF TRANSITION People all over the world have been reviving memories of 20 years ago,when the Berlin Wall was finally brought down. There were the scenes of people coming together again, after years of division and hopeless separation. The peoples of Central and Eastern Europe and their governments walked towards history, driven by the hope for freedom.

3. The past 20 years have been an unprecedented success, both economically as well as politically. Democracy has taken root. The economies have grown. People have prospered. Economic transition equals privatisation, liberalisation and stabilisation.

4. OECD TRANSITION ECONOMICS PROGRAMMES Free prices, Free trade, Free labour markets, Privatization and competition transformed the economies of the Czech Republic, Hungary, Poland and the Slovak Republic.

5. The multiyear efforts of economic stabilisation and structural transformation brought about large benefits. The four countries became magnets for foreign direct investment and a new growth pole in Europe Real GDP per capita expanded more than twice as fast than in most OECD countries

6. OECD members have often distinctive blends of institutional and policy frameworks,reflecting their history and cultures OECD working instuments such as Codes of Liberalisation, were also standards for successful reform

7. LESSONS LEARNED FROM TRANSITION Decades of central planning distorted societies and economies dramatically. The effects are still apparent in differentiated social and economic performance. (East Germany, which was more advanced industrially than the West before the war, but today it is still catching up, in spite of over a trillion Euros’ worth of support for its transition.)

8. LESSONS LEARNED FROM TRANSITION Expectations for a speedy completion of transition were unrealistic. In none of the Central and Eastern Europe countries and the former Soviet Union has transformation been smooth and linear.

9. LESSONS LEARNED FROM TRANSITION Needed stronger institutional transformations  Creating democratic institutions and governance,  new social norms and values,  stronger civil societies,  openness to private organisations and to entrepreneurship,  and a network of regulators is related to this partial reform

10. CURRENT CHALLENGES AND OPPORTUNITIES The lessons learnt during the last 20 years for the economies in transition may shed some light when reconstructing a better world economy. Over the longer term, building knowledge societies and greening the economy would become increasingly important to sustain the prospects for growth

11. CURRENT CHALLENGES AND OPPORTUNITIES It is therefore, vital to continue reforms to improve the business climate in those countries and to create more favourable conditions for a second wave of investment, more tilted towards services, as well as for upgrading infrastructure. This points to the need of increasing investment in knowledge capital, and in creating adequate conditions for R&D activities. In all these areas the OECD is ready to help, as they deliver their innovation and green growth strategies.

12. TWENTY YEARS AFTER : CENTRAL AND EASTERN EUROPE COPING WITH COMMUNIST LEGACY Twenty years after the fall of communism, countries of the former Soviet bloc have democratic political systems, are members of international organizations such as the EU and NATO, and few even have the euro. But their societies are still coping with the aftermath of their totalitarian past, which is proving to be a painful and a much longer process than might have been imagined 20 years ago.

13. TWENTY YEARS AFTER : CENTRAL AND EASTERN EUROPE COPING WITH COMMUNIST LEGACY Right after the fall of communism 20 years ago, the most optimistic forecasts predicted that countries like Czechoslovakia, Hungary and Poland would catch up with the developed and stabilized western democracies in just a few years.

14. TWENTY YEARS AFTER THE FALL OF BERLIN WALL Economically the East German transition proved far more difficult than anyone thought at the outset. East Germans took their political future in their hands in the fall of l989. They can be proud of finally contributing to the downfall of the regime that walled them in.

15. TWENTY YEARS AFTER THE FALL OF BERLIN WALL In essence East Germany can be said to have faced a dual transition: one to capitalism, the second to the post-industrial economy that had taken hold in the non-socialist world, while they remained in their collectivist CMEA cocoon. The East German population similarly wanted welfare capitalism, but got what they saw as neo- liberalism. It was not necessarily a bad deal, but they found it a disquieting one.

16. CONCLUSIONS Specific aspects with regards to the transition economies are facing domestic challenges(Like in mature capitalist countries these countries need to attempt to protect their core financial systems by improving its governance and structure.) A major challenge will be to maintain access to finance for the growth driving SME(Small Medium Entriprises) sector

17. CONCLUSIONS The overriding problem will be the fiscal constraint, which was restricting growth in the past and is now leading the region into deeper recession than the rest of the world. Intelligent industrial policy is required in time of a shrinking private sector and a constraint government budget.

18. CONCLUSIONS Finally it should be emphasized that there were different paths of transition. What seems clear is that even after 20 years transition is not over, in fact the current crisis of global capitalism is the intellectual challenge for thought on formation of human societies

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