Grand Bazaar: The Finance Center

In his lectures at the Istanbul University School of Economics, the famous professor of economic history, Ömer Lütfi Barkan, used to gesture towards the Grand Bazaar and say, “It’s just waiting to be researched.” My interest in the Grand Bazaar dates to those days, and my many years of research, directed by Önder Küçükerman, an expert in the field, culminated in a book.

All covered markets are financial centers. Nevertheless, in Turkey we knew them merely as places where money and valuable goods were stored for safekeeping. When I realized that covered markets and bazaars are actually units with functions going far beyond this, I also realized that I had to correct this widespread misconception. Most importantly of all, from a social standpoint, Istanbul’s Grand Bazaar (Kapalıçarşı), is the sole public area that is entirely secular. It is a plain fact that over a period of 500 years a large number of religions and sects built a common culture here without ever coming into conflict. A covered bazaar constitutes a capital unit through the trade carried out in it. Clearly this is not going to come about merely through the storage of money and valuable goods. It is not for nothing that Evliya Çelebi says, “Ottoman towns can be divided into two types, those that have covered bazaars and those that do not.”

There are three covered bazaars in Istanbul and 117 in some 100 towns around Anatolia. Among them four stand out: the markets of Bursa, Tire and Edirne, and the Istanbul Jewelry Market, because, beyond acting as places of safekeeping, these markets have also played a powerful role in shaping the economy in each period. The Jewelry Market (Cevahir Bedesteni) is a perfect example of this. This market, which took five years to build, is the heart of the Grand Bazaar. With its eight columns and 15 domes it is even smaller than the Public Auction Rooms (Sandal Bedesteni) as an architectural entity. But in function it served as a safety deposit box and a market for valuable goods, where financial transactions of all kinds were carried out, where records were maintained of the rise and fall in the value of money and where Turkey’s monetary regime was shaped. IOU’s were paid and goods bartered here. At times debased coins were even put on the market here. And following devaluations, counterfeit foreign currency was even circulated abroad from this market.

Every country strives to maximize its own economic interests. It has always been that way and always will be, and every means, both overt and covert, is employed to this end. It is no coincidence then that next to the bazaar and in the same years not only were ‘monetary foundations’ set up to lend money, but also a ‘simkeşhane’ (literally, silver-wire house), or what we know today as a mint. The first Ottoman mint where coins of all kinds were produced was on Beyazıt Square. The process called ‘tecdid-i sikke’ (renewal of coins), which could be regarded as a sort of mini-devaluation, took place at the mint, and the new coins were circulated from the Grand Bazaar. We know from historical documents that Mehmet the Conqueror had counterfeit Venetian coins minted during the war with the Italian Republic.

When Sultan Mehmet the Conqueror, aka the Caesar of Rome, conquered the ‘Orbis Romanus’, he commissioned the construction of the Kapalı Çarşı (Grand Bazaar) and the Bedesten (Jewelry Market), which soon became the Mediterranean basin’s largest commercial and financial hub of the day. This sultan was characterized by a global outlook and was in that sense a true emperor, who was able to see beyond his own time and generate timely and unering solutions, a ruler who clearly grasped the spirit of the age.

The Jewelry Market of the Istanbul Grand Bazaar has turned to gold and adornments today. The Auction Rooms meanwhile are a sales outlet for gift items in general and are still in search of an identity. The same can be said of all the markets of Anatolia. When an economic function ceases to be, it cannot be kept alive by force. We might look for parallels between the Grand Bazaar jewelry market in its day and Istanbul as an international financial capital today. The similarity lies in Istanbul’s decision to again become a world leader. It is without a doubt interesting that the city should once again aspire to a leadership role as a financial capital after 500 years, and nothing would be more fitting for the only city in the world that straddles the intersection of East and West, looking in both directions. The Union of Banks of Turkey, which spearheaded the idea, envisages Turkey dominating the region in 2010 and this business contributing eight percent of GDP by 2025. If you ask ‘how’, the answer lies in political will. But a long range approach is definitely in order.