Economic Update

Published 22 Jul 2010

The conservative Justice and Development Party (AKP), which bounded to a decisive victory in Turkey’s general election on November 3rd, is determined to dispel claims that it has designs on overhauling the country’s secular regime. With the old cast of characters unable to pass the 10% threshold required to enter parliament, the AKP and its popular leader Recep Tayyip Erdogan are in position to prove they can govern, and do it under Turkey’s rigid secular framework.

The AKP has the numbers to form a government alone, a rarity in Turkey’s fractious political scene, having garnered 34.2% of the vote or 363 seats in the 550-member parliament. The party will face sole opposition from the left-of-centre Republican People’s Party (CHP), the only other party able to clear the election hurdle, with 19.4% of the vote.

But the country’s most popular figure, Erdogan, will not lead his party in the new government because of a political ban based on a conviction for inciting hatred under the country’s strict laws governing public speech. He served a four-month jail term in 1999 for reading a poem which compared minarets to helmets and mosques to barracks.

However, Erdogan beats back comparisons to the Welfare Party of which he was a member and which was forced from government in 1997 under pressure from the military because of its Islamist bent. He says AK is not a religious party. “We have won votes from all parts and parties. We have become the party of the centre, and this was our target. From now on no one can call us a religious party,” Milliyet newspaper quoted Erdogan as saying after his party’s election victory.

Erdogan has been careful to say that AK supports Turkey’s Western orientation, including European Union membership and its agreement with the International Monetary Fund (IMF), which has committed billions of dollars in aid to the country to help wrest it from economic crisis, in exchange for commitment to an ambitious reform package. “AKP is ready to take responsibility to build up the political will to accelerate the EU entry process and to strengthen the integration of our economy with the world economy and the implementation of the economic programme,” Erdogan said after the election.

“Our most urgent issue is the EU and I will send my colleagues to Europe without waiting to receive the mandate,” he said. In his first trip abroad since the election, Erdogan went to Italy with deputies from his party to court support for a start to membership talks with the EU, which has balked at offering a date to Ankara because of concerns over the implementation of new laws meant to align Turkey with EU norms. Turkish newspapers made much of the fact that Erdogan ate lunch with Italian Prime Minister Silvio Berlusconi, taking a break from the fasting month of Ramadan.

Perhaps the single biggest obstacle to Turkey winning a start to negotiations with the EU is the issue of Cyprus, which is slated for entry into the 15-member block ahead of its overshadowing northern neighbour, which opposes the island’s accession as long as it is divided. But a new peace plan crafted by the United Nations might offer a framework toward a resolution, and Erdogan was quick to throw his weight behind the possibility. “No matter how much we say ‘It’s not related, they’re not linked’, solving the Cyprus issue would not just accelerate the EU process, but also be a concrete and useful step to overcoming many problems between Turkey and Greece,” the Anatolian news agency reported Erdogan as saying.

But Erdogan will not be officially at the head of government for at least some time. He is due to name a deputy from his party to stand in his place as prime minister, who is formally appointed by the president, until he can find his way into government. A possible January appeal by Erdogan could offer the legal window he needs. If 28 of its deputies resign, the party can force by-elections, which would allow Erdogan to run for a seat, should his ban be lifted by the courts.

AK and CHP both likely benefited from broad disillusionment with the current government, which was at the helm during two economic crises and flagging recovery in the remaining few months before the elections. The government was hamstrung over EU reforms, and markets yearning for stability responded to the dour political mood with poor performances. In contrast, news of the country’s first single-party government since the 1980s spurred on financial markets. The main stock index surged 12% in the week after the election.

The election is significant for AKP’s presence, but also for the total absence of any party in the previous government. All of the leaders of the main party’s left out of parliament have announced plans to step down. Prime Minister Bulent Ecevit’s Democratic Left Party (DSP), which was the biggest party in parliament in the previous election in 1999 with 22.1% of the vote, garnered a paltry 1.2%. His party’s performance evinced this from the ageing 77-year-old leftist: “We’ve committed suicide. I was not expecting this.”