EDITORIAL: Recep Tayyip Erdogan’s win in Turkey’s runoff presidential election is good news for his Justice and Development Party (AKP), the country’s conservative lobby and its diehard crusaders for civilian supremacy, no doubt, but it’s also bad news for the economy, foreign investors, and Ankara’s fragile relations with the west; particularly when the Ukraine war and tensions about Nato’s expansion are all the rage.
Indeed, the Turkish lira greeted his win by dropping to a record low, weakening beyond 20 to the dollar with no end to the slide in sight, and FDI is holding its breath to see if the president will reverse the state’s stranglehold on economic policy and allow interest rates to rise in face of record inflation.
Nevertheless, the victory extends his time as Turkey’s longest serving modern leader and he has at least another five years to revitalise his mixed legacy. Turks have not forgotten that his remarkable rise – which enabled him to cut the secular Kemalist military down to size and drench the state’s overarching narrative in religion after a hundred years – owed to his success in rebuilding the broken economy and judiciary, delivering justice and development at the doorstep just like his manifesto promised.
But it’s also true that two decades in power turned him into something of an autocrat that liked to punch above his weight in an out of the country, to the point that he started behaving and living like a neo-Ottoman sultan answerable only to himself.
Lately, his inability to control the economy that he rebuilt, especially his policy novelties, has been alienating the same people that came out on the streets to crush the 2016 coup attempt against his government, which is why markets were more comfortable pricing in an Erdogan defeat.
He’s completely taken over the Turkish central bank and ordered shocking rate cuts even as inflation rose above 80 percent, insulting conventional economic theory by claiming that lower rates were the best way to fight runaway inflation. That’s why FDI has been on the way out and the lira tumbling for much of the last couple of years.
Now, though, he’s promised a new team of credible economists with international experience to work on the economy. That, along with help from state apparatus, might explain how he was able to turn the tables in the election and then the runoff.
Yet analysts are still split on whether he’ll reverse some of his controversial policies. Some say he no longer needs to muscle his way around dropping approval ratings, so there’s a good chance he might leave the new economic managers to their task.
Others are concerned, however, that if his blatant disregard for conventional economics, despite the suffering of the people, didn’t cost him the presidency then he’ll see no reason to change his ways. Time will tell.
Washington has its work cut out too, since Erdogan has made it painfully clear that he’s not impressed with the sanctions against Russia and continues to have serious problems with Nato’s expansion plans.
The latter, in the thick of the Ukraine war, will be a particularly hard nut to crack as the Turkish president is known for keeping his country from being taken lightly in important international negotiations.
All things considered, Recep Erdogan has clearly been the man that gave his people a sense of pride and empowerment and put his country back on the map after almost a century of stops and starts and political and economic meltdowns.
That is why enough Turks support him enough to give him a third decade in power, despite the recent financial troubles that are exclusively of his making. And despite his successes and failures so far, it is how he leaves Turkey after the next five years, assuming these will be his last at the top, that will define the Erdogan era.
Copyright Business Recorder, 2023